Office of the Revisor of Statutes
Minnesota Session Laws - 2002, Regular Session
Key: (1) language to be deleted (2) new language
CHAPTER 311-S.F.No. 2542
An act relating to business organizations; regulating
business corporations, nonprofit corporations, and
limited liability companies; providing legal
recognition of electronic records and signatures;
regulating meetings by means of remote communications
and dissolutions and terminations; regulating use of
names by successor corporations; regulating investment
company authority to issue shares; defining terms;
making technical and conforming changes; providing for
mergers and acquisitions by business corporations;
amending Minnesota Statutes 2000, sections 302A.011,
subdivisions 17, 21, 31, 38, 50, by adding
subdivisions; 302A.115, subdivision 5; 302A.135, by
adding a subdivision; 302A.231; 302A.239, subdivisions
1, 2; 302A.431, subdivision 3; 302A.433, subdivision
3; 302A.436; 302A.441; 302A.449, subdivision 1;
302A.471, subdivision 1; 302A.621, subdivisions 1, 2,
3, 4; 302A.673, subdivision 1; 302A.734; 303.11;
317A.011, by adding subdivisions; 317A.231; 317A.239,
subdivisions 1, 2; 317A.431, subdivision 3; 317A.433,
subdivision 3; 317A.445; 317A.453, subdivision 1;
317A.733, subdivisions 3, 4; 322A.03; 322B.03,
subdivisions 36a, 45a, by adding subdivisions;
322B.12, subdivision 4; 322B.333, subdivision 3;
322B.336, subdivision 3; 322B.343; 322B.35,
subdivisions 1, 2; 322B.363, subdivision 1; 322B.643;
322B.656, subdivisions 1, 2; 322B.826; 323A.11-02;
333.055, subdivision 4; proposing coding for new law
in Minnesota Statutes, chapters 302A; 317A; 322B;
repealing Minnesota Statutes 2000, section 317A.449.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
ARTICLE 1
BUSINESS CORPORATIONS
Section 1. Minnesota Statutes 2000, section 302A.011,
subdivision 17, is amended to read:
Subd. 17. [NOTICE.] "Notice" is given by a shareholder of
a corporation to the corporation or an officer of the
corporation when in writing and mailed or delivered to the
corporation or the officer at the registered office or principal
executive office of the corporation. In all other cases,
"notice" is given to a person when mailed to the person at an
address designated by the person or at the last known address of
the person, or when communicated to the person orally, or when
handed to the person, or when left at the office of the person
with a clerk or other person in charge of the office, or if
there is no one in charge, when left in a conspicuous place in
the office, or if the office is closed or the person to be
notified has no office, when left at the dwelling house or usual
place of abode of the person with some person of suitable age
and discretion then residing therein. Notice is also given by a
publicly held corporation to a shareholder if the notice is
addressed to the shareholder or group of shareholders in a
manner permitted by the rules and regulations under the
Securities Exchange Act of 1934, provided that the corporation
has first received any affirmative written consent or implied
consent required under those rules and regulations. Notice by
mail is given when deposited in the United States mail with
sufficient postage affixed. Notice is deemed received when it
is given.
Sec. 2. Minnesota Statutes 2000, section 302A.011,
subdivision 21, is amended to read:
Subd. 21. [PARENT.] "Parent" of a specified corporation
means a corporation that directly, or indirectly through related
corporations organizations, owns more than 50 percent of the
voting power of the shares entitled to vote for directors of the
specified corporation.
Sec. 3. Minnesota Statutes 2000, section 302A.011,
subdivision 31, is amended to read:
Subd. 31. [SUBSIDIARY.] "Subsidiary" of a specified
corporation means a corporation having more than 50 percent of
the voting power of its shares entitled to vote for directors
owned directly, or indirectly through related
corporations organizations, by the specified corporation.
Sec. 4. Minnesota Statutes 2000, section 302A.011,
subdivision 38, is amended to read:
Subd. 38. [CONTROL SHARE ACQUISITION.] "Control share
acquisition" means an acquisition, directly or indirectly, by an
acquiring person of beneficial ownership of shares of an issuing
public corporation that, except for section 302A.671, would,
when added to all other shares of the issuing public corporation
beneficially owned by the acquiring person, entitle the
acquiring person, immediately after the acquisition, to exercise
or direct the exercise of a new range of voting power within any
of the ranges specified in section 302A.671, subdivision 2,
paragraph (d), but does not include any of the following:
(a) an acquisition before, or pursuant to an agreement
entered into before, August 1, 1984;
(b) an acquisition by a donee pursuant to an inter vivos
gift not made to avoid section 302A.671 or by a distributee as
defined in section 524.1-201, clause (10);
(c) an acquisition pursuant to a security agreement not
created to avoid section 302A.671;
(d) an acquisition under sections 302A.601 to 302A.661, if
the issuing public corporation is a party to the transaction;
(e) an acquisition from the issuing public corporation;
(f) an acquisition for the benefit of others by a person
acting in good faith and not made to avoid section 302A.671, to
the extent that the person may not exercise or direct the
exercise of the voting power or disposition of the shares except
upon the instruction of others;
(g) an acquisition pursuant to a savings, employee stock
ownership, or other employee benefit plan of the issuing public
corporation or any of its subsidiaries, or by a fiduciary of the
plan acting in a fiduciary capacity pursuant to the plan; or
(h) an acquisition subsequent to January 1, 1991, pursuant
to an offer to purchase for cash pursuant to a tender offer, or
to exchange for stock pursuant to an exchange offer, all shares
of the voting stock of the issuing public corporation:
(i) which (1) that has been approved by a majority vote of
the members of a committee comprised composed solely of the one
or more disinterested members of the board of the issuing public
corporation formed pursuant to section 302A.673, subdivision 1,
paragraph (d), before the commencement of, or the public
announcement of the intent to commence, the tender or exchange
offer; and
(ii) (2) pursuant to which the acquiring person will become
the owner of over 50 percent of the voting stock of the issuing
public corporation outstanding at the time of the transaction.
For purposes of this subdivision, shares beneficially owned
by a plan described in clause (g), or by a fiduciary of a plan
described in clause (g) pursuant to the plan, are not deemed to
be beneficially owned by a person who is a fiduciary of the plan.
Sec. 5. Minnesota Statutes 2000, section 302A.011,
subdivision 50, is amended to read:
Subd. 50. [MARKET VALUE.] "Market value," when used in
reference to shares or other property of any corporation, means
the following:
(1) (a) In the case of shares, the average closing sale
price of a share on the composite tape for New York Stock
Exchange listed shares during the 30 trading days immediately
preceding the date in question or, with respect to the
references in section 302A.553, subdivision 3, if a person or
persons selling the shares have commenced a tender offer or have
announced an intention to seek control of the corporation,
during the 30 trading days preceding the earlier of the
commencement of the tender offer or the making of the
announcement, in either case:
(1) on the composite tape for New York Stock Exchange
listed shares; or,
(2) if the shares are not quoted on the composite tape or
not listed on the New York Stock Exchange, on the principal
United States securities exchange registered under the
Securities Exchange Act of 1934 on which the shares are listed,;
or,
(3) if the shares are not listed on any such exchange, on
the NASDAQ National Nasdaq Stock Market,; or,
(4) if the shares are not quoted on the NASDAQ
National Nasdaq Stock Market, on the NASDAQ Small Cap Market, or
any system then in use, or, with respect to the reference in
section 302A.553, subdivision 3, if the person or persons
selling the shares shall have commenced a tender offer or have
announced an intention to seek control of the corporation,
during the 30 trading days preceding the earlier of the
commencement of the tender offer or the making of the
announcement, provided that.
If no quotation under clauses (1) through (4) is available,
then the market value is the fair market value on the date in
question of the shares as determined in good faith by the board
of the corporation;.
(2) (b) In the case of property other than cash or shares,
the fair market value of the property on the date in question as
determined in good faith by the board of the corporation.
Sec. 6. Minnesota Statutes 2000, section 302A.011, is
amended by adding a subdivision to read:
Subd. 60. [ELECTRONIC COMMUNICATION.] "Electronic
communication" means any form of communication, not directly
involving the physical transmission of paper, that creates a
record that may be retained, retrieved, and reviewed by a
recipient of the communication, and that may be directly
reproduced in paper form by the recipient through an automated
process.
Sec. 7. Minnesota Statutes 2000, section 302A.011, is
amended by adding a subdivision to read:
Subd. 61. [REMOTE COMMUNICATION.] "Remote communication"
means communication via electronic communication, conference
telephone, video conference, the Internet, or such other means
by which persons not physically present in the same location may
communicate with each other on a substantially simultaneous
basis.
Sec. 8. Minnesota Statutes 2000, section 302A.011, is
amended by adding a subdivision to read:
Subd. 62. [AUTHENTICATED.] "Authenticated" means, with
respect to an electronic communication, that the communication
is delivered to the principal place of business of the
corporation, or to an officer or agent of the corporation
authorized by the corporation to receive the communication, and
that the communication sets forth information from which the
corporation can reasonably conclude that the communication was
sent by the purported sender.
Sec. 9. [302A.015] [LEGAL RECOGNITION OF ELECTRONIC
RECORDS AND SIGNATURES.]
Subdivision 1. [DEFINITIONS.] (a) For purposes of this
section, the words, terms, and phrases defined in this
subdivision have the meanings given them.
(b) "Electronic" means relating to technology having
electrical, digital, magnetic, wireless, optical,
electromagnetic, or similar capabilities.
(c) "Electronic record" means a record created, generated,
sent, communicated, received, or stored by electronic means.
(d) "Electronic signature" means an electronic sound,
symbol, or process attached to or logically associated with a
record and executed or adopted by a person with the intent to
sign the record.
(e) "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.
Subd. 2. [ELECTRONIC RECORDS AND SIGNATURES.] For purposes
of this chapter:
(1) a record or signature may not be denied legal effect or
enforceability solely because it is in electronic form;
(2) a contract may not be denied legal effect or
enforceability solely because an electronic record was used in
its formation;
(3) if a provision requires a record to be in writing, an
electronic record satisfies the requirement; and
(4) if a provision requires a signature, an electronic
signature satisfies the requirement.
Sec. 10. Minnesota Statutes 2000, section 302A.115,
subdivision 5, is amended to read:
Subd. 5. [USE OF NAME BY SUCCESSOR CORPORATION.] A
corporation that is merged the surviving organization in a
merger with another domestic or foreign corporation one or more
other organizations, or that is incorporated by the
reorganization of one or more domestic or foreign corporations
organizations, or that acquires by sale, lease, or other
disposition to or exchange with a domestic corporation an
organization all or substantially all of the assets of
another domestic or foreign corporation organization, including
its name, may have the same name as that used in this state by
any of the other corporations organizations, if the
other corporation organization whose name is sought to be used
was incorporated organized under the laws of, or is authorized
to transact business in, this state.
Sec. 11. Minnesota Statutes 2000, section 302A.135, is
amended by adding a subdivision to read:
Subd. 6. [INVESTMENT COMPANIES.] Notwithstanding any
contrary provision of this chapter, the board of directors of a
corporation that is registered as an open-end management
investment company under the Investment Company Act of 1940 may,
without shareholder approval, increase or decrease, but not
below the then-outstanding shares, the aggregate number of
shares the corporation has authority to issue, including shares
of any class or series, unless a provision has been included in
the corporation's articles prohibiting the board from increasing
or decreasing the aggregate number of shares, or any class or
series of shares, as applicable, that the corporation has
authority to issue.
Sec. 12. Minnesota Statutes 2000, section 302A.231, is
amended to read:
302A.231 [BOARD MEETINGS.]
Subdivision 1. [TIME; PLACE.] Meetings of the board may be
held from time to time as provided in the articles or bylaws at
any place within or without the state that the board may select
or by any means described in subdivision 2. If the board fails
to select a place for a meeting, the meeting shall be held at
the principal executive office, unless the articles or bylaws
provide otherwise. The board of directors may determine under
subdivision 2 that a meeting of the board of directors shall be
held solely by means of remote communication.
Subd. 2. [ELECTRONIC COMMUNICATIONS MEETINGS SOLELY BY
MEANS OF REMOTE COMMUNICATION.] (a) A conference Any meeting
among directors by any means of may be conducted solely by one
or more means of remote communication through which all of the
directors may simultaneously hear participate with each other
during the conference constitutes a board meeting, if the same
notice is given of the conference as would be meeting required
by subdivision 3 for a meeting 4, and if the number of directors
participating in the conference would be meeting is sufficient
to constitute a quorum at a meeting. Participation in a meeting
by that means constitutes presence in person at the meeting.
(b) Subd. 3. [PARTICIPATION IN MEETINGS BY MEANS OF REMOTE
COMMUNICATION.] A director may participate in a board
meeting not described in paragraph (a) by any means of
conference telephone or, if authorized by the board, by such
other means of remote communication, in each case through which
the director, other directors so participating, and all
directors physically present at the meeting may simultaneously
hear participate with each other during the meeting.
Participation in a meeting by that means constitutes presence in
person at the meeting.
Subd. 3. 4. [CALLING MEETINGS; NOTICE.] Unless the
articles or bylaws provide for a different time period, a
director may call a board meeting by giving at least ten days'
notice or, in the case of organizational meetings pursuant to
section 302A.171, subdivision 2, at least three days' notice, to
all directors of the date, time, and place of the meeting. The
notice need not state the purpose of the meeting unless the
articles or bylaws require it.
Subd. 4. 5. [PREVIOUSLY SCHEDULED MEETINGS.] If the day or
date, time, and place of a board meeting have been provided in
the articles or bylaws, or announced at a previous meeting of
the board, no notice is required. Notice of an adjourned
meeting need not be given other than by announcement at the
meeting at which adjournment is taken.
Subd. 5. 6. [WAIVER OF NOTICE.] A director may waive
notice of a meeting of the board. A waiver of notice by a
director entitled to notice is effective whether given before,
at, or after the meeting, and whether given in writing, orally,
or by attendance. Attendance by a director at a meeting is a
waiver of notice of that meeting, except where the director
objects at the beginning of the meeting to the transaction of
business because the meeting is not lawfully called or convened
and does not participate thereafter in the meeting.
Sec. 13. Minnesota Statutes 2000, section 302A.239,
subdivision 1, is amended to read:
Subdivision 1. [METHOD.] An action required or permitted
to be taken at a board meeting may be taken by written action
signed, or consented to by authenticated electronic
communication, by all of the directors. If the articles so
provide, any action, other than an action requiring shareholder
approval, may be taken by written action signed, or consented to
by authenticated electronic communication, by the number of
directors that would be required to take the same action at a
meeting of the board at which all directors were present.
Sec. 14. Minnesota Statutes 2000, section 302A.239,
subdivision 2, is amended to read:
Subd. 2. [EFFECTIVE TIME.] The written action is effective
when signed, or consented to by authenticated electronic
communication, by the required number of directors, unless a
different effective time is provided in the written action.
Sec. 15. Minnesota Statutes 2000, section 302A.431,
subdivision 3, is amended to read:
Subd. 3. [TIME; PLACE.] A regular meeting, if any, shall
be held on the day or date and at the time and place fixed by,
or in a manner authorized by, the articles or bylaws, except
that a meeting called by or at the demand of a shareholder
pursuant to subdivision 2 shall be held in the county where the
principal executive office of the corporation is located. To
the extent authorized in the articles or bylaws, the board of
directors may determine that a regular meeting of the
shareholders shall be held solely by means of remote
communication in accordance with section 302A.436, subdivision 2.
Sec. 16. Minnesota Statutes 2000, section 302A.433,
subdivision 3, is amended to read:
Subd. 3. [TIME; PLACE.] Special meetings shall be held on
the date and at the time and place fixed by the chief executive
officer, the chief financial officer, the board, or a person
authorized by the articles or bylaws to call a meeting, except
that a special meeting called by or at the demand of a
shareholder or shareholders pursuant to subdivision 2 shall be
held in the county where the principal executive office is
located. To the extent authorized in the articles or bylaws,
the board of directors may determine that a special meeting of
the shareholders shall be held solely by means of remote
communication in accordance with section 302A.436, subdivision 2.
Sec. 17. Minnesota Statutes 2000, section 302A.436, is
amended to read:
302A.436 [ELECTRONIC REMOTE COMMUNICATIONS FOR SHAREHOLDER
MEETINGS.]
Subdivision 1. [ELECTRONIC CONFERENCES CONSTRUCTION AND
APPLICATION.] If and This section shall be construed and applied
to:
(1) facilitate remote communication consistent with other
applicable law; and
(2) be consistent with reasonable practices concerning
remote communication and with the continued expansion of those
practices.
Subd. 2. [SHAREHOLDER MEETINGS HELD SOLELY BY MEANS OF
REMOTE COMMUNICATION.] To the extent authorized in the articles
or bylaws or and determined by the board of a closely held
corporation, a conference among regular or special meeting of
shareholders may be held solely by any combination of means of
remote communication through which the shareholders may
simultaneously hear each other during participate in the
conference constitutes a regular or special meeting of
shareholders, if the same notice of the meeting is given of the
conference to every holder of shares entitled to vote as would
be required by this chapter for a meeting, and if the number of
shares held by the shareholders participating in the conference
meeting would be sufficient to constitute a quorum at a
meeting. Participation in a conference by a shareholder by that
means constitutes presence at the meeting in person or by proxy
if all the other requirements of section 302A.449 are met.
Subd. 2 3. [PARTICIPATION IN SHAREHOLDER MEETINGS BY
ELECTRONIC MEANS OF REMOTE COMMUNICATION.] If and To the extent
authorized in the articles or bylaws or and determined by the
board of a closely held corporation, a shareholder may
participate in not physically present in person or by proxy at a
regular or special meeting of shareholders not described in
subdivision 1 by any means of communication through which the
shareholder, other shareholders so participating, and all
shareholders physically present at the meeting may
simultaneously hear each other during the meeting may, by means
of remote communication, participate in a meeting of
shareholders held at a designated place. Participation in a
meeting by a shareholder by that means constitutes presence at
the meeting in person or by proxy if all the other requirements
of section 302A.449 are met.
Subd. 3 4. [REQUIREMENTS FOR MEETINGS HELD SOLELY BY MEANS
OF REMOTE COMMUNICATION AND FOR PARTICIPATION IN MEETINGS BY
ELECTRONIC MEANS OF REMOTE COMMUNICATION.] In any meeting of
shareholders held solely by means of remote communication under
subdivision 2 or in any meeting of shareholders held at a
designated place in which one or more shareholders participate
by means of remote communication under subdivision 3:
(1) the corporation shall implement reasonable measures to
verify that each person deemed present and entitled to vote at
the meeting by means of remote communication is a shareholder;
and
(2) the corporation shall implement reasonable measures to
provide each shareholder participating by means of remote
communication with a reasonable opportunity to participate in
the meeting, including an opportunity to:
(i) read or hear the proceedings of the meeting
substantially concurrently with those proceedings;
(ii) if allowed by the procedures governing the meeting,
have the shareholder's remarks heard or read by other
participants in the meeting substantially concurrently with the
making of those remarks; and
(iii) if otherwise entitled, vote on matters submitted to
the shareholders.
Subd. 5. [NOTICE TO SHAREHOLDERS.] (a) Any notice to
shareholders given by the corporation under any provision of
this chapter, the articles, or the bylaws by a form of
electronic communication consented to by the shareholder to whom
the notice is given is effective when given. The notice is
deemed given:
(1) if by facsimile communication, when directed to a
telephone number at which the shareholder has consented to
receive notice;
(2) if by electronic mail, when directed to an electronic
mail address at which the shareholder has consented to receive
notice;
(3) if by a posting on an electronic network on which the
shareholder has consented to receive notice, together with
separate notice to the shareholder of the specific posting, upon
the later of:
(i) the posting; and
(ii) the giving of the separate notice; and
(4) if by any other form of electronic communication by
which the shareholder has consented to receive notice, when
directed to the shareholder.
An affidavit of the secretary, other authorized officer, or
authorized agent of the corporation, that the notice has been
given by a form of electronic communication is, in the absence
of fraud, prima facie evidence of the facts stated in the
affidavit.
(b) Consent by a shareholder to notice given by electronic
communication may be given in writing or by authenticated
electronic communication. The corporation is entitled to rely
on any consent so given until revoked by the shareholder,
provided that no revocation affects the validity of any notice
given before receipt by the corporation of revocation of the
consent.
Subd. 6. [REVOCATION.] Any ballot, vote, authorization, or
consent submitted by electronic communication under this chapter
may be revoked by the shareholder submitting the ballot, vote,
authorization, or consent so long as the revocation is received
by an officer of the corporation at or before the meeting or
before an action without a meeting is effective according to
section 302A.441.
Subd. 7. [WAIVER.] Waiver of notice by a shareholder of a
meeting by means of authenticated electronic communication
described in subdivisions 1 and 2 may be given in the manner
provided in section 302A.435, subdivision 4. Participation in a
meeting by means of remote communication described in
subdivisions 1 and 2 and 3 is a waiver of notice of that
meeting, except where the shareholder objects at the beginning
of the meeting to the transaction of business because the
meeting is not lawfully called or convened, or objects before a
vote on an item of business because the item may not lawfully be
considered at the meeting and does not participate in the
consideration of the item at that meeting.
Sec. 18. Minnesota Statutes 2000, section 302A.441, is
amended to read:
302A.441 [ACTION WITHOUT A MEETING.]
An action required or permitted to be taken at a meeting of
the shareholders may be taken without a meeting by written
action signed, or consented to by authenticated electronic
communication, by all of the shareholders entitled to vote on
that action. The written action is effective when it has been
signed, or consented to by authenticated electronic
communication, by all of those shareholders, unless a different
effective time is provided in the written action.
Sec. 19. Minnesota Statutes 2000, section 302A.449,
subdivision 1, is amended to read:
Subdivision 1. [AUTHORIZATION.] (a) A shareholder may cast
or authorize the casting of a vote by (1) filing a written
appointment of a proxy, signed by the shareholder, with an
officer of the corporation at or before the meeting at which the
appointment is to be effective, or (2) telephonic transmission
or authenticated electronic communication, whether or not
accompanied by written instructions of the shareholder, of an
appointment of a proxy with the corporation or the corporation's
duly authorized agent at or before the meeting at which the
appointment is to be effective. In addition, a shareholder of a
publicly held corporation may cast or authorize the casting of a
vote by a proxy by transmitting to the corporation or the
corporation's duly authorized agent before the meeting, an
appointment of a proxy by means of a telegram, cablegram, or any
other form of electronic transmission, including telephonic
transmission, whether or not accompanied by written instructions
of the shareholder. The telephonic transmission or
authenticated electronic transmission communication must set
forth or be submitted with information from which it can be
determined that the appointment was authorized by the
shareholder. If it is determined reasonably concluded that a
telegram, cablegram, or other electronic the telephonic
transmission or authenticated electronic communication is valid,
the inspectors of election or, if there are no inspectors, the
other persons making that determination shall specify the
information upon which they relied to make that
determination. A proxy so appointed may vote on behalf of the
shareholder, or otherwise participate, in a meeting by remote
communication according to section 302A.436 to the extent the
shareholder appointing the proxy would have been entitled to
participate by remote communication according to section
302A.436 if the shareholder did not appoint the proxy.
(b) A copy, facsimile telecommunication, or other
reproduction of the original writing or transmission may be
substituted or used in lieu of the original writing or
transmission for any purpose for which the original writing or
transmission could be used, provided that the copy, facsimile
telecommunication, or other reproduction is a complete and
legible reproduction of the entire original writing or
transmission.
(c) An appointment of a proxy for shares held jointly by
two or more shareholders is valid if signed or otherwise
authorized consented to by authenticated electronic
communication by any one of them, unless the corporation
receives from any one of those shareholders written notice or
authenticated electronic communication either denying the
authority of that person to appoint a proxy or appointing a
different proxy.
Sec. 20. Minnesota Statutes 2000, section 302A.471,
subdivision 1, is amended to read:
Subdivision 1. [ACTIONS CREATING RIGHTS.] A shareholder of
a corporation may dissent from, and obtain payment for the fair
value of the shareholder's shares in the event of, any of the
following corporate actions:
(a) an amendment of the articles that materially and
adversely affects the rights or preferences of the shares of the
dissenting shareholder in that it:
(1) alters or abolishes a preferential right of the shares;
(2) creates, alters, or abolishes a right in respect of the
redemption of the shares, including a provision respecting a
sinking fund for the redemption or repurchase of the shares;
(3) alters or abolishes a preemptive right of the holder of
the shares to acquire shares, securities other than shares, or
rights to purchase shares or securities other than shares;
(4) excludes or limits the right of a shareholder to vote
on a matter, or to cumulate votes, except as the right may be
excluded or limited through the authorization or issuance of
securities of an existing or new class or series with similar or
different voting rights; except that an amendment to the
articles of an issuing public corporation that provides that
section 302A.671 does not apply to a control share acquisition
does not give rise to the right to obtain payment under this
section;
(b) a sale, lease, transfer, or other disposition of all or
substantially all of the property and assets of the corporation,
but not including a transaction permitted without shareholder
approval in section 302A.661, subdivision 1, or a disposition in
dissolution described in section 302A.725, subdivision 2, or a
disposition pursuant to an order of a court, or a disposition
for cash on terms requiring that all or substantially all of the
net proceeds of disposition be distributed to the shareholders
in accordance with their respective interests within one year
after the date of disposition;
(c) a plan of merger, whether under this chapter or under
chapter 322B, to which the corporation is a constituent
organization, except as provided in subdivision 3, and except
for a plan of merger adopted under section 302A.626;
(d) a plan of exchange, whether under this chapter or under
chapter 322B, to which the corporation is a party as the
corporation whose shares will be acquired by the acquiring
corporation, except as provided in subdivision 3; or
(e) any other corporate action taken pursuant to a
shareholder vote with respect to which the articles, the bylaws,
or a resolution approved by the board directs that dissenting
shareholders may obtain payment for their shares.
Sec. 21. Minnesota Statutes 2000, section 302A.621,
subdivision 1, is amended to read:
Subdivision 1. [WHEN AUTHORIZED; CONTENTS OF PLAN.] A
parent owning at least 90 percent of the outstanding shares of
each class and series of a subsidiary directly, or indirectly
through related corporations organizations, other than classes
or series that, absent this section, would otherwise not be
entitled to vote on the merger, may merge the subsidiary into
itself or into any other subsidiary at least 90 percent of the
outstanding shares of each class and series of which is owned by
the parent directly, or indirectly through related corporations
organizations, other than classes or series that, absent this
section, would otherwise not be entitled to vote on the merger,
without a vote of the shareholders of itself or any subsidiary
or may merge itself, or itself and one or more of the
subsidiaries, into one of the subsidiaries under this section.
A resolution approved by the affirmative vote of a majority of
the directors of the parent present shall set forth a plan of
merger that contains:
(a) (1) the name of the subsidiary or subsidiaries, the
name of the parent and the name of the surviving corporation;
(b) (2) the manner and basis of converting the shares of
the subsidiary or subsidiaries or parent into securities of the
parent, subsidiary, or of another corporation or, in whole or in
part, into money or other property;
(c) (3) if the parent is a constituent corporation but is
not the surviving corporation in the merger, a provision for the
pro rata issuance of shares of the surviving corporation to the
holders of shares of the parent on surrender of any certificates
for shares of the parent; and
(d) (4) if the surviving corporation is a subsidiary, a
statement of any amendments to the articles of the surviving
corporation that will be part of the merger.
If the parent is a constituent corporation and the
surviving corporation in the merger, it may change its corporate
name, without a vote of its shareholders, by the inclusion of a
provision to that effect in the resolution of merger setting
forth the plan of merger that is approved by the affirmative
vote of a majority of the directors of the parent present. Upon
the effective date of the merger, the name of the parent shall
be changed.
If the parent is a constituent corporation but is not the
surviving corporation in the merger, the resolution is not
effective unless it is also approved by the affirmative vote of
the holders of a majority of the voting power of all shares of
the parent entitled to vote at a regular or special meeting held
in accordance with section 302A.613 if the parent is a domestic
corporation or in accordance with the laws under which it is
incorporated if the parent is a foreign corporation.
Sec. 22. Minnesota Statutes 2000, section 302A.621,
subdivision 2, is amended to read:
Subd. 2. [NOTICE TO SHAREHOLDERS OF SUBSIDIARY.] Notice of
the action, including a copy of the plan of merger, shall be
mailed given to each shareholder, other than the parent and any
subsidiary, of each subsidiary that is a constituent corporation
in the merger before, or within ten days after, the effective
date of the merger.
Sec. 23. Minnesota Statutes 2000, section 302A.621,
subdivision 3, is amended to read:
Subd. 3. [ARTICLES OF MERGER; CONTENTS OF ARTICLES.]
Articles of merger shall be prepared that contain:
(a) (1) the plan of merger;
(b) (2) the number of outstanding shares of each class and
series of each subsidiary that is a constituent corporation in
the merger, other than the classes or series that, absent this
section, would otherwise not be entitled to vote on the merger,
and the number of shares of each class and series of the
subsidiary or subsidiaries, other than classes or series that,
absent this section, would otherwise not be entitled to vote on
the merger, owned by the parent directly, or indirectly through
related corporations organizations; and
(c) The date a copy of the plan of merger was mailed to
shareholders, other than the parent or a subsidiary, of each
subsidiary that is a constituent corporation in the merger; and
(d) (3) a statement that the plan of merger has been
approved by the parent under this section.
Sec. 24. Minnesota Statutes 2000, section 302A.621,
subdivision 4, is amended to read:
Subd. 4. [ARTICLES SIGNED, FILED.] Within 30 days after a
copy of the plan of merger is mailed to shareholders of each
subsidiary that is a constituent corporation to the merger, or
upon waiver of the mailing by the holders of all outstanding
shares of each subsidiary that is a constituent corporation to
the merger, The articles of merger shall be signed on behalf of
the parent and filed with the secretary of state.
Sec. 25. [302A.626] [MERGER TO EFFECT A HOLDING COMPANY
REORGANIZATION.]
Subdivision 1. [DEFINITIONS.] (a) For purposes of this
section, the terms defined in this subdivision have the meanings
given them.
(b) "Holding company" means the corporation that is or
becomes the direct parent of the surviving corporation of a
merger accomplished under this section.
(c) "Parent constituent corporation" means the parent that
merges with or into the subsidiary constituent corporation.
(d) "Subsidiary constituent corporation" means the
subsidiary that the parent constituent corporation merges with
or into in the merger.
Subd. 2. [AUTHORIZATION.] Unless its articles expressly
provide otherwise, and subject to subdivision 3, a parent
constituent corporation may merge with or into a subsidiary
constituent corporation without a vote of the shareholders of
the parent constituent corporation.
Subd. 3. [REQUIREMENTS.] A merger may be accomplished
under this section only if each of the following requirements is
met:
(1) the holding company and the constituent corporations to
the merger are each organized under this chapter;
(2) at all times following the issuance of shares until the
consummation of a merger under this section, the holding company
was a direct wholly owned subsidiary of the parent constituent
corporation;
(3) immediately before the consummation of a merger under
this section, the subsidiary constituent corporation is an
indirect wholly owned subsidiary of the parent constituent
corporation and a direct wholly owned subsidiary of the holding
company;
(4) the parent constituent corporation and the subsidiary
constituent corporation are the only constituent corporations to
the merger;
(5) immediately after the merger becomes effective, the
surviving corporation becomes or remains a direct wholly owned
subsidiary of the holding company;
(6) each share or fraction of a share of the parent
constituent corporation outstanding immediately before the
effective time of the merger is converted in the merger into a
share or equal fraction of a share of the holding company having
the same designation and relative rights and preferences, and
the same restrictions thereon, as the share or fraction of a
share of the parent constituent corporation being converted in
the merger;
(7) the articles and bylaws of the holding company
immediately following the effective time of the merger contain
provisions identical to the articles and bylaws of the parent
constituent corporation immediately before the effective time of
the merger, other than provisions, if any, regarding the
incorporator or incorporators, the corporate name, the
registered office and agent, the initial board of directors, and
the initial subscribers for shares and the provisions contained
in any amendment to the articles of the parent constituent
corporation that were necessary to effect an exchange,
reclassification, or cancellation of shares, if the exchange,
reclassification, or cancellation has become effective;
(8) the articles and bylaws of the surviving corporation
immediately following the effective time of the merger are
identical to the articles and bylaws of the parent constituent
corporation immediately before the effective time of the merger,
other than provisions, if any, regarding the incorporator or
incorporators, the corporate name, the registered office and
agent, the initial board of directors, and the initial
subscribers for shares and the provisions contained in any
amendment to the articles of the parent constituent corporation
that were necessary to effect an exchange, reclassification, or
cancellation of shares, if the exchange, reclassification, or
cancellation has become effective, except that:
(i) the articles of the surviving corporation shall be
amended in the merger to contain a provision requiring that any
act or transaction by or involving the surviving corporation,
other than the election or removal of directors of the surviving
corporation, that requires for its adoption under this chapter
or its articles the approval of the shareholders of the
surviving corporation shall, by specific reference to this
section, require, in addition, the approval of the shareholders
of the holding company, or any successor by merger, by the same
vote as is required by this chapter and/or by the articles of
the surviving corporation; and
(ii) the articles of the surviving corporation may be
amended in the merger to reduce the number of classes, series,
and shares that the surviving corporation is authorized to
issue;
(9) the directors of the parent constituent corporation
become or remain the directors of the holding company
immediately after the merger becomes effective;
(10) the board of directors of the parent constituent
corporation determines that the shareholders of the parent
constituent corporation will not recognize gain or loss for
United States federal income tax purposes; and
(11) a resolution approved by the affirmative vote of a
majority of the directors of the parent constituent corporation
present sets forth a plan of merger that contains provisions
addressing the requirements of clauses (1) to (10).
Subd. 4. [REMOVAL OF DIRECTORS OF SURVIVING
CORPORATION.] Neither subdivision 3, clause (8), item (i), nor
any provisions of the surviving corporation's articles required
by that item may be construed to require approval of the
shareholders of the holding company to elect or remove directors
of the surviving corporation.
Subd. 5. [INTERACTION WITH CERTAIN OTHER SECTIONS.] To the
extent restrictions under section 302A.671 or 302A.673 applied
to the parent constituent corporation or any of its shareholders
at the effective time of the merger, those restrictions apply to
the holding company and its shareholders immediately after the
merger becomes effective as though the holding company were the
parent constituent corporation. No shareholder who, immediately
before the merger becomes effective, was not an acquiring person
or an interested shareholder of the parent constituent
corporation shall, solely by reason of the merger, become an
acquiring person or interested shareholder of the holding
company.
Subd. 6. [SHARE CERTIFICATES.] If the name of the holding
company at the time the merger takes effect is the same as the
name of the parent constituent corporation immediately before
that time, the shares of the holding company into which the
shares of the parent constituent corporation are converted in
the merger must, unless new certificates are issued, be
represented by the share certificates that previously
represented shares of the parent constituent corporation.
Subd. 7. [ARTICLES OF MERGER; FILING WITH SECRETARY OF
STATE.] (a) Articles of merger must be prepared that contain:
(1) the plan of merger; and
(2) a statement that the plan of merger was adopted under
this section.
(b) The articles of merger must be signed on behalf of the
parent constituent corporation and filed with the secretary of
state.
Subd. 8. [CERTIFICATE.] The secretary of state shall issue
a certificate of merger to the surviving corporation or its
legal representative.
Subd. 9. [NONEXCLUSIVITY.] A merger between a parent and a
subsidiary may be accomplished under sections 302A.611,
302A.613, and 302A.615, or section 302A.621 instead of this
section, in which case this section does not apply.
Sec. 26. Minnesota Statutes 2000, section 302A.673,
subdivision 1, is amended to read:
Subdivision 1. [BUSINESS COMBINATION WITH INTERESTED
SHAREHOLDER; APPROVAL BY DIRECTORS.] (a) Notwithstanding
anything to the contrary contained in this chapter (except the
provisions of subdivision 3), an issuing public corporation may
not engage in any business combination, or vote, consent, or
otherwise act to authorize a subsidiary of the issuing public
corporation to engage in any business combination, with, with
respect to, proposed by or on behalf of, or pursuant to any
written or oral agreement, arrangement, relationship,
understanding, or otherwise with, any interested shareholder of
the issuing public corporation or any affiliate or associate of
the interested shareholder for a period of four years following
the interested shareholder's share acquisition date unless the
business combination or the acquisition of shares made by the
interested shareholder on the interested shareholder's share
acquisition date is approved before the interested shareholder's
share acquisition date, or on the share acquisition date but
prior to the interested shareholder's becoming an interested
shareholder on the share acquisition date, by a committee of the
board of the issuing public corporation formed in accordance
with paragraph (d).
(b) If a good faith definitive proposal regarding a
business combination is made in writing to the board of the
issuing public corporation, a committee of the board formed in
accordance with paragraph (d) shall consider and take action on
the proposal and respond in writing within 30 days after receipt
of the proposal by the issuing public corporation, setting forth
its decision regarding the proposal.
(c) If a good faith definitive proposal to acquire shares
is made in writing to the board of the issuing public
corporation, a committee of the board formed in accordance with
paragraph (d), shall consider and take action on the proposal
and respond in writing within 30 days after receipt of the
proposal by the issuing public corporation, setting forth its
decision regarding the proposal.
(d)(1) When a business combination or acquisition of shares
is proposed pursuant to this subdivision, the board shall
promptly form a committee composed solely of all of the board's
one or more disinterested directors. The committee shall take
action on the proposal by the affirmative vote of a majority of
committee members. No larger proportion or number of votes
shall be required. Notwithstanding the provisions of section
302A.241, subdivision 1, the committee shall not be subject to
any direction or control by the board with respect to the
committee's consideration of, or any action concerning, a
business combination or acquisition of shares pursuant to this
section.
(2) A committee formed pursuant to this subdivision shall
be composed of one or more members. Only disinterested
directors may be members of a committee formed pursuant to this
subdivision. However, If the board has no disinterested
directors, the board shall select three or more disinterested
persons to be committee members. Committee members are deemed
to be directors for purposes of sections 302A.251, 302A.255, and
302A.521.
(3) For purposes of this subdivision, a director or person
is "disinterested" if the director or person is neither an
officer nor an employee, nor has been an officer or employee
within five years preceding the formation of the committee
pursuant to this section, of the issuing public corporation, or
of a related organization.
Sec. 27. Minnesota Statutes 2000, section 302A.734, is
amended to read:
302A.734 [EFFECTIVE DATE OF DISSOLUTION; CERTIFICATE.]
Subdivision 1. [EFFECTIVE DATE.] When the articles of
dissolution have been filed with the secretary of state, or on a
later date or a later time each within 30 days after filing if
the articles of dissolution so provide, the corporation is
dissolved.
Subd. 2. [CERTIFICATE.] The secretary of state shall issue
to the dissolved corporation or its legal representative a
certificate of dissolution that contains:
(1) the name of the corporation;
(2) the date and time the articles of dissolution were
filed with the secretary of state is effective; and
(3) a statement that the corporation is dissolved at the
effective date and time of the dissolution.
ARTICLE 2
LIMITED LIABILITY COMPANIES
Section 1. Minnesota Statutes 2000, section 322B.03, is
amended by adding a subdivision to read:
Subd. 6a. [AUTHENTICATED.] "Authenticated" means, with
respect to an electronic communication, that the communication
is delivered to the principal place of business of the limited
liability company, or to a manager or agent of the limited
liability company authorized by the limited liability company to
receive the communication, and that the communication sets forth
information from which the limited liability company can
reasonably conclude that the communication was sent by the
purported sender.
Sec. 2. Minnesota Statutes 2000, section 322B.03, is
amended by adding a subdivision to read:
Subd. 17b. [ELECTRONIC COMMUNICATION.] "Electronic
communication" means any form of communication, not directly
involving the physical transmission of paper, that creates a
record that may be retained, retrieved, and reviewed by a
recipient of the communication, and that may be directly
reproduced in paper form by the recipient through an automated
process.
Sec. 3. Minnesota Statutes 2000, section 322B.03,
subdivision 36a, is amended to read:
Subd. 36a. [PARENT.] "Parent" of a specified limited
liability company means a limited liability company or a
corporation that directly or indirectly through related
organizations owns more than 50 percent of the voting power of
the membership interests entitled to vote for governors of the
specified limited liability company.
Sec. 4. Minnesota Statutes 2000, section 322B.03, is
amended by adding a subdivision to read:
Subd. 41a. [REMOTE COMMUNICATION.] "Remote communication"
means communication via electronic communication, conference
telephone, video conference, the Internet, or such other means
by which persons not physically present in the same location may
communicate with each other on a substantially simultaneous
basis.
Sec. 5. Minnesota Statutes 2000, section 322B.03,
subdivision 45a, is amended to read:
Subd. 45a. [SUBSIDIARY.] "Subsidiary" of a specified
limited liability company means a limited liability company or a
corporation having more than 50 percent of the voting power of
its membership interests entitled to vote for governors owned
directly or indirectly through related organizations by the
specified limited liability company.
Sec. 6. [322B.04] [LEGAL RECOGNITION OF ELECTRONIC RECORDS
AND SIGNATURES.]
Subdivision 1. [DEFINITIONS.] (a) For purposes of this
section, the words, terms, and phrases defined in this
subdivision have the meanings given them.
(b) "Electronic" means relating to technology having
electrical, digital, magnetic, wireless, optical,
electromagnetic, or similar capabilities.
(c) "Electronic record" means a record created, generated,
sent, communicated, received, or stored by electronic means.
(d) "Electronic signature" means an electronic sound,
symbol, or process attached to or logically associated with a
record and executed or adopted by a person with the intent to
sign the record.
(e) "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.
Subd. 2. [ELECTRONIC RECORDS AND SIGNATURES.] For purposes
of this chapter:
(1) a record or signature may not be denied legal effect or
enforceability solely because it is in electronic form;
(2) a contract may not be denied legal effect or
enforceability solely because an electronic record was used in
its formation;
(3) if a provision requires a record to be in writing, an
electronic record satisfies the requirement; and
(4) if a provision requires a signature, an electronic
signature satisfies the requirement.
Sec. 7. Minnesota Statutes 2000, section 322B.12,
subdivision 4, is amended to read:
Subd. 4. [USE OF A NAME BY A SURVIVING ORGANIZATION.] A
limited liability company that is merged the surviving
organization in a merger with another limited liability company
or domestic or foreign corporation one or more other
organizations, or that is organized by the reorganization of one
or more limited liability companies or domestic or foreign
corporations organizations, or that acquires by sale, lease, or
other disposition to or exchange with a limited liability
company an organization all or substantially all of the assets
of another limited liability company or domestic or foreign
corporation organization, including its name, may have the same
name as that used in this state by any of the other limited
liability companies or domestic or foreign
corporations organizations, if the other limited liability
company or domestic or foreign corporation organization whose
name is sought to be used was organized under the laws of, or is
authorized to transact business in, this state.
Sec. 8. Minnesota Statutes 2000, section 322B.333,
subdivision 3, is amended to read:
Subd. 3. [TIME AND PLACE.] A regular meeting, if any, must
be held on the day or date and at the time and place fixed by,
or in a manner authorized by, the articles, a member control
agreement, or bylaws, except that a meeting called by or at the
demand of a member pursuant to subdivision 2 must be held in the
county where the principal executive office of the limited
liability company is located. To the extent authorized in the
articles, a member control agreement, or the bylaws, the board
of governors may determine that a regular meeting of the members
shall be held solely by means of remote communication in
accordance with section 322B.343, subdivision 2.
Sec. 9. Minnesota Statutes 2000, section 322B.336,
subdivision 3, is amended to read:
Subd. 3. [TIME AND PLACE.] Special meetings must be held
on the date and at the time and place fixed by the chief
manager, the treasurer, the board of governors, or a person
authorized by the articles, a member control agreement, or
bylaws to call a meeting, except that a special meeting called
by or at the demand of a member or members pursuant to
subdivision 2 must be held in the county where the principal
executive office is located. To the extent authorized in the
articles, a member control agreement, or the bylaws, the board
of governors may determine that a special meeting of the members
shall be held solely by means of remote communication in
accordance with section 322B.343, subdivision 2.
Sec. 10. Minnesota Statutes 2000, section 322B.343, is
amended to read:
322B.343 [ELECTRONIC REMOTE COMMUNICATIONS FOR MEMBER
MEETINGS.]
Subdivision 1. [ELECTRONIC CONFERENCES CONSTRUCTION AND
APPLICATION.] If and This section shall be construed and applied
to:
(1) facilitate remote communication consistent with other
applicable law; and
(2) be consistent with reasonable practices concerning
remote communication and with the continued expansion of those
practices.
Subd. 2. [MEMBER MEETINGS HELD SOLELY BY MEANS OF REMOTE
COMMUNICATION.] To the extent authorized in the articles, a
member control agreement, or the bylaws, or and determined by
the board of governors of a closely held limited liability
company, a conference among members regular or special meeting
of members may be held solely by any combination of means of
remote communication through which the members may
simultaneously hear each other during participate in the
conference constitutes a regular or special meeting of members,
if the same notice of the meeting is given of the conference to
every owner of membership interests entitled to vote as would be
required by this chapter for a meeting, and if the membership
interests held by the members participating in the conference
meeting would be sufficient to constitute a quorum at a
meeting. Participation in a conference by a member by that
means constitutes presence at the meeting in person or by proxy
if all the other requirements of section 322B.363 are met.
Subd. 2. 3. [PARTICIPATION BY ELECTRONIC MEANS IN MEMBER
MEETINGS BY MEANS OF REMOTE COMMUNICATION.] If and To the extent
authorized in the articles, a member control agreement, or the
bylaws, or and determined by the board of governors of a closely
held limited liability company, a member may participate in not
physically present in person or by proxy at a regular or special
meeting of members not described in subdivision 1 by any means
of communication through which the member, other members so
participating, and all members physically present at the meeting
may simultaneously hear each other during the meeting may, by
means of remote communication, participate in a meeting of
members held at a designated place. Participation in a meeting
by a member by that means constitutes presence at the meeting in
person or by proxy if all the other requirements of section
322B.363 are met.
Subd. 4. [REQUIREMENTS FOR MEETINGS HELD SOLELY BY MEANS
OF REMOTE COMMUNICATION AND FOR PARTICIPATION BY MEANS OF REMOTE
COMMUNICATION.] In any meeting of members held solely by means
of remote communication under subdivision 2 or in any meeting of
members held at a designated place in which one or more members
participate by means of remote communication under subdivision 3:
(1) the limited liability company shall implement
reasonable measures to verify that each person deemed present
and entitled to vote at the meeting by means of remote
communication is a member; and
(2) the limited liability company shall implement
reasonable measures to provide each member participating by
means of remote communication with a reasonable opportunity to
participate in the meeting, including an opportunity to:
(i) read or hear the proceedings of the meeting
substantially concurrently with those proceedings;
(ii) if allowed by the procedures governing the meeting,
have the member's remarks heard or read by other participants in
the meeting substantially concurrently with the making of those
remarks; and
(iii) if otherwise entitled, vote on matters submitted to
the members.
Subd. 5. [NOTICE TO MEMBERS.] (a) Any notice to members
given by the limited liability company under any provision of
this chapter, the articles, a member control agreement, or the
bylaws by a form of electronic communication consented to by the
member to whom the notice is given is effective when given. The
notice is deemed given:
(1) if by facsimile communication, when directed to a
telephone number at which the member has consented to receive
notice;
(2) if by electronic mail, when directed to an electronic
mail address at which the member has consented to receive
notice;
(3) if by a posting on an electronic network on which the
member has consented to receive notice, together with separate
notice to the member of the specific posting, upon the later of:
(i) the posting; and
(ii) the giving of the separate notice; and
(4) if by any other form of electronic communication by
which the member has consented to receive notice, when directed
to the member.
An affidavit of the secretary, other authorized manager, or
authorized agent of the limited liability company, that the
notice has been given by a form of electronic communication is,
in the absence of fraud, prima facie evidence of the facts
stated in the affidavit.
(b) Consent by a member to notice given by electronic
communication may be given in writing or by authenticated
electronic communication. The limited liability company is
entitled to rely on any consent so given until revoked by the
member, provided that no revocation affects the validity of any
notice given before receipt by the limited liability company of
revocation of the consent.
Subd. 6. [REVOCATION.] Any ballot, vote, authorization, or
consent submitted by electronic communication under this chapter
may be revoked by the member submitting the ballot, vote,
authorization, or consent so long as the revocation is received
by a manager of the limited liability company at or before the
meeting or before an action without a meeting is effective
according to section 322B.656.
Subd. 3. 7. [WAIVER.] Waiver of notice by a member of a
meeting by means of authenticated electronic communication
described in subdivisions 1 and 2 may be given in the manner
provided in section 322B.34, subdivision 4. Participation in a
meeting by means of remote communication described in
subdivisions 1 and 2 and 3 is a waiver of notice of that
meeting, except where the member objects at the beginning of the
meeting to the transaction of business because the meeting is
not lawfully called or convened, or objects before a vote on an
item of business because the item may not lawfully be considered
at the meeting and does not participate in the consideration of
the item at that meeting.
Sec. 11. Minnesota Statutes 2000, section 322B.35,
subdivision 1, is amended to read:
Subdivision 1. [METHOD.] An action required or permitted
to be taken at a meeting of the members may be taken by written
action signed, or consented to by authenticated electronic
communication, by all of the members. If the articles or a
member control agreement so provide, any action may be taken by
written action signed, or consented to by authenticated
electronic communication, by the members who own voting power
equal to the voting power that would be required to take the
same action at a meeting of the members at which all members
were present.
Sec. 12. Minnesota Statutes 2000, section 322B.35,
subdivision 2, is amended to read:
Subd. 2. [EFFECTIVE TIME.] The written action is effective
when signed, or consented to by authenticated electronic
communication, by the required members, unless a different
effective time is provided in the written action.
Sec. 13. Minnesota Statutes 2000, section 322B.363,
subdivision 1, is amended to read:
Subdivision 1. [AUTHORIZATION.] (a) A member may cast or
authorize the casting of a vote by (1) filing a written
appointment of a proxy with a manager of the limited liability
company at or before the meeting at which the appointment is to
be effective., or (2) telephonic transmission or authenticated
electronic communication, whether or not accompanied by written
instructions of the member, of an appointment of a proxy with
the limited liability company or the limited liability company's
duly authorized agent at or before the meeting at which the
appointment is to be effective. The telephonic transmission or
authenticated electronic communication must set forth or be
submitted with information from which it can be determined that
the appointment was authorized by the member. If it is
reasonably concluded that the telephonic transmission or
authenticated electronic communication is valid, the inspectors
of election or, if there are not inspectors, the other persons
making that determination shall specify the information upon
which they relied to make that determination. A proxy so
appointed may vote on behalf of the member, or otherwise
participate, in a meeting by remote communication according to
section 322B.343, to the extent the member appointing the proxy
would have been entitled to participate by remote communication
according to section 322B.343, if the member did not appoint the
proxy.
(b) A written appointment of a proxy may be signed by the
member or authorized by the member by transmission of a
telegram, cablegram, or other means of electronic transmission,
provided that the limited liability company has no reason to
believe that the telegram, cablegram, or other electronic
transmission was not authorized by the member. Any copy,
facsimile, telecommunication, or other reproduction of the
original writing or transmission may be substituted or used in
lieu of the original writing or transmission for any purpose for
which the original transmission could be used, if the copy,
facsimile telecommunication, or other reproduction is a complete
and legible reproduction of the entire original writing or
transmission.
(c) An appointment of a proxy for membership interests
owned jointly by two or more members is valid if signed
or otherwise authorized consented to by authenticated electronic
communication, by any one of them, unless the limited liability
company receives from any one of those members written notice or
an authenticated electronic communication either denying the
authority of that person to appoint a proxy or appointing a
different proxy.
Sec. 14. Minnesota Statutes 2000, section 322B.643, is
amended to read:
322B.643 [BOARD OF GOVERNORS MEETINGS.]
Subdivision 1. [TIME AND PLACE.] Meetings of the board of
governors may be held from time to time as provided in the
articles of organization, a member control agreement, or bylaws
at any place within or without the state that the board of
governors may select or by any means described in subdivision
2. If the board of governors fails to select a place for a
meeting, the meeting must be held at the principal executive
office, unless the articles, a member control agreement, or
bylaws provide otherwise. The board of governors may determine
under subdivision 2 that a meeting of the board of governors
shall be held solely by means of remote communication.
Subd. 2. [ELECTRONIC COMMUNICATIONS MEETINGS SOLELY BY
MEANS OF REMOTE COMMUNICATION.] (a) A conference Any meeting
among governors may be conducted solely by any one or more means
of remote communication through which all of the governors may
simultaneously hear participate with each other during the
conference constitutes a board of governors meeting, if the same
notice is given of the conference meeting as would be required
by subdivision 3 for a meeting 4, and if the number of governors
participating in the conference meeting would be sufficient to
constitute a quorum at a meeting. Participation in a meeting by
that means constitutes presence in person at the meeting.
(b) Subd. 3. [PARTICIPATION IN MEETINGS BY MEANS OF REMOTE
COMMUNICATION.] A governor may participate in a board of
governors meeting not described in paragraph (a) by any means of
conference telephone or, if authorized by the board, by such
other means of remote communication, in each case through which
the governor, other governors so participating, and all
governors physically present at the meeting may simultaneously
hear participate with each other during the meeting.
Participation in a meeting by that means constitutes presence in
person at the meeting.
Subd. 3. 4. [CALLING MEETINGS AND NOTICE.] Unless the
articles of organization, a member control agreement, or bylaws
provide for a different time period, a governor may call a board
meeting by giving at least ten days' notice or, in the case of
organizational meetings under section 322B.60, subdivision 2, at
least three days' notice to all governors of the date, time, and
place of the meeting. The notice need not state the purpose of
the meeting unless the articles, a member control agreement, or
bylaws require it.
Subd. 4. 5. [PREVIOUSLY SCHEDULED MEETINGS.] If the day or
date, time, and place of a board of governors meeting have been
provided in the articles, a member control agreement, or bylaws,
or announced at a previous meeting of the board of governors, no
notice is required. Notice of an adjourned meeting need not be
given other than by announcement at the meeting at which
adjournment is taken.
Subd. 5. 6. [WAIVER OF NOTICE.] A governor may waive
notice of a meeting of the board of governors. A waiver of
notice by a governor entitled to notice is effective whether
given before, at, or after the meeting, and whether given in
writing, orally, or by attendance. Attendance by a governor at
a meeting is a waiver of notice of that meeting, except where
the governor objects at the beginning of the meeting to the
transaction of business because the meeting is not lawfully
called or convened and does not participate in the meeting after
the objection.
Sec. 15. Minnesota Statutes 2000, section 322B.656,
subdivision 1, is amended to read:
Subdivision 1. [METHOD.] An action required or permitted
to be taken at a board of governors meeting may be taken by
written action signed, or consented to by authenticated
electronic communication, by all of the governors. If the
articles or a member control agreement so provide, any action,
other than an action requiring member approval, may be taken by
written action signed, or consented to by authenticated
electronic communication, by the number of governors that would
be required to take the same action at a meeting of the board of
governors at which all governors were present.
Sec. 16. Minnesota Statutes 2000, section 322B.656,
subdivision 2, is amended to read:
Subd. 2. [EFFECTIVE TIME.] The written action is effective
when signed, or consented to by authenticated electronic
communication, by the required number of governors, unless a
different effective time is provided in the written action.
Sec. 17. Minnesota Statutes 2000, section 322B.826, is
amended to read:
322B.826 [EFFECTIVE DATE OF TERMINATION AND CERTIFICATE OF
TERMINATION.]
Subdivision 1. [EFFECTIVE DATE.] When the articles of
termination have been filed with the secretary of state, or on a
later date or a later time each within 30 days after filing if
the articles of termination so provide, the limited liability
company is terminated.
Subd. 2. [CERTIFICATE.] The secretary of state shall issue
to the dissolved limited liability company or its legal
representative a certificate of termination that contains:
(1) the name of the limited liability company;
(2) the date and time the articles of termination were
filed with the secretary of state is effective; and
(3) a statement that the limited liability company is
terminated at the effective date and time of the termination.
ARTICLE 3
NONPROFIT CORPORATIONS
Section 1. Minnesota Statutes 2000, section 317A.011, is
amended by adding a subdivision to read:
Subd. 3a. [AUTHENTICATED.] "Authenticated" means, with
respect to an electronic communication, that the communication
is delivered to the principal place of business of the
corporation, or to an officer or agent of the corporation
authorized by the corporation to receive the communication, and
that the communication sets forth information from which the
corporation can reasonably conclude that the communication was
sent by the purported sender.
Sec. 2. Minnesota Statutes 2000, section 317A.011, is
amended by adding a subdivision to read:
Subd. 7a. [ELECTRONIC COMMUNICATION.] "Electronic
communication" means any form of communication, not directly
involving the physical transmission of paper, that creates a
record that may be retained, retrieved, and reviewed by a
recipient of the communication, and that may be directly
reproduced in paper form by the recipient through an automated
process.
Sec. 3. Minnesota Statutes 2000, section 317A.011, is
amended by adding a subdivision to read:
Subd. 18a. [REMOTE COMMUNICATION.] "Remote communication"
means communication via electronic communication, conference
telephone, video conference, the Internet, or such other means
by which persons not physically present in the same location may
communicate with each other on a substantially simultaneous
basis.
Sec. 4. [317A.015] [LEGAL RECOGNITION OF ELECTRONIC
RECORDS AND SIGNATURES.]
Subdivision 1. [DEFINITIONS.] (a) For purposes of this
section, the words, terms, and phrases defined in this
subdivision have the meanings given them.
(b) "Electronic" means relating to technology having
electrical, digital, magnetic, wireless, optical,
electromagnetic, or similar capabilities.
(c) "Electronic record" means a record created, generated,
sent, communicated, received, or stored by electronic means.
(d) "Electronic signature" means an electronic sound,
symbol, or process attached to or logically associated with a
record and executed or adopted by a person with the intent to
sign the record.
(e) "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.
Subd. 2. [ELECTRONIC RECORDS AND SIGNATURES.] For purposes
of this chapter:
(1) a record or signature may not be denied legal effect or
enforceability solely because it is in electronic form;
(2) a contract may not be denied legal effect or
enforceability solely because an electronic record was used in
its formation;
(3) if a provision requires a record to be in writing, an
electronic record satisfies the requirement; and
(4) if a provision requires a signature, an electronic
signature satisfies the requirement.
Sec. 5. Minnesota Statutes 2000, section 317A.231, is
amended to read:
317A.231 [BOARD MEETINGS.]
Subdivision 1. [TIME; PLACE.] Meetings of the board may be
held as provided in the articles or bylaws in or out of this
state. Unless the articles or bylaws provide otherwise, a
meeting of the board must be held at least once per year. If
the articles or bylaws or the board fail to select a place for a
meeting, the meeting must be held at the registered office. The
board of directors may determine under subdivision 2 that a
meeting of the board of directors shall be held solely by means
of remote communication.
Subd. 2. [ELECTRONIC COMMUNICATIONS MEETINGS SOLELY BY
MEANS OF REMOTE COMMUNICATION.] (a) A conference Any meeting
among directors may be conducted solely by a one or more means
of remote communication through which all of the directors
may simultaneously hear each other during participate in
the conference is a board meeting, if the same notice is given
of the conference as would be meeting required for a meeting by
subdivision 4, and if the number of directors participating in
the conference meeting is sufficient to constitute a quorum at a
meeting. Participation in a meeting by this that means is
personal constitutes presence at the meeting.
(b) Subd. 3. [PARTICIPATION IN MEETINGS BY MEANS OF REMOTE
COMMUNICATION.] A director may participate in a board meeting by
any means of conference telephone or, if authorized by the
board, by such other means of remote communication, in each case
through which the that director, other directors so
participating, and all directors physically present at the
meeting may simultaneously hear participate with each other
during the meeting. Participation in a meeting by this that
means is personal constitutes presence at the meeting.
Subd. 3 4. [CALLING MEETINGS; NOTICE.] (a) Unless the
articles or bylaws provide otherwise, a director may call a
board meeting by giving five days' notice to all directors of
the date, time, and place of the meeting. The notice need not
state the purpose of the meeting unless the articles or bylaws
require it.
(b) If the day or date, time, and place of a board meeting
have been provided in the articles or bylaws, or announced at a
previous meeting of the board, notice is not required. Notice
of an adjourned meeting need not be given other than by
announcement at the meeting at which adjournment is taken.
Subd. 4 5. [WAIVER OF NOTICE.] A director may waive notice
of a meeting of the board. A waiver of notice by a director
entitled to notice is effective whether given before, at, or
after the meeting, and whether given in writing, orally, or by
attendance. Attendance by a director at a meeting is a waiver
of notice of that meeting, unless the director objects at the
beginning of the meeting to the transaction of business because
the meeting is not lawfully called or convened and does not
participate in the meeting.
Sec. 6. Minnesota Statutes 2000, section 317A.239,
subdivision 1, is amended to read:
Subdivision 1. [METHOD.] An action required or permitted
to be taken at a board meeting may be taken by written action
signed, or consented to by authenticated electronic
communication, by all of the directors. If the articles so
provide, an action, other than an action requiring member
approval, may be taken by written action signed, or consented to
by authenticated electronic communication, by the number of
directors that would be required to take the same action at a
meeting of the board at which all directors were present.
Sec. 7. Minnesota Statutes 2000, section 317A.239,
subdivision 2, is amended to read:
Subd. 2. [EFFECTIVE TIME.] The written action is effective
when signed, or consented to by authenticated electronic
communication, by the required number of directors, unless a
different effective time is provided in the written action.
Sec. 8. Minnesota Statutes 2000, section 317A.431,
subdivision 3, is amended to read:
Subd. 3. [TIME; PLACE.] An annual meeting of members must
be held at the time and place stated in or fixed in accordance
with the articles or bylaws. If a place is not stated or if a
demand for a meeting is made under subdivision 2, the meeting
must be held in the county where the corporation's registered
office is located. To the extent authorized in articles or
bylaws, the board of directors may determine that an annual
meeting of the members shall be held solely by means of remote
communication in accordance with section 317A.450, subdivision 2.
Sec. 9. Minnesota Statutes 2000, section 317A.433,
subdivision 3, is amended to read:
Subd. 3. [TIME; PLACE.] Special meetings of members may be
held in or out of this state at the place stated in or fixed in
accordance with the articles, bylaws, or by the president or the
board. If a special meeting is demanded by the members, the
meeting must be held in the county where the corporation's
registered office is located. To the extent authorized in the
articles or bylaws, the board of directors may determine that a
special meeting of the members shall be held solely by means of
remote communication in accordance with section 317A.450,
subdivision 2.
Sec. 10. Minnesota Statutes 2000, section 317A.445, is
amended to read:
317A.445 [UNANIMOUS ACTION WITHOUT A MEETING.]
An action required or permitted to be taken at a meeting of
the members may be taken without a meeting by written action
signed, or consented to by authenticated electronic
communication, by all of the members entitled to vote on that
action. The written action is effective when it has been
signed, or consented to by authenticated electronic
communication, by all of those members, unless a different
effective time is provided in the written action. When this
chapter requires a certificate concerning an action to be filed
with the secretary of state, the officers signing the
certificate must indicate that the action was taken under this
section.
Sec. 11. [317A.450] [REMOTE COMMUNICATIONS FOR MEMBER
MEETINGS.]
Subdivision 1. [CONSTRUCTION AND APPLICATION.] This
section shall be construed and applied to:
(1) facilitate remote communication consistent with other
applicable law; and
(2) be consistent with reasonable practices concerning
remote communication and with the continued expansion of those
practices.
Subd. 2. [MEMBER MEETINGS HELD SOLELY BY MEANS OF REMOTE
COMMUNICATION.] To the extent authorized in the articles or
bylaws and determined by the board, an annual or special meeting
of members may be held solely by one or more means of remote
communication, if notice of the meeting is given to every member
entitled to vote, and if the number of voting members
participating in the meeting is sufficient to constitute a
quorum at a meeting. Participation by a member by that means
constitutes presence at the meeting in person or by proxy if all
the other requirements of section 317A.453 are met.
Subd. 3. [PARTICIPATION IN MEMBER MEETINGS BY MEANS OF
REMOTE COMMUNICATION.] To the extent authorized in the articles
or bylaws and determined by the board, a member not physically
present in person or by proxy at an annual or special meeting of
members may, by means of remote communication, participate in a
meeting of members held at a designated place. Participation by
a member by that means constitutes presence at the meeting in
person or by proxy if all the other requirements of section
317A.453 are met.
Subd. 4. [REQUIREMENTS FOR MEETINGS HELD SOLELY BY MEANS
OF REMOTE COMMUNICATION AND FOR PARTICIPATION BY MEANS OF REMOTE
COMMUNICATION.] In any meeting of members held solely by means
of remote communication under subdivision 2 or in any meeting of
members held at a designated place in which one or more members
participate by means of remote communication under subdivision 3:
(1) the corporation shall implement reasonable measures to
verify that each person deemed present and entitled to vote at
the meeting by means of remote communication is a member; and
(2) the corporation shall implement reasonable measures to
provide each member participating by means of remote
communication with a reasonable opportunity to participate in
the meeting, including an opportunity to:
(i) read or hear the proceedings of the meeting
substantially concurrently with those proceedings;
(ii) if allowed by the procedures governing the meeting,
have the member's remarks heard or read by other participants in
the meeting substantially concurrently with the making of those
remarks; and
(iii) if otherwise entitled, vote on matters submitted to
the members.
Subd. 5. [NOTICE TO MEMBERS.] (a) Any notice to members
given by the corporation under any provision of this chapter,
the articles, or the bylaws by a form of electronic
communication consented to by the member to whom the notice is
given is effective when given. The notice is deemed given:
(1) if by facsimile communication, when directed to a
telephone number at which the member has consented to receive
notice;
(2) if by electronic mail, when directed to an electronic
mail address at which the member has consented to receive
notice;
(3) if by a posting on an electronic network on which the
member has consented to receive notice, together with separate
notice to the member of the specific posting, upon the later of:
(i) the posting; and
(ii) the giving of the separate notice; and
(4) if by any other form of electronic communication by
which the member has consented to receive notice, when directed
to the member.
An affidavit of the secretary, other authorized officer, or
authorized agent of the corporation, that the notice has been
given by a form of electronic communication is, in the absence
of fraud, prima facie evidence of the facts stated in the
affidavit.
(b) Consent by a member to notice given by electronic
communication may be given in writing or by authenticated
electronic communication. The corporation is entitled to rely
on any consent so given until revoked by the member, provided
that no revocation affects the validity of any notice given
before receipt by the corporation of revocation of the consent.
Subd. 6. [WAIVER.] Waiver of notice by a member of a
meeting by means of authenticated electronic communication may
be given in the manner provided in section 317A.435, subdivision
3. Participation in a meeting by means of remote communication
described in subdivisions 2 and 3 is a waiver of notice of that
meeting, except where the member objects at the beginning of the
meeting to the transaction of business because the meeting is
not lawfully called or convened, or objects before a vote on an
item of business because the item may not lawfully be considered
at the meeting and does not participate in the consideration of
the item at that meeting.
Sec. 12. Minnesota Statutes 2000, section 317A.453,
subdivision 1, is amended to read:
Subdivision 1. [AUTHORIZATION.] If the articles or bylaws
permit proxy voting, a member may appoint a proxy to cast or
authorize the casting of a vote or otherwise act for the member
by signing an (1) filing a nonelectronic written appointment
form either personally or of a proxy, signed by the member, with
an attorney-in-fact officer of the corporation at or before the
meeting at which the appointment is to be effective, or (2)
telephonic transmission or authenticated electronic
communication, whether or not accompanied by written
instructions of the member, of an appointment of a proxy with
the corporation or the corporation's duly authorized agent at or
before the meeting at which the appointment is to be effective.
Sec. 13. Minnesota Statutes 2000, section 317A.733,
subdivision 3, is amended to read:
Subd. 3. [EFFECTIVE DATE.] When the articles of
dissolution have been filed with the secretary of state, or on a
later date or a later time each within 30 days after filing if
the articles of dissolution so provide, the corporation is
dissolved.
Sec. 14. Minnesota Statutes 2000, section 317A.733,
subdivision 4, is amended to read:
Subd. 4. [CERTIFICATE.] The secretary of state shall issue
to the dissolved corporation a certificate of dissolution that
contains:
(1) the name of the corporation;
(2) the date and time the articles of dissolution were
filed with the secretary of state is effective; and
(3) a statement that the corporation is dissolved at the
effective date and time of the dissolution.
Sec. 15. [REPEALER]
Minnesota Statutes 2000, section 317A.449, is repealed.
ARTICLE 4
MISCELLANEOUS CHANGES
Section 1. Minnesota Statutes 2000, section 303.11, is
amended to read:
303.11 [NOTICE OF NAME CHANGES, WHERE FILED.]
Each foreign corporation authorized to transact business in
this state, shall, whenever it changes its name, dissolves, or
merges into another corporation, file in the office of the
secretary of state a certificate to that effect authenticated by
the proper officer of the state or country under the laws of
which the corporation is organized.
Sec. 2. Minnesota Statutes 2000, section 322A.03, is
amended to read:
322A.03 [RESERVATION OF NAME.]
(a) The exclusive right to the use of a name may be
reserved by:
(1) any person intending to organize a limited partnership
under sections 322A.01 to 322A.87 and to adopt that name;
(2) any domestic limited partnership or any foreign limited
partnership registered in this state which, in either case,
intends to adopt that name;
(3) any foreign limited partnership intending to register
in this state and adopt that name; and
(4) any person intending to organize a foreign limited
partnership and intending to have it register in this state and
adopt that name.
(b) The reservation shall be made by filing with the
secretary of state an application, executed by the applicant, to
reserve a specified name. On finding that the name is available
for use by a domestic or foreign limited partnership, the
secretary of state shall reserve the name for the exclusive use
of the applicant for a period of 12 months. The reservation may
be renewed for successive 12-month periods. The right to the
exclusive use of a reserved name may be transferred to any other
person by filing in the office of the secretary of state a
notice of the transfer, executed by the applicant for whom the
name was reserved and specifying the name and address of the
transferee according to section 302A.117.
Sec. 3. Minnesota Statutes 2000, section 323A.11-02, is
amended to read:
323A.11-02 [STATEMENT OF FOREIGN QUALIFICATION.]
(a) Before transacting business in this state, a foreign
limited liability partnership must file a statement of foreign
qualification. The statement must contain:
(1) the name of the foreign limited liability partnership
which satisfies the requirements of the state or other
jurisdiction under whose law it is formed and ends with
"Registered Limited Liability Partnership," "Limited Liability
Partnership," "R.L.L.P.," "L.L.P.," "RLLP," or "LLP;"
(2) the street address, including the zip code, of the
partnership's chief executive office and, if different, the
street address, including the zip code, of an office of the
partnership in this state, if any;
(3) if there is no office of the partnership in this state,
the name and street address, including the zip code, of the
partnership's agent for service of process; and
(4) a deferred effective date, if any; and
(5) the name of the jurisdiction under whose law the
foreign limited liability partnership was originally registered.
(b) The agent of a foreign limited liability company for
service of process must be an individual who is a resident of
this state or other person authorized to do business in this
state.
(c) The status of a partnership as a foreign limited
liability partnership is effective on the later of the filing of
the statement of foreign qualification or a date specified in
the statement. The status remains effective, regardless of
changes in the partnership, until it is canceled pursuant to
section 323A.1-05(d) or revoked pursuant to section 323A.10-03.
(d) An amendment or cancellation of a statement of foreign
qualification is effective when it is filed or on a deferred
effective date specified in the amendment or cancellation.
(e) A statement of foreign qualification may include the
information necessary to make an election under section 319B.04,
subdivision 2, and to update that information as provided in
section 319B.04, subdivision 3.
Sec. 4. Minnesota Statutes 2000, section 333.055,
subdivision 4, is amended to read:
Subd. 4. The secretary of state shall accept for filing
all certificates and renewals thereof which comply with the
provisions of sections 333.001 to 333.06 and which are
accompanied by the prescribed fees, notwithstanding the fact
that the assumed name disclosed therein may not be
distinguishable from one or more other assumed names already
filed with the secretary of state. In the event of duplication
or similarity, the secretary of state shall, within 20 days
after the filing, notify in writing each previously filed
business holding a certificate for the assumed name or a similar
assumed name, of the duplication or similarity, including in the
notice the name and last known address of the person so filing.
The secretary of state shall not accept for filing a certificate
that discloses an assumed name that is not distinguishable from
a corporate, limited liability company, limited liability
partnership, cooperative, or limited partnership name in use or
reserved in this state by another or a trade or service mark
registered with the secretary of state, unless there is filed
with the certificate a written consent, court decree of prior
right, or affidavit of nonuser of the kind required by section
302A.115, subdivision 1, clause (d). The secretary of state
shall determine whether a name is distinguishable from another
name for purposes of this subdivision.
Presented to the governor March 28, 2002
Signed by the governor April 1, 2002, 9:09 a.m.
Official Publication of the State of Minnesota
Revisor of Statutes