As Reported by the Senate Government Oversight and Reform Committee
132nd General Assembly
Regular Session Sub. S. B. No. 179
2017-2018
Senator LaRose
Cosponsor: Senator Hackett, Coley, Brown
A BILL
To amend sections 1701.86, 1702.27, 1702.30, 1702.33, 1702.38, 1702.521, 1702.53, 1702.55, 1705.06, 1705.14, 1705.43, 1705.44, 1705.46, 1705.48, and 1745.05 and to enact sections 111.35, 1702.341, 1702.531, 1705.431, and 1705.441 of the Revised Code to automatically dissolve a limited liability company under certain circumstances, to authorize the Secretary of State to implement an electronic notification system to alert a person if a business name containing a specific word has been registered, to specify procedures for continuing a limited liability company whose last remaining member ceases to be a member, to modify the law governing dissolved limited liability companies, to allow a dissolving corporation to provide to the Secretary of State a specified affidavit instead of a certificate from the Department of Taxation showing that the corporation has paid all required taxes, to modify the law governing nonprofit corporations, and to allow a religious organization to choose to be considered an unincorporated nonprofit association.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 1701.86, 1702.27, 1702.30, 1702.33, 1702.38, 1702.521, 1702.53, 1702.55, 1705.06, 1705.14, 1705.43, 1705.44, 1705.46, 1705.48, and 1745.05 be amended and sections 111.35, 1702.341, 1702.531, 1705.431, and 1705.441 of the Revised Code be enacted to read as follows:
Sec. 111.35. The secretary of state may implement an electronic notification system under which any person may request to be notified if a business name containing a specific word or words has been registered. For purposes of this section, "person" has the same meaning as in section 1701.01 of the Revised Code.
Sec. 1701.86. (A) A corporation may be dissolved voluntarily in the manner provided in this section, provided the provisions of Chapter 1704. of the Revised Code do not prevent the dissolution from being effected.
(B) A resolution of dissolution for a corporation shall set forth that the corporation elects to be dissolved. The resolution also may include any of the following:
(1) The date on which the certificate of dissolution is to be filed or the conditions or events that will result in the filing of the certificate;
(2) Authorization for the officers or directors to abandon the proposed dissolution before the filing of the certificate of dissolution;
(3) Any additional provision considered necessary with respect to the proposed dissolution and winding up.
(C) If an initial stated capital is not set forth in the articles then before the corporation begins business, or if an initial stated capital is set forth in the articles then before subscriptions to shares shall have been received in the amount of that initial stated capital, the incorporators or a majority of them may adopt, by a writing signed by each of them, a resolution of dissolution.
(D) The directors may adopt a resolution of dissolution in any of the following cases:
(1) When the corporation has been adjudged bankrupt or has made a general assignment for the benefit of creditors;
(2) By leave of the court, when a receiver has been appointed in a general creditors' suit or in any suit in which the affairs of the corporation are to be wound up;
(3) When substantially all of the assets have been sold at judicial sale or otherwise;
(4) When the articles have been canceled for failure to file annual franchise or excise tax returns or for failure to pay franchise or excise taxes and the corporation has not been reinstated or does not desire to be reinstated;
(5) When the period of existence of the corporation specified in its articles has expired.
(E) The shareholders at a meeting held for such purpose may adopt a resolution of dissolution by the affirmative vote of the holders of shares entitling them to exercise two-thirds of the voting power of the corporation on such proposal or, if the articles provide or permit, by the affirmative vote of a greater or lesser proportion, though not less than a majority, of such voting power, and by such affirmative vote of the holders of shares of any particular class as is required by the articles. Notice of the meeting of the shareholders shall be given to all the shareholders whether or not entitled to vote at it.
(F) Upon the adoption of a resolution of dissolution, a certificate shall be prepared, on a form prescribed by the secretary of state, setting forth all of the following:
(1) The name of the corporation;
(2) A statement that a resolution of dissolution has been adopted;
(3) A statement of the manner of adoption of such resolution, and, in the case of its adoption by the incorporators or directors, a statement of the basis for such adoption;
(4) The place in this state where its principal office is or is to be located;
(5) The internet address of each domain name held or maintained by or on behalf of the corporation;
(6) The name and address of its statutory agent;
(7) The date of dissolution, if other than the filing date. The date of dissolution shall not be more than ninety days after the filing of the certificate of dissolution.
(G) When the resolution of dissolution is adopted by the incorporators, the certificate shall be signed by not less than a majority of them. In all other cases, the certificate shall be signed by any authorized officer, unless the officer fails to execute and file such certificate within thirty days after the date upon which such certificate is to be filed. In that latter event, the certificate of dissolution may be signed by any three shareholders or, if there are less than three shareholders, all of the shareholders and shall set forth a statement that the persons signing the certificate are shareholders and are filing the certificate because of the failure of the officers to do so.
(H) Except as otherwise provided in division (I) of this section, a certificate of dissolution, filed with the secretary of state, shall be accompanied by all of the following:
(1) An affidavit of one or more of the persons executing the certificate of dissolution or of an officer of the corporation containing a statement of the counties, if any, in this state in which the corporation has personal property or a statement that the corporation is of a type required to pay personal property taxes to state authorities only;
(2)
A certificate or other evidence from the department of taxation
showing that the corporation has paid all taxes administered by and
required to be paid to the tax commissioner that are or will be due
from the corporation on the date of the dissolution,
or
that the department has received an adequate guarantee for the
payment of all such taxes
an affidavit of one or more of the persons executing the certificate
of dissolution or of an officer of the corporation containing a
statement that the corporation is not required to pay or the
department of taxation has not assessed any tax for which such a
certificate or other evidence is not provided;
(3) A certificate or other evidence showing the payment of all personal property taxes accruing up to the date of dissolution or showing that such payment has been adequately guaranteed, or an affidavit of one or more of the persons executing the certificate of dissolution or of an officer of the corporation containing a statement that the corporation is not required to pay or the department of taxation has not assessed any tax for which such a certificate or other evidence is not provided;
(4) A receipt, certificate, or other evidence from the director of job and family services showing that all contributions due from the corporation as an employer have been paid, or that such payment has been adequately guaranteed, or that the corporation is not subject to such contributions;
(5) A receipt, certificate, or other evidence from the bureau of workers' compensation showing that all premiums due from the corporation as an employer have been paid, or that such payment has been adequately guaranteed, or that the corporation is not subject to such premium payments.
(I) In lieu of the receipt, certificate, or other evidence described in division (H)(2), (3), (4), or (5) of this section, a certificate of dissolution may be accompanied by an affidavit of one or more persons executing the certificate of dissolution or of an officer of the corporation containing a statement of the date upon which the particular department, agency, or authority was advised in writing of the scheduled effective date of the dissolution and was advised in writing of the acknowledgment by the corporation of the applicability of the provisions of section 1701.95 of the Revised Code.
(J) Upon the filing of a certificate of dissolution and such accompanying documents or on a later date specified in the certificate that is not more than ninety days after the filing, the corporation shall be dissolved.
Sec. 1702.27. (A) Except as provided in division (B) of this section and section 1702.521 of the Revised Code:
(1) The number of directors as fixed by the articles or the regulations shall be not less than three or, if not so fixed, the number shall be three, except that if there are only one or two members of the corporation, the number of directors may be less than three but not less than the number of members.
(2)(a) Subject to division (A)(2)(c) of this section, unless the articles or the regulations fix the number of directors or provide the manner in which that number may be fixed or changed by the voting members, the number may be fixed or changed at a meeting of the voting members called for the purpose of electing directors, if a quorum is present, by the affirmative vote of a majority of the voting members present in person, by the use of authorized communications equipment, by mail, or, if permitted, by proxy.
(b) For purposes of division (A)(2)(a) of this section, participation by a voting member in a meeting through the use of any of the means of communication described in that division constitutes presence in person of that voting member at the meeting for purposes of determining a quorum.
(c) No reduction in the number of directors shall of itself have the effect of shortening the term of any incumbent director.
(3)
The director
directors
shall be natural persons, shall be at least eighteen years of age,
and
shall
have the qualifications, if any, that are stated in the articles or
the regulations.
(4) The articles or the regulations may provide that persons occupying certain positions within or without the corporation shall be ex officio directors, but, unless otherwise provided in the articles or the regulations, such ex officio directors shall not be considered for quorum purposes and shall have no vote.
(B) The court of common pleas of the county in which the corporation maintains its principal office may, pursuant to division (A) of section 1702.521 of the Revised Code, order the appointment of a provisional director for the corporation without regard to the number or qualifications of directors stated in the articles or regulations of the corporation.
Sec. 1702.30. (A) Except where the law, the articles, or the regulations require that action be otherwise authorized or taken, all of the authority of a corporation shall be exercised by or under the direction of its directors. For their own government, the directors may adopt bylaws that are not inconsistent with the articles or the regulations.
(B)
A director shall perform the director's
duties
of
as
a
director, including the duties as a member of any committee of the
directors upon which the director may serve, in good faith, in a
manner the director reasonably believes to be in or not opposed to
the best interests of the corporation, and with the care that an
ordinarily prudent person in a like position would use under similar
circumstances. A director serving on a committee of directors is
acting as a director.
(C)
In performing the director's
duties
of a director,
a director is entitled to rely on information, opinions, reports, or
statements, including financial statements and other financial data,
that are prepared or presented by any
of the
following:
(1) One or more directors, officers, or employees of the corporation who the director reasonably believes are reliable and competent in the matters prepared or presented;
(2) Counsel, public accountants, or other persons as to matters that the director reasonably believes are within the person's professional or expert competence;
(3) A committee of the directors upon which the director does not serve, duly established in accordance with a provision of the articles or the regulations, as to matters within its designated authority, which committee the director reasonably believes to merit confidence.
(D) For purposes of division (B) of this section, all of the following apply:
(1)
A director shall not be found to have failed
to perform violated
the
director's duties in
accordance with that under
division
(B) of this section,
unless it is proved,
by clear and convincing evidence,
in an action brought against the director
that
the director has not acted in good faith, in a manner the director
reasonably believes to be in or not opposed to the best interests of
the corporation, or with the care that an ordinarily prudent person
in a like position would use under similar circumstances.
Such an ,
in any
action
includes,
but is not limited to, an action that involves brought
against a director, including an action involving
or
affects
affecting
any
of the following:
(a) A change or potential change in control of the corporation;
(b) A termination or potential termination of the director's service to the corporation as a director;
(c) The director's service in any other position or relationship with the corporation.
(2) A director shall not be considered to be acting in good faith if the director has knowledge concerning the matter in question that would cause reliance on information, opinions, reports, or statements that are prepared or presented by the persons described in divisions (C)(1) to (3) of this section, to be unwarranted.
(3)
The
provisions of this division do not limit Division
(D) of this section does not limit
relief
available under section 1702.301 of the Revised Code.
(E)(1)
Subject to divisions (E)(2) and (3) of this section, a
A
director
is liable in damages for any act
action
that
the director takes or fails to take as a
director
only if it is proved,
by clear and convincing evidence,
in a court with
of
competent
jurisdiction
that the director's
act
or omission of
the director was
one
undertaken
with a
deliberate
intent to cause injury to the corporation or was
one undertaken with
a
reckless
disregard for the best interests of the corporation.
(2)
Division (E)(1) of this section This
division
does
not affect the liability of a director under section 1702.55 of the
Revised Code.
(3)
Subject to division (E)(2) of this section, This
division
(E)(1)
of this section does
not apply if, and only to the extent that, at the time of an
a
director's
act
or omission of
a director that
is the subject of the
complaint,
the articles or the regulations of the corporation state,
by specific reference to that
this
division,
that its provisions do not apply
to the corporation.
(F)
For purposes of this section, a
director, in
determining what a
the
director
reasonably believes to be in or not opposed to the best interests of
the corporation, a
director shall
consider the purposes of the corporation and,
in the director's discretion,
may consider any of the following:
(1)
The interests of the corporation's
employees,
suppliers, creditors, and customers
of the corporation;
(2) The economy of this state and of the nation;
(3) Community and societal considerations;
(4)
The long-term and short-term best
interests
of the corporation, including,
but not limited to,
the
possibility that those interests may be best served by the continued
independence of the corporation.
(G) A director is not a trustee with respect to the corporation or with respect to any property held or administered by the corporation, including property that may be subject to restrictions imposed by the donor or transferor of the property.
(H)
Divisions
(D)
and ,
(E),
and (G)
of this section do not affect the duties of a director who acts in
any capacity other than in the capacity as a director.
Sec. 1702.33. (A) The regulations may provide for the creation by the directors of an executive committee or any other committee of the directors, to consist of one or more directors, and may authorize the delegation to any such committee of any of the authority of the directors, however conferred.
(B) The directors may appoint one or more directors as alternate members of any committee described in division (A) of this section, who may take the place of any absent member or members at any meeting of the particular committee.
(C) Each committee described in division (A) of this section shall serve at the pleasure of the directors, shall act only in the intervals between meetings of the directors, and shall be subject to the control and direction of the directors.
(D) Unless otherwise provided in the regulations or ordered by the directors, any committee described in division (A) of this section may act by a majority of its members at a meeting or by a writing or writings signed by all of its members.
(E) Meetings of committees described in division (A) of this section may be held by any means of authorized communications equipment, unless participation by members of the committee at a meeting by means of authorized communications equipment is prohibited by the articles, the regulations, or an order of the directors. Participation in a meeting pursuant to this division constitutes presence at the meeting.
(F) An act or authorization of an act by any committee described in division (A) of this section within the authority delegated to it shall be as effective for all purposes as the act or authorization of the directors.
(G) Unless otherwise provided in the articles, the regulations, or the resolution of the directors creating a committee under division (A) of this section, the committee may create one or more subcommittees consisting of one or more members of the committee and may delegate to a subcommittee any or all of the powers and authority of the committee.
Sec. 1702.341. (A) Unless a corporation's articles or regulations or a written agreement with an officer of the corporation establishes additional fiduciary duties, an officer's only fiduciary duties to the corporation are to perform the officer's duties to the corporation in good faith, in a manner the officer reasonably believes to be in or not opposed to the best interests of the corporation, and with the care that an ordinarily prudent person in a like position would use under similar circumstances. In performing the officer's duties, an officer is entitled to rely on information, opinions, reports, or statements, including financial statements and other financial data, that are prepared or presented by any of the following:
(1) One or more directors, officers, or employees of the corporation whom the officer reasonably believes are reliable and competent in the matters prepared or presented;
(2) Counsel, public accountants, or other persons as to matters that the officer reasonably believes are within the person's professional or expert competence.
(B) In any action brought against an officer, the officer shall not be found to have violated the officer's duties under division (A) of this section unless it is proved by clear and convincing evidence that the officer has not acted in good faith, in a manner the officer reasonably believes to be in or not opposed to the best interests of the corporation, or with the care that an ordinarily prudent person in a like position would use under similar circumstances. An officer shall not be considered to be acting in good faith if the officer has knowledge concerning the matter in question that would cause reliance on information, opinions, reports, or statements that are prepared or presented by any of the persons described in division (A)(1) or (2) of this section to be unwarranted.
(C) An officer is liable in damages for a violation of the officer's duties under division (A) of this section only if it is proved by clear and convincing evidence in a court of competent jurisdiction that the officer's act or omission was undertaken with deliberate intent to cause injury to the corporation or with reckless disregard for the best interests of the corporation. This division does not apply if, and only to the extent that, at the time of an officer's act or omission that is the subject of the complaint, the corporation's articles or regulations or a written agreement between the officer and the corporation state by specific reference to this division that this division does not apply to the officer.
(D) An officer is not a trustee with respect to the corporation or with respect to any property held or administered by the corporation, including property that may be subject to restrictions imposed by the donor or transferor of the property.
(E) This section does not affect the duties of an officer who acts in any capacity other than that of an officer and does not affect an officer's contractual obligations to the corporation.
Sec. 1702.38. (A) The articles may be amended from time to time in any respect if the articles as amended set forth all the provisions that are required in, and only those provisions that may properly be in, original articles filed at the time of adopting the amendment, other than with respect to the initial directors, except that a public benefit corporation shall not amend its articles in such manner that it will cease to be a public benefit corporation.
(B) Without limiting the generality of the authority described in division (A) of this section, the articles may be amended to:
(1) Change the name of the corporation;
(2) Change the place in this state where its principal office is to be located;
(3) Change, enlarge, or diminish its purpose or purposes;
(4) Change any provision of the articles or add any provision that may properly be included in the articles.
(C)(1) If initial directors are not named in the articles, then at any time before a meeting of voting members and before the incorporators have elected directors, the incorporators or a majority of them may adopt an amendment at a meeting.
(2) The voting members present in person, by use of authorized communications equipment, by mail, or, if permitted, by proxy at a meeting held for that purpose, may adopt an amendment by the affirmative vote of a majority of the voting members present if a quorum is present or, if the articles or the regulations provide or permit, by the affirmative vote of a greater or lesser proportion or number of the voting members, and by the affirmative vote of the voting members of any particular class that is required by the articles or the regulations.
(2)
(3)
For
purposes of division
divisions
(C)(1)
and
(2) of
this section, participation by a voting member at a meeting through
the use of any of the means of communication described in that
division constitutes presence in person of that voting member at the
meeting for purposes of determining a quorum.
(D) In addition to or in lieu of adopting an amendment to the articles, the voting members may adopt amended articles by the same action or vote as that required to adopt the amendment.
(E) The directors may adopt amended articles to consolidate the original articles and all previously adopted amendments to the articles that are in force at the time, or the voting members at a meeting held for that purpose may adopt the amended articles by the same vote as that required to adopt an amendment.
(F) Amended articles shall set forth all the provisions that are required in, and only the provisions that may properly be in, original articles filed at the time of adopting the amended articles, other than with respect to the initial directors, and shall contain a statement that they supersede the existing articles.
(G) Upon the adoption of any amendment or amended articles, a certificate containing a copy of the resolution adopting the amendment or amended articles, a statement of the manner of its adoption, and, in the case of adoption of the resolution by the directors, a statement of the basis for such adoption, shall be filed with the secretary of state, and upon that filing the articles shall be amended accordingly, and the amended articles shall supersede the existing articles. The certificate shall be signed by any authorized officer of the corporation.
(H) A copy of an amendment or amended articles changing the name of a corporation or its principal office in this state, certified by the secretary of state, may be filed for record in the office of the county recorder of any county in this state, and for that recording the county recorder shall charge and collect the same fee as provided for in division (A)(1) of section 317.32 of the Revised Code. That copy shall be recorded in the official records of the county recorder.
Sec. 1702.521. (A) Upon the complaint of not less than one-fourth of the directors of the corporation or upon the complaint of not less than one-fourth of the voting members of the corporation, the court of common pleas of the county in which the corporation maintains its principal office may order the appointment of a provisional director for that corporation if the articles or regulations of the corporation expressly provide for such an appointment. No appointment shall be made until a hearing is held by the court. Notice of the hearing shall be given to each director and the secretary of the corporation in any manner that the court directs. The complainants shall establish at the hearing that, because of irreconcilable differences among the existing directors or because there are no directors and the voting members are unable to elect any directors, the continued operation of the corporation has been substantially impeded or made impossible.
(B) A provisional director shall have the same rights and duties as other directors and shall serve until removed by the appointing court or by the members of the corporation entitled to exercise a majority of the voting power of the corporation in the election of directors or until the provisional director's earlier resignation or death. If the provisional director dies or resigns, the court, pursuant to division (A) of this section, may appoint a replacement provisional director, upon its own motion and without the filing of a complaint for the appointment of a provisional director. If the appointing court finds that the irreconcilable differences no longer exist, it shall order the removal of the provisional director.
(C) No person shall be appointed as a provisional director unless the person is generally conversant with corporate affairs, has no legal or equitable interest in the obligations of the corporation of which the person is to be appointed a director, and is not indebted to such corporation. The compensation of a provisional director shall be determined by agreement with the corporation for which the provisional director is serving, subject to the approval of the appointing court, except that the appointing court may fix the provisional director's compensation in the absence of agreement or in the event of disagreement between the provisional director and the corporation.
(D) A proceeding concerning the appointment of a provisional director of a corporation is a special proceeding, and final orders issued in the proceeding may be vacated, modified, or reversed on appeal pursuant to the Rules of Appellate Procedure and, to the extent not in conflict with those rules, Chapter 2505. of the Revised Code.
Sec. 1702.53. (A) A copy of the articles or amended articles filed in the office of the secretary of state, certified by the secretary of state, shall be conclusive evidence, except as against the state, that the corporation has been incorporated under the laws of this state; and a copy duly certified by the secretary of state of any certificate of amendment or other certificate filed in the secretary of state's office shall be prima-facie evidence of such amendment or of the facts stated in any such certificate, and of the observance and performance of all antecedent conditions necessary to the action which such certificate purports to evidence.
(B) A copy of amended articles filed in the office of the secretary of state, certified by the secretary of state, shall be accepted in this state and other jurisdictions in lieu of the original articles, amendments thereto, and prior amended articles.
(C) The original or a copy of the record of minutes of the proceedings of the incorporators of a corporation, or of the proceedings or meetings of the members or any class of members, or of the directors, or of any committee thereof, including any written consent, waiver, release, or agreement entered in such record or minutes, or the original or a copy of a statement that no specified proceeding was had or that no specified consent, waiver, release, or agreement exists, shall, when certified to be true by the secretary or an assistant secretary of a corporation, be received in the courts as prima-facie evidence of the facts stated therein. Every meeting referred to in such certified original or copy shall be deemed duly called and held, and all motions and resolutions adopted and proceedings had at such meeting shall be deemed duly adopted and had, and all elections of directors and all elections or appointments of officers chosen at such meeting shall be deemed valid, until the contrary is proved; and whenever a person who is not a member of a corporation has acted in good faith in reliance upon any such certified original or copy, it is conclusive in the person's favor.
(D)(1) A certificate issued by the secretary of state confirming that a corporation is in good standing is, for a period of seven days after the date on the certificate, conclusive evidence that both of the following are true:
(a) The authority of a domestic corporation has not been limited as described in section 1702.49 of the Revised Code, provided that the person relying on the certificate had no knowledge that the corporation's articles had been canceled and provided that the certificate is not presented as evidence against the state.
(b) The license authorizing a foreign corporation to transact business in this state has not expired, been canceled, or been surrendered.
(2) As used in division (D)(1) of this section, "in good standing" means that the authority of the corporation to carry on business is not limited by section 1702.49 of the Revised Code.
Sec. 1702.531. (A) Absent an express agreement to the contrary, a person providing goods to or performing services for a domestic or foreign corporation owes no duty to, incurs no liability or obligation to, and is not in privity with the members or creditors of the corporation by reason of providing goods to or performing services for the corporation.
(B) Absent an express agreement to the contrary, a person providing goods to or performing services for a member or group of members of a domestic or foreign corporation owes no duty to, incurs no liability or obligation to, and is not in privity with the corporation, any other members of the corporation, or the corporation's creditors by reason of providing goods to or performing services for the member or group of members.
Sec. 1702.55. (A) The members, the directors, and the officers of a corporation shall not be personally liable for any obligation of the corporation.
(B)
In
addition to any other liabilities imposed by law upon a corporation's
directors
who
and
except as otherwise provided
in division (D) of this section, directors are jointly and severally
liable to the corporation as provided in division (C) of this section
if they
vote
for or assent to
any of the following:
(1) A distribution of assets to members contrary to law or the articles;
(2) A distribution of assets to persons other than creditors during the winding up of the affairs of the corporation, on dissolution or otherwise, without the payment of all known obligations of the corporation, or without making adequate provision therefor;
(3)
The making of loans, other than in the usual conduct of its affairs
or in accordance with provisions therefor in the articles, to an
officer,
or
director,
or member
of
the corporation;
shall be jointly and severally liable to ,
unless, when the corporation makes the loan, a majority of the
corporation's disinterested directors vote to make the loan and,
taking into account the terms and provisions of the loan and other
relevant factors, determine that making the loan reasonably may be
expected to benefit
the
corporation.
(C)
Directors who are jointly and severally liable to the corporation
under division (B) of this section are liable
as follows:
in
(1)
In cases
under division (B)(1) of this section,
up to the amount of such distribution in excess of the amount that
could have been distributed without violation of law or the articles,
but not in excess of the amount that would inure to the benefit of
the creditors of the corporation if it was insolvent at the time of
the distribution or there was reasonable
ground to believe that by such action it would be rendered insolvent,
or to the benefit of the members other than members of the class in
respect of which the distribution was made;
and in
(2)
In cases
under division (B)(2) of this section, to the extent that such
obligations (not otherwise barred by statute) are not paid, or for
the payment of which adequate provision has not been made;
and in
(3)
In cases
under division (B)(3) of this section, for the amount of the loan
with interest thereon at the rate specified
in section 1343.03 of
six
per cent per annum the
Revised Code
until
such amount has been paid,
except that a .
(D) A director shall not be liable under division (B)(1) or (2) of this section if in determining the amount available for any such distribution, the director in good faith relied on a financial statement of the corporation prepared by an officer or employee of the corporation in charge of its accounts or certified by a public accountant or firm of public accountants, or in good faith the director considered the assets to be of their book value, or the director followed what the director believed to be sound accounting and business practice.
(C)
(E)
A
director who is present at a meeting of the directors or a committee
thereof at which action on any matter is authorized or taken and who
has not voted for or against such action shall be presumed to have
voted for the action unless the director's written dissent therefrom
is filed either during the meeting or within a reasonable time after
the adjournment thereof, with the person acting as secretary of the
meeting or with the secretary of the corporation.
(D)
(F)
A
member who knowingly receives any distribution made contrary to law
or the articles shall be liable to the corporation for the amount
received by the member that is in excess of the amount that could
have been distributed without violation of law or the articles.
(E)
(G)
A
director against whom a claim is asserted under or pursuant to this
section and who is held liable thereon shall be entitled to
contribution, on equitable principles, from other directors who also
are liable; and in addition, any director against whom a claim is
asserted under or pursuant to this section or who is held liable
shall have a right of contribution from the members who knowingly
received any distribution made contrary to law or the articles, and
such members as among themselves shall also be entitled to
contribution in proportion to the amounts received by them
respectively.
(F)
(H)
The fact that a loan is made in violation of this section does not
affect the borrower's liability on the loan.
(I) No action shall be brought by or on behalf of a corporation upon any cause of action arising under division (B)(1) or (2) of this section at any time after two years from the day on which the violation occurs.
(G)
(J)
Nothing
contained in this section shall preclude any creditor whose claim is
unpaid from exercising such rights as the creditor otherwise would
have by law to enforce the creditor's claim against assets of the
corporation distributed to members or other persons.
Sec. 1705.06. (A) Each limited liability company shall maintain continuously in this state an agent for service of process on the company. The agent shall be one of the following:
(1) A natural person who is a resident of this state;
(2) A domestic or foreign corporation, nonprofit corporation, limited liability company, partnership, limited partnership, limited liability partnership, limited partnership association, professional association, business trust, or unincorporated nonprofit association that has a business address in this state. If the agent is an entity other than a domestic corporation, the agent shall meet the requirements of Title XVII of the Revised Code for an entity of the agent's type to transact business or exercise privileges in this state.
(B)(1) The secretary of state shall not accept original articles of organization of a limited liability company for filing unless the articles are accompanied by both of the following:
(a) A written appointment of an agent as described in division (A) of this section that is signed by an authorized member, manager, or other representative of the limited liability company;
(b) A written acceptance of the appointment that is signed by the designated agent on a form prescribed by the secretary of state.
(2) In cases not covered by division (B)(1) of this section, the limited liability company shall appoint the agent described in division (A) of this section and shall file with the secretary of state, on a form prescribed by the secretary of state, a written appointment of that agent that is signed as described in division (K) of this section and a written acceptance of the appointment that is signed by the designated agent.
(3) For purposes of divisions (B)(1) and (2) of this section, the filed written acceptance of an agent's appointment shall be a signed original document or a photocopy, facsimile, or similar reproduction of a signed original document.
(C) The written appointment of an agent described in division (A) of this section shall set forth the name of the agent and the agent's address in this state, including the street and number or other particular description of that address. It otherwise shall be in the form that the secretary of state prescribes. The secretary of state shall keep a record of the names of limited liability companies and the names and addresses of their agents.
(D) If any agent described in division (A) of this section dies, resigns, or moves outside of this state, the limited liability company shall appoint forthwith another agent and file with the secretary of state, on a form prescribed by the secretary of state, a written appointment of the agent and acceptance of appointment as described in division (B)(2) of this section.
(E) If the agent described in division (A) of this section changes the agent's address from the address stated in the records of the secretary of state, the agent or the limited liability company shall file forthwith with the secretary of state, on a form prescribed by the secretary of state, a written statement setting forth the new address.
(F) An agent described in division (A) of this section may resign by filing with the secretary of state, on a form prescribed by the secretary of state, a written notice of resignation that is signed by the agent and by mailing a copy of that notice to the limited liability company at the current or last known address of its principal office. The notice shall be mailed to the company on or prior to the date that the notice is filed with the secretary of state and shall set forth the name of the company, the name and current address of the agent, the current or last known address, including the street and number or other particular description, of the company's principal office, a statement of the resignation of the agent, and a statement that a copy of the notice has been sent to the company within the time and in the manner specified in this division. The authority of the resigning agent terminates thirty days after the filing of the notice with the secretary of state.
(G) A limited liability company may revoke the appointment of its agent described in division (A) of this section by filing with the secretary of state, on a form prescribed by the secretary of state, a written appointment of another agent and an acceptance of appointment in the manner described in division (B)(2) of this section and a statement indicating that the appointment of the former agent is revoked.
(H)(1) Any legal process, notice, or demand required or permitted by law to be served upon a limited liability company may be served upon the company as follows:
(a) If the agent described in division (A) of this section is a natural person, by delivering a copy of the process, notice, or demand to the agent;
(b) If the agent is not a natural person, by delivering a copy of the process, notice, or demand to the address of the agent in this state as contained in the records of the secretary of state.
(2) If the agent described in division (A) of this section cannot be found or no longer has the address that is stated in the records of the secretary of state or the limited liability company has failed to maintain an agent as required by this section and if the party or the agent or representative of the party that desires service of the process, notice, or demand files with the secretary of state an affidavit that states that one of those circumstances exists and states the most recent address of the company that the party who desires service has been able to ascertain after a diligent search, then the service of the process, notice, or demand upon the secretary of state as the agent of the company may be initiated by delivering to the secretary of state four copies of the process, notice, or demand accompanied by a fee of five dollars. The secretary of state shall give forthwith notice of that delivery to the company at either its principal office as shown upon the secretary of state's records or at any different address specified in the affidavit of the party desiring service and shall forward to the company at either address by certified mail, return receipt requested, a copy of the process, notice, or demand. Service upon the company is made when the secretary of state gives the notice and forwards the process, notice, or demand as set forth in division (H)(2) of this section.
(I) The secretary of state shall keep a record of each process, notice, and demand that pertains to a limited liability company and that is delivered to the secretary of state's office under this section or another law of this state that authorizes service upon the secretary of state in connection with a limited liability company. In that record, the secretary of state shall record the time of each delivery of that type and the secretary of state's subsequent action with respect to the process, notice, or demand.
(J) This section does not limit or affect the right to serve any process, notice, or demand upon a limited liability company in any other manner permitted by law.
(K) The written appointment of an agent or a written statement filed by the company with the secretary of state shall be signed by an authorized member, manager, or other representative of the company.
(L)(1) Upon the failure of a limited liability company to maintain an agent, or upon the failure of a limited liability company or agent to file a statement of change of address of an agent, the secretary of state shall give notice thereof by ordinary or electronic mail to the company at the address provided to the secretary of state. Unless the default is cured within thirty days after the mailing or transmission of the notice or within any further period of time that the secretary of state grants, upon expiration of that period of time, the articles of organization shall be canceled without further notice or action by the secretary of state. The secretary of state shall make a notation of the cancellation on the secretary of state's records.
(2) Subject to division (L)(3) of this section, a limited liability company whose articles of organization have been canceled under division (L)(1) of this section shall be reinstated if the limited liability company does both of the following:
(a) Files, on a form prescribed by the secretary of state, an application for reinstatement and the required appointment of an agent or statement of change of address of an agent, as applicable;
(b) Pays the filing fee specified in division (Q) of section 111.16 of the Revised Code.
(3) The secretary of state shall reserve the name of a limited liability company whose articles of organization have been canceled under division (L)(1) of this section for a period of one year after the date of cancellation. If the limited liability company applies for reinstatement under division (L)(2) of this section more than one year after that date and section 1705.05 of the Revised Code prohibits the secretary of state from reinstating the limited liability company under its previous name, then the limited liability company shall change its name by amending its articles of organization before it may be reinstated under division (L)(2) of this section.
(4) Upon reinstatement of a limited liability company's articles of organization under division (L)(2) of this section, all of the following apply:
(a) The limited liability company's rights, privileges, and franchises existing at the time its articles of organization were canceled, including all real or personal property rights and credits and all contract and other rights, shall be fully vested in the limited liability company as if the articles of organization had not been canceled, and the limited liability company again shall be entitled to exercise those rights, privileges, and franchises.
(b) If a manager, member, officer, agent, or employee of the limited liability company exercised or attempted to exercise any rights, privileges, or franchises on behalf of the limited liability company while the limited liability company's articles of organization were canceled, the person had no knowledge of the cancellation, and the action was within the scope of the limited liability company's articles of organization that existed immediately before the cancellation, then both of the following apply:
(i) The action has the same force and effect that it would have had if the limited liability company's articles of organization had not been canceled.
(ii) The limited liability company shall be exclusively liable for the action.
(5) Divisions (L)(2) to (4) of this section are remedial in nature and are to be construed liberally to accomplish the purpose of providing full reinstatement of a limited liability company's articles of organization, retroactive to the time of the cancellation of the articles of organization.
Sec. 1705.14. (A) A person becomes a member at the time that a limited liability company is formed or at any later time that is specified in the records of the company for becoming a member.
(B)
After the filing of the articles of organization of a limited
liability company, a person may be admitted as an additional member
in either
any
of
the following ways:
(1)
If
he
the person
acquires an interest directly from the limited liability company,
upon compliance with the operating agreement or, if the operating
agreement does not so provide, upon the written consent of all of the
members;
(2)
If
he
the person
is an assignee of the interest of a member who has the power as
provided in writing in the operating agreement to grant the assignee
the right to become a member, upon the exercise of that power and
compliance with any conditions limiting the grant or exercise of the
power;
(3) In accordance with division (A)(6)(b) of section 1705.43 of the Revised Code.
Sec.
1705.43.
(A) A limited liability company organized under this chapter shall be
dissolved upon
the occurrence of if
any
of the following
events
are true:
(1)
The expiration
of the period,
if any, fixed by the operating agreement or articles of organization
for the duration of the company;
has expired.
(2)
One or more events specified in writing in the operating agreement as
causing the dissolution of the company;
have occurred.
(3)
The
unanimous written agreement of all All
members
have
given unanimous written consent to
dissolve the company;.
(4)
Except as provided in this
division
(C)
and
division (A)(6)
of
this section, the
withdrawal of a
member of the company,
unless the business of the has
withdrawn. The withdrawal of a member of the company shall not result
in the dissolution of the company, except as otherwise provided in
the operating agreement, if any of the following apply:
(a)
The company
is continued by the consent of all of the remaining members
or under .
(b)
The company is continued under
a
right to continue the company that is stated in writing in the
operating agreement;.
(c) The company was formed on or after December 3, 1999.
(d) The company was formed before December 3, 1999, and its articles or operating agreement were amended to specify that the withdrawal of a member does not cause the dissolution of the company.
(5)
Upon
entry of a A
decree
of judicial dissolution has
been entered under
section 1705.47 of the Revised Code.
(6) All members of the company have ceased to be members, as described in section 1705.15 of the Revised Code. This division does not apply to a company if one of the following applies:
(a) The operating agreement provides for a substitute member to be admitted as of the date the last remaining member ceased to be a member of the company.
(b) The operating agreement does not provide for a substitute member to be admitted as of the date the last remaining member ceased to be a member of the company, but the legal representative or successor of the last remaining member admits a substitute member to the company in writing not later than the ninetieth day after the last remaining member ceased to be a member of the company. The substitute member shall be deemed to have been admitted as of the date the last remaining member ceased to be a member of the company.
(B)(1) Following the occurrence of any of the events of dissolution specified in this section, the limited liability company shall deliver to the secretary of state for filing a certificate of dissolution on a form that is prescribed by the secretary of state and that includes all of the following:
(a) The name of the company;
(b) The location of the company's current or future principal office in this state;
(c) The internet address of each domain name held or maintained by or on behalf of the company;
(d) The name and address of the company's statutory agent;
(e)
The
effective
date of its
the
company's
dissolution.
For
purposes of this chapter, the company's date of dissolution shall be
considered the date specified on the certificate of dissolution. A
company for which a receiver has been appointed to wind up its
affairs or that is the subject of an application filed under section
1705.47 of the Revised Code is not considered to be dissolved before
the date of dissolution.
(2) The secretary of state shall make available to the public on the secretary of state's official web site, in a searchable format, a list of all domestic limited liability companies that have filed certificates of dissolution and, for each such company, a copy of the certificate and a copy of the notice of dissolution described in section 1705.431 of the Revised Code. The secretary of state shall make that information available concerning each dissolved company for a period of at least five years after the date the certificate of dissolution is filed and may remove the information after that period expires.
(C)
If the company was formed on or after the effective date of this
amendment, or the company was formed prior to the effective date of
this amendment and its articles or operating agreement are amended to
specifically state that this division applies to the company, the
withdrawal of a member of the company shall not cause the dissolution
of the company except as may be provided in the operating agreement.
When a limited liability company is dissolved as described in this
section, all of the following shall apply:
(1) Except as otherwise provided in division (A)(1) of section 1705.45 of the Revised Code, the company shall cease to carry on business and shall take only the actions necessary to wind up its affairs.
(2) Except as otherwise provided in division (C)(4) of this section and except as otherwise ordered by a court acting pursuant to section 1705.44 of the Revised Code, the company shall continue as a limited liability company for a period of five years after the date the certificate of dissolution is filed for the purpose of winding up its affairs.
(3) The company shall give notice of its dissolution in accordance with section 1705.431 of the Revised Code.
(4) The dissolution of the company shall not eliminate or impair any remedy available to or against the company or its members or managers for any right or claim existing, or any liability incurred, before the dissolution, so long as the company brings an action not later than the applicable deadline prescribed by law, so long as the person who is sent a notice under section 1705.431 of the Revised Code submits a claim not later than the deadline specified in that section, and so long as any other person brings an action not later than five years after the date the certificate of dissolution is filed. Any existing claim, any claim that would have accrued, and any pending action or proceeding by or against the company may be prosecuted to judgment, with a right of appeal as in other cases, except that a court may stay any proceeding, execution, or process or the satisfaction or performance of any order, judgment, or decree as provided in section 1705.44 of the Revised Code. Any action, suit, or proceeding begun by or against the company in accordance with this division shall not abate, and the company shall be continued as a limited liability company for that sole purpose until any judgments, orders, or decrees are fully executed.
(5) If any property right of the company is discovered after the winding up of the company's affairs is complete, any member, manager, or liquidating trustee that wound up the affairs of the company or a receiver appointed by the appropriate court, as determined under section 1705.44 of the Revised Code, may enforce the property right, collect and divide the assets discovered among the persons entitled to those assets, and prosecute any necessary actions or proceedings in the name of the company. The assets shall be distributed and disposed of in accordance with any applicable court order or, in the absence of a court order, in accordance with section 1705.46 of the Revised Code.
Sec. 1705.431. (A) Not later than the ninetieth day before the end of the five-year period after the date the certificate of dissolution is filed, a limited liability company that is dissolved as described in section 1705.43 of the Revised Code shall give notice of the dissolution by certified or registered mail, return receipt requested, to each known creditor and to each known person that has a claim against the company, including a claim that is conditional, unmatured, or contingent on the occurrence or nonoccurrence of future events. The company also shall post the notice on any web site the company maintains in its own name and shall file a copy of the notice with the secretary of state. The notice shall include all of the following:
(1) A statement that all claims against the company must be presented in writing, identify the claimant, and contain sufficient information to reasonably inform the company of the substance of the claim;
(2) The mailing address to which a claimant must send the claim;
(3) The deadline by which the company must receive the claim, which shall be at least sixty days after the company gives the notice;
(4) A statement that a claim will be barred if the company does not receive the claim not later than the deadline specified in the notice;
(5) A statement that the company may make distributions to other creditors or claimants, including distributions to members of the company, without further notice.
(B)(1) A claim asserted by a claimant that was given notice of a limited liability company's dissolution under this section is barred unless the claimant delivers the claim to the company not later than the deadline specified in the notice.
(2) A limited liability company that gives notice of its dissolution in accordance with this section may reject, in whole or in part, any matured claim by sending notice of the rejection to the claimant by certified or registered mail, return receipt requested, not later than the ninetieth day after the company receives the claim and not later than the thirtieth day before the end of the five-year period after the date of dissolution. The notice of rejection shall include a copy of division (B) of this section and a copy of section 1705.44 of the Revised Code.
(3) A claim asserted by a claimant that receives a notice of rejection under division (B)(2) of this section is barred unless the claimant commences an action to enforce the claim not later than the thirtieth day after the company mails the notice of rejection to the claimant.
(C)(1) A limited liability company that gives notice of its dissolution under this section may offer to any claimant whose claim is contingent, conditional, or unmatured such security as the company determines is sufficient to provide compensation to the claimant if the claim matures. The company shall send the offer of security to the claimant by certified or registered mail, return receipt requested, not later than the ninetieth day after the company receives any such claim from the claimant and not later than the thirtieth day before the end of the five-year period after the date the certificate of dissolution is filed. The offer of security shall include a copy of division (C) of this section and a copy of section 1705.44 of the Revised Code.
(2) If, not later than the thirtieth day after the company mails an offer of security under division (C)(1) of this section to a claimant, the claimant does not deliver to the company a written notice rejecting the offer, the claimant shall be deemed to have accepted the security as the sole source from which to satisfy the claimant's claim against the company.
(D) A limited liability company that gives notice of its dissolution under this section may apply to the appropriate court, as determined under section 1705.44 of the Revised Code, for a determination of the amount and form of insurance or other security to which both of the following apply:
(1) It will be sufficient to provide compensation to any claimant that has rejected an offer of security made under this section.
(2) It is reasonably likely to be sufficient to provide compensation for claims that have not been made known to the company or that have not arisen but that, based on the facts known to the company, are likely to arise or to become known to the company within five years after the date the certificate of dissolution is filed or within a longer period not to exceed ten years after that date, as determined by the company's members or managers or by the court.
(E) A limited liability company's act of giving notice of dissolution or making an offer of security under this section does not revive any claim then barred, constitute acknowledgment by the company that any person to whom the company gave notice of dissolution is a proper claimant, or operate as a waiver of any defense or counterclaim.
Sec.
1705.44.
(A)
Except
as otherwise provided in the operating agreement, the members of a
dissolved limited liability company who have not wrongfully dissolved
the company, a liquidating trustee selected by those members, or, if
the management of the company has not been reserved to its members,
its managers may wind up the affairs of the company.
Upon application of any member of a dissolved limited liability
company or his legal representative or assignee, the court of common
pleas may wind up the affairs of the company or may cause its affairs
to be wound up by a liquidating trustee appointed by the court.
Subject to division (A)(1) of section 1705.45 of the Revised Code,
the persons winding up the affairs of the company promptly shall
proceed to complete the winding up of the company as speedily as is
practicable and not later than five years after the date the
certificate of dissolution is filed, except as otherwise provided in
division (C)(4) of section 1705.43 of the Revised Code and except as
otherwise ordered by a court in accordance
with this section.
(B) The court of common pleas of the county in which the principal office of a dissolved limited liability company is or was to be located shall have authority over the winding up of the company's affairs as provided in this section and may order and adjudge with respect to any of the following matters:
(1) A request by the company that the court wind up the company's affairs or appoint a liquidating trustee to wind up the company's affairs. Any of the following persons may request the court to do so:
(a) Any member of the company or the member's legal representative or assignee;
(b) A majority of the company's managers, if management of the company is not reserved to members;
(c) A creditor or claimant, including a creditor or claimant who is a member or manager of the company.
If the court grants the request, the court shall provide such notice of the court's decision as the court considers proper to all of the company's members and managers and any other interested persons.
(2) An application made under division (D) of section 1705.431 of the Revised Code for a determination concerning insurance or security;
(3) The presentation and proof of all claims and demands against the company and of all rights, interests, or liens in or on any of its property, including property described in division (C)(5) of section 1705.43 of the Revised Code. The court may fix the time within which and the manner in which that proof must be made and the person to whom the presentation must be made, and may bar any person who fails to make and present proofs as required by the court from participating in any distribution of assets.
(4) The stay of the prosecution of any proceeding against the company or involving any property and the requirement that the parties to the proceeding present and prove their claims, demands, rights, interests, or liens at the time and in the manner required of creditors or others, or the grant of leave to bring or maintain an independent proceeding to enforce liens;
(5) The settlement or determination of all claims of every nature against the company or any of its property, the determination of the assets required to be retained or insurance to be obtained to pay or provide for the payment of those claims or any claim, the determination of the assets available for distribution among members, and the making of new parties to the proceeding so far as the court considers proper for the determination of all matters;
(6) The determination of the rights of members in, and the assets of, the company;
(7) The presentation and filing of intermediate and final accounts of the company's members, managers, or liquidating trustee and hearings on them, the allowance, disallowance, or settlement of those accounts, and the discharge of the members, managers, or liquidating trustee from their duties and liabilities;
(8) The appointment of a special master commissioner or guardian ad litem to hear and determine any matters the court considers proper. The applicant in the proceeding shall pay the reasonable fees and expenses of the special master commissioner or guardian ad litem, including all reasonable expert witness fees, unless the court orders otherwise.
(9) The filling of any vacancies among the company's managers or in the position of liquidating trustee when the members are unable to fill the vacancies because they lack a quorum or for any other reason;
(10) The appointment of a receiver, in accordance with the usages of a court in equitable matters, to wind up the affairs of the company, to take custody of any of its property, or for any other purpose, as described in section 1705.441 of the Revised Code;
(11) The issuance or entry of any injunction or other order the court considers proper in the administration of the trust involved in winding up the company's affairs and giving notice of the winding up of affairs;
(12) The allowance and payment of compensation to the company's members, managers, or liquidating trustee or to any person rendering services beneficial to the company or to those interested in the company;
(13) The entry of a judgment or decree to operate as a deed or other instrument ordered to be executed or the appointment of a master commissioner or guardian ad litem to execute that deed or instrument in the name of the company with the same effect as if it were executed by an authorized member or manager, if there is no agent competent to execute that deed or instrument, if the company or its members or managers do not perform or comply with a judgment or decree of the court, or if the court considers it proper.
(C) A judicial proceeding under this section concerning the winding up of the affairs of a limited liability company is a special proceeding, and final orders of the proceeding may be vacated, modified, or reversed on appeal pursuant to the rules of appellate procedure and, to the extent not in conflict with those rules, pursuant to Chapter 2505. of the Revised Code.
Sec. 1705.441. (A) After a limited liability company is dissolved, the appropriate court, as determined under section 1705.44 of the Revised Code, may appoint any member, manager, or other person, regardless of whether the person is a resident of this state and regardless of the person's interest in the company, as a receiver to wind up the company's affairs.
(B) If a receiver is appointed to wind up the company's affairs, all of the creditors', claimants', and members' claims, demands, rights, interests, or liens shall be determined as of the day on which the receiver was appointed, unless those claims, demands, rights, interests, or liens have already been determined under section 1705.431 of the Revised Code. Unless the court orders otherwise, the appointment vests in the receiver and the receiver's successors the right to immediate possession of all of the company's property. The company shall, if so ordered, execute and deliver conveyances of its property to the receiver or to the receiver's nominee.
(C) Unless the court orders otherwise, the receiver shall have all of the authority vested in the company's members or of its managers, if management is not reserved to the company's members. The receiver shall exercise that authority subject to the court's orders and may be required to qualify by giving bond to the state in an amount fixed by the court, with surety to the satisfaction of the clerk of the court, conditioned on the faithful discharge of the receiver's duties and on a due accounting for all money or property received by the receiver.
Sec. 1705.46. (A) Upon the winding up of a limited liability company and the liquidation of its assets, the assets shall be distributed in the following order:
(1) To the extent permitted by law, to members who are creditors and other creditors in satisfaction of liabilities of the company other than liabilities for distributions to members;
(2) Except as otherwise provided in the operating agreement, to members and former members in satisfaction of liabilities for distributions to members;
(3) Except as otherwise provided in the operating agreement, to members as follows:
(a) First, for the return of their contributions;
(b) Second, with respect to their membership interests.
(B)
A limited liability company that is winding up its affairs and
liquidating its assets shall pay in
full any claims and liabilities or
make reasonable provision to
pay all claims and obligations, including all contingent,
conditional, or unmatured claims and obligations that are known to
the company and all claims and obligations that are known to the
company but with respect to which the claimant or obligee is unknown.
If there are for
those payments in full by insurance or otherwise if the company has
sufficient
assets,
the claims and obligations shall be paid in full or any provision to
pay them shall be made in full.
If there
are insufficient the
company does not have sufficient
assets,
the company
shall pay claims
and obligations
shall be paid or provided for liabilities,
or provide for those payments by insurance or otherwise,
according
to their priority,
and .
Among
claims
and obligations
liabilities
of
equal priority,
the company
shall be
paid ratably apportion
those payments
to
the extent of the assets
funds
legally
available
for their
payment. Unless
otherwise provided in the operating agreement, any Any
remaining
assets shall be distributed as provided in division (A) of this
section.
(C) A dissolved limited liability company shall do all of the following:
(1) Pay the claims made and not rejected under division (B) of section 1705.431 of the Revised Code;
(2) Post the security offered and not rejected under division (C) of section 1705.431 of the Revised Code;
(3) Post any security ordered by a court under division (D) of section 1705.431 of the Revised Code;
(4) Make any payment required by a court acting under section 1705.44 of the Revised Code;
(5) Pay, or make provision by insurance or otherwise for, all other claims that are mature, known, and uncontested or that have been finally determined to be owing by the company and any other claims described in division (D)(2) of section 1705.431 of the Revised Code. In the absence of fraud, the judgment of the company's members or, if management is not reserved to the members, the company's managers as to the provision the company makes for the payment of all claims under this division shall be conclusive.
Sec. 1705.48. Except as otherwise provided by this chapter or any other provision of the Revised Code, including, but not limited to, sections 3734.908, 5739.33, 5743.57, 5747.07, and 5753.02 of the Revised Code, all of the following apply:
(A) The debts, obligations, and liabilities of a limited liability company, whether arising in contract, tort, or otherwise, are solely the debts, obligations, and liabilities of the limited liability company.
(B) No member, manager, or officer of a limited liability company is personally liable to satisfy any judgment, decree, or order of a court for, or is personally liable to satisfy in any other manner, a debt, obligation, or liability of the company solely by reason of being a member, manager, or officer of the limited liability company.
(C) The failure of a limited liability company or any of its members, managers, or officers to observe any formalities relating to the exercise of the limited liability company's powers or the management of its activities is not a factor to consider in, or a ground for, imposing liability on the members, managers, or officers for the debts, obligations, or other liabilities of the company.
(D) Nothing in this chapter affects any personal liability of any member, any manager, or any officer of a limited liability company for the member's, manager's, or officer's own actions or omissions.
(E) This chapter does not affect any statutory or common law of this or another state that pertains to the relationship between an individual who renders a professional service and a recipient of that service, including, but not limited to, any contract or tort liability arising out of acts or omissions committed or omitted during the course of rendering the professional service.
(F) The dissolution of a limited liability company shall not affect the limited liability of a member of the company with respect to transactions occurring, or acts or omissions done or omitted, in the name of or by the company.
(G) A member of a dissolved limited liability company who receives a distribution of assets from the company is not liable for any claim against the company in an amount in excess of the amount of the member's pro rata share of the claim or the amount distributed to the member, whichever is less. No member's aggregate liability for claims against a dissolved limited liability company shall exceed the amount distributed to that member after the dissolution.
(H) When the assets of a dissolved limited liability company are distributed pursuant to this chapter, a member of the company may be liable for a claim against the company only if an action on that claim is commenced by a person who received notice under section 1705.431 of the Revised Code not later than the deadline prescribed in that section or by any other person not later than five years after the date the certificate of dissolution is filed.
Sec. 1745.05. As used in this chapter, unless the context otherwise requires:
(A) "Authorized communications equipment" means any communications equipment that provides a transmission, including, but not limited to, by telephone, telecopy, or any electronic means, from which it can be determined that the transmission was authorized by, and accurately reflects the intention of, the member or manager involved and, with respect to meetings, allows all persons participating in the meeting to contemporaneously communicate with each other.
(B)(1) "Entity" means any of the following:
(a) An unincorporated nonprofit association existing under the laws of this state or any other state;
(b) A nonprofit corporation existing under the laws of this state or any other state;
(c) A for profit corporation existing under the laws of this state or any other state;
(d) Any of the following organizations existing under the laws of this state, the United States, or any other state:
(i) An unincorporated business or for profit organization, including a general or limited partnership;
(ii) A limited liability company;
(iii) Any other legal or commercial entity the formation and operation of which is governed by statute.
(2) "Entity" includes a domestic or foreign entity.
(C) "Established practices" means the practices used by an unincorporated nonprofit association without material change during the most recent five years of its existence or, if it has existed for less than five years, during its entire existence.
(D) "Governing principles" means all agreements, whether oral, in a record, or implied from its established practices, or any combination of them, that govern the purpose or operation of an unincorporated nonprofit association and the rights and obligations of its members and managers. "Governing principles" includes any amendment or restatement of the agreements constituting the governing principles.
(E) "Internal Revenue Code" means the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C. 1, as amended.
(F) "Manager" means a person, irrespective of the person's designation as director or other designation, that is responsible, alone or in concert with others, for the management of an unincorporated nonprofit association as stated in division (E) of section 1745.32 of the Revised Code.
(G) "Member" means a person that, under the governing principles of an unincorporated nonprofit association, is entitled to participate in the selection of persons authorized to manage the affairs of the association or in the adoption of the policies and activities of the association.
(H) "Mutual benefit association" means any unincorporated nonprofit association organized under this chapter other than a public benefit association.
(I) "Person" means an individual, corporation, business trust, statutory entity trust, estate, trust, partnership, limited liability company, cooperative, association, joint venture, public corporation, government or governmental subdivision, agency, or instrumentality, two or more persons having a joint or common interest, or any other legal or commercial entity.
(J) "Public benefit association" means an unincorporated nonprofit association that is exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code or is organized for a public or charitable purpose and that upon dissolution must distribute its assets to a public benefit association, the United States, a state or any political subdivision of a state, or a person that is recognized as exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code.
(K) "Public benefit entity" means an entity that is recognized as exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code or is organized for a public or charitable purpose and that upon dissolution must distribute its assets to a public benefit entity, the United States, a state or any political subdivision of a state, or a person that is recognized as exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code. "Public benefit entity" does not include an entity that is organized by one or more municipal corporations to further a public purpose that is not a charitable purpose.
(L) "Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.
(M) "Unincorporated nonprofit association" means an unincorporated organization, consisting of two or more members joined by mutual consent pursuant to an agreement, written, oral, or inferred from conduct, for one or more common, nonprofit purposes. "Unincorporated nonprofit association" does not include any of the following:
(1) A trust;
(2) A marriage, domestic partnership, common law relationship, or other domestic living arrangement;
(3) An organization that is formed under any other statute that governs the organization and operation of unincorporated associations;
(4) A joint tenancy, tenancy in common, or tenancy by the entireties notwithstanding that the co-owners share use of the property for a nonprofit purpose;
(5) A religious organization that operates according to the rules, regulations, canons, discipline, or customs established by the organization, including any ministry, apostolate, committee, or group within that organization, unless the governing principles of the organization specify that the organization is an unincorporated nonprofit association for purposes of this chapter.
(N)(1) Subject to division (N)(2) of this section, "volunteer" means a manager, officer, member, or agent of an unincorporated nonprofit association, or another person acting for the association, who satisfies both of the following:
(a) Performs services for or on behalf of, and under the authority or auspices of, that unincorporated nonprofit association;
(b) Does not receive compensation, either directly or indirectly, for performing those services.
(2) For purposes of division (N)(1) of this section, "compensation" does not include any of the following:
(a) Actual and necessary expenses that are incurred by a volunteer in connection with the services performed for an unincorporated nonprofit association and that are reimbursed to the volunteer or otherwise paid;
(b) Insurance premiums paid on behalf of a volunteer, and amounts paid or reimbursed, pursuant to divisions (A) and (G) of section 1745.43 of the Revised Code;
(c) Modest perquisites.
Section 2. That existing sections 1701.86, 1702.27, 1702.30, 1702.33, 1702.38, 1702.521, 1702.53, 1702.55, 1705.06, 1705.14, 1705.43, 1705.44, 1705.46, 1705.48, and 1745.05 of the Revised Code are hereby repealed.