1.1                          A bill for an act 
  1.2             relating to state government; secretary of state; 
  1.3             regulating filing fees and procedures; amending 
  1.4             Minnesota Statutes 1996, sections 5.12; 5.23; 5.25, 
  1.5             subdivision 1; 5A.03; 5A.04; 302A.821, subdivision 5; 
  1.6             303.14, subdivision 1; 308A.005, by adding a 
  1.7             subdivision; 317A.821, subdivision 3; 317A.827, 
  1.8             subdivision 1; 322A.03; 331A.02, subdivision 1; 
  1.9             333.035; 336.9-203; 336.9-402; 336.9-403; 336.9-404; 
  1.10            336A.04, subdivision 4; and 514.08, subdivision 2; 
  1.11            proposing coding for new law in Minnesota Statutes, 
  1.12            chapter 5; repealing Minnesota Rules, part 3650.0030, 
  1.13            subpart 8. 
  1.14  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.15     Section 1.  Minnesota Statutes 1996, section 5.12, is 
  1.16  amended to read: 
  1.17     5.12 [CERTIFICATE; CERTIFIED COPY OF DOCUMENT; FEE 
  1.18  CERTIFICATES AND CERTIFICATIONS.] 
  1.19     Subdivision 1.  [FEES.] The secretary of state shall charge 
  1.20  a fee of $5 for each certificate or certification of a copy of 
  1.21  any document filed in the office of the secretary of state.  The 
  1.22  secretary of state shall charge a fee of $3 for a copy of an 
  1.23  original filing of a corporation, limited partnership, trade or 
  1.24  service mark, or for the complete record of a certificate of 
  1.25  assumed name.  The secretary of state shall charge a fee of $3 
  1.26  for a copy of any or all subsequent filings of a corporation, 
  1.27  limited partnership, or trade or service mark.  The secretary of 
  1.28  state shall charge a fee of $1 per page for copies of other 
  1.29  nonuniform commercial code documents filed with the secretary of 
  2.1   state. 
  2.2      Subd. 2.  [CERTIFICATE OF GOOD STANDING.] Upon payment of 
  2.3   the proper fee, the secretary of state shall issue a certificate 
  2.4   of good standing to a person when a business entity is in good 
  2.5   standing as defined in section 5.26. 
  2.6      Subd. 3.  [CERTIFICATE OF NOT IN GOOD STANDING.] Upon 
  2.7   payment of the proper fee, the secretary of state shall issue a 
  2.8   certificate of not in good standing to a person when a business 
  2.9   entity is not in good standing as defined in section 5.26. 
  2.10     Subd. 4.  [CERTIFICATE OF REGISTRATION.] Upon payment of 
  2.11  the proper fee, the secretary of state shall issue a certificate 
  2.12  of registration to a person when a business filing with the 
  2.13  secretary has been made that does not create a separate legal 
  2.14  entity.  
  2.15     Sec. 2.  Minnesota Statutes 1996, section 5.23, is amended 
  2.16  to read: 
  2.17     5.23 [REMOVAL OF DOCUMENTS FROM THE PUBLIC RECORD.] 
  2.18     Subdivision 1.  [FAILURE TO PAY FILING FEE.] If an 
  2.19  instrument authorized to be filed with the secretary of state 
  2.20  has been submitted with a draft or other negotiable 
  2.21  instrument payment order or item that is returned without being 
  2.22  honored rejected or dishonored, the secretary may must remove 
  2.23  the instrument from the public record.  The secretary may also 
  2.24  pursue collection of the rejected or dishonored draft or 
  2.25  negotiable instrument payment order or item and recover the face 
  2.26  amount of the draft or negotiable instrument payment order or 
  2.27  item, any service fee, and any additional collection costs 
  2.28  incurred to collect the amount.  If the draft or negotiable 
  2.29  instrument payment order or item is honored, the instrument must 
  2.30  be returned to the public record as of the date the draft or 
  2.31  negotiable instrument payment order or item is honored and the 
  2.32  secretary may impose restrictions on the manner of payment that 
  2.33  will be accepted for any future filings.  This subdivision does 
  2.34  not apply to financing statements filed under chapter 336. 
  2.35     Subd. 2.  [FAILURE TO PAY FEE.] If a party enters into a 
  2.36  continuing agreement with the secretary of state for the receipt 
  3.1   of information or products containing information and payment 
  3.2   for services or products is made by a draft or other negotiable 
  3.3   instrument payment order or item that is returned without being 
  3.4   honored rejected or dishonored, the secretary shall immediately 
  3.5   terminate the agreement.  The secretary may also pursue 
  3.6   collection of the rejected or dishonored draft or negotiable 
  3.7   instrument payment order or item and recover the face amount of 
  3.8   the draft or negotiable instrument payment order or item and any 
  3.9   additional costs incurred to collect the amount.  If the draft 
  3.10  or negotiable instrument payment order or item is honored, the 
  3.11  agreement may be reinstated and the secretary may impose 
  3.12  restrictions on the manner of payment that will be accepted 
  3.13  during the course of the agreement.  
  3.14     Subd. 3.  [FAILURE TO PAY DIRECT ACCESS CHARGES.] If a 
  3.15  customer who has subscribed with the secretary of state for 
  3.16  direct computer access to the secretary's data bases makes 
  3.17  payment for information received with a draft or other 
  3.18  negotiable instrument payment order or item that is returned 
  3.19  without being honored rejected or dishonored, the secretary 
  3.20  shall immediately terminate the customer's access to the data 
  3.21  bases.  The secretary may also pursue collection of the rejected 
  3.22  or dishonored draft or negotiable instrument payment order or 
  3.23  item and recover the face amount of the draft or negotiable 
  3.24  instrument payment order or item and any additional costs 
  3.25  incurred to collect the amount.  If the draft or negotiable 
  3.26  instrument payment order or item is honored, access may be 
  3.27  restored and the secretary may impose restrictions on the 
  3.28  methods of payment that will be acceptable.  
  3.29     Subd. 4.  [COLLECTION OF ALL AMOUNTS.] The secretary of 
  3.30  state must collect the face amount of the rejected or dishonored 
  3.31  draft or negotiable instrument payment order or item, any 
  3.32  service fee, and all costs of collection in every possible 
  3.33  instance.  Collection must occur whether or not the instrument 
  3.34  is returned to the public record or the customer continues to 
  3.35  receive the information products or access to the data base.  
  3.36  Uncollectible drafts payment orders and items must be processed 
  4.1   according to applicable Minnesota law. 
  4.2      Sec. 3.  Minnesota Statutes 1996, section 5.25, subdivision 
  4.3   1, is amended to read: 
  4.4      Subdivision 1.  [WHO MAY BE SERVED.] A process, notice, or 
  4.5   demand required or permitted by law to be served upon an entity 
  4.6   governed by chapter 221, 302A, 303, 317A, 322A, 322B, 323, 330, 
  4.7   540, or 543 may be served on:  (1) the registered agent, if any; 
  4.8   (2) if no agent has been appointed then on an officer, manager, 
  4.9   or partner of the entity; or (3) if no agent, officer, manager, 
  4.10  or partner can be found at the address on file with the 
  4.11  secretary of state, on the secretary of state as provided in 
  4.12  this section. 
  4.13     Sec. 4.  [5.26] [GOOD STANDING.] 
  4.14     Subdivision 1.  [DEFINITION.] "Good standing" means that a 
  4.15  business entity has complied with all of the filing and 
  4.16  registration requirements with the office of the secretary of 
  4.17  state described in the entity's governing chapter.  
  4.18     Subd. 2.  [EFFECT OF STATUS.] (a) When a business entity is 
  4.19  in good standing it may amend its organizing document that is on 
  4.20  file with the secretary of state.  
  4.21     (b) When a business entity is in good standing, the 
  4.22  secretary of state shall issue a certificate of good standing as 
  4.23  described in section 5.12.  
  4.24     (c) A business entity that is not in good standing may 
  4.25  participate in a merger where it does not survive the merger 
  4.26  transaction or may dissolve or terminate its existence.  It may 
  4.27  not amend its organizing document or file other documents with 
  4.28  the secretary of state, other than documents required to return 
  4.29  the business entity to good standing. 
  4.30     (d) When a business entity is not in good standing, the 
  4.31  secretary of state shall issue a certificate of not in good 
  4.32  standing as described in section 5.12.  The secretary of state 
  4.33  shall not issue a certificate of good standing with respect to a 
  4.34  business entity that is not in good standing.  
  4.35     Subd. 3.  [REINSTATEMENT.] Reinstatement of good standing 
  4.36  is controlled by the provisions of the chapter that governs the 
  5.1   business entity.  
  5.2      Sec. 5.  Minnesota Statutes 1996, section 5A.03, is amended 
  5.3   to read: 
  5.4      5A.03 [ORGANIZATION APPLICATION FOR REGISTRATION.] 
  5.5      (a) An application for registration as an international 
  5.6   student exchange visitor placement organization must be 
  5.7   submitted in the form prescribed by the secretary of state.  The 
  5.8   application must include: 
  5.9      (1) evidence that the organization meets the standards 
  5.10  established by the secretary of state by rule; 
  5.11     (2) the name, address, and telephone number of the 
  5.12  organization, its chief executive officer, and the person within 
  5.13  the organization who has primary responsibility for supervising 
  5.14  placements within the state; 
  5.15     (3) the organization's unified business identification 
  5.16  number, if any; 
  5.17     (4) the organization's United States Information Agency 
  5.18  number, if any; 
  5.19     (5) evidence of Council on Standards for International 
  5.20  Educational Travel listing, if any; 
  5.21     (6) whether the organization is exempt from federal income 
  5.22  tax; and 
  5.23     (7) a list of the organization's placements in Minnesota 
  5.24  for the previous academic year including the number of students 
  5.25  placed, their home countries, the school districts in which they 
  5.26  were placed, and the length of their placements. 
  5.27     (b) The application must be signed by the chief executive 
  5.28  officer of the organization and the person within the 
  5.29  organization who has primary responsibility for supervising 
  5.30  placements within Minnesota.  If the secretary of state 
  5.31  determines that the application is complete, the secretary of 
  5.32  state shall file the application and the applicant is registered.
  5.33     (c) Organizations that have registered shall inform the 
  5.34  secretary of state of any changes in the information required 
  5.35  under paragraph (a), clause (1), within 30 days of the 
  5.36  change.  There is no fee to amend a registration. 
  6.1      (d) Registration under this chapter is valid for one year.  
  6.2   The registration may be renewed annually.  The fee to renew a 
  6.3   registration is $50 per year. 
  6.4      (e) Organizations registering for the first time in 
  6.5   Minnesota must pay an initial registration fee of $150. 
  6.6      (f) Fees collected by the secretary of state under this 
  6.7   section must be deposited in the state treasury and credited to 
  6.8   the general fund and are added to the appropriation from which 
  6.9   registration costs are paid. 
  6.10     Sec. 6.  Minnesota Statutes 1996, section 5A.04, is amended 
  6.11  to read: 
  6.12     5A.04 [RULES.] 
  6.13     (a) The secretary of state shall adopt by rule standards 
  6.14  for international student exchange visitor placement 
  6.15  organizations.  In adopting the rules, the secretary of state 
  6.16  may adopt standards established by the United States Information 
  6.17  Agency and the Council on Standards for International 
  6.18  Educational Travel.  The secretary of state may incorporate 
  6.19  standards established by the United States Information Agency or 
  6.20  the Council on Standards for International Educational Travel by 
  6.21  reference and may accept an organization's designation by the 
  6.22  United States Information Agency or acceptance for listing by 
  6.23  the Council on Standards for International Educational Travel as 
  6.24  evidence of compliance with the standards. 
  6.25     (b) The secretary of state may adopt rules as necessary to 
  6.26  carry out its duties under this chapter. The rules may provide 
  6.27  for a reasonable registration fee not to exceed $150 for each 
  6.28  initial registration and $50 for each annual renewal to defray 
  6.29  the costs of processing registrations.  Fees collected by the 
  6.30  secretary of state under this provision shall be deposited in 
  6.31  the state treasury and credited to the general fund and are 
  6.32  added to the appropriation from which registration costs are 
  6.33  paid. 
  6.34     (c) The secretary of state must require that an 
  6.35  international student exchange visitor placement organization's 
  6.36  application form for participation as a host family include a 
  7.1   signed document complying with section 299C.62, subdivision 2, 
  7.2   that gives the organization permission to conduct a background 
  7.3   check on members of the host family.  Sections 299C.60 to 
  7.4   299C.64 apply to the background check, except that for purposes 
  7.5   of this section the term "background check crime" includes any 
  7.6   felony. 
  7.7      Sec. 7.  Minnesota Statutes 1996, section 302A.821, 
  7.8   subdivision 5, is amended to read: 
  7.9      Subd. 5.  [PENALTY.] (a) A corporation that has failed for 
  7.10  three consecutive years to file a registration pursuant to the 
  7.11  requirements of subdivision 1, has been notified of the failure 
  7.12  pursuant to subdivision 4, and has failed to file the delinquent 
  7.13  registration during the 60-day period described in subdivision 
  7.14  4, shall be dissolved by the secretary of state as described in 
  7.15  paragraph (b).  
  7.16     (b) Immediately after the expiration of the 60-day period 
  7.17  described in paragraph (a), if the corporation has not filed the 
  7.18  delinquent registration, the secretary of state shall issue a 
  7.19  certificate of involuntary dissolution, and a copy of the 
  7.20  certificate shall be filed in the office of the secretary of 
  7.21  state.  The original certificate shall be sent to the registered 
  7.22  office of the corporation.  The secretary of state shall 
  7.23  annually inform the attorney general and the commissioner of 
  7.24  revenue of the methods by which the names of corporations 
  7.25  dissolved under this section during the preceding year may be 
  7.26  determined.  A corporation dissolved in this manner is not 
  7.27  entitled to the benefits of section 302A.781.  The liability, if 
  7.28  any, of the shareholders of a corporation dissolved in this 
  7.29  manner shall be determined and limited in accordance with 
  7.30  section 302A.557, except that the shareholders shall have no 
  7.31  liability to any director of the corporation under section 
  7.32  302A.559, subdivision 2.  
  7.33     Sec. 8.  Minnesota Statutes 1996, section 303.14, 
  7.34  subdivision 1, is amended to read: 
  7.35     Subdivision 1.  [FILED WITH SECRETARY OF STATE; CONTENTS.] 
  7.36  Between January 15 and May 15, in each calendar year, every 
  8.1   foreign corporation which holds a certificate of authority shall 
  8.2   make and file with the secretary of state a report for the 
  8.3   previous calendar year, setting forth: 
  8.4      (1) the name of the corporation and the state or country 
  8.5   under the laws of which it is organized; 
  8.6      (2) if the name of the corporation does not end with the 
  8.7   word "Corporation" or the word "Incorporated," or the 
  8.8   abbreviation "Inc.," or does not contain the word "Company" or 
  8.9   the abbreviation "Co." not immediately preceded by the word 
  8.10  "and" or the character "&," then the name of the corporation 
  8.11  with the word or abbreviation which it has agreed to add thereto 
  8.12  for use in this state; 
  8.13     (3) the address of its registered office in this state and 
  8.14  the name of its registered agent at such address; 
  8.15     (4) additional information necessary or appropriate to 
  8.16  enable the secretary of state to determine the additional 
  8.17  license fee, if any, payable by the corporation; 
  8.18     (5) a statement of the corporate taxable net income as 
  8.19  stated in its appropriate Minnesota corporate income tax return 
  8.20  that was due in the previous year; and 
  8.21     (6) the fee required by section 303.07, subdivision 2.  
  8.22  This fee shall be submitted with the annual report.  
  8.23     Sec. 9.  Minnesota Statutes 1996, section 308A.005, is 
  8.24  amended by adding a subdivision to read: 
  8.25     Subd. 1a.  [ADDRESS.] "Address" means mailing address, 
  8.26  including a zip code.  In the case of a registered address, the 
  8.27  term means the mailing address and the actual office location, 
  8.28  which may not be a post office box. 
  8.29     Sec. 10.  Minnesota Statutes 1996, section 317A.821, 
  8.30  subdivision 3, is amended to read: 
  8.31     Subd. 3.  [DISSOLUTION; EXTENSION.] If a corporation fails 
  8.32  to regain its good standing under subdivision 2 on or before 
  8.33  December 31, 1997, the corporation is dissolved under section 
  8.34  317A.827.  After December 31, 1997, the corporate existence of a 
  8.35  corporation dissolved under this subdivision may be extended by 
  8.36  filing the initial corporate registration with the secretary of 
  9.1   state and payment of a $1,000 $25 fee.  The extension relates 
  9.2   back to December 31, 1997. 
  9.3      Sec. 11.  Minnesota Statutes 1996, section 317A.827, 
  9.4   subdivision 1, is amended to read: 
  9.5      Subdivision 1.  [PROCEDURE.] If a corporation fails to file 
  9.6   the initial registration by December 31, 1997, or if it fails to 
  9.7   file the delinquent registration before expiration of the 60-day 
  9.8   period in section 317A.823, subdivision 3, the secretary of 
  9.9   state shall immediately issue a certificate of involuntary 
  9.10  dissolution.  The secretary of state shall send the original 
  9.11  certificate to the registered office of the corporation and file 
  9.12  a copy in the office of the secretary of state.  The secretary 
  9.13  of state shall annually inform the attorney general of 
  9.14  the methods by which the names of corporations dissolved under 
  9.15  this section during the previous year may be determined.  A 
  9.16  corporation dissolved under this section is not entitled to the 
  9.17  benefits of section 317A.781, subdivision 1. 
  9.18     Sec. 12.  Minnesota Statutes 1996, section 322A.03, is 
  9.19  amended to read: 
  9.20     322A.03 [RESERVATION OF NAME.] 
  9.21     (a) The exclusive right to the use of a name may be 
  9.22  reserved by: 
  9.23     (1) any person intending to organize a limited partnership 
  9.24  under sections 322A.01 to 322A.87 and to adopt that name; 
  9.25     (2) any domestic limited partnership or any foreign limited 
  9.26  partnership registered in this state which, in either case, 
  9.27  intends to adopt that name; 
  9.28     (3) any foreign limited partnership intending to register 
  9.29  in this state and adopt that name; and 
  9.30     (4) any person intending to organize a foreign limited 
  9.31  partnership and intending to have it register in this state and 
  9.32  adopt that name. 
  9.33     (b) The reservation shall be made by filing with the 
  9.34  secretary of state an application, executed by the applicant, to 
  9.35  reserve a specified name.  On finding that the name is available 
  9.36  for use by a domestic or foreign limited partnership, the 
 10.1   secretary of state shall reserve the name for the exclusive use 
 10.2   of the applicant for a period of 120 days.  Once having so 
 10.3   reserved a name, the same applicant may not again reserve the 
 10.4   same name until more than 60 days after the expiration of the 
 10.5   last 120-day period for which that applicant reserved that 
 10.6   name 12 months.  The reservation may be renewed for successive 
 10.7   12-month periods.  The right to the exclusive use of a reserved 
 10.8   name may be transferred to any other person by filing in the 
 10.9   office of the secretary of state a notice of the transfer, 
 10.10  executed by the applicant for whom the name was reserved and 
 10.11  specifying the name and address of the transferee. 
 10.12     Sec. 13.  Minnesota Statutes 1996, section 331A.02, 
 10.13  subdivision 1, is amended to read: 
 10.14     Subdivision 1.  [QUALIFICATION.] No newspaper in this state 
 10.15  shall be entitled to any compensation or fee for publishing any 
 10.16  public notice unless it is qualified as a medium of official and 
 10.17  legal publication.  A newspaper that is not qualified must 
 10.18  inform a public body that presents a public notice for 
 10.19  publication that it is not qualified.  To be qualified as a 
 10.20  medium of official and legal publication, a newspaper shall:  
 10.21     (a) be printed in the English language in newspaper format 
 10.22  and in column and sheet form equivalent in printed space to at 
 10.23  least 1,000 square inches; 
 10.24     (b) if a daily, be distributed at least five days each 
 10.25  week, or if not a daily, be distributed at least once each week, 
 10.26  for 50 weeks each year.  In any week in which a legal holiday is 
 10.27  included, not more than four issues of a daily paper are 
 10.28  necessary; 
 10.29     (c) in at least half of its issues each year, have no more 
 10.30  than 75 percent of its printed space comprised of advertising 
 10.31  material and paid public notices.  In all of its issues each 
 10.32  year, have 25 percent, if published more often than weekly, or 
 10.33  50 percent, if weekly, of its news columns devoted to news of 
 10.34  local interest to the community which it purports to serve.  Not 
 10.35  more than 25 percent of its total nonadvertising column inches 
 10.36  in any issue may wholly duplicate any other publication unless 
 11.1   the duplicated material is from recognized general news 
 11.2   services; 
 11.3      (d) be circulated in the local public corporation which it 
 11.4   purports to serve, and either have at least 500 copies regularly 
 11.5   delivered to paying subscribers, or have at least 500 copies 
 11.6   regularly distributed without charge to local residents; 
 11.7      (e) have its known office of issue established in either 
 11.8   the county in which lies, in whole or in part, the local public 
 11.9   corporation which the newspaper purports to serve, or in an 
 11.10  adjoining county; 
 11.11     (f) file a copy of each issue immediately with the state 
 11.12  historical society; 
 11.13     (g) be made available at single or subscription prices to 
 11.14  any person, corporation, partnership, or other unincorporated 
 11.15  association requesting the newspaper and making the applicable 
 11.16  payment, or be distributed without charge to local residents; 
 11.17     (h) have complied with all the foregoing conditions of this 
 11.18  subdivision for at least one year immediately preceding the date 
 11.19  of the notice publication; and 
 11.20     (i) between September 1 and December 31 of each year 
 11.21  publish and submit to the secretary of state, along with a 
 11.22  filing fee of $25, a sworn United States Post Office 
 11.23  second-class periodicals-class statement of ownership and 
 11.24  circulation or a statement of ownership and circulation verified 
 11.25  by a recognized independent circulation auditing agency covering 
 11.26  a period of not less than at least one year ending no earlier 
 11.27  than the June 30 preceding the filing publication deadline, 
 11.28  provided that a filing published and submitted.  When 
 11.29  publication occurs after December 31 and before July 1, 
 11.30  qualification shall be effective from the date of the 
 11.31  filing described in paragraph (j) through December 31 of that 
 11.32  year.  The secretary of state shall make the list of newspapers 
 11.33  whose filings have been accepted available for public 
 11.34  inspection.  The acceptance of a filing does not constitute a 
 11.35  guarantee by the state that any other qualification requirement 
 11.36  has been met.; and 
 12.1      (j) after publication, submit to the secretary of state by 
 12.2   December 31 a filing containing the newspaper's name, address of 
 12.3   its known office of issue, telephone number, and a statement 
 12.4   that it has complied with all of the requirements of this 
 12.5   section.  The filing must be accompanied by a fee of $25.  The 
 12.6   secretary of state shall make available for public inspection a 
 12.7   list of newspapers that have filed.  Acceptance of a filing does 
 12.8   not constitute a guarantee by the state that any other 
 12.9   qualification has been met. 
 12.10     Sec. 14.  Minnesota Statutes 1996, section 333.035, is 
 12.11  amended to read: 
 12.12     333.035 [AMENDMENT OF CERTIFICATE.] 
 12.13     Within 60 days after the occurrence of any event which 
 12.14  makes any statement in the last previous statement certificate 
 12.15  filed incorrect, an amended certificate shall be filed and the 
 12.16  amended certificate shall be published by the person conducting 
 12.17  the business in the same manner as provided by section 
 12.18  333.01.  If the amendment is made only to comply with a change 
 12.19  in the law that occurred since the previous date of filing, 
 12.20  publication is not required. 
 12.21     Sec. 15.  Minnesota Statutes 1996, section 336.9-203, is 
 12.22  amended to read: 
 12.23     336.9-203 [ATTACHMENT AND ENFORCEABILITY OF SECURITY 
 12.24  INTEREST; PROCEEDS; FORMAL REQUISITES.] 
 12.25     (1) Subject to the provisions of section 336.4-210 on the 
 12.26  security interest of a collecting bank, sections 336.9-115 and 
 12.27  336.9-116 on security interests in investment property and 
 12.28  section 336.9-113 on a security interest arising under the 
 12.29  article on sales, a security interest is not enforceable against 
 12.30  the debtor or third parties with respect to the collateral and 
 12.31  does not attach unless: 
 12.32     (a) the collateral is in the possession of the secured 
 12.33  party pursuant to agreement, the collateral is investment 
 12.34  property and the secured party has control pursuant to 
 12.35  agreement, or the debtor has signed a security agreement which 
 12.36  contains a description of the collateral and, in addition, when 
 13.1   the security interest covers crops growing or to be grown or 
 13.2   timber to be cut, a description of the land concerned; 
 13.3      (b) value has been given; and 
 13.4      (c) the debtor has rights in the collateral. 
 13.5      (2) A security interest attaches when it becomes 
 13.6   enforceable against the debtor with respect to the collateral.  
 13.7   Attachment occurs as soon as all of the events specified in 
 13.8   subsection (1) have taken place unless explicit agreement 
 13.9   postpones the time of attaching. 
 13.10     (3) Unless otherwise agreed a security agreement gives the 
 13.11  secured party the rights to proceeds provided by section 
 13.12  336.9-306. 
 13.13     (4) A transaction, although subject to this article, is 
 13.14  also subject to Minnesota Statutes, Sections 48.153 to 48.157; 
 13.15  Chapters 52, 53, and 56; and Sections 168.66 to 168.77, 222.13 
 13.16  to 222.16, and 334.01 to 334.06, and in the case of conflict 
 13.17  between the provisions of this article and any such statute, the 
 13.18  provisions of such statute control.  Failure to comply with any 
 13.19  applicable statute has only the effect which is specified 
 13.20  therein. 
 13.21     Sec. 16.  Minnesota Statutes 1996, section 336.9-402, is 
 13.22  amended to read: 
 13.23     336.9-402 [FORMAL REQUISITES OF FINANCING STATEMENT; 
 13.24  AMENDMENTS; MORTGAGE AS FINANCING STATEMENT.] 
 13.25     (1) A financing statement is sufficient if it gives the 
 13.26  name of the debtor and the secured party, is signed by the 
 13.27  debtor, gives an address of the secured party from which 
 13.28  information concerning the security interest may be obtained, 
 13.29  gives a mailing address of the debtor, gives the social security 
 13.30  number of the debtor or, in the case of a debtor doing business 
 13.31  other than as an individual, the internal revenue service 
 13.32  taxpayer identification number of the debtor, and contains a 
 13.33  statement indicating the types or describing the items, of 
 13.34  collateral.  A financing statement may be filed before a 
 13.35  security agreement is made or a security interest otherwise 
 13.36  attaches.  When the financing statement covers crops growing or 
 14.1   to be grown, the statement must also contain a description of 
 14.2   the real estate concerned and the name of the record owner 
 14.3   thereof and the crop years that are covered by the financing 
 14.4   statement.  When the financing statement covers timber to be cut 
 14.5   or covers minerals or the like (including oil and gas) or 
 14.6   accounts subject to subsection (5) of section 336.9-103, or when 
 14.7   the financing statement is filed as a fixture filing (section 
 14.8   336.9-313) and the collateral is goods which are or are to 
 14.9   become fixtures, the statement must also comply with subsection 
 14.10  (5).  A copy of the security agreement is sufficient as a 
 14.11  financing statement if it contains the above information and is 
 14.12  signed by the debtor.  A carbon, photographic or other 
 14.13  reproduction of a security agreement or a financing statement is 
 14.14  sufficient as a financing statement if the security agreement so 
 14.15  provides or if the original has been filed in this state. 
 14.16     (2) A financing statement which otherwise complies with 
 14.17  subsection (1) is sufficient when it is signed by the secured 
 14.18  party instead of the debtor when it is filed to perfect a 
 14.19  security interest in 
 14.20     (a) collateral already subject to a security interest in 
 14.21  another jurisdiction when it is brought into this state, or when 
 14.22  the debtor's location is changed to this state.  Such a 
 14.23  financing statement must state that the collateral was brought 
 14.24  into this state or that the debtor's location was changed to 
 14.25  this state under such circumstances; or 
 14.26     (b) proceeds under section 336.9-306 if the security 
 14.27  interest in the original collateral was perfected.  Such a 
 14.28  financing statement must describe the original collateral; or 
 14.29     (c) collateral as to which the filing has lapsed within one 
 14.30  year; or 
 14.31     (d) collateral acquired after a change of name, identity or 
 14.32  corporate structure of the debtor (subsection (7)); or 
 14.33     (e) a lien filed pursuant to chapter 514; or 
 14.34     (f) collateral which is subject to a filed judgment.  
 14.35     (2a) Except for documents filed under clauses (e) and (f), 
 14.36  the reason for the omission of the debtor signature must be 
 15.1   stated on the front of the financing statement.  
 15.2      (3) A form substantially as follows is sufficient to comply 
 15.3   with subsection (1): 
 15.4      Name of debtor (or assignor) 
 15.5      .............................. 
 15.6      Address 
 15.7      .............................. 
 15.8      Debtor's Social Security Number or I.R.S. Tax I.D. Number 
 15.9      ............................... 
 15.10     Name of secured party (or assignee) 
 15.11     .............................. 
 15.12     Address 
 15.13     .............................. 
 15.14     1.  This financing statement covers the following types (or 
 15.15  items) of property: 
 15.16     (Describe) 
 15.17     .............................. 
 15.18     2.  (If collateral is crops) The above described crops are 
 15.19  growing or are to be grown on: 
 15.20     (Describe real estate and the name of the record owner 
 15.21  thereof) ...... 
 15.22     ....................................................... ....
 15.23     3.  (If applicable) The above goods are to become fixtures 
 15.24  on 
 15.25     (Describe real estate).......................... and this 
 15.26  financing statement is to be filed for record in the real estate 
 15.27  records.  (If the debtor does not have an interest of record) 
 15.28  The name of a record owner is ................. 
 15.29     4. 3. (If products of collateral are claimed) 
 15.30     Products of the collateral are also covered. 
 15.31     Use whichever signature line is applicable. 
 15.32     Signature of debtor (or assignor) 
 15.33     ......................... 
 15.34     Signature of secured party (or assignee) 
 15.35     ......................... 
 15.36     (4) A financing statement may be amended by filing a 
 16.1   writing signed by both the debtor and the secured party.  If the 
 16.2   sole purpose of the amendment is to change the name or address 
 16.3   of the secured party, only the secured party need sign the 
 16.4   amendment.  A writing is sufficient if it sets forth the name 
 16.5   and address of the debtor and secured party as those items 
 16.6   appear on the original financing statement or the most recently 
 16.7   filed amendment, the file number and date of filing of the 
 16.8   financing statement.  An amendment does not extend the period of 
 16.9   effectiveness of a financing statement.  If any amendment adds 
 16.10  collateral, it is effective as to the added collateral only from 
 16.11  the filing date of the amendment.  In this article, unless the 
 16.12  context otherwise requires, the term "financing statement" means 
 16.13  the original financing statement and any amendments. 
 16.14     (5) A financing statement covering timber to be cut or 
 16.15  covering minerals or the like (including oil and gas) or 
 16.16  accounts subject to subsection (5) of section 336.9-103, or a 
 16.17  financing statement filed as a fixture filing (section 
 16.18  336.9-313) where the debtor is not a transmitting utility, must 
 16.19  show that it covers this type of collateral, must recite that it 
 16.20  is to be filed for record in the real estate records, and the 
 16.21  financing statement must contain a description of the real 
 16.22  estate sufficient if it were contained in a mortgage of the real 
 16.23  estate to give constructive notice of the mortgage under the law 
 16.24  of this state.  If the debtor does not have an interest of 
 16.25  record in the real estate, the financing statement must show the 
 16.26  name of a record owner.  No description of the real estate or 
 16.27  the name of the record owner thereof is required for a fixture 
 16.28  filing where the debtor is a transmitting utility. 
 16.29  Notwithstanding the foregoing a general description of the real 
 16.30  estate is sufficient for a fixture filing where a railroad is 
 16.31  the record owner of the real estate on which the fixtures are or 
 16.32  are to be located; and for the purposes of this subsection, the 
 16.33  requirement of a general description is satisfied if the fixture 
 16.34  filing (1) identifies the section, township and range numbers of 
 16.35  the county in which the land is located; (2) identifies the 
 16.36  quarter-quarter of the section that the land is located in; (3) 
 17.1   indicates the name of the record owner of the real estate; and 
 17.2   (4) states the street address of the real estate if one exists. 
 17.3      (6) A mortgage is effective as a financing statement filed 
 17.4   as a fixture filing from the date of its recording if (a) the 
 17.5   goods are described in the mortgage by item or type, (b) the 
 17.6   goods are or are to become fixtures related to the real estate 
 17.7   described in the mortgage, (c) the mortgage complies with the 
 17.8   requirements for a financing statement in this section other 
 17.9   than a recital that it is to be filed in the real estate 
 17.10  records, and (d) the mortgage is duly recorded.  No fee with 
 17.11  reference to the financing statement is required other than the 
 17.12  regular recording and satisfaction fees with respect to the 
 17.13  mortgage. 
 17.14     (7) A financing statement sufficiently shows the name of 
 17.15  the debtor if it gives the individual, partnership or corporate 
 17.16  name of the debtor, whether or not it adds other trade names or 
 17.17  the names of partners, and gives the social security number of 
 17.18  the debtor or, in the case of a debtor doing business other than 
 17.19  as an individual, the internal revenue service taxpayer 
 17.20  identification number of the debtor.  Where the debtor so 
 17.21  changes a personal name or in the case of an organization its 
 17.22  name, identity or corporate structure that a filed financing 
 17.23  statement becomes seriously misleading, the filing is not 
 17.24  effective to perfect a security interest in collateral acquired 
 17.25  by the debtor more than four months after the change, unless a 
 17.26  new appropriate financing statement is filed before the 
 17.27  expiration of that time.  A filed financing statement remains 
 17.28  effective with respect to collateral transferred by the debtor 
 17.29  even though the secured party knows of or consents to the 
 17.30  transfer. 
 17.31     (8) A financing statement, amendment, continuation, 
 17.32  assignment, release, or termination substantially complying with 
 17.33  the requirements of this section is effective even though it 
 17.34  contains minor errors which are not seriously misleading.  The 
 17.35  omission or any inaccuracy in stating the debtor's social 
 17.36  security or federal tax identification number is not, standing 
 18.1   alone, a seriously misleading error. 
 18.2      Sec. 17.  Minnesota Statutes 1996, section 336.9-403, is 
 18.3   amended to read: 
 18.4      336.9-403 [WHAT CONSTITUTES FILING; DURATION OF FILING; 
 18.5   EFFECT OF LAPSED FILING; DUTIES OF FILING OFFICER.] 
 18.6      (1) Presentation for filing of a financing statement and 
 18.7   tender of the filing fee or acceptance of the statement by the 
 18.8   filing officer constitutes filing under this article. 
 18.9      (2) Except as provided in subsection (6) a filed financing 
 18.10  statement is effective for a period of five years from the date 
 18.11  of filing.  The effectiveness of a filed financing statement 
 18.12  lapses on the expiration of the five-year period unless a 
 18.13  continuation statement is filed prior to the lapse.  If a 
 18.14  security interest perfected by filing exists at the time 
 18.15  insolvency proceedings are commenced by or against the debtor, 
 18.16  the security interest remains perfected until termination of the 
 18.17  insolvency proceedings and thereafter for a period of 60 days or 
 18.18  until expiration of the five-year period, whichever occurs later 
 18.19  regardless of whether the financing statement filed as to that 
 18.20  security interest is destroyed by the filing officer pursuant to 
 18.21  subsection (3).  Upon lapse the security interest becomes 
 18.22  unperfected, unless it is perfected without filing.  If the 
 18.23  security interest becomes unperfected upon lapse, it is deemed 
 18.24  to have been unperfected as against a person who became a 
 18.25  purchaser or lien creditor before lapse. 
 18.26     (3) A continuation statement may be filed by the secured 
 18.27  party within six months prior to the expiration of the five-year 
 18.28  period specified in subsection (2).  Any such continuation 
 18.29  statement must be signed by the secured party, set forth the 
 18.30  name, social security number or other tax identification number 
 18.31  of the debtor, and address of the debtor and secured party as 
 18.32  those items appear on the original financing statement or the 
 18.33  most recently filed amendment, identify the original statement 
 18.34  by file number and filing date, and state that the original 
 18.35  statement is still effective.  A continuation statement signed 
 18.36  by a person other than the secured party of record must be 
 19.1   accompanied by a separate written statement of assignment signed 
 19.2   by the secured party of record and complying with subsection (2) 
 19.3   of section 336.9-405, including payment of the required fee.  
 19.4   Upon timely filing of the continuation statement, the 
 19.5   effectiveness of the original statement is continued for five 
 19.6   years after the last date to which the filing was effective 
 19.7   whereupon it lapses in the same manner as provided in subsection 
 19.8   (2) unless another continuation statement is filed prior to such 
 19.9   lapse.  Succeeding continuation statements may be filed in the 
 19.10  same manner to continue the effectiveness of the original 
 19.11  statement.  Unless a statute on disposition of public records 
 19.12  provides otherwise, the filing officer may remove a lapsed 
 19.13  statement from the files and destroy it immediately if the 
 19.14  officer has retained a microfilm or other photographic record 
 19.15  copy in a format which meets archival standards, or in other 
 19.16  cases after one year after the lapse.  The filing officer shall 
 19.17  so arrange matters by physical annexation of financing 
 19.18  statements to continuation statements or other related filings, 
 19.19  or by other means, that if the officer physically destroys the 
 19.20  financing statements of a period more than five years past, 
 19.21  those which have been continued by a continuation statement or 
 19.22  which are still effective under subsection (6) shall be 
 19.23  retained.  If insolvency proceedings are commenced by or against 
 19.24  the debtor, the secured party shall notify the filing officer 
 19.25  both upon commencement and termination of the proceedings, and 
 19.26  the filing officer shall not destroy any financing statements 
 19.27  filed with respect to the debtor until termination of the 
 19.28  insolvency proceedings.  The security interest remains perfected 
 19.29  until termination of the insolvency proceedings and thereafter 
 19.30  for a period of 60 days or until expiration of the five-year 
 19.31  period, whichever occurs later. 
 19.32     (4) Except as provided in subsection (7) a filing officer 
 19.33  shall mark each statement with a file number and with the date 
 19.34  and hour of filing and shall hold the statement or a microfilm 
 19.35  or other photographic copy thereof in a format that meets 
 19.36  archival standards for public inspection.  In addition the 
 20.1   filing officer shall index the statements according to the name 
 20.2   of the debtor and shall note in the index the file number, the 
 20.3   address of the debtor given in the statement, and the social 
 20.4   security number or other tax identification number of the debtor 
 20.5   given in the statement. 
 20.6      (5) The secretary of state shall prescribe uniform forms 
 20.7   for statements and samples thereof shall be furnished to all 
 20.8   filing officers in the state.  The uniform fee for filing and 
 20.9   indexing and for stamping a copy furnished by the secured party 
 20.10  to show the date and place of filing: 
 20.11     (a) for an original financing statement or statement of 
 20.12  continuation on a standard form prescribed by the secretary of 
 20.13  state, is $15 for up to two debtor names and $15 for each 
 20.14  additional name thereafter; 
 20.15     (b) for an original financing statement or statement of 
 20.16  continuation that is not on a standard form prescribed by the 
 20.17  secretary of state, is $20 for up to two debtor names and $20 
 20.18  for each additional name thereafter; 
 20.19     (c) for an amendment on a standard form prescribed by the 
 20.20  secretary of state that does not add debtor names, is $15; 
 20.21     (d) for an amendment that is not on a standard form 
 20.22  prescribed by the secretary of state and that does not add 
 20.23  debtor names, is $20; 
 20.24     (e) for an amendment on a standard form prescribed by the 
 20.25  secretary of state that adds more than one debtor name, is $15 
 20.26  per debtor name; and 
 20.27     (f) for an amendment that is not on a standard form 
 20.28  prescribed by the secretary of state that adds more than one 
 20.29  debtor name, is $20 per debtor name. 
 20.30  In no case will a filing officer accept more than four 
 20.31  additional pages per financing statement for filing in the 
 20.32  uniform commercial code records. 
 20.33     The secretary of state shall adopt rules for filing, 
 20.34  amendment, continuation, termination, removal, and destruction 
 20.35  of financing statements. 
 20.36     (6) If the debtor is a transmitting utility (subsection (5) 
 21.1   of section 336.9-401) and a filed financing statement so states, 
 21.2   it is effective until a termination statement is filed.  A real 
 21.3   estate mortgage which is effective as a fixture filing under 
 21.4   subsection (6) of section 336.9-402 remains effective as a 
 21.5   fixture filing until the mortgage is released or satisfied of 
 21.6   record or its effectiveness otherwise terminates as to the real 
 21.7   estate. 
 21.8      (7) When a financing statement covers timber to be cut or 
 21.9   covers minerals or the like (including oil and gas) or accounts 
 21.10  subject to subsection (5) of section 336.9-103, or is filed as a 
 21.11  fixture filing, it shall be filed for record and the filing 
 21.12  officer shall index it under the names of the debtor and any 
 21.13  owner of record shown on the financing statement in the same 
 21.14  fashion as if they were the mortgagors in a mortgage of the real 
 21.15  estate described, and, to the extent that the law of this state 
 21.16  provides for indexing of mortgages under the name of the 
 21.17  mortgagee, under the name of the secured party as if the secured 
 21.18  party were the mortgagee thereunder, or, for filing offices 
 21.19  other than the secretary of state, where indexing is by 
 21.20  description in the same fashion as if the financing statement 
 21.21  were a mortgage of the real estate described.  
 21.22     (8) The fees provided for in this article shall supersede 
 21.23  the fees for similar services otherwise provided for by law 
 21.24  except in the case of security interests filed in connection 
 21.25  with a certificate of title on a motor vehicle. 
 21.26     Sec. 18.  Minnesota Statutes 1996, section 336.9-404, is 
 21.27  amended to read: 
 21.28     336.9-404 [TERMINATION STATEMENT.] 
 21.29     (1) If a financing statement covering consumer goods is 
 21.30  filed on or after January 1, 1977, then within one month or 
 21.31  within ten days following written demand by the debtor after 
 21.32  there is no outstanding secured obligation and no commitment to 
 21.33  make advances, incur obligations or otherwise give value, the 
 21.34  secured party must file with each filing officer with whom the 
 21.35  financing statement was filed, a termination statement to the 
 21.36  effect that the secured party no longer claims a security 
 22.1   interest under the financing statement.  The termination 
 22.2   statement must set forth the name and address of the debtor and 
 22.3   secured party as those items appear on the original financing 
 22.4   statement or the most recently filed amendment; identify the 
 22.5   original financing statement by file number and filing date; and 
 22.6   be signed by the secured party.  In other cases whenever there 
 22.7   is no outstanding secured obligation and no commitment to make 
 22.8   advances, incur obligations, or otherwise give value, the 
 22.9   secured party must on written demand by the debtor send the 
 22.10  debtor, for each filing officer with whom the financing 
 22.11  statement was filed, a termination statement to the effect that 
 22.12  the secured party no longer claims a security interest under the 
 22.13  financing statement, which shall be identified by file number.  
 22.14  A termination statement signed by a person other than the 
 22.15  secured party of record must be accompanied by a separate 
 22.16  written statement of assignment signed by the secured party of 
 22.17  record and complying with subsection (2) of section 336.9-405, 
 22.18  including payment of the required fee.  If the affected secured 
 22.19  party fails to file such a termination statement as required by 
 22.20  this subsection, or to send such a termination statement within 
 22.21  ten days after proper demand therefor the secured party shall be 
 22.22  liable to the debtor for $100, and in addition for any loss 
 22.23  caused to the debtor by such failure. 
 22.24     (2) On being presented with such a termination statement 
 22.25  the filing officer must note it in the index.  If a duplicate 
 22.26  termination statement is provided, the filing officer shall 
 22.27  return one copy of the termination statement to the secured 
 22.28  party stamped to show the time of receipt thereof.  If the 
 22.29  filing officer has a microfilm or other photographic record of 
 22.30  the financing statement in a format that meets archival 
 22.31  standards, and of any related continuation statement, statement 
 22.32  of assignment and statement of release, the filing officer may 
 22.33  remove the originals from the files at any time after receipt of 
 22.34  the termination statement, or having no such record, the filing 
 22.35  officer may remove them from the files at any time after one 
 22.36  year after receipt of the termination statement. 
 23.1      (3) There shall be no fee collected for the filing of a 
 23.2   termination if the termination statement is in the standard form 
 23.3   prescribed by the secretary of state.  The fee for filing a 
 23.4   termination statement on a form that is not the standard form 
 23.5   prescribed by the secretary of state is $5.  If the original 
 23.6   financing statement was subject to subsection (5) of section 
 23.7   336.9-402, the fee prescribed by section 357.18, subdivision 1, 
 23.8   clause (1), is also required. 
 23.9      Sec. 19.  Minnesota Statutes 1996, section 336A.04, 
 23.10  subdivision 4, is amended to read: 
 23.11     Subd. 4.  [FILING PROCEDURE.] (a) The filing officer shall 
 23.12  mark the effective financing statement or lien notice with a 
 23.13  consecutive file number and the date and hour of filing.  
 23.14     (b) The filing office shall maintain the original filed 
 23.15  document or a microfilm or other photographic copy of the filed 
 23.16  document in a format that meets archival standards for public 
 23.17  inspection as provided in rule by the secretary of state.  
 23.18     (c) The filing office shall index filed documents according 
 23.19  to the file number of the document.  
 23.20     Sec. 20.  Minnesota Statutes 1996, section 514.08, 
 23.21  subdivision 2, is amended to read: 
 23.22     Subd. 2.  [STATEMENT BY LIEN CLAIMANT; REQUIREMENTS.] Such 
 23.23  statement shall be made by or at the instance of the lien 
 23.24  claimant, be verified by the oath of some person shown by such 
 23.25  verification to have knowledge of the facts stated, and shall 
 23.26  set forth: 
 23.27     (1) a notice of intention to claim and hold a lien, and the 
 23.28  amount thereof; 
 23.29     (2) that such amount is due and owing to the claimant for 
 23.30  labor performed, or for skill, material, or machinery furnished, 
 23.31  and for what improvement the same was done or supplied; 
 23.32     (3) the names of the claimant, and of the person for or to 
 23.33  whom performed or furnished; 
 23.34     (4) the dates when the first and last items of the 
 23.35  claimant's contribution to the improvement were made; 
 23.36     (5) a description of the premises to be charged, 
 24.1   identifying the same with reasonable certainty; 
 24.2      (6) the name of the owner thereof at the time of making 
 24.3   such statement, according to the best information then had; 
 24.4      (7) the post office address of the claimant.  (The failure 
 24.5   to insert such post office address shall not invalidate the lien 
 24.6   statement); 
 24.7      (8) that claimant acknowledges that a copy of the statement 
 24.8   must be served personally or by certified mail within the 
 24.9   120-day period provided in this section on the owner, the 
 24.10  owner's authorized agent or the person who entered into the 
 24.11  contract with the contractor as provided herein; and 
 24.12     (9) that notice as required by section 514.011, subdivision 
 24.13  2, if any, was given. 
 24.14     When the claimant files the notice, the social security 
 24.15  number of an individual owner or the Internal Revenue Service 
 24.16  taxpayer identification number for an owner other than an 
 24.17  individual is not required. 
 24.18     Sec. 21.  [RULES REPEALER.] 
 24.19     Minnesota Rules, part 3650.0030, subpart 8, is repealed. 
 24.20     Sec. 22.  [EFFECTIVE DATE; APPLICABILITY.] 
 24.21     Section 15 applies to security agreements signed on or 
 24.22  after August 1, 1997.  Section 16 applies to original financing 
 24.23  statements filed on or after August 1, 1997.