Senate Bill 1696c1

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    Florida Senate - 1999                           CS for SB 1696

    By the Committee on Judiciary and Senator Klein





    308-1894-99

  1                      A bill to be entitled

  2         An act relating to limited liability companies;

  3         amending ss. 608.401, 608.402, 608.403,

  4         608.404, 608.406, 608.407, 608.408, 608.4081,

  5         608.4082, 608.409, 608.4101, 608.411, 608.415,

  6         608.416, 608.4211, 608.422, 608.4225, 608.423,

  7         608.4231, 608.4232, 608.425, 608.426, 608.4261,

  8         608.427, 608.428, 608.432, 608.433, 608.434,

  9         608.436, 608.4362, 608.4363, 608.437, 608.438,

10         608.4381, 608.4383, 608.4384, 608.441,

11         608.4421, 608.444, 608.447, 608.448, 608.4481,

12         608.449, 608.4492, 608.4511, 608.452, 608.455,

13         608.463, 608.471, 608.502, 608.503, 608.504,

14         608.505, 608.507, 608.508, 608.512, 608.5135,

15         F.S.; revising provisions of chapter 608, F.S.,

16         relating to limited liability companies;

17         clarifying and updating such provisions to

18         reflect current operating procedures; providing

19         for requirements, limitations, procedures,

20         rights, liabilities, reports, fees, and

21         penalties; creating s. 608.4115, F.S.;

22         providing for correcting certain articles of

23         organization; providing for effect; creating s.

24         608.4226, F.S.; providing for resolving

25         conflicts of interest; creating s. 608.4235,

26         F.S.; providing for agency of members and

27         managers; creating s. 608.4236, F.S.; providing

28         for delegation of rights and powers to manage;

29         creating s. 608.4237, F.S.; providing for

30         membership termination upon bankruptcy;

31         creating s. 608.439, F.S.; providing for

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    Florida Senate - 1999                           CS for SB 1696
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  1         conversion of certain entities to a limited

  2         liability company; creating s. 608.601, F.S.;

  3         providing for member's derivative actions;

  4         creating ss. 608.701, 608.702, and 608.703,

  5         F.S.; providing for application of certain case

  6         law for certain purposes; providing for

  7         receiving certificates and certified copies

  8         into evidence; providing for interrogatories by

  9         the Department of State; repealing s. 608.4062,

10         F.S., relating to foreign limited liability

11         companies; repealing s. 608.412, F.S., relating

12         to supplemental affidavit of capital

13         contributions; repealing s. 608.424, F.S.,

14         relating to contracting debts; repealing s.

15         608.4494, F.S., relating to deposit with the

16         Department of Banking and Finance; providing an

17         effective date.

18

19  Be It Enacted by the Legislature of the State of Florida:

20

21         Section 1.  Sections 608.401, 608.402, 608.403,

22  608.404, 608.408, 608.4081, 608.4082, 608.409, 608.4101,

23  608.411, 608.415, 608.416, 608.4211, 608.422, 608.4225,

24  608.423, 608.4231, 608.4232, 608.425, 608.426, 608.4261,

25  608.427, 608.428, 608.432, 608.433, 608.434, 608.441,

26  608.4421, 608.444, 608.447, 608.448, 608.4481, 608.449,

27  608.4492, 608.4511, 608.452, 608.455, 608.463, 608.502,

28  608.503, 608.504, 608.505, 608.507, 608.508, 608.512,

29  608.5135, Florida Statutes, and sections 608.406, 608.407,

30  608.438, 608.4381, 608.4383, 608.4384, and 608.471, Florida

31  Statutes, 1998 Supplement, are amended, sections 608.436,

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  1  608.4362, 608.4363, and 608.437, Florida Statutes, are

  2  transferred and renumbered as sections 608.4227, 608.4228,

  3  608.4229, and 608.4238, Florida Statutes, respectively, and

  4  amended, and sections 608.4115, 608.4226, 608.4235, 608.4236,

  5  608.4237, 608.439, 608.601, 608.701, 608.702, and 608.703,

  6  Florida Statutes, are created, to read:

  7           608.401  Short title.--Sections 608.401-608.703

  8  608.514 may be cited as the "Florida Limited Liability Company

  9  Act."

10         608.402  Definitions.--As used in this chapter:

11         (1)  "Articles of merger" means initial, amended, and

12  restated articles of merger of a limited liability company

13  delivered to the Department of State in accordance with s.

14  608.4382. In the case of a foreign limited liability company,

15  the term includes all records serving a similar function

16  required to be filed with the Department of State or other

17  official having custody of company records in the state or

18  country under whose law it is organized.

19         (2)  "Articles of organization" means initial, amended,

20  and restated articles of organization of a limited liability

21  company, including initial, amended, or restated articles of

22  merger, if any. In the case of a foreign limited liability

23  company, the term includes all records serving a similar

24  function required to be filed with the Department of State or

25  other official having custody of company records in the state

26  or country under whose law it is organized.

27         (3)  "Authorized representative" means one or more

28  persons acting to form a limited liability company by

29  executing and filing the articles of organization of such

30  limited liability company in accordance with this chapter and

31  authorized by a member identified in the articles of

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  1  organization or operating agreement of such limited liability

  2  company, which authorized representative may, but need not be,

  3  a member of the limited liability company that the authorized

  4  representative forms.

  5         (4)(1)  "Bankruptcy" means an event that causes a

  6  person to cease to be a member as provided in s. 608.4237.

  7  "Bankrupt" means a debtor under the federal bankruptcy law or

  8  insolvent under any state insolvency act.

  9         (5)(2)  "Business" means every trade, occupation, or

10  profession and other lawful business, purpose, or activity,

11  whether or not carried on for profit.

12         (6)(3)  "Capital account" means the agreed value of the

13  initial contributions as provided in s. 608.4211, increased by

14  the agreed value of subsequent contributions amounts

15  subsequently contributed to capital, if any, and reduced by

16  distributions of capital,. unless otherwise provided in the

17  articles of organization or the operating agreement

18  regulations, additional contributions or distributions of

19  capital shall only be upon agreement of all the members.

20  Unless otherwise provided in the articles of organization or

21  the regulations, the capital account of a member shall be

22  adjusted to reflect a default in the payment of any amount

23  previously agreed to be contributed.

24         (7)  "Contribution" means any cash, property, or

25  services rendered, or a promissory note or other obligation to

26  contribute cash or property or to perform services, which a

27  person contributes to the limited liability company as a

28  member.

29         (8)(4)  "Conveyance" means any assignment, transfer,

30  sale, lease, mortgage, hypothecation, or encumbrance.

31

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  1         (9)(5)  "Court" includes every court and judge having

  2  jurisdiction in the action.

  3         (10)  "Distribution" means a direct or indirect

  4  transfer of money or other property or incurrence of

  5  indebtedness by a limited liability company to or for the

  6  benefit of its members in respect of their economic interests.

  7         (11)(6)  "Entity" means, without limitation, includes

  8  any corporation or foreign corporation, as such terms are

  9  defined in s. 607.01401; unincorporated association or

10  business; limited liability company; business trust, real

11  estate investment trust, common law trust, or other,

12  partnership, trust, general partnership, limited liability

13  partnership, limited partnership, limited liability limited

14  partnership, joint venture, or two or more persons having a

15  joint or common economic interest; any or state, local,

16  federal, or foreign government, governmental subdivision,

17  agency, or instrumentality; or any other domestic or foreign

18  entity that is formed pursuant to the provisions of applicable

19  law governments.

20         (12)  "Foreign limited liability company" means a

21  limited liability company formed under the laws of any state

22  other than Florida or under the laws of any foreign country or

23  other foreign jurisdiction.

24         (13)(7)  "Individual" means a natural person and

25  includes the estate of a natural person an incompetent or

26  deceased individual.

27         (14)  "Insolvent" means the inability of a limited

28  liability company to pay the company's debts as they become

29  due in the ordinary course of business or that the fair value

30  of the company's total assets would be less than the sum of

31  its total liabilities plus the amount that would be needed, if

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  1  the company were to be dissolved and terminated at the time of

  2  the distribution, to satisfy the preferential distribution

  3  rights of the company's members accrued through such

  4  dissolution and termination.

  5         (15)  "Knowledge" means a person's actual knowledge of

  6  a fact, and does not include constructive knowledge of a fact.

  7         (16)(8)  "Limited liability company" or "company" means

  8  a limited liability company organized and existing under this

  9  chapter.

10         (17)  "Majority-in-interest of the members" means,

11  unless otherwise provided in the articles of organization or

12  operating agreement, members owning more than 50 percent of

13  the then-current percentage or other interest in the profits

14  of the limited liability company.

15         (18)  "Manager" means a person who is appointed or

16  elected to manage a manager-managed company and, unless

17  otherwise provided in the articles of organization or

18  operating agreement, a manager may be, but need not be, a

19  member of the limited liability company.

20         (19)  "Manager-managed company" means a limited

21  liability company which is designated to be managed by

22  managers in its articles of organization or operating

23  agreement.

24         (20)(9)  "Managing member" means, with respect to a

25  limited liability company that has set forth in its articles

26  of organization that it is to be managed by its members, a

27  member appointed or elected as a managing member of a

28  member-managed company the limited liability company pursuant

29  to and in accordance with the articles of organization or

30  regulations of the limited liability company.

31

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  1         (21)(10)  "Member" means any person who has been

  2  admitted to a limited liability company as a member as

  3  provided in s. 608.4232 and has an economic equity interest in

  4  a limited liability company represented by a capital account

  5  or, in the case of a foreign limited liability company, has

  6  been admitted to a limited liability company as a member in

  7  accordance with the laws of the state or foreign country or

  8  other foreign jurisdiction under which the foreign limited

  9  liability company is organized.

10         (22)  "Member-managed company" means a limited

11  liability company other than a manager-managed company.

12         (23)  "Membership interest," "member's interest," or

13  "interest" means a member's share of the profits and the

14  losses of the limited liability company, the right to receive

15  distributions of the limited liability company's assets,

16  voting rights, management rights, or any other rights under

17  this chapter or the articles of organization or operating

18  agreement.

19         (24)(13)  "Operating agreement" "Regulations" means

20  written or oral provisions which are adopted for the

21  management and regulation of the affairs of the limited

22  liability company and which set forth the relationships of the

23  members, managers, and limited liability company.  The term

24  includes amendments to the operating agreement, subject to s.

25  608.423.

26         (25)(11)  "Person" means an individual or an entity.

27         (26)  "Personal or other legal representative" means,

28  as to a natural person, the executor, administrator, guardian,

29  conservator, or other legal representative of the natural

30  person and, as to a person other than a natural person, the

31  legal representative or successor of such person.

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  1         (12)  "Real property" means land and any interest or

  2  estate in land.

  3         (14)  "Relative capital account" means, for a member, a

  4  ratio the numerator of which is the capital account of that

  5  member and the denominator of which is the total of the

  6  capital accounts of all members.

  7         608.403  Purpose.--A limited liability company may be

  8  organized under this chapter for any lawful purpose, but

  9  remains subject to except that special statutes and

10  regulations of the laws of this state for regulating the

11  regulation and controlling its control of specific types of

12  business, which shall control when in conflict with this

13  chapter herewith.

14         608.404  Powers.--Unless its articles of organization

15  or operating agreement regulations provide otherwise, each

16  limited liability company organized and existing under this

17  chapter shall have the same powers as an individual to do all

18  things necessary to carry out its business and affairs,

19  including, without limitation, the power to:

20         (1)  Sue and or be sued, and or complain or defend, in

21  its name.

22         (2)  Purchase, take, receive, lease, subscribe for, or

23  otherwise acquire, own, hold, improve, vote, use, and or

24  otherwise deal in or with real or personal property, or an

25  interest in real or personal property or any legal or

26  equitable interest in property, wherever located.

27         (3)  Sell, convey, mortgage, grant pledge, create a

28  security interest in, lease, exchange, and lend, or otherwise

29  encumber or dispose of, all or any part of its property or

30  assets.

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  1         (4)  Purchase, receive, subscribe for, or otherwise

  2  acquire, own, hold, vote, use, sell, mortgage, lend, grant a

  3  security interest in, or otherwise dispose of and deal in and

  4  with, shares or other interests in or obligations of any other

  5  entity.

  6         (5)(4)  Make contracts or guarantees, or incur

  7  liabilities; borrow money; issue its notes, bonds, or other

  8  obligations, which may be convertible into or include the

  9  option to purchase other securities of the limited liability

10  company; secure any of its obligations by mortgage or pledge

11  of all or any part of its property, franchises, and income; or

12  make contracts of guaranty and suretyship which are necessary

13  or convenient to the conduct, promotion, or attainment of the

14  business of a corporation the majority of the outstanding

15  stock of which is owned, directly or indirectly, by the

16  contracting limited liability company; a corporation which

17  owns, directly or indirectly, a majority of the outstanding

18  membership interests stock of the contracting limited

19  liability company; or a corporation the majority of the

20  outstanding stock of which is owned, directly or indirectly,

21  by a corporation which owns, directly or indirectly, the

22  majority of the outstanding membership interests stock of the

23  contracting limited liability company, which contracts of

24  guaranty and suretyship shall be deemed to be necessary or

25  convenient to the conduct, promotion, or attainment of the

26  business of the contracting limited liability company; or make

27  other contracts of guaranty and suretyship which are necessary

28  or convenient to the conduct, promotion, or attainment of the

29  business of the contracting limited liability company.

30

31

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  1         (6)(5)  Lend money, invest or reinvest its funds, and

  2  or receive and hold real or personal property as security for

  3  repayment.

  4         (7)(6)  Conduct its business, locate offices, and

  5  exercise the powers granted by this chapter within or without

  6  this state.

  7         (8)(7)  Select Elect or appoint managers and appoint

  8  officers, directors, employees, and agents of the limited

  9  liability company, define their duties, fix their

10  compensation, and lend them money and credit.

11         (8)  Make and amend its regulations, not inconsistent

12  with its articles of organization or with the laws of this

13  state, for the administration and regulation of the affairs of

14  the company.

15         (9)  Make donations for to the public welfare or for

16  charitable, scientific, or educational purposes.

17         (10)  Indemnify a member or manager or any other person

18  as provided in this chapter against expenses actually and

19  reasonably incurred by him or her or it in connection with the

20  defense of an action, suit, or proceeding, whether civil or

21  criminal, in which he or she or it is made a party.

22         (11)  Cease its activities and surrender its

23  certificate of organization.

24         (12)  Have and exercise all powers necessary or

25  convenient to effect any or all of the purposes for which the

26  company is organized.

27         (13)  Transact any lawful business that will aid

28  governmental policy.

29         (10)(14)  Pay pensions and establish pension plans,

30  pension trusts, profit-sharing plans, bonus plans, option

31  plans, and benefit or other incentive plans for any or all of

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  1  its current or former managers, members, officers, agents, and

  2  employees.

  3         (11)(15)  Be a promoter, incorporator, shareholder,

  4  partner, member, associate, or manager of any corporation,

  5  partnership, limited partnership, limited liability company,

  6  joint venture, trust, or other entity.

  7         (12)(16)  Make payments or donations or do any other

  8  act not inconsistent with law that furthers the business and

  9  affairs of the limited liability company.

10         608.406  Limited liability company name.--

11         (1)  A limited liability company name:

12         (a)  Must contain the words "limited liability company"

13  or "limited company," or the abbreviations their abbreviation

14  "L.L.C." or "L.C.," or the designations "LLC" or "LC" as shall

15  be the last words of the name of every limited liability

16  company formed under the provisions of this chapter.  The word

17  "limited" may be abbreviated as "Ltd." and the word "company"

18  may be abbreviated as "Co."  Omission of the words "limited

19  liability company" or "limited company," the abbreviations

20  "L.L.C." or "L.C.," or the designations "LLC" or "LC" in the

21  use of the name of the limited liability company shall render

22  any person who knowingly participates in the omission, or

23  knowingly acquiesces in the omission, liable for any

24  indebtedness, damage, or liability caused by the omission.

25         (b)(2)  The limited liability name May not contain

26  language stating or implying that the limited liability

27  company is organized for a purpose other than that permitted

28  in this chapter act and its articles of organization.

29         (c)(3)  The limited liability name May not contain

30  language stating or implying that the limited liability

31  company is connected with a state or federal government agency

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  1  or a corporation or other entity chartered under the laws of

  2  the United States.

  3         (2)(4)  The name of the limited liability company shall

  4  be filed with the Department of State for public notice only

  5  and shall not alone create any presumption of ownership beyond

  6  that which is created under the common law. The Department of

  7  State shall record the name without regard to any other name

  8  recorded. The limited liability name must be distinguishable

  9  upon the records of the Division of Corporations of the

10  Department of State from all other entities or filings, except

11  fictitious name registrations pursuant to s. 865.09, organized

12  or registered under the laws of this state that are on file

13  with the division.

14         (5)  Omission of the words "limited liability company"

15  or "limited company," or their abbreviation "L.L.C." or

16  "L.C.," in the use of the name of the limited liability

17  company shall render any person who participates in the

18  omission, or knowingly acquiesces in it, liable for any

19  indebtedness, damage, or liability occasioned by the omission.

20         608.407  Articles of organization.--

21         (1)  In order to form a limited liability company,

22  articles of organization of a limited liability company shall

23  be executed and filed with the Department of State by one or

24  more members or authorized representatives of the company.

25  The articles of organization shall set forth:

26         (a)  The name of the limited liability company.

27         (b)  The period of its duration, which may be

28  perpetual.

29         (b)(c)  The mailing address and the street address of

30  the principal office of the limited liability company.

31

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  1         (c)(d)  The name and street address of its initial

  2  registered agent for service of process in the state. The

  3  articles of organization shall include or be accompanied by

  4  the written statement required by s. 608.415. together with a

  5  statement in writing in such form and manner as shall be

  6  prescribed by the Department of State accepting the

  7  appointment as a registered agent simultaneously with his or

  8  her being designated.  Such statement of acceptance shall

  9  state that the registered agent is familiar with, and accepts,

10  the obligations of that position.

11         (e)  The right, if given, of the members to admit

12  additional members and the terms and conditions of the

13  admissions.

14         (f)  The right, if given, of the remaining members of

15  the limited liability company to continue the business on the

16  death, retirement, resignation, expulsion, bankruptcy, or

17  dissolution of a member or the occurrence of any other event

18  which terminates the continued membership of a member in the

19  limited liability company.

20         (d)(g)1.  If the limited liability company is to be

21  managed by one a manager or more managers, a statement that

22  the company is to be a manager-managed company managed by a

23  manager or managers and the names and addresses of such

24  managers who are to serve as managers until the first annual

25  meeting of members or until their successors are elected and

26  qualify.

27         2.  If the management of a limited liability company is

28  reserved to the members, a statement to that effect and the

29  names and addresses of the managing members.

30         (e)(h)  Any other matters that the members elect

31  determine to include in the articles of organization therein.

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  1         (2)  An affidavit declaring that the limited liability

  2  company has at least one member and setting forth the amount

  3  of the cash and a description and agreed value of property

  4  other than cash contributed by the members and the amount

  5  anticipated to be contributed by the members shall accompany

  6  the articles of organization of a limited liability company.

  7         (2)(3)  A limited liability company is formed at the

  8  time described in s. 608.409 if the person filing the articles

  9  of organization has substantially complied there has been

10  substantial compliance with the requirements of this section.

11         (3)(4)  The articles of organization shall must be

12  executed by at least one member or the authorized

13  representative of a member.

14         608.408  Execution of certificate or statement.--

15         (1)  A certificate or statement required by this

16  chapter to be filed with the Department of State must be

17  executed in the following manner:

18         (a)  If it is the articles an original certificate of

19  organization, an affidavit, a supplemental affidavit, a

20  certificate of conversion amendment, or a statement of change

21  of registered agent or registered office, it must be signed by

22  a member or by the authorized representative of a member, and

23  by the new registered agent, if applicable; and

24         (b)  If it is a certificate of dissolution or

25  revocation of dissolution, it must be signed by all members

26  having the same percentage of membership interests necessary

27  to approve the dissolution or revocation of dissolution.

28         (2)  Any person may sign a certificate through by an

29  attorney in fact, but a power of attorney to sign a

30  certificate or statement authorizing relating to the admission

31  of a member must specifically describe the admission.

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  1         (3)  The execution of a certificate by a member

  2  constitutes an affirmation by the person executing the

  3  certificate, under the penalties of perjury, that the facts

  4  stated therein are true.

  5         (4)  If the articles of organization contain or any

  6  other document authorized or required to be filed under this

  7  chapter contains a false statement, one who suffers loss by

  8  reliance on the statement may recover damages for the loss

  9  from a person who signed the record or caused another to sign

10  it on the person's behalf and knew the statement to be false

11  at the time the record was signed.

12         608.4081  Filing requirements.--

13         (1)  To be filed by the Department of State, a document

14  must satisfy the following requirements, as supplemented or

15  modified by of this section and of any other section of this

16  chapter: that adds to or varies these requirements to be

17  entitled to filing by the Department of State.

18         (a)(2)  This chapter act must require or permit filing

19  the document by in the office of the Department of State.

20         (b)(3)  The document must be executed as required by s.

21  608.407 contain the information required by this act.  It may

22  contain other information as well.

23         (c)  The document must contain any information required

24  by this chapter and may contain other information the company

25  elects to include.

26         (d)(4)  The document must be typewritten or printed and

27  must be legible.

28         (e)(5)  The document must be in the English language.

29  A limited liability company name need not be in English if

30  written in English letters or Arabic or Roman numerals, and

31  the certificate of existence status required of a foreign

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  1  limited liability company companies need not be in English if

  2  accompanied by a reasonably authenticated English translation.

  3         (f)(6)  If the Department of State has prescribed a

  4  mandatory form for the document, the document must be in or on

  5  the prescribed form.

  6         (g)(7)  The document must be delivered to the office of

  7  the Department of State for filing, may be accompanied by one

  8  exact or conformed copy, and must be accompanied by the

  9  correct filing fee and any other tax or penalty required by

10  this chapter act or other law.

11         (2)  The document may be accompanied by one exact or

12  conformed copy.

13         (3)  Any signature on any certificate authorized to be

14  filed by the Department of State under any provision of this

15  chapter may be a facsimile, a conformed signature, or an

16  electronically transmitted signature.

17         608.4082  Filing duties of Department of State.--

18         (1)  The Department of State files a document by

19  stamping or otherwise endorsing the document as "filed,"

20  together with the Secretary of State's official title and the

21  date and time of receipt.  After filing a document, the

22  Department of State shall deliver an acknowledgment or

23  certified copy of the document to the domestic or foreign

24  limited liability company or its representative.

25         (2)  If The Department of State refuses to file a

26  document, it shall return any document the department refuses

27  to file it to the domestic or foreign limited liability

28  company or its representative within 15 days after the

29  document was received for filing, together with a brief,

30  written explanation of the reason for refusal.

31

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  1         (3)  If the applicant returns the document with

  2  corrections in accordance with the rules of the Department of

  3  State within 60 days after it was mailed to the applicant by

  4  the Department of State and if at the time of return the

  5  applicant so requests in writing, the filing date of the

  6  document shall be the filing date that would have been applied

  7  had the original document not been deficient, except as to

  8  persons who justifiably relied on the record before correction

  9  and were adversely affected thereby.

10         (4)(3)  The Department of State's duty to file

11  documents under this section is ministerial.  The Filing or

12  refusing to file a document does not:

13         (a)  Affect the validity or invalidity of the document

14  in whole or part;

15         (b)  Relate to the correctness or incorrectness of

16  information contained in the document; or

17         (c)  Create a presumption that the document is valid or

18  invalid or that information contained in the document is

19  correct or incorrect.

20         (5)(4)  If not otherwise provided by law and the

21  provisions of this chapter act, the Department of State shall

22  determine, by rule, the appropriate format for, number of

23  copies of, manner of execution of, method of electronic

24  transmission of, and amount of and method of payment of fees

25  for, any document placed under its jurisdiction.

26         (5)  If a document is determined by the Department of

27  State to be incomplete and inappropriate for filing, the

28  Department of State may return the document to the person or

29  limited liability company filing it, together with a brief

30  written explanation of the reason for the refusal to file.  If

31  the applicant returns the document with corrections in

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  1  accordance with the rules of the department within 60 days

  2  after it was mailed to the applicant by the department and if

  3  at the time of return the applicant so requests in writing,

  4  the filing date of the document will be the filing date that

  5  would have been applied had the original document not been

  6  deficient, except as to persons who justifiably relied on the

  7  record before correction and were adversely affected thereby.

  8         (6)  Unless otherwise permitted by this act, a delayed

  9  effective date for a document may not be later than the 90th

10  day after the date on which it is filed.

11         608.409  Effect of filing and issuance of time and date

12  endorsement on the articles certificate of organization.--

13         (1)  Unless a delayed effective date is specified, the

14  limited liability company's existence begins at the date and

15  time when the articles of organization are filed, as evidenced

16  by the Department of State's date and time endorsement on the

17  original document, or on a date specified in the articles of

18  organization, if such date is within 5 business days prior to

19  the date of filing.

20         (2)  The articles of organization may specify a delayed

21  effective time and date of commencement of the company's

22  existence, and if so specified they do, the articles of

23  organization shall become effective, and the company's

24  existence shall commence, at the time and date specified. If a

25  delayed effective date, but no time, is specified, the

26  articles of organization shall become effective, and the

27  company's existence shall commence, at the close of business

28  on the delayed effective that date. Unless otherwise permitted

29  by this chapter, a delayed effective date for a document may

30  not be later than the 90th day after the date on which the

31  document is filed.

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  1         (3)  The Department of State's filing of the articles

  2  of organization is conclusive proof that all conditions

  3  precedent to organization have been satisfied except in a

  4  proceeding by the state to cancel or revoke the organization

  5  or to administratively dissolve the organization.

  6         (4)  A limited liability company shall not transact

  7  business or incur indebtedness, except that which is

  8  incidental to its organization or to obtaining subscriptions

  9  for or payment of contributions, until the articles of

10  organization have been filed by the Department of State.

11         608.4101  Records to be kept; right to information.--

12         (1)  Each limited liability company shall keep at its

13  principal registered office the following records:

14         (a)  A current list of the full names and last known

15  business, residence, or mailing addresses of all members and

16  managers.

17         (b)  A copy of the articles of organization and all

18  certificates of conversion amendments thereto, together with

19  executed copies of any powers of attorney pursuant to which

20  any articles of organization or certificates were certificate

21  was executed.

22         (c)  Copies of the limited liability company's federal,

23  state, and local income tax returns and reports, if any, for

24  the 3 most recent years.

25         (d)  Copies of any then-effective operating agreement

26  regulations and any financial statements of the limited

27  liability company for the 3 most recent years.

28         (e)  Unless contained in the articles of organization

29  or the operating agreement regulations, a writing setting out:

30         1.  The amount of cash and a description and statement

31  of the agreed value of any the other property or services

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  1  contributed by each member and which each member has agreed to

  2  contribute.

  3         2.  The times at which or events on the happening of

  4  which any additional contributions agreed to be made by each

  5  member are to be made.

  6         3.  Any events upon the happening of which the limited

  7  liability company is to be dissolved and its affairs wound up.

  8         (2)  A limited liability company shall provide members

  9  and their agents and attorneys access to its records at the

10  company's principal office or other reasonable locations

11  specified in the operating agreement. The company shall

12  provide former members and their agents and attorneys access

13  for proper purposes to records pertaining to the period during

14  which they were members. The right of access provides the

15  opportunity to inspect and copy records during ordinary

16  business hours. The company may impose a reasonable charge,

17  limited to the costs of labor and material, for copies of

18  records furnished. Records kept under this section are subject

19  to inspection and copying during ordinary business hours at

20  the reasonable request, and at the expense, of any member.

21         (3)  A limited liability company shall furnish to a

22  member, and to the legal representative of a deceased member

23  or member under legal disability:

24         (a)  Without demand, information concerning the

25  company's business or affairs reasonably required for the

26  proper exercise of the member's rights and performance of the

27  member's duties under the operating agreement or this chapter;

28  and

29         (b)  On demand, other information concerning the

30  company's business or affairs, except to the extent that the

31

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  1  demand or the information demanded is unreasonable or

  2  otherwise improper under the circumstances.

  3         (4)  Each manager shall have the right to examine all

  4  of the information described in subsection (1) for a purpose

  5  reasonably related to his or her position as a manager. The

  6  manager of a limited liability company shall have the right to

  7  keep confidential from the members, for such period of time as

  8  the manager deems reasonable, any information which the

  9  manager reasonably believes to be in the nature of trade

10  secrets or other information the disclosure of which the

11  manager in good faith believes is not in the best interest of

12  the limited liability company or could damage the limited

13  liability company or its business or which the limited

14  liability company is required by law or by agreement with a

15  third party to keep confidential.

16         (5)  A limited liability company may maintain its

17  records in other than a written form if such form is capable

18  of conversion into written form within a reasonable time.

19         (6)  Any action to enforce any right arising under this

20  section shall be brought in the appropriate circuit court.

21         608.411  Amendments to or restatements of articles of

22  organization.--

23         (1)  The articles of organization of a limited

24  liability company are amended by filing the articles a

25  certificate of amendment thereto with the Department of State.

26  The articles certificate of amendment shall set forth:

27         (a)  The name of the limited liability company.

28         (b)  The date of filing of the articles of

29  organization.

30         (c)  The amendment to the articles of organization.

31

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  1         (2)  Within 30 days after the happening of any of the

  2  following events, an amendment to the articles of

  3  organization, indicating the occurrence of the event or

  4  events, shall be filed:

  5         (a)  There is a change in the name of the limited

  6  liability company.

  7         (b)  There is a false or erroneous statement in the

  8  articles of organization.

  9         (c)  There is a change in the time as stated in the

10  articles of organization for the dissolution of the limited

11  liability company.

12         (d)  A time is fixed for the dissolution of the limited

13  liability company, if no time is specified in the articles of

14  organization.

15         (e)  The members desire to make a change in any other

16  statement in the articles of organization in order for it to

17  accurately represent the agreement between them.

18         (2)(3)  Unless otherwise provided in this chapter or in

19  the articles certificate of amendment, the articles a

20  certificate of amendment shall be effective when filed at the

21  time of its filing with the Department of State.

22         (3)(4)  A limited liability company may, whenever

23  desired, integrate into a single instrument all of the

24  provisions of its articles of organization which are then in

25  effect and operative as a result of there having theretofore

26  been filed with the department one or more certificates or

27  other instruments pursuant to any of the provisions referred

28  to in this section, and it may at the same time further amend

29  its articles of organization by adopting restated articles of

30  organization which meet all the requirements of s. 608.407.

31

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  1         (4)(5)  If the restated articles of organization merely

  2  restate and integrate but do not further amend the

  3  then-effective initial articles of organization as theretofore

  4  amended or supplemented by any instrument that was executed

  5  and filed pursuant to any of the provisions of this section,

  6  the company it shall title the filing be specifically

  7  designated in its heading as the "Restated Articles of

  8  Organization," together with such other words as the limited

  9  liability company deems may deem appropriate, and shall be

10  executed as provided in this chapter for articles of

11  organization and filed as provided by this chapter with the

12  department.  If the restated articles restate and integrate

13  and also further amend in any respect the then-effective

14  articles of organization, the company as theretofore amended

15  or supplemented, they shall title the filing be specifically

16  designated in their heading as the "Amended and Restated

17  Articles of Organization," together with such other words as

18  the limited liability company deems may deem appropriate. In

19  each case described in this subsection, the document and shall

20  be executed as provided in this chapter for articles of

21  organization and filed as provided by this chapter with the

22  Department of State.

23         (5)(6)  Restated articles of organization shall state,

24  either in their heading or in an introductory paragraph, the

25  limited liability company's present name, and, if it has been

26  changed, the name under which it was originally filed; the

27  date of filing of its original articles of organization with

28  the Department of State; and any the future effective date or

29  time if other than the date and time of, which shall be a date

30  or time certain, of the restated articles if it is not to be

31  effective upon the filing of the restated articles of

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  1  organization. Restated articles of organization shall also

  2  state that they were duly executed and are being filed in

  3  accordance with this section. If the restated articles of

  4  organization only restate and integrate and do not further

  5  amend the limited liability company's articles of organization

  6  as theretofore amended or supplemented and there is no

  7  discrepancy between those provisions and the restated articles

  8  of organization, they shall state that fact as well.

  9         (6)(7)  Upon the filing of the restated articles of

10  organization with the Department of State, or upon any the

11  future effective date or time provided in of restated articles

12  of organization as provided for therein, the initial articles

13  of organization existing prior to such filing, as theretofore

14  amended or supplemented, shall be superseded and; thenceforth,

15  the restated articles of organization, including any further

16  amendment or changes made thereby, shall become be the

17  company's articles of organization. of the limited liability

18  company, but The original effective date of the company's

19  formation shall remain unchanged.

20         (7)(8)  Any amendment or change effected in connection

21  with the restatement and integration of the articles of

22  organization shall be subject to any other provisions of this

23  chapter, not inconsistent with this section, which would apply

24  if a separate articles certificate of amendment were filed to

25  effect such amendment or change.

26         608.4115  Correcting the articles of organization filed

27  of record.--

28         (1)  A limited liability company or foreign limited

29  liability company may correct the articles of organization

30  filed of record with the Department of State within 30

31

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  1  business days after filing if the record contains a false or

  2  erroneous statement or was defectively signed.

  3         (2)  The articles of organization filed of record are

  4  corrected:

  5         (a)  By preparing articles of correction that:

  6         1.  Describe the articles of organization filed of

  7  record, including their filing date, or attach a copy of the

  8  articles of organization to the articles of correction.

  9         2.  Specify the incorrect statement and the reason the

10  statement is incorrect or the manner in which the signing was

11  defective.

12         3.  Correct the incorrect statement or defective

13  signing.

14         (b)  By delivering the articles of correction to the

15  Department of State for filing.

16         (3)  The articles of correction are effective

17  retroactively to the effective date of the articles of

18  organization they correct except as to persons relying on the

19  uncorrected articles of organization and adversely affected by

20  the correction. As to those persons, the articles of

21  correction are effective when filed.

22         608.415  Registered office and registered agent.--

23         (1)  Each limited liability company shall have and

24  continuously maintain in this state:

25         (a)  A registered office, which may be the same as its

26  place of business; and

27         (b)  A registered agent, which agent may be either:

28         1.  An individual who resides in this state whose

29  business office is identical with such registered office.

30         2.  A foreign or domestic entity corporation or limited

31  liability company authorized to transact business in this

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  1  state, having a business office identical with such registered

  2  office.

  3         (2)  A registered agent or a successor registered agent

  4  appointed pursuant to s. 608.416 on whom process may be served

  5  shall each file a statement in writing with the Department of

  6  State accepting the appointment as registered agent

  7  simultaneously with being designated.  Such statement or

  8  acceptance shall state that the registered agent is familiar

  9  with, and accepts, the obligations of that position as

10  provided for in this chapter.

11         (3)  The Department of State shall maintain an accurate

12  record of the registered agents and registered office for the

13  service of process and shall furnish any information disclosed

14  thereby promptly upon request and payment of the required fee.

15         (4)  A limited liability company may not prosecute,

16  maintain, or defend any action in any court until the limited

17  liability company complies with the provisions of this section

18  and pays to the Department of State a penalty of $5 for each

19  day it has failed to comply or $500, whichever amount is less,

20  and pays any other amount required under this chapter.

21         608.416  Change of registered office or registered

22  agent.--

23         (1)  A limited liability company may change its

24  registered office or agent by upon filing with the Department

25  of State a statement setting forth:

26         (a)  The name of the limited liability company.

27         (b)  The street address of its current registered

28  office.

29         (c)  If the street address of its registered office is

30  to be changed, the new street address to which the registered

31  office is to be changed.

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  1         (d)  If its current registered agent is to be changed,

  2  the name of the new registered agent and the new registered

  3  agent's written consent to the appointment, either on the

  4  statement or attached to it.

  5         (e)  That such change was authorized by affirmative

  6  vote of a majority of the members or as otherwise provided in

  7  the articles of organization or the operating agreement

  8  regulations of the limited liability company.

  9         (2)  Any registered agent may resign his or her agency

10  appointment by signing and delivering for filing with the

11  Department of State a statement of resignation and mailing a

12  copy of such statement to the limited liability company at its

13  principal office address shown in its most recently filed

14  document.  The agency is terminated and the registered office

15  discontinued, if so provided, on the 31st day after the date

16  on which the statement was filed with the Department of State.

17  After receipt of the notice of the resignation of its

18  registered agent, the limited liability company for which such

19  registered agent was acting shall obtain and designate a new

20  registered agent to take the place of the resigning registered

21  agent.

22         (3)  A registered agent may change the address of the

23  registered office of any limited liability company for which

24  such agent his or hers is the registered agency by notifying

25  the limited liability company in writing of the change,

26  signing, either manually or in facsimile, and delivering to

27  the Department of State for filing a statement that complies

28  with the requirements of paragraphs (1)(a)-(d), and reciting

29  that the limited liability company has been notified of the

30  change.

31

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  1         608.4211  Contributions to capital and liability for

  2  contribution.--

  3         (1)  The contribution of a member may be in cash,

  4  property, or services rendered, or a promissory note or other

  5  obligation to contribute cash or property or to perform

  6  services.

  7         (2)  A promise by a member to contribute to the limited

  8  liability company is not enforceable unless it is set out in

  9  writing signed by the member.

10         (3)  Unless otherwise Except as provided in the

11  articles of organization or operating agreement regulations, a

12  member is obligated to the limited liability company to

13  perform any enforceable promise to contribute cash or property

14  or to perform services, even if the member he or she is unable

15  to perform because of the member's his or her death or

16  disability or any other reason.  If a member does not make the

17  required contribution of property or services, the member he

18  or she is obligated, at the option of the limited liability

19  company, to contribute cash equal to that portion of the

20  agreed value, as stated in the records of the limited

21  liability company required to be kept pursuant to this

22  chapter, of the stated contribution that has not been made.

23  The foregoing option shall be in addition to, and not in lieu

24  of, any other rights, including the right to specific

25  performance, that the limited liability company may have

26  against such member under the articles of organization or

27  operating agreement or applicable law.

28         (4)  Unless otherwise provided in the articles of

29  organization or the operating agreement regulations, the

30  obligation of a member to make a contribution or return money

31  or other property paid or distributed in violation of this

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  1  chapter may be compromised only by consent of all the members.

  2  Notwithstanding the compromise, the creditor of a limited

  3  liability company, who extends credit or otherwise acts in

  4  reasonable reliance upon that obligation after the member has

  5  signed a writing that indicates the obligation and before the

  6  amendment or cancellation of the writing to indicate the

  7  compromise, may enforce the original obligation to the extent

  8  the creditor relied on the obligation when extending credit.

  9         (5)  The articles of organization or operating

10  agreement regulations of a limited liability company may

11  provide that the interest of any member who fails to make any

12  contribution that the member he or she is obligated to make

13  shall be subject to specified penalties for, or specified

14  consequences of, such failure.  Such penalties or consequences

15  may take the form of reducing the defaulting member's

16  proportionate membership interest in the limited liability

17  company, subordinating the defaulting member's his or her

18  interest in the limited liability company to that of the

19  nondefaulting members, a forced sale of the defaulting

20  member's membership limited liability company interest, the

21  forfeiture of the defaulting member's membership limited

22  liability company interest, the lending by other members of

23  the amount necessary to meet the defaulting member's his or

24  her commitment, a fixing of the value of the defaulting

25  member's membership limited liability company interest by

26  appraisal or by formula and redemption or sale of the

27  defaulting member's membership limited liability company

28  interest at such value, or other penalties or consequences.

29         608.422  Management of limited liability company.--

30         (1)  The management of the limited liability company,

31  Unless otherwise provided in its the articles of organization

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  1  or the operating agreement, the company shall be a

  2  member-managed company. regulations, shall be vested in its

  3  members in proportion to their contributions to the capital of

  4  the limited liability company, as adjusted from time to time

  5  to properly reflect any additional contributions or

  6  withdrawals by the members; however,

  7         (2)  In a member-managed company:

  8         (a)  Unless otherwise provided in the articles of

  9  organization or operating agreement, management shall be

10  vested in its members in proportion to the then-current

11  percentage or other interest of members in the profits of the

12  limited liability company owned by all of the members.

13         (b)  Except as otherwise provided in subsection (3) or

14  in this chapter, the decision of a majority-in-interest of the

15  members shall be controlling.

16         (3)  If the articles of organization or the operating

17  agreement provide for the management of the limited liability

18  company by a manager or managers, the management of the

19  limited liability company shall may be vested in a manager or

20  managers and the company shall be a manager-managed company.

21  who shall be elected annually by the members in the manner

22  prescribed by and provided in the articles of organization or

23  the regulations of the limited liability company.  The manager

24  or managers shall also hold the offices and have the

25  responsibilities accorded to them by the members and set out

26  in the articles of organization or the regulations of the

27  limited liability company.

28         (4)  In a manager-managed company:

29         (a)  Each manager has equal rights in the management

30  and conduct of the company's business.

31

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  1         (b)  Except as otherwise provided in subsection (3) or

  2  in this chapter, any matter relating to the business of the

  3  company may be exclusively decided by the manager or, if there

  4  is more than one manager, by a majority of the managers.

  5         (c)  A manager:

  6         1.  Must be designated, appointed, elected, removed, or

  7  replaced by a vote, approval, or consent of a

  8  majority-in-interest of the members; and

  9         2.  Holds office until a successor has been elected and

10  qualified, unless the manager sooner resigns or is removed.

11         (5)  Action requiring the consent of members or

12  managers under this chapter may be taken without a meeting,

13  subject to the limitations of s. 608.4231.

14         (6)  A member or manager may appoint a proxy to vote or

15  otherwise act for the member or manager by signing an

16  appointment instrument, either personally or by the member's

17  or manager's attorney-in-fact.

18         (7)  The manager or managers may also hold the offices

19  and have such other responsibilities accorded to them by the

20  members and set out in the articles of organization or the

21  operating agreement of the limited liability company.

22         608.4225  General standards for managers and managing

23  members.--

24         (1)  Subject to ss. 608.423 and 608.4226, each manager

25  and managing member shall owe a duty of loyalty and a duty of

26  care to the limited liability company and the other members of

27  the limited liability company. A manager or managing member

28  shall discharge his or her duties as a manager or managing

29  member, including his or her duties as a member of a

30  committee:

31         (a)  The duty of loyalty includes, without limitation:

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  1         1.  Accounting to the limited liability company and

  2  holding as trustee for the limited liability company any

  3  property, profit, or benefit derived by such manager or

  4  managing member in the conduct or winding up of the limited

  5  liability company business or derived from a use by such

  6  manager or managing member of limited liability company

  7  property, including the appropriation of a limited liability

  8  company opportunity.

  9         2.  Refraining from dealing with the limited liability

10  company in the conduct or winding up of the limited liability

11  company business as or on behalf of a party having an interest

12  adverse to the limited liability company.

13         3.  Refraining from competing with the limited

14  liability company in the conduct of the limited liability

15  company business before the dissolution of the limited

16  liability company. In good faith.

17         (b)  The duty of care is limited to refraining from

18  engaging in grossly negligent or reckless conduct, intentional

19  misconduct, or a knowing violation of law. With the care an

20  ordinarily prudent person in a like position would exercise

21  under similar circumstances.

22         (c)  Each manager and managing member shall discharge

23  the duties to the limited liability company and other members

24  under this chapter or under the articles of organization or

25  operating agreement and exercise any rights consistent with

26  the obligation of good faith and fair dealing. In a manner he

27  or she reasonably believes to be in the best interests of the

28  limited liability company.

29         (d)  A manager or managing member does not violate a

30  duty or obligation under this chapter or under the articles of

31  organization or operating agreement merely because the

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  1  manager's or managing member's conduct furthers such manager's

  2  or managing member's own interest.

  3         (e)  A manager or managing member may lend money to and

  4  transact other business with the company. As to each loan or

  5  transaction, the rights and obligations of the manager or

  6  managing member are the same as those of a person who is not a

  7  member, subject to other applicable law.

  8         (f)  This section applies to a person winding up the

  9  limited liability company business as the personal or other

10  legal representative of the last surviving member as if such

11  person were a manager or managing member.

12         (2)  In discharging a manager's or managing member's

13  his or her duties, a manager or managing member is entitled to

14  rely on information, opinions, reports, or statements,

15  including financial statements and other financial data, if

16  prepared or presented by:

17         (a)  One or more members or employees of the limited

18  liability company whom the manager or managing member

19  reasonably believes to be reliable and competent in the

20  matters presented;

21         (b)  Legal counsel, public accountants, or other

22  persons as to matters the manager or managing member

23  reasonably believes are within the persons' professional or

24  expert competence; or

25         (c)  A committee of managers, members, or managing

26  members of which the affected manager or managing member he or

27  she is not a participant member if the manager or managing

28  member reasonably believes the committee merits confidence.

29         (3)  In discharging a manager's or managing member's

30  his or her duties, a manager or managing member may consider

31  such factors as the manager or managing member he or she deems

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  1  relevant, including the long-term prospects and interests of

  2  the limited liability company and its members, and the social,

  3  economic, legal, or other effects of any action on the

  4  employees, suppliers, customers of the limited liability

  5  company, the communities and society in which the limited

  6  liability company operates, and the economy of the state and

  7  the nation.

  8         (4)  A member, manager, or managing member is not

  9  acting in good faith if the member, manager, or managing

10  member he or she has knowledge concerning the matter in

11  question that makes reliance otherwise permitted by subsection

12  (2) unwarranted.

13         (5)  A manager or managing member is not liable for any

14  action taken as a manager or managing member, or any failure

15  to take any action, if the manager or managing member he or

16  she performed the duties of the manager's or managing member's

17  his or her position in compliance with this section.

18         608.4226  Conflicts of interest.--

19         (1)  No contract or other transaction between a limited

20  liability company and one or more of its members, managers, or

21  managing members or any other limited liability company,

22  corporation, firm, association, or entity in which one or more

23  of its members, managers, or managing members are managers,

24  managing members, directors, or officers or are financially

25  interested shall be either void or voidable because of such

26  relationship or interest, because such members, managers, or

27  managing members are present at the meeting of the managers or

28  managing members or a committee thereof which authorizes,

29  approves, or ratifies such contract or transaction, or because

30  their votes are counted for such purpose, if:

31

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  1         (a)  The fact of such relationship or interest is

  2  disclosed or known to the managers or managing members or

  3  committee which authorizes, approves, or ratifies the contract

  4  or transaction by a vote or consent sufficient for the purpose

  5  without counting the votes or consents of such interested

  6  members, managers, or managing members;

  7         (b)  The fact of such relationship or interest is

  8  disclosed or known to the members entitled to vote and they

  9  authorize, approve, or ratify such contract or transaction by

10  vote or written consent; or

11         (c)  The contract or transaction is fair and reasonable

12  as to the limited liability company at the time it is

13  authorized by the managers, managing members, a committee, or

14  the members.

15         (2)  For purposes of paragraph (1)(a) only, a conflict

16  of interest transaction is authorized, approved, or ratified

17  if it receives the affirmative vote of a majority of the

18  managers or managing members, or of the committee, who have no

19  relationship or interest in the transaction described in

20  subsection (1), but a transaction may not be authorized,

21  approved, or ratified under this section by a single manager

22  of a manager-managed company or a single managing member of a

23  member-managed company, unless the company is a single member

24  limited liability company. If a majority of the managers or

25  managing members who have no such relationship or interest in

26  the transaction vote to authorize, approve, or ratify the

27  transaction, a quorum is present for the purpose of taking

28  action under this section. The presence of or a vote cast by a

29  manager or managing member with such relationship or interest

30  in the transaction does not affect the validity of any action

31  taken under paragraph (1)(a) if the transaction is otherwise

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  1  authorized, approved, or ratified as provided in that

  2  subsection, but such presence or vote of those managers or

  3  managing members may be counted for purposes of determining

  4  whether the transaction is approved under other sections of

  5  this chapter.

  6         (3)  For purposes of paragraph (1)(b), a conflict of

  7  interest transaction is authorized, approved, or ratified if

  8  it receives the vote of a majority-in-interest of the members

  9  entitled to be counted under this subsection. Membership

10  interests owned by or voted under the control of a manager or

11  managing member who has a relationship or interest in the

12  transaction described in subsection (1) may not be counted in

13  a vote of members to determine whether to authorize, approve,

14  or ratify a conflict of interest transaction under paragraph

15  (1)(b). The vote of those membership interests, however, is

16  counted in determining whether the transaction is approved

17  under other sections of this act. A majority-in-interest of

18  the members, whether or not present, that are entitled to be

19  counted in a vote on the transaction under this subsection

20  constitutes a quorum for the purpose of taking action under

21  this section.

22         (Substantial rewording of section.  See

23         s. 608.436, F.S., for present text.)

24         608.4227  Liability of members and managers.--

25         (1)  Except as provided in this chapter, neither the

26  members of a limited liability company nor the managers of a

27  limited liability company managed by a manager or managing

28  member are liable, solely by reason of being a member or

29  serving as a manager or managing member, under a judgment,

30  decree, or order of a court, or in any other manner, for a

31

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  1  debt, obligation, or liability of the limited liability

  2  company;

  3         (2)  Any such member or manager or other person acting

  4  under the articles of organization or operating agreement of a

  5  limited liability company shall not be liable to the limited

  6  liability company or to any such other member or manager for

  7  the member's or manager's or other person's good faith

  8  reliance on the provisions of the limited liability company's

  9  articles of organization or operating agreement; and

10         (3)  The member's or manager's or other person's duties

11  and liabilities may be expanded or restricted by provisions in

12  a limited liability company's articles of organization or

13  operating agreement.

14         (Substantial rewording of section.  See

15         s. 608.4362, F.S., for present text.)

16         608.4228  Liability of managers and managing members.--

17         (1)  A manager or a managing member shall not be

18  personally liable for monetary damages to the limited

19  liability company or any other person for any statement, vote,

20  decision, or failure to act regarding management or policy

21  decisions by a manager or a managing member, unless:

22         (a)  The manager or managing member breached or failed

23  to perform the duties as a manager or managing member; and

24         (b)  The manager's or managing member's breach of or

25  failure to perform those duties constitutes any of the

26  following:

27         1.  A violation of the criminal law, unless the manager

28  or managing member had a reasonable cause to believe his or

29  her conduct was lawful or had no reasonable cause to believe

30  such conduct was unlawful. A judgment or other final

31  adjudication against a manager or managing member in any

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  1  criminal proceeding for a violation of the criminal law estops

  2  that manager or managing member from contesting the fact that

  3  such breach, or failure to perform, constitutes a violation of

  4  the criminal law, but does not estop the manager or managing

  5  member from establishing that he or she had reasonable cause

  6  to believe that his or her conduct was lawful or had no

  7  reasonable cause to believe that such conduct was unlawful.

  8         2.  A transaction from which the manager or managing

  9  member derived an improper personal benefit, either directly

10  or indirectly.

11         3.  A distribution in violation of s. 608.426.

12         4.  In a proceeding by or in the right of the limited

13  liability company to procure a judgment in its favor or by or

14  in the right of a member, conscious disregard of the best

15  interest of the limited liability company, or willful

16  misconduct.

17         5.  In a proceeding by or in the right of someone other

18  than the limited liability company or a member, recklessness

19  or an act or omission which was committed in bad faith or with

20  malicious purpose or in a manner exhibiting wanton and willful

21  disregard of human rights, safety, or property.

22         (2)  For the purposes of this section, the term

23  "recklessness" means acting, or failing to act, in conscious

24  disregard of a risk known, or so obvious that it should have

25  been known, to the manager or managing member and known to the

26  manager or managing member, to be so great as to make it

27  highly probable that harm would follow from such action or

28  failure to act.

29         (3)  A manager or managing member is deemed not to have

30  derived an improper personal benefit from any transaction if

31  the transaction and the nature of any personal benefit derived

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  1  by the manager or managing member are not prohibited by state

  2  or federal law or the articles of organization or operating

  3  agreement and, without further limitation, the transaction and

  4  the nature of any personal benefit derived by a manager or

  5  managing member are disclosed or known to the members, and the

  6  transaction was authorized, approved, or ratified by the vote

  7  of a majority-in-interest of the members other than the

  8  managing member, or the transaction was fair and reasonable to

  9  the limited liability company at the time it was authorized by

10  the manager or managing member, notwithstanding that a manager

11  or managing member received a personal benefit.

12         (4)  The circumstances set forth in subsection (3) are

13  not exclusive and do not preclude the existence of other

14  circumstances under which a manager will be deemed not to have

15  derived an improper benefit.

16         (Substantial rewording of section.  See

17         s. 608.4363, F.S., for present text.)

18         608.4229  Indemnification of managers, managing

19  members, officers, employees, and agents.--

20         (1)  Subject to such standards and restrictions, if

21  any, as are set forth in its articles of organization or

22  operating agreement, a limited liability company may, and

23  shall have the power to, but shall not be required to,

24  indemnify and hold harmless any member or manager or other

25  person from and against any and all claims and demands

26  whatsoever.

27         (2)  Notwithstanding subsection (1), indemnification or

28  advancement of expenses shall not be made to or on behalf of

29  any manager, managing member, officer, employee, or agent if a

30  judgment or other final adjudication establishes that the

31  actions, or omissions to act, of such manager, managing

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  1  member, officer, employee, or agent were material to the cause

  2  of action so adjudicated and constitute any of the following:

  3         (a)  A violation of criminal law, unless the manager,

  4  managing member, officer, employee, or agent had no reasonable

  5  cause to believe such conduct was unlawful.

  6         (b)  A transaction from which the manager, managing

  7  member, officer, employee, or agent derived an improper

  8  personal benefit.

  9         (c)  In the case of a manager or managing member, a

10  circumstance under which the liability provisions of s.

11  608.426 are applicable.

12         (d)  Willful misconduct or a conscious disregard for

13  the best interests of the limited liability company in a

14  proceeding by or in the right of the limited liability company

15  to procure a judgment in its favor or in a proceeding by or in

16  the right of a member.

17         608.423  Limited liability company operating agreement;

18  nonwaivable provisions regulations.--

19         (1)  Except as otherwise provided in subsection (2),

20  all members of a limited liability company may enter into an

21  operating agreement, which need not be in writing, to regulate

22  the affairs of the company and the conduct of its business,

23  establish duties in addition to those set forth in this

24  chapter, and to govern relations among the members, managers,

25  and company. Any inconsistency between written and oral

26  operating agreements shall be resolved in favor of the written

27  agreement. To the extent the operating agreement does not

28  otherwise provide, this chapter governs relations among the

29  members, managers, and company.

30         (2)  The operating agreement may not:

31

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  1         (a)  Unreasonably restrict a right to information or

  2  access to records under s. 608.4101;

  3         (b)  Eliminate the duty of loyalty under s. 608.4225,

  4  but the agreement may:

  5         1.  Identify specific types or categories of activities

  6  that do not violate the duty of loyalty, if not manifestly

  7  unreasonable; and

  8         2.  Specify the number or percentage of members or

  9  disinterested managers that may authorize or ratify, after

10  full disclosure of all material facts, a specific act or

11  transaction that otherwise would violate the duty of loyalty;

12         (c)  Unreasonably reduce the duty of care under s.

13  608.4225;

14         (d)  Eliminate the obligation of good faith and fair

15  dealing under s. 608.4225, but the operating agreement may

16  determine the standards by which the performance of the

17  obligation is to be measured, if the standards are not

18  manifestly unreasonable;

19         (e)  Vary the right to expel a member in an event

20  specified in this chapter;

21         (f)  Vary the requirement to wind up the limited

22  liability company's business in a case specified in this

23  chapter; or

24         (g)  Restrict rights of a person, other than a manager,

25  member, or transferee of a member's distributional interest,

26  under this chapter.

27         (3)(1)  The power to adopt, alter, amend, or repeal the

28  operating agreement regulations of a limited liability company

29  shall be vested in the members of the company unless vested in

30  the manager or managers of the company by the articles of

31  organization or operating agreement, provided that any

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  1  amendment to a written operating agreement shall be in

  2  writing.  The operating agreement Regulations adopted by the

  3  members or by the manager or managers may be repealed or

  4  altered; a new operating agreement regulations may be adopted

  5  by the members; and the members may prescribe in any operating

  6  agreement regulations made by them that such operating

  7  agreement regulations may not be altered, amended, or repealed

  8  by the manager or managers.  The regulations may contain any

  9  provisions for the regulation and management of the affairs of

10  the limited liability company not inconsistent with law or the

11  articles of organization.

12         (4)(2)  Unless the articles of organization or the

13  operating agreement provides regulations provide otherwise, if

14  the management of the limited liability company is vested in a

15  manager or managers, the managers may adopt an operating

16  agreement regulations to be effective only in an emergency as

17  defined in subsection (7) (5).  The emergency operating

18  agreement regulations, which is are subject to amendment or

19  repeal by the members, may make all provisions necessary for

20  managing the limited liability company during an emergency,

21  including procedures for calling a meeting of the managers and

22  designation of additional or substitute managers.

23         (5)(3)  All provisions of the regular operating

24  agreement regulations consistent with the emergency

25  regulations remain effective during the emergency.  The

26  emergency operating agreement is regulations are not effective

27  after the emergency ends.

28         (6)(4)  Actions taken by the limited liability company

29  in good faith in accordance with the emergency operating

30  agreement regulations have the effect of binding the company

31

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  1  and may not be used to impose liability on a manager,

  2  employee, or agent of the company.

  3         (7)(5)  An emergency exists for purposes of this

  4  section if the limited liability company's managers cannot

  5  readily be assembled because of some catastrophic event.

  6         (Substantial rewording of section.  See

  7         s. 608.4231, F.S., for present text.)

  8         608.4231  Voting by members and managers.--

  9         (1)  The articles of organization or operating

10  agreement may provide for classes or groups of members having

11  such relative rights, powers, and duties as the articles of

12  organization or operating agreement may provide, and may make

13  provision for the future creation in the manner provided in

14  the articles of organization or operating agreement of

15  additional classes or groups of members having such relative

16  rights, powers, and duties as may be established, including

17  rights, powers, and duties senior to existing classes and

18  groups of members. The articles of organization or operating

19  agreement may provide for the taking of an action, including

20  the amendment of the articles of organization or operating

21  agreement, without the vote or approval of any member or class

22  or group of members, including an action to create under the

23  provisions of the articles of organization or operating

24  agreement a class or group of limited liability company

25  interests that was not previously outstanding. The articles of

26  organization or operating agreement may provide that any

27  member or class or group of members shall have no voting

28  rights.

29         (2)  The articles of organization or operating

30  agreement may grant to all or certain identified members or a

31  specified class or group of the members the right to vote

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  1  separately or with all or any class or group of the members or

  2  manager on any matter. Voting by members may be on a

  3  per-capita, number, financial interest, class, group, or any

  4  other basis.

  5         (3)  If no voting provision is contained in the

  6  articles of organization or operating agreement:

  7         (a)  The members of a limited liability company shall

  8  vote in proportion to their then-current percentage or other

  9  interest in the profits of the limited liability company or,

10  in the case of a member who has assigned the member's entire

11  economic interest in the limited liability company to a person

12  who has not been admitted as a member, in proportion to the

13  then-current percentage or other interest in the profits of

14  the limited liability company that the assigning member would

15  have, had the assignment not been made.

16         (b)  In all matters in which a vote is required, a vote

17  of a majority-in-interest of the members shall be sufficient

18  unless provided otherwise in the company's articles of

19  organization or operating agreement or this chapter.

20         (4)  Notwithstanding any provision to the contrary in

21  the articles of organization or operating agreement, in no

22  event shall the articles of organization be amended by a vote

23  of less than a majority-in-interest of the members.

24         (5)  Notwithstanding any provision to the contrary in

25  the articles of organization or operating agreement, members

26  shall have the right to vote on a dissolution of the limited

27  liability company as provided in s. 608.441 and on a merger of

28  the limited liability company as provided in s. 608.4381.

29         (6)  Except as otherwise provided in the articles of

30  organization or the operating agreement, if the members have

31  appointed more than one manager to manage the business of the

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  1  limited liability company, decisions of the managers shall be

  2  made by majority vote of the managers, if at a meeting, or by

  3  unanimous written consent.

  4         (7)  The articles of organization or operating

  5  agreement which grants a right to vote may set forth

  6  provisions relating to notice of the time, place, or purpose

  7  of any meeting at which any matter is to be voted on by any

  8  members, waiver of any such notice, action by consent without

  9  a meeting, the establishment of a record date, quorum

10  requirements, voting in person or by proxy, or any other

11  matter with respect to the exercise of any such right to vote.

12         (8)  Unless otherwise provided in the articles of

13  organization or operating agreement, on any matter that is to

14  be voted on by members, the members may take such action

15  without a meeting, without prior notice, and without a vote if

16  a consent or consents in writing, setting forth the action so

17  taken, are signed by the members having not less than the

18  minimum number of votes that would be necessary to authorize

19  or take such action at a meeting, but in no event by a vote of

20  less than a majority-in-interest of the members which would be

21  necessary to authorize or take such action at a meeting.

22  Unless otherwise provided in the articles of organization or

23  operating agreement, on any matter that is to be voted on by

24  members or managers, the members or managers may vote in

25  person or by proxy. Within 10 days after obtaining such

26  authorization by written consent, notice must be given to

27  those members who have not consented in writing or who are not

28  entitled to vote on the action.

29         608.4232  Admission of additional members.--Except as

30  otherwise provided in the articles of organization or the

31  operating agreement regulations, no person may be admitted as

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  1  a member unless a majority-in-interest of the members consent

  2  each member consents in writing to the admission of the

  3  additional member.

  4         608.4235  Agency of members and managers.--

  5         (1)  Subject to subsections (2) and (3):

  6         (a)  In a member-managed company, each member is an

  7  agent of the limited liability company for the purpose of its

  8  business, and an act of a member, including the signing of an

  9  instrument in the company's name, for apparently carrying on

10  in the ordinary course the company's business or business of

11  the kind carried on by the company binds the company, unless

12  the member had no authority to act for the company in the

13  particular matter and the person with whom the member was

14  dealing knew or had notice that the member lacked authority.

15         (b)  An act of a member which is not apparently for

16  carrying on in the ordinary course the company's business or

17  business of the kind carried on by the company binds the

18  company only if the act was authorized by appropriate vote of

19  the other members.

20         (2)  Subject to subsection (3), in a manager-managed

21  company:

22         (a)  A member is not an agent of the company for the

23  purpose of its business solely by reason of being a member.

24  Each manager is an agent of the company for the purpose of its

25  business, and an act of a manager, including the signing of an

26  instrument in the company's name, for apparently carrying on

27  in the ordinary course the company's business or business of

28  the kind carried on by the company binds the company, unless

29  the manager had no authority to act for the company in the

30  particular matter and the person with whom the manager was

31  dealing knew or had notice that the manager lacked authority.

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  1         (b)  An act of a manager which is not apparently for

  2  carrying on in the ordinary course the company's business or

  3  business of the kind carried on by the company binds the

  4  company only if the act was authorized under s. 608.422.

  5         (3)  Unless the articles of organization or operating

  6  agreement limit the authority of a member, any member of a

  7  member-managed company or manager of a manager-managed company

  8  may sign and deliver any instrument transferring or affecting

  9  the company's interest in real property. The instrument is

10  conclusive in favor of a person who gives value without

11  knowledge of the lack of the authority of the person signing

12  and delivering the instrument.

13         608.4236 Delegation of rights and powers to

14  manage.--Unless otherwise provided in the limited liability

15  company's articles of organization or operating agreement, a

16  member or manager of a limited liability company has the power

17  and authority to delegate to one or more other persons the

18  member's or manager's, as the case may be, rights and powers

19  to manage and control the business and affairs of the limited

20  liability company, including the power and authority to

21  delegate to agents, boards of managers, managing members or

22  directors, officers and assistant officers, and employees of a

23  member or manager of the limited liability company and the

24  power and authority to delegate by a management agreement or

25  another agreement with, or otherwise, to other persons. Unless

26  otherwise provided in the limited liability company's articles

27  of organization or operating agreement, such delegation by a

28  member or manager of a limited liability company shall not

29  cause the member or manager to cease to be a member or

30  manager, as the case may be, of the limited liability company.

31

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  1         608.4237  Membership termination upon events of

  2  bankruptcy.--A person ceases to be a member of a limited

  3  liability company upon the occurrence of any of the following:

  4         (1)  Unless otherwise provided in the articles of

  5  organization or operating agreement, or with the written

  6  consent of all members, a member:

  7         (a)  Makes an assignment for the benefit of creditors;

  8         (b)  Files a voluntary petition in bankruptcy;

  9         (c)  Is adjudged a bankrupt or insolvent, or has

10  entered against the member an order for relief, in any

11  bankruptcy or insolvency proceeding;

12         (d)  Files a petition or answer seeking for himself any

13  reorganization, arrangement, composition, readjustment,

14  liquidation, dissolution, or similar relief under any statute,

15  law, or regulation;

16         (e)  Files an answer or other pleading admitting or

17  failing to contest the material allegations of a petition

18  filed against the member in any proceeding of this nature; or

19         (f)  Seeks, consents to, or acquiesces in the

20  appointment of a trustee, receiver, or liquidator of the

21  member or of all or any substantial part of the member's

22  properties; or

23         (2)  Unless otherwise provided in the articles of

24  organization or operating agreement, or with the written

25  consent of all members, 120 days after the commencement of any

26  proceeding against the member seeking reorganization,

27  arrangement, composition, readjustment, liquidation,

28  dissolution, or similar relief under any statute, law, or

29  regulation, if the proceeding has not been dismissed, or if

30  within 90 days after the appointment without the member's

31  consent or acquiescence of a trustee, receiver, or liquidator

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  1  of the member or of all or any substantial part of the

  2  member's properties, the appointment is not vacated or stayed,

  3  or within 90 days after the expiration of any such stay, the

  4  appointment is not vacated.

  5         (Substantial rewording of section.  See

  6         s. 608.437, F.S., for present text.)

  7         608.4238  Unauthorized assumption of powers.--All

  8  persons purporting to act as or on behalf of a limited

  9  liability company, having actual knowledge that there was no

10  organization of a company under this chapter, are jointly and

11  severally liable for all liabilities created while so acting

12  except for any liability to any person who also had actual

13  knowledge that there was no organization of a limited

14  liability company.

15         608.425  Limited liability company property.--

16         (1)  All property originally contributed to the limited

17  liability company or subsequently acquired by a limited

18  liability company by purchase or otherwise is limited

19  liability company property.

20         (2)  Unless otherwise provided in the articles of

21  organization or the operating agreement regulations, property

22  acquired with limited liability company funds is limited

23  liability company property.

24         (3)  Instruments and documents providing for the

25  acquisition, mortgage, or disposition of property of the

26  limited liability company shall be valid and binding upon the

27  company, if they are executed in accordance with this chapter

28  by the persons authorized in the articles of organization or

29  the regulations to execute such documents on behalf of the

30  limited liability company, or, if the articles of organization

31  or the regulations do not provide for the execution of such

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  1  documents, one or more managers of a limited liability company

  2  having a manager or managers, or one or more members of a

  3  limited liability company in which management has been

  4  retained in the members.

  5         608.426  Distributions Distribution of property;

  6  impairment of capital.--

  7         (1)  The limited liability company may make

  8  distributions, from time to time, distribute its property to

  9  its members in accordance with the provisions contained in the

10  operating agreement regulations, except that no distribution

11  may be made if after the distribution the limited liability

12  company would not be insolvent able to pay its debts as they

13  become due in the usual course of business, or the limited

14  liability company's total assets would be less than the sum of

15  its total liabilities (except liabilities to members on

16  account of their contributions, unless otherwise provided in

17  the articles of organization). If the operating agreement does

18  regulations do not provide for the payment of distributions to

19  members, the distributions shall be made on the basis of the

20  agreed value, as stated in the records of the limited

21  liability company, of the contributions made by each member to

22  the extent they have been received by the limited liability

23  company and have not been returned, when made, must be

24  allocated on the basis of each member's relative capital

25  account.

26         (2)  The managers or managing members of a limited

27  liability company may base a determination that a distribution

28  is not prohibited under subsection (1) either on financial

29  statements prepared on the basis of accounting practices and

30  principles that are reasonable in the circumstances or on a

31  fair valuation or other method that is reasonable in the

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  1  circumstances. In the case of any distribution based upon such

  2  financial statement or such a valuation, each such

  3  distribution shall be identified as a distribution based upon

  4  such financial statements or a fair current valuation of

  5  assets, and the amount distributed shall be disclosed to the

  6  receiving members concurrent with their receipt of the

  7  distribution.

  8         (3)  A manager or managing member who votes for or

  9  assents to a distribution made in violation of this section,

10  the articles of incorporation, or the operating agreement

11  regulations, is personally liable to the limited liability

12  company for the amount of the distribution that exceeds what

13  could have been distributed without such violation if it is

14  established that the manager or managing member he or she did

15  not perform the manager's or managing member's his or her

16  duties in compliance with s. 608.4225.  In any proceeding

17  commenced under this section, a manager or managing member has

18  all of the defenses ordinarily available to a manager or

19  managing member.

20         (4)  A manager or managing member held liable under

21  subsection (3) for an unlawful distribution is entitled to

22  contribution:

23         (a)  From every other manager or managing member who is

24  also could be liable under subsection (3) for the unlawful

25  distribution; and

26         (b)  From each member to the extent of for the amount

27  the member accepted knowing the distribution was made in

28  violation of this section, the articles of incorporation, or

29  the operating agreement regulations.

30         (5)  A proceeding under this section is barred unless

31  it is commenced within 2 years after the date on which the

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  1  distribution was made. In the case of a distribution in the

  2  form of indebtedness, each payment of principal or interest is

  3  treated as a distribution.

  4         608.4261  Sharing of profits and losses.--The profits

  5  and losses of the limited liability company shall be allocated

  6  among the members in the manner provided in the articles of

  7  organization or the operating agreement regulations.  If the

  8  articles of organization do not or the operating agreement

  9  does regulations do not provide for the allocation of profits

10  and losses among members, profits and losses shall be

11  allocated on the basis of the agreed value, as stated in the

12  records of the limited liability company, of the contributions

13  made by each member to the extent such contributions have been

14  received by the limited liability company and have not been

15  returned each member's relative capital account.

16         608.427  Withdrawal of member and distribution upon

17  withdrawal or reduction of members' contributions to

18  capital.--

19         (1)  A member may withdraw from a limited liability

20  company only at the time or upon the occurrence of an event

21  specified in the articles of organization or operating

22  agreement and in accordance with the articles of organization

23  or operating agreement. Notwithstanding anything to the

24  contrary under applicable law, unless the articles of

25  organization or operating agreement provides otherwise, a

26  member may not resign from a limited liability company prior

27  to the dissolution and winding up of the limited liability

28  company. Notwithstanding anything to the contrary under

29  applicable law, the articles of organization or operating

30  agreement may provide that a limited liability company

31  interest may not be assigned prior to the dissolution and

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  1  winding up of the limited liability company. A member may

  2  withdraw from a limited liability company at the time or upon

  3  the happening of an event specified in the articles of

  4  organization or the regulations.  If the articles of

  5  organization and regulations do not specify the time or the

  6  events upon the happening of which a member may withdraw or a

  7  definite time for the dissolution and the winding up of the

  8  limited liability company, a member may withdraw upon not less

  9  than 6 months' prior written notice to each nonwithdrawing

10  member at his or her address as set forth in the records that

11  are required to be kept under s. 608.4101.

12         (2)  Except as provided in subsection (3), Upon

13  withdrawal, a withdrawing member is entitled to receive any

14  distribution to which the withdrawing member he or she is

15  entitled under the articles of organization or operating

16  agreement regulations, and, if not otherwise provided in the

17  articles of organization and operating agreement regulations,

18  the withdrawing member he or she is entitled to receive,

19  within a reasonable time after withdrawal, the fair value of

20  the withdrawing member's interest in the limited liability

21  company as of the date of resignation based upon the

22  withdrawing member's right to share in distributions from the

23  limited liability company balance of his or her capital

24  account.

25         (3)  A member may not receive a distribution from a

26  limited liability company to the extent that, after giving

27  effect to the distribution, all liabilities of the limited

28  liability company, other than liabilities to members on

29  account of their ownership interests in the limited liability

30  company, exceed the value of the limited liability company's

31  assets.

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  1         (3)(4)  In the absence of a statement in the articles

  2  of organization or the operating agreement regulations to the

  3  contrary or the consent of all members of the limited

  4  liability company, a member, irrespective of the nature of the

  5  member's his or her or its contribution, has only the right to

  6  demand and receive cash in return for the member's his or her

  7  or its contribution to capital.

  8         608.428  Liability upon wrongful distribution return of

  9  contribution.--

10         (1)(a)  If a member receives the return of any part of

11  his or her contribution without violation of the articles of

12  organization, the regulations, or this chapter, he or she is

13  liable to the limited liability company for a period of 1 year

14  thereafter for the amount of the returned contribution, but

15  only to the extent necessary to discharge the limited

16  liability company's liabilities to creditors who extended

17  credit to the limited liability company during the period the

18  contribution was held by the limited liability company.

19         (1)(b)  If a member receives a distribution the return

20  of any part of his or her contribution in violation of the

21  articles of organization, the operating agreement regulations,

22  or this chapter, the member he or she is liable to the limited

23  liability company for a period of 3 6 years thereafter for the

24  amount of the distribution contribution wrongfully made

25  returned.

26         (2)  A member may not receive a distribution from a

27  liability company to the extent that, after giving effect to

28  the distribution, all liabilities of the limited liability

29  company, other than liabilities to members on account of their

30  membership interests in the limited liability company, exceed

31  the value of the limited liability company's assets. A member

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  1  receives a return of his or her contribution to the extent

  2  that a distribution to the member reduces his or her share of

  3  the fair value of the net assets of the limited liability

  4  company below the value, as set forth in the records that the

  5  limited liability company is required to keep pursuant to s.

  6  608.4101, of the member's contribution which has not been

  7  distributed to him or her.

  8         (Substantial rewording of section.  See

  9         s. 608.432, F.S., for present text.)

10         608.432  Assignment of member's interest.--

11         (1)  A limited liability company interest is assignable

12  in whole or in part except as provided in the articles of

13  organization or operating agreement. The assignee of a

14  member's interest shall have no right to participate in the

15  management of the business and affairs of a limited liability

16  company except as provided in the articles of organization or

17  operating agreement and upon:

18         (a)  The approval of all of the members of the limited

19  liability company other than the member assigning the limited

20  liability company interest; or

21         (b)  Compliance with any procedure provided for in the

22  limited liability company agreement.

23         (2)  Unless otherwise provided in the articles of

24  organization or operating agreement:

25         (a)  An assignment of a membership interest does not

26  entitle the assignee to become or to exercise any rights or

27  powers of a member;

28         (b)  An assignment of a membership interest entitles

29  the assignee to share in such profits and losses, to receive

30  such distribution or distributions, and to receive such

31  allocation of income, gain, loss, deduction, or credit or

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  1  similar item to which the assignor was entitled, to the extent

  2  assigned; and

  3         (c)  A member ceases to be a member and to have the

  4  power to exercise any rights or powers of a member upon

  5  assignment of all of the membership interest of such member.

  6  Unless otherwise provided in the articles of organization or

  7  operating agreement, the pledge of, or granting of a security

  8  interest, lien, or other encumbrance in or against, any or all

  9  of the membership interest of a member shall not cause the

10  member to cease to be a member or to have the power to

11  exercise any rights or powers of a member.

12         (3)  The articles of organization or operating

13  agreement may provide that a member's interest in a limited

14  liability company may be evidenced by a certificate of

15  membership interest issued by the limited liability company.

16         (4)  Unless otherwise provided in the articles of

17  organization or operating agreement and except to the extent

18  assumed by agreement, until an assignee of a membership

19  interest becomes a member, the assignee shall have no

20  liability as a member solely as a result of the assignment.

21         (5)  Unless otherwise provided in the articles of

22  organization or operating agreement, a limited liability

23  company may acquire, by purchase, redemption, or otherwise,

24  any membership interest or other interest of a member or

25  manager in the limited liability company. Unless otherwise

26  provided in the articles of organization or operating

27  agreement, any such interest so acquired by the limited

28  liability company shall be deemed canceled.

29         608.433  Right of assignee to become member.--

30         (1)  Unless otherwise provided in the articles of

31  organization or operating agreement, an assignee of a limited

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  1  liability company interest may become a member only if all

  2  other members other than the member assigning the interest

  3  consent.

  4         (2)  An assignee who has become a member has, to the

  5  extent assigned, the rights and powers, and is subject to the

  6  restrictions and liabilities, of the assigning a member under

  7  the articles of organization, the operating agreement

  8  regulations, and this chapter.  An assignee who becomes a

  9  member also is liable for the obligations of the assignee's

10  his or her assignor to make and return contributions as

11  provided in s. ss. 608.4211 and wrongful distributions as

12  provided in s. 608.428.  However, the assignee is not

13  obligated for liabilities which are unknown to the assignee at

14  the time the assignee he or she became a member and which

15  could not be ascertained from the articles of organization or

16  the operating agreement regulations.

17         (3)  If an assignee of a limited liability company

18  interest becomes a member, the assignor is not released from

19  his or her liability to the limited liability company under

20  ss. 608.4211, 608.426, and 608.4228 608.4362.

21         (4)  On application to a court of competent

22  jurisdiction by any judgment creditor of a member, the court

23  may charge the limited liability company membership interest

24  of the member with payment of the unsatisfied amount of the

25  judgment with interest. To the extent so charged, the judgment

26  creditor has only the rights of an assignee of such the

27  limited liability company interest. This chapter does not

28  deprive any member of the benefit of any exemption laws

29  applicable to the member's his or her limited liability

30  company interest.

31

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  1         608.434  Power of estate of deceased or incompetent

  2  member; dissolved or terminated member.--

  3         (1)  If a member who is an individual dies or if a

  4  court of competent jurisdiction adjudges a member who is an

  5  individual to be incompetent to manage the member's his or her

  6  person or property, the member's executor, administrator,

  7  guardian, conservator, or other legal representative may

  8  exercise all the member's rights for the purpose of settling

  9  the member's his or her estate or administering the member's

10  his or her property, including any power the member had to

11  give an assignee the right to become a member.

12         (2)  If a member is a corporation, limited liability

13  company, trust, or other entity and is dissolved or

14  terminated, the powers of that member may be exercised by its

15  legal representative or successor.

16         608.438  Merger of limited liability company.--

17         (1)  As used in this section and ss. 608.4381-608.4384,

18  the term "other business entity" includes a corporation, a

19  business trust or association, a real estate investment trust,

20  a common law trust, an unincorporated business, a general

21  partnership, a limited partnership, a limited liability

22  company other than a limited liability company organized under

23  the laws of this chapter, or any other entity that is formed

24  pursuant to the requirements of applicable law.

25         (2)  Unless otherwise provided in the articles of

26  organization or the operating agreement regulations of a

27  limited liability company, pursuant to a plan of merger, a

28  limited liability company may merge with or into one or more

29  limited liability companies or other business entities formed,

30  organized, or incorporated under the laws of this state or any

31

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  1  other state, the United States, foreign country, or other

  2  foreign jurisdiction, if:

  3         (a)  Each limited liability company that is a party to

  4  the merger complies with the applicable provisions of this

  5  chapter and complies with the terms of its articles of

  6  organization and operating agreement regulations.

  7         (b)  Each domestic partnership that is a party to the

  8  merger complies with the applicable provisions of chapter 620.

  9         (c)  Each domestic corporation that is a party to the

10  merger complies with the applicable provisions of chapter 607.

11         (d)  The merger is permitted by the laws of the state,

12  country, or jurisdiction under which each other business

13  entity that is a party to the merger is formed, organized, or

14  incorporated, and each such other business entity complies

15  with such laws in effecting the merger.

16         (3)  The plan of merger shall set forth:

17         (a)  The name of each limited liability company and the

18  name and jurisdiction of formation, organization, or

19  incorporation of each other business entity planning to merge,

20  and the name of the surviving or resulting limited liability

21  company or other business entity into which each other limited

22  liability company or other business entity plans to merge,

23  which is, in this section and in ss. 608.4381-608.4384,

24  designated as the surviving entity.

25         (b)  The terms and conditions of the merger.

26         (c)  The manner and basis of converting the interests

27  of the members of each limited liability company that is a

28  party to the merger and the interests, partnership interests,

29  shares, obligations, or other securities of each other

30  business entity that is a party to the merger into interests,

31  partnership interests, shares, obligations, or other

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  1  securities of the surviving entity or any other limited

  2  liability company or other business entity or, in whole or in

  3  part, into cash or other property, and the manner and basis of

  4  converting rights to acquire interests of each limited

  5  liability company that is a party to the merger and rights to

  6  acquire interests, partnership interests, shares, obligations,

  7  or other securities of each other business entity that is a

  8  party to the merger into rights to acquire interests,

  9  partnership interests, shares, obligations, or other

10  securities of the surviving entity or any other limited

11  liability company or other business entity or, in whole or in

12  part, into cash or other property.

13         (d)  If a partnership is to be the surviving entity,

14  the names and business addresses of the general partners of

15  the surviving entity.

16         (e)  If a limited liability company is to be the

17  surviving entity, and management thereof is vested in one or

18  more managers, the names and business addresses of such

19  managers.

20         (f)  All statements required to be set forth in the

21  plan of merger by the laws under which each other business

22  entity that is a party to the merger is formed, organized, or

23  incorporated.

24         (4)  The plan of merger may set forth:

25         (a)  If a limited liability company is to be the

26  surviving entity, any amendments to, or a restatement of, the

27  articles of organization or the operating agreement

28  regulations of the surviving entity, and such amendments or

29  restatement shall be effective at the effective date of the

30  merger.

31

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  1         (b)  The effective date of the merger, which may be on

  2  or after the date of filing the certificate of merger.

  3         (c)  A provision authorizing one or more of the limited

  4  liability companies that are parties to the merger to abandon

  5  the proposed merger pursuant to s. 608.4381(7).

  6         (d)  A statement of, or a statement of the method of

  7  determining, the "fair value," as defined in s.

  8  608.4384(1)(b), of an interest in any limited liability

  9  company that is a party to the merger.

10         (e)  Other provisions relating to the merger.

11         608.4381  Action on plan of merger.--

12         (1)  Unless the articles of organization or the

13  operating agreement regulations of a limited liability company

14  require a greater than majority vote, the plan of merger shall

15  be approved in writing by a majority of the managers who are

16  members of a limited liability company that is a party to the

17  merger in which management is not reserved to its members.  If

18  no manager is a member, the plan of merger shall be approved

19  by vote of the members as set forth in this section. Unless

20  the articles of organization or the operating agreement

21  regulations of a limited liability company require a greater

22  than majority vote or provide for another method of

23  determining the voting rights of each of its members, and

24  whether or not management is reserved to its members, the plan

25  of merger shall be approved in writing by a

26  majority-in-interest majority of the members of a limited

27  liability company that is a party to the merger, and, if

28  applicable, the vote of each member shall be weighted in

29  accordance with s. 608.4231(1)(b); provided, unless the

30  articles of organization or the operating agreement

31  regulations of the limited liability company require a greater

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  1  than majority vote or provide for another method of

  2  determining the voting rights of each of its members, if there

  3  is more than one class or group of members, the merger shall

  4  be approved by a majority-in-interest majority of the members

  5  of each such class or group, and, if applicable, the vote of

  6  each member shall be weighted in accordance with s.

  7  608.4231(1)(b).

  8         (2)  In addition to the approval required by subsection

  9  (1), if the surviving entity is a partnership, no member of a

10  limited liability company that is a party to the merger shall,

11  as a result of the merger, become a general partner of the

12  surviving entity unless such member specifically consents in

13  writing to becoming a general partner of the surviving entity

14  and unless such written consent is obtained from each such

15  member who, as a result of the merger, would become a general

16  partner of the surviving entity, such merger shall not become

17  effective under s. 608.4383.  Any member providing such

18  consent in writing shall be deemed to have voted in favor of

19  the plan of merger for purposes of s. 608.4384.

20         (3)  All members of each limited liability company that

21  is a party to the merger shall be given written notice of any

22  meeting or other action with respect to the approval of a plan

23  of merger as provided in subsection (4), not fewer than 30 or

24  more than 60 days before the date of the meeting at which the

25  plan of merger shall be submitted for approval by the members

26  of such limited liability company; provided, if the plan of

27  merger is submitted to the members of the limited liability

28  company for their written approval or other action without a

29  meeting, such notification shall be given to each member not

30  fewer than 30 or more than 60 days before the effective date

31  of the merger.  Pursuant to s. 608.455, the notification

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  1  required by this subsection may be waived in writing by the

  2  person or persons entitled to such notification.

  3         (4)  The notification required by subsection (3) shall

  4  be in writing and shall include:

  5         (a)  The date, time, and place of the meeting, if any,

  6  at which the plan of merger is to be submitted for approval by

  7  the members of the limited liability company, or, if the plan

  8  of merger is to be submitted for written approval or by other

  9  action without a meeting, a statement to that effect.

10         (b)  A copy or summary of the plan of merger.

11         (c)  A clear and concise statement that, if the plan of

12  merger is effected, members dissenting therefrom may be

13  entitled, if they comply with the provisions of s. 608.4384

14  regarding the rights of dissenting members, to be paid the

15  fair value of their interests, which shall be accompanied by a

16  copy of s. 608.4384.

17         (d)  A statement of, or a statement of the method of

18  determining, the "fair value," as defined in s.

19  608.4384(1)(b), of an interest in the limited liability

20  company, in the case of a limited liability company in which

21  management is not reserved to its members, as determined by

22  the managers of such limited liability company, which

23  statement may consist of a reference to the applicable

24  provisions of such limited liability company's articles of

25  organization or operating agreement regulations that determine

26  the fair value of an interest in the limited liability company

27  for such purposes, and which shall constitute an offer by the

28  limited liability company to purchase at such fair value any

29  interests of a "dissenter," as defined in s. 608.4384(1)(a),

30  unless and until such dissenter's right to receive the fair

31

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  1  value of the dissenter's his interests in the limited

  2  liability company is terminated pursuant to s. 608.4384(8).

  3         (e)  The date on which such notification was mailed or

  4  delivered to the members.

  5         (f)  Any other information concerning the plan of

  6  merger.

  7         (5)  The notification required by subsection (3) shall

  8  be deemed to be given at the earliest date of:

  9         (a)  The date such notification is received;

10         (b)  Five days after the date such notification is

11  deposited in the United States mail addressed to the member at

12  the member's his address as it appears in the books and

13  records of the limited liability company, with postage thereon

14  prepaid;

15         (c)  The date shown on the return receipt, if sent by

16  registered or certified mail, return receipt requested, and

17  the receipt is signed by or on behalf of the addressee; or

18         (d)  The date such notification is given in accordance

19  with the provisions of the articles of organization or the

20  operating agreement regulations of the limited liability

21  company.

22         (6)  A plan of merger may provide for the manner, if

23  any, in which the plan of merger may be amended at any time

24  before the effective date of the merger, except after the

25  approval of the plan of merger by the members of a limited

26  liability company that is a party to the merger, the plan of

27  merger may not be amended to:

28         (a)  Change the amount or kind of interests,

29  partnership interests, shares, obligations, other securities,

30  cash, rights, or any other property to be received by the

31

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  1  members of such limited liability company in exchange for or

  2  on conversion of their interests;

  3         (b)  If the surviving entity is a limited liability

  4  company, change any term of the articles of organization or

  5  the operating agreement regulations of the surviving entity,

  6  except for changes that otherwise could be adopted without the

  7  approval of the members of the surviving entity;

  8         (c)  If the surviving entity is not a limited liability

  9  company, change any term of the articles of incorporation or

10  comparable governing document of the surviving entity, except

11  for changes that otherwise could be adopted by the board of

12  directors or comparable representatives of the surviving

13  entity; or

14         (d)  Change any of the terms and conditions of the plan

15  of merger if any such change, alone or in the aggregate, would

16  materially and adversely affect the members, or any class or

17  group of members, of such limited liability company.

18

19  If an amendment to a plan of merger is made in accordance the

20  plan and articles of merger have been filed with the

21  Department of State, amended articles of merger executed by

22  each limited liability company and other business entity that

23  is a party to the merger shall be filed with the Department of

24  State prior to the effective date of the merger.

25         (7)  Unless the limited liability company's articles of

26  organization or operating agreement regulations or the plan of

27  merger provide otherwise, notwithstanding the prior approval

28  of the plan of merger by any limited liability company that is

29  a party to the merger in which management is not reserved to

30  its members, and at any time prior to the filing of articles

31  of merger with the Department of State, the planned merger may

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  1  be abandoned, subject to any contractual rights, by any such

  2  limited liability company by the affirmative vote of a

  3  majority of its managers without further action by its

  4  members, in accordance with the procedure set forth in the

  5  plan of merger or, if none is set forth, in the manner

  6  determined by the managers of such limited liability company.

  7         608.4383  Effect of merger.--When a merger becomes

  8  effective:

  9         (1)  Every limited liability company and other business

10  entity that is a party to the merger merges into the surviving

11  entity and the separate existence of every limited liability

12  company and other business entity that is a party to the

13  merger, except the surviving entity, ceases.

14         (2)  The title to all property other than real property

15  or any interest therein, owned by each domestic corporation

16  and other business entity that is a party to the merger is

17  vested in the surviving entity without reversion or

18  impairment. Title to real property or any interest therein

19  shall be conveyed by the recordation of a deed with payment of

20  applicable taxes thereon.

21         (3)  The surviving entity shall thereafter be

22  responsible and liable for all the liabilities and obligations

23  of each limited liability company and other business entity

24  that is a party to the merger, including liabilities arising

25  out of the rights of dissenters with respect to such merger

26  under applicable law.

27         (4)  Any claim existing or action or proceeding pending

28  by or against any limited liability company or other business

29  entity that is a party to the merger may be continued as if

30  the merger did not occur or the surviving entity may be

31

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  1  substituted in the proceeding for the limited liability

  2  company or other business entity which ceased existence.

  3         (5)  Neither the rights of creditors nor any liens upon

  4  the property of any limited liability company or other

  5  business entity shall be impaired by such merger.

  6         (6)  If a limited liability company is the surviving

  7  entity, the articles of organization and the operating

  8  agreement regulations of such limited liability company in

  9  effect immediately prior to the time the merger becomes

10  effective shall be the articles of organization and the

11  operating agreement regulations of the surviving entity,

12  except as amended or restated to the extent provided in the

13  plan of merger.

14         (7)  The interests, partnership interests, shares,

15  obligations, or other securities, and the rights to acquire

16  interests, partnership interests, shares, obligations, or

17  other securities, of each limited liability company and other

18  business entity that is a party to the merger shall be

19  converted into interests, partnership interests, shares,

20  obligations, or other securities, or rights to such

21  securities, of the surviving entity or any other limited

22  liability company or other business entity or, in whole or in

23  part, into cash or other property as provided in the plan of

24  merger, and the former holders of interests, partnership

25  interests, shares, obligations, or other securities, or rights

26  to such securities, shall be entitled only to the rights

27  provided in the plan of merger and to their rights as

28  dissenters, if any, under s. 608.4384, ss. 607.1301-607.1320,

29  s. 620.205, or other applicable law.

30         608.4384  Rights of dissenting members.--

31         (1)  For purposes of this section, the term:

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  1         (a)  "Dissenter" means a member of a limited liability

  2  company who is a recordholder of the interests to which the

  3  dissenter he seeks relief as of the date fixed for the

  4  determination of members entitled to notice of a plan of

  5  merger, who does not vote such interests in favor of the plan

  6  of merger, and who exercises the right to dissent from the

  7  plan of merger when and in the manner required by this

  8  section.

  9         (b)  "Fair value," with respect to a dissenter's

10  interests, means the value of the interests in the limited

11  liability company that is a party to a plan of merger as of

12  the close of business of the day prior to the effective date

13  of the merger to which the dissenter objects, excluding any

14  appreciation or depreciation in anticipation of the merger,

15  unless such exclusion would be inequitable.

16         (2)  Each member of a limited liability company that is

17  a party to a merger shall have the right to be paid the fair

18  value of such member's his interests as a dissenter only as

19  provided in this section.

20         (3)  Not later than 20 days after the date on which the

21  notification required by s. 608.4381(3) is given to the

22  members, or if such notification is waived in writing by the

23  dissenter, not later than 20 days after the date of such

24  written waiver, the dissenter shall deliver to the limited

25  liability company a written demand for payment to the

26  dissenter him of the fair value of the interests as to which

27  the dissenter he seeks relief that states the dissenter's his

28  address, the number and class, if any, of those interests,

29  and, at the election of the dissenter, the amount claimed by

30  the dissenter him as the fair value of the interests.  The

31  statement of fair market value by the dissenter, if any, shall

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  1  constitute an offer by the dissenter to sell the interests to

  2  the limited liability company at such amount. A dissenter may

  3  dissent as to less than all the interests registered in the

  4  dissenter's his name.  In such event, the dissenter's rights

  5  shall be determined as if the interests as to which the

  6  dissenter he has dissented and the dissenter's his remaining

  7  interests were registered in the names of different members.

  8  If the interests as to which a dissenter seeks relief are

  9  represented by certificates, the dissenter shall deposit such

10  certificates with the limited liability company simultaneously

11  with the delivery of the written demand for payment.  Upon

12  receiving a demand for payment from a dissenter who is a

13  recordholder of uncertificated interests, the limited

14  liability company shall make an appropriate notation of the

15  demand for payment in its records. The limited liability

16  company may restrict the transfer of uncertificated interests

17  from the date the dissenter's written demand for payment is

18  delivered.  A written demand for payment served on the limited

19  liability company in which the dissenter is a member shall

20  constitute service on the surviving entity.

21         (4)  The written demand for payment required by

22  subsection (3) shall be deemed to be delivered to the limited

23  liability company at the earliest of:

24         (a)  The date such written demand is received;

25         (b)  Five days after the date such written demand is

26  deposited in the United States mail addressed to the principal

27  business office of the limited liability company, with postage

28  thereon prepaid;

29         (c)  The date shown on the return receipt, if such

30  written demand is sent by registered or certified mail, return

31

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  1  receipt requested, and the receipt is signed by or on behalf

  2  of the addressee; or

  3         (d)  The date such written demand is given in

  4  accordance with the provisions of the limited liability

  5  company's articles of organization or operating agreement

  6  regulations.

  7         (5)  Unless the articles of organization or operating

  8  agreement regulations of the limited liability company in

  9  which the dissenter is a member provides provide a basis or

10  method for determining and paying the fair value of the

11  interests as to which the dissenter seeks relief, or unless

12  the limited liability company or the surviving entity and the

13  dissenter have agreed in writing as to the fair value of the

14  interests as to which the dissenter seeks relief, the

15  dissenter, the limited liability company, or the surviving

16  entity, within 90 days after the dissenter delivers the

17  written demand for payment to the limited liability company,

18  may file an action in any court of competent jurisdiction in

19  the county in this state where the registered office of the

20  limited liability company is located or was located when the

21  plan of merger was approved by its members, or in the county

22  in this state in which the principal office of the limited

23  liability company that issued the interests is located or was

24  located when the plan of merger was approved by its members

25  partners, requesting that the fair value of the dissenter's

26  interests be determined.  The court shall also determine

27  whether each dissenter that is a party to such proceeding, as

28  to whom the limited liability company or the surviving entity

29  requests the court to make such determination, is entitled to

30  receive payment of the fair value for the dissenter's his

31  interests.  Other dissenters, within the 90-day period after a

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  1  dissenter delivers a written demand to the limited liability

  2  company, may join such proceeding as plaintiffs or may be

  3  joined in any such proceeding as defendants, and any two or

  4  more such proceedings may be consolidated.  If the limited

  5  liability company or surviving entity commences such a

  6  proceeding, all dissenters, whether or not residents of this

  7  state, other than dissenters who have agreed in writing with

  8  the limited liability company or the surviving entity as to

  9  the fair value of the interests as to which such dissenters

10  seek relief, shall be made parties to such action as an action

11  against their interests.  The limited liability company or the

12  surviving entity shall serve a copy of the initial pleading in

13  such proceeding upon each dissenter who is a party to such

14  proceeding and who is a resident of this state in the manner

15  provided by law for the service of a summons and complaint and

16  upon each such dissenter who is not a resident of this state

17  either by registered or certified mail and publication or in

18  such matter as is permitted by law.  The jurisdiction of the

19  court in such a proceeding shall be plenary and exclusive. All

20  dissenters who are proper parties to the proceeding are

21  entitled to judgment against the limited liability company or

22  the surviving entity for the amount of the fair value of their

23  interests as to which payment is sought hereunder.  The court

24  may, if it so elects, appoint one or more persons as

25  appraisers to receive evidence and recommend a decision on the

26  question of fair value.  The appraisers shall have such power

27  and authority as is specified in the order of their

28  appointment or an amendment thereof.  The limited liability

29  company shall pay each dissenter the amount found to be due

30  the dissenter him within 10 days after final determination of

31  the proceedings.  Upon payment of the judgment, the dissenter

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  1  shall cease to have any interest in the interests as to which

  2  payment is sought hereunder.

  3         (6)  The judgment may, at the discretion of the court,

  4  include a fair rate of interest, to be determined by the

  5  court.

  6         (7)  The costs and expenses of any such proceeding

  7  shall be determined by the court and shall be assessed against

  8  the limited liability company or the surviving entity, but all

  9  or any part of such costs and expenses may be apportioned and

10  assessed as the court deems equitable against any or all of

11  the dissenters who are parties to the proceeding, to whom the

12  limited liability company or the surviving entity has made an

13  offer to pay for the interests, if the court finds that the

14  action of such dissenters in failing to accept such offer was

15  arbitrary, vexatious, or not in good faith. Such expenses

16  shall include reasonable compensation for, and reasonable

17  expenses of, the appraisers, but shall exclude the fees and

18  expenses of counsel for, and experts employed by, any party.

19  If the fair value of the interests, as determined, materially

20  exceeds the amount which the limited liability company or the

21  surviving entity offered to pay therefor, the court in its

22  discretion may award to any dissenter who is a party to the

23  proceeding such amount as the court determines to be

24  reasonable compensation to any attorney or expert employed by

25  the dissenter in the proceeding.

26         (8)  The right of a dissenter to receive fair value for

27  and the obligation to sell such interests as to which the

28  dissenter he seeks relief, and the right of the limited

29  liability company or the surviving entity to purchase such

30  interests and the obligation to pay the fair value of such

31  interests, shall terminate if:

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  1         (a)  The dissenter has not complied with this section,

  2  unless the limited liability company or the surviving entity

  3  waives, in writing, such noncompliance;

  4         (b)  The limited liability company abandons the merger

  5  or is finally enjoined or prevented from carrying it out, or

  6  the members rescind their adoption or approval of the merger;

  7         (c)  The dissenter withdraws the dissenter's his

  8  demand, with the consent of the limited liability company or

  9  the surviving entity; or

10         (d)1.  The articles of organization or the operating

11  agreement regulations of the limited liability company in

12  which the dissenter was a member does not provide a basis or

13  method for determining and paying the dissenter the fair value

14  of the dissenter's his interests.

15         2.  The limited liability company or the surviving

16  entity and the dissenter have not agreed upon the fair value

17  of the dissenter's interests.

18         3.  Neither the dissenter, the limited liability

19  company, nor the surviving entity has filed or is joined in a

20  complaint under subsection (5) within the 90-day period

21  provided in subsection (5).

22         (9)  Unless otherwise provided in the articles of

23  organization or the operating agreement regulations of the

24  limited liability company in which the dissenter was a member,

25  after the date the dissenter delivers the written demand for

26  payment in accordance with subsection (3) until either the

27  termination of the rights and obligations arising under

28  subsection (3) or the purchase of the dissenter's interests by

29  the limited liability company or the surviving entity, the

30  dissenter shall be entitled only to payment as provided in

31  this section and shall not be entitled to any other rights

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  1  accruing from such interests, including voting or distribution

  2  rights.  If the right to receive fair value is terminated

  3  other than by the purchase of the dissenter's interests by the

  4  limited liability company or the surviving entity, all rights

  5  of the dissenter as a member of the limited liability company

  6  shall be reinstated effective as of the date the dissenter

  7  delivered the written demand for payment, including the right

  8  to receive any intervening payment or other distribution with

  9  respect to the dissenter's interests in the limited liability

10  company, or, if any such rights have expired or any such

11  distribution other than a cash payment has been completed, in

12  lieu thereof at the election of the surviving entity, the fair

13  value thereof in cash as determined by the surviving entity as

14  of the time of such expiration or completion, but without

15  prejudice otherwise to any action or proceeding of the limited

16  liability company that may have been taken by the limited

17  liability company on or after the date the dissenter delivered

18  the written demand for payment.

19         (10)  A member who is entitled under this section to

20  demand payment for the member's his interests shall not have

21  any right at law or in equity to challenge the validity of any

22  merger that creates the member's his entitlement to demand

23  payment hereunder, or to have the merger set aside or

24  rescinded, except with respect to compliance with the

25  provisions of the limited liability company's articles of

26  organization or operating agreement regulations or if the

27  merger is unlawful or fraudulent with respect to such member.

28         (11)  Unless otherwise provided in the articles of

29  organization or the operating agreement regulations of the

30  limited liability company in which the dissenter was a member,

31  this section does not apply with respect to a plan of merger

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  1  if, as of the date fixed for the determination of members

  2  entitled to notice of a plan of merger:

  3         (a)  The membership interests of the limited liability

  4  company were held of record by not fewer than 500 members; or

  5         (b)  The membership interests were registered on a

  6  national securities exchange or quoted on the National

  7  Association of Securities Dealers Automated Quotation System.

  8         608.439  Conversion of certain entities to a limited

  9  liability company.--

10         (1)  As used in this section, the term "other entity"

11  means a business trust or association, a real estate

12  investment trust, a common-law trust, or any other

13  unincorporated business, including a partnership, whether

14  general (including a registered limited liability partnership)

15  or limited (including a registered limited liability limited

16  partnership) or a foreign limited liability company.

17         (2)  Any other entity may convert to a domestic limited

18  liability company by complying with subsection (8) and filing

19  in the Department of State in accordance with s. 608.4081:

20         (a)  A certificate of conversion to a limited liability

21  company that has been executed by one or more authorized

22  persons in accordance with s. 608.408; and

23         (b)  Articles of organization that comply with s.

24  608.407 and have been executed by one or more authorized

25  persons in accordance with s. 608.408.

26         (3)  The certificate of conversion to a limited

27  liability company shall state:

28         (a)  The date on which and jurisdiction in which the

29  other entity was first created, formed, or otherwise came into

30  being and, if it has changed, its jurisdiction immediately

31

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  1  prior to its conversion to a domestic limited liability

  2  company;

  3         (b)  The name of the other entity immediately prior to

  4  the filing of the certificate of conversion to a limited

  5  liability company;

  6         (c)  The name of the limited liability company as set

  7  forth in its articles of organization filed in accordance with

  8  subsection (2); and

  9         (d)  The future effective date or time (which shall be

10  a date or time certain) of the conversion to a limited

11  liability company if it is not to be effective upon the filing

12  of the certificate of conversion to a limited liability

13  company and the articles of organization.

14         (4)  Upon the filing in the Department of State of the

15  certificate of conversion to a limited liability company and

16  the articles of organization or upon the future effective date

17  or time of the certificate of conversion to a limited

18  liability company and the articles of organization, the other

19  entity shall be converted into a domestic limited liability

20  company and the limited liability company shall thereafter be

21  subject to all of the provisions of this chapter, except that

22  notwithstanding s. 608.409, the existence of the limited

23  liability company shall be deemed to have commenced on the

24  date the other entity commenced its existence in the

25  jurisdiction in which the other entity was first created,

26  formed, incorporated, or otherwise came into being.

27         (5)  The conversion of any other entity into a domestic

28  limited liability company shall not affect any obligations or

29  liabilities of the other entity incurred prior to its

30  conversion to a domestic limited liability company or the

31

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  1  personal liability of any person incurred prior to such

  2  conversion.

  3         (6)  When any conversion becomes effective under this

  4  section, for all purposes of the laws of this state, all of

  5  the rights, privileges, and powers of the other entity that

  6  has converted, and all property, real, personal, and mixed,

  7  and all debts due to such other entity, as well as all other

  8  things and causes of action belonging to such other entity,

  9  shall be vested in the domestic limited liability company and

10  shall thereafter be the property of the domestic limited

11  liability company as they were of the other entity that has

12  converted, and the title to any real property vested by deed

13  or otherwise in such other entity shall not revert or be in

14  any way impaired by reason of this chapter, but all rights of

15  creditors and all liens upon any property of such other entity

16  shall be preserved unimpaired, and all debts, liabilities, and

17  duties of the other entity that has converted shall

18  thenceforth attach to the domestic limited liability company

19  and may be enforced against it to the same extent as if said

20  debts, liabilities, and duties had been incurred or contracted

21  by it.

22         (7)  Unless otherwise agreed, or as required under

23  applicable non-Florida law, the converting entity shall not be

24  required to wind up its affairs or pay its liabilities and

25  distribute its assets, and the conversion shall not constitute

26  a dissolution of such entity and shall constitute a

27  continuation of the existence of the converting entity in the

28  form of a domestic limited liability company.

29         (8)  Prior to filing a certificate of conversion to

30  limited liability company with the Department of State, the

31  conversion shall be approved in the manner provided for by the

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  1  document, instrument, agreement, or other writing, as the case

  2  may be, governing the internal affairs of the other entity and

  3  the conduct of its business or by applicable law, as

  4  appropriate, and the articles of organization or operating

  5  agreement shall be approved by the same authorization required

  6  to approve the conversion.

  7         (9)  The provisions of this section shall not be

  8  construed to limit the accomplishment of a change in the law

  9  governing, or the domicile of, any other entity to this state

10  by any other means provided for in the articles of

11  organization or operating agreement or other agreement or as

12  otherwise permitted by law, including by the amendment of the

13  articles of organization or operating agreement or other

14  agreement.

15         608.441  Dissolution.--

16         (1)  A limited liability company organized under this

17  chapter shall be dissolved, and the company's affairs shall be

18  concluded, upon the first to occur occurrence of any of the

19  following events:

20         (a)  At the time specified in the articles of

21  organization or operating agreement, but if no such time is

22  set forth in the articles of organization or operating

23  agreement, then the limited liability company shall have a

24  perpetual existence; When the period fixed for the duration of

25  the limited liability company expires.

26         (b)  Upon the occurrence of events specified in the

27  articles of organization or operating agreement; By the

28  unanimous written agreement of all members.

29         (c)  Unless otherwise provided in the articles of

30  organization or operating agreement, upon the written consent

31  of all of the members of the limited liability company; Upon

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  1  the death, bankruptcy, or dissolution of a member or upon the

  2  occurrence of any other event which terminates the continued

  3  membership of a member in the limited liability company,

  4  unless the business of the limited liability company is

  5  continued by the consent of all the remaining members or under

  6  a right to continue stated in the articles of organization of

  7  the limited liability company.

  8         (d)  At any time there are no members; however, unless

  9  otherwise provided in the articles of organization or

10  operating agreement, the limited liability company is not

11  dissolved and is not required to be wound up if, within 90

12  days, or such other period as provided in the articles of

13  organization or operating agreement, after the occurrence of

14  the event that terminated the continued membership of the last

15  remaining member, the personal or other legal representative

16  of the last remaining member agrees in writing to continue the

17  limited liability company and agrees to the admission of the

18  personal representative of such member or its nominee or

19  designee to the limited liability company as a member,

20  effective as of the occurrence of the event that terminated

21  the continued membership of the last remaining member; or When

22  a limited liability company has fewer than two members.

23         (e)  The entry of an order of dissolution by a circuit

24  court pursuant to subsection (3).

25         (2)  So long as the limited liability company continues

26  to have at least one remaining member, and except as otherwise

27  provided in the articles of organization or operating

28  agreement, the death, retirement, resignation, expulsion,

29  bankruptcy, or dissolution of any member or the occurrence of

30  any other event that terminates the continued membership of

31  any member shall not cause the limited liability company to be

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  1  dissolved, and upon the occurrence of any such event, the

  2  limited liability company shall be continued without

  3  dissolution.

  4         (3)(2)  Unless otherwise provided in the articles of

  5  organization or operating agreement, on application by or for

  6  a member, the circuit court may order dissolution of a limited

  7  liability company if it is established by a preponderance of

  8  the evidence that it is not reasonably practicable to carry on

  9  the business of the limited liability company in conformity

10  with the articles of organization or the operating agreement

11  regulations.

12         (4)(3)  Following the occurrence of any of the events

13  specified in this section which cause the dissolution of the

14  limited liability company, the limited liability company shall

15  deliver articles of dissolution to the Department of State for

16  filing.

17         608.4421  Claims against dissolved limited liability

18  company.--

19         (1)  A dissolved limited liability company may dispose

20  of the known claims against it by following the procedures

21  described in subsections (2), (3), and (4).

22         (2)  The dissolved limited liability company shall

23  deliver to each of its known claimants written notice of the

24  dissolution at any time after its effective date.  The written

25  notice shall:

26         (a)  Provide a reasonable description of the claim that

27  the claimant may be entitled to assert.

28         (b)  State whether the claim is admitted or not

29  admitted, in whole or in part, and, if admitted:

30         1.  The amount that is admitted, which may be as of a

31  given date.

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  1         2.  Any interest obligation if fixed by an instrument

  2  of indebtedness.

  3         (c)  Provide a mailing address where a claim may be

  4  sent.

  5         (d)  State the deadline, which may not be fewer than

  6  120 days after the effective date of the written notice, by

  7  which confirmation of the claim must be delivered to the

  8  dissolved limited liability company.

  9         (e)  State that the limited liability company may make

10  distributions thereafter to other claimants and its members or

11  former members without further notice.

12         (3)  A dissolved limited liability company may reject,

13  in whole or in part, any claim made by a claimant pursuant to

14  this subsection by mailing written notice of such rejection to

15  the claimant within 90 days after receipt of such claim and,

16  in all events, at least 150 days before expiration of 3 years

17  following the effective date of dissolution.  A notice sent by

18  the limited liability company pursuant to this subsection

19  shall be accompanied by a copy of this section.

20         (4)  A dissolved limited liability company electing to

21  follow the procedures described in subsections (2) and (3)

22  shall also give notice of the dissolution of the limited

23  liability company to persons with claims contingent upon the

24  occurrence or nonoccurrence of future events or otherwise

25  conditional or unmatured, and request that such persons

26  present such claims in accordance with the terms of such

27  notice.  Such notice shall be in substantially the form, and

28  sent in the same manner, as described in subsection (2).

29         (5)  A dissolved limited liability company shall offer

30  any claimant whose claim is contingent, conditional, or

31  unmatured such security as the limited liability company

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  1  determines is sufficient to provide compensation to the

  2  claimant if the claim matures.  The dissolved limited

  3  liability company shall deliver such offer to the claimant

  4  within 90 days after receipt of such claim and, in all events,

  5  at least 150 days before expiration of 3 years following the

  6  effective date of dissolution.  If the claimant offered such

  7  security does not deliver in writing to the dissolved limited

  8  liability company a notice rejecting the offer within 120 days

  9  after receipt of such offer for security, the claimant is

10  deemed to have accepted such security as the sole source from

11  which to satisfy the claimant's his or her claim against the

12  limited liability company.

13         (6)  A dissolved limited liability company which has

14  given notice in accordance with subsections (2) and (4) shall

15  petition the circuit court in the county where the limited

16  liability company's principal office is located or was located

17  at the effective date of dissolution to determine the amount

18  and form of security that will be sufficient to provide

19  compensation to any claimant who has rejected the offer for

20  security made pursuant to subsection (5).

21         (7)  A dissolved limited liability company which has

22  given notice in accordance with subsection (2) shall petition

23  the circuit court in the county where the limited liability

24  company's principal office is located or was located at the

25  effective date of dissolution to determine the amount and form

26  of security which will be sufficient to provide compensation

27  to claimants whose claims are known to the limited liability

28  company but whose identities are unknown.  The court shall

29  appoint a guardian ad litem to represent all claimants whose

30  identities are unknown in any proceeding brought under this

31  subsection.  The reasonable fees and expenses of such

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  1  guardian, including all reasonable expert witness fees, shall

  2  be paid by the petitioner in such proceeding.

  3         (8)  The giving of any notice or making of any offer

  4  pursuant to the provisions of this section shall not revive

  5  any claim then barred or constitute acknowledgment by the

  6  dissolved limited liability company that any person to whom

  7  such notice is sent is a proper claimant and shall not operate

  8  as a waiver of any defense or counterclaim in respect of any

  9  claim asserted by any person to whom such notice is sent.

10         (9)  A dissolved limited liability company which has

11  followed the procedures described in subsections (2)-(7):

12         (a)  Shall pay the claims admitted or made and not

13  rejected in accordance with subsection (3).

14         (b)  Shall post the security offered and not rejected

15  pursuant to subsection (5).

16         (c)  Shall post any security ordered by the circuit

17  court in any proceeding under subsections (6) and (7).

18         (d)  Shall pay or make provision for all other

19  obligations of the limited liability company.

20

21  Such claims or obligations shall be paid in full, and any such

22  provision for payments shall be made in full if there are

23  sufficient funds.  If there are insufficient funds, such

24  claims and obligations shall be paid or provided for according

25  to their priority and, among claims of equal priority, ratably

26  to the extent of funds legally available therefor.  Any

27  remaining funds shall be distributed pursuant to s. 608.444;

28  however, such distribution may not be made before the

29  expiration of 150 days from the date of the last notice of

30  rejections given pursuant to subsection (3).

31

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  1         (10)  A dissolved limited liability company which has

  2  not followed the procedures described in subsections (2) and

  3  (3) shall pay or make reasonable provision to pay all claims

  4  and obligations, including all contingent, conditional, or

  5  unmatured claims known to the limited liability company and

  6  all claims which are known to the dissolved limited liability

  7  company but for which the identity of the claimant is unknown.

  8  Such claims shall be paid in full, and any such provision for

  9  payment made shall be made in full if there are sufficient

10  funds.  If there are insufficient funds, such claims and

11  obligations shall be paid or provided for according to their

12  priority and, among claims of equal priority, ratably to the

13  extent of funds legally available therefor.  Any remaining

14  funds shall be distributed pursuant to s. 608.444.

15         (11)  A member of a dissolved limited liability

16  company, the assets of which were distributed pursuant to

17  subsection (9) or subsection (10) is not liable for any claim

18  against the limited liability company in an amount in excess

19  of such member's pro rata share of the claim or the amount

20  distributed to the member, whichever is less.

21         (12)  A member of a dissolved limited liability

22  company, the assets of which were distributed pursuant to

23  subsection (9) is not liable for any claim against the limited

24  liability company on which a proceeding is not begun prior to

25  the expiration of 3 years following the effective date of

26  dissolution.

27         (13)  The aggregate liability of any member of a

28  dissolved limited liability company for claims against the

29  dissolved limited liability company may not exceed the amount

30  distributed to the member in dissolution.

31

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  1         608.444  Distribution of assets upon dissolution.--In

  2  settling accounts after dissolution of a limited liability

  3  company, the assets of the limited liability company must be

  4  distributed in the following order:

  5         (1)  To creditors, including members who are creditors,

  6  to the extent permitted by law in satisfaction of liabilities

  7  of the limited liability company, whether by payment or

  8  establishment of reserves, other than liabilities for

  9  distributions to members under s. 608.426 or s. 608.427.

10         (2)  Except as provided in the operating agreement

11  regulations, to members and former members in satisfaction of

12  liabilities for distributions under s. 608.426 or s. 608.427.

13         (3)  Except as provided in the articles of organization

14  or the operating agreement regulations, to members pro rata in

15  proportion to their then-current percentage, or other

16  interests in the profits, of the company respective capital

17  accounts.

18         608.447  Cancellation of articles certificate of

19  organization.--The articles certificate of organization of a

20  limited liability company shall be canceled by the Department

21  of State upon issuance of the certificate of dissolution.

22         608.448  Grounds for administrative dissolution.--

23         (1)  The Department of State may commence a proceeding

24  under s. 608.4481 to administratively dissolve a limited

25  liability company if:

26         (a)  The limited liability company has failed to file

27  its annual report or pay the annual report filing fee within

28  the time required by this chapter.

29         (b)  The limited liability company is without a

30  registered agent or registered office in this state for 30

31  days or more.

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  1         (c)  The limited liability company does not notify the

  2  Department of State within 30 days that its registered agent

  3  or registered office has been changed, that its registered

  4  agent has resigned, or that its registered office has been

  5  discontinued.

  6         (d)  The limited liability company has failed to answer

  7  truthfully and fully, within 30 days after mailing or within

  8  such additional time as fixed by the Department of State the

  9  time prescribed by this chapter, interrogatories propounded by

10  the Department of State.

11         (e)  The limited liability company's period of duration

12  has expired.

13         (2)  The enumeration in subsection (1) of grounds for

14  administrative dissolution shall not exclude actions or

15  special proceedings by the Department of Legal Affairs or any

16  state officials for the annulment or dissolution of a limited

17  liability company for other causes as provided in any other

18  law of this state.

19         608.4481  Procedure for and effect of administrative

20  dissolution.--

21         (1)  If the Department of State determines that one or

22  more grounds exist under s. 608.448 for dissolving a limited

23  liability company, it shall serve the limited liability

24  company with written notice of its determination, stating the

25  grounds therefor.

26         (2)  If the limited liability company does not correct

27  each ground for dissolution or demonstrate to the reasonable

28  satisfaction of the Department of State that each ground

29  determined by the Department of State does not exist within 60

30  days after issuance of the notice, the Department of State

31  shall administratively dissolve the limited liability company

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  1  by issuing a certificate of dissolution that recites the

  2  ground or grounds for dissolution and its effective date.

  3         (3)  A limited liability company administratively

  4  dissolved continues its existence but may not carry on any

  5  business except that necessary to wind up and liquidate its

  6  business and affairs under s. 608.4431 and notify claimants

  7  under s. 608.4421.

  8         (4)  A manager or member of a limited liability company

  9  dissolved pursuant to this section, purporting to act on

10  behalf of the limited liability company, is personally liable

11  for the debts, obligations, and liabilities of the limited

12  liability company arising from such action and incurred

13  subsequent to the limited liability company's administrative

14  dissolution only if the manager or member he or she has actual

15  notice of the administrative dissolution at the time such

16  action is taken; but such liability shall be terminated upon

17  the ratification of such action by the limited liability

18  company's members subsequent to the reinstatement of the

19  limited liability company under s. 608.4482.

20         (5)  The administrative dissolution of a limited

21  liability company does not terminate the authority of its

22  registered agent.

23         608.449  Grounds for judicial dissolution.--A circuit

24  court may dissolve a limited liability company:

25         (1)(a)  In a proceeding by the Department of Legal

26  Affairs if it is established that:

27         1.  The limited liability company obtained its articles

28  of organization through fraud; or

29         2.  The limited liability company has continued to

30  exceed or abuse the authority conferred upon it by law.

31

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  1         (b)  The enumeration in paragraph (a) of grounds for

  2  involuntary dissolution does not exclude actions or special

  3  proceedings by the Department of Legal Affairs or any state

  4  official for the annulment or dissolution of a limited

  5  liability company for other causes as provided in any other

  6  law of this state.

  7         (2)  In a proceeding by a manager or member if it is

  8  established that:

  9         (a)  The managers or members are deadlocked in the

10  management of the limited liability company affairs, the

11  members are unable to break the deadlock, and irreparable

12  injury to the limited liability company is threatened or being

13  suffered; or

14         (b)  The limited liability company's assets are being

15  misappropriated misappointed or wasted.

16         (3)  In a proceeding by a creditor if it is established

17  that:

18         (a)  The creditor's claim has been reduced to judgment,

19  the execution on that judgment returned unsatisfied, and the

20  limited liability company is insolvent; or

21         (b)  The limited liability company has admitted in

22  writing that the creditor's claim is due and owing and the

23  limited liability company is insolvent.

24         (4)  In a proceeding by the limited liability company

25  to have its voluntary dissolution continued under court

26  supervision.

27         608.4492  Receivership or custodianship.--

28         (1)  A court in a judicial proceeding brought to

29  dissolve a limited liability company may appoint one or more

30  receivers to wind up and liquidate, or one or more custodians

31  to manage, the business and affairs of the limited liability

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  1  company. The court shall hold a hearing, after notifying all

  2  parties to the proceeding and any interested persons

  3  designated by the court, before appointing a receiver or

  4  custodian.  The court appointing a receiver or custodian has

  5  exclusive jurisdiction over the limited liability company and

  6  all of its property wherever located.

  7         (2)  The court may appoint a person authorized to act

  8  as a receiver or custodian.  The court may require the

  9  receiver or custodian to post bond, with or without sureties,

10  in an amount the court directs.

11         (3)  The court shall describe the powers and duties of

12  the receiver or custodian in its appointing order, which may

13  be amended from time to time.  Among other powers:

14         (a)  The receiver:

15         1.  May dispose of all or any part of the assets of the

16  limited liability company wherever located, at a public or

17  private sale, if authorized by the court.

18         2.  May sue and defend in the receiver's his or her own

19  name as receiver of the limited liability company in all

20  courts of this state.

21         (b)  The custodian may exercise all of the powers of

22  the limited liability company, through or in place of its

23  managers or members, to the extent necessary to manage the

24  affairs of the limited liability company in the best interests

25  of its members and creditors.

26         (4)  The court during a receivership may redesignate

27  the receiver a custodian, and during a custodianship may

28  redesignate the custodian a receiver, if doing so is in the

29  best interests of the limited liability company and its

30  members and creditors.

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  1         (5)  The court from time to time during the

  2  receivership or custodianship may order compensation paid and

  3  expense disbursements or reimbursements made to the receiver

  4  or custodian and the receiver's or custodian's his or her

  5  counsel from the assets of the limited liability company or

  6  proceeds from the sale of assets.

  7         (6)  The court has jurisdiction to appoint an ancillary

  8  receiver for the assets and business of a limited liability

  9  company.  The ancillary receiver shall serve ancillary to a

10  receiver located in any other state, whenever the court deems

11  that circumstances exist requiring the appointment of such a

12  receiver. The court may appoint such an ancillary receiver for

13  a foreign limited liability company even though no receiver

14  has been appointed elsewhere.  Such receivership shall be

15  converted into an ancillary receivership when an order entered

16  by a court of competent jurisdiction in the other state

17  provides for a receivership of the limited liability company.

18         608.4511  Annual report for Department of State.--

19         (1)  Each domestic limited liability company and each

20  foreign limited liability company authorized to transact

21  business in this state shall deliver to the Department of

22  State for filing a sworn annual report on such forms as the

23  Department of State prescribes that sets forth:

24         (a)  The name of the limited liability company and the

25  state or country under the law of which it is organized.

26         (b)  The date of organization or, if a foreign limited

27  liability company, the date on which it was admitted to do

28  business in this state.

29         (c)  The street address and the mailing address of its

30  principal office.

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  1         (d)  The limited liability company's federal employer

  2  identification number or, if none, whether one has been

  3  applied for.

  4         (e)  The names and business, residence, or mailing

  5  street address of its managing members or and managers.

  6         (f)  The street address of its registered office and

  7  the name of its registered agent at that office in this state.

  8         (g)  Such additional information as may be necessary or

  9  appropriate to enable the Department of State to carry out the

10  provisions of this chapter.

11         (2)  Proof to the satisfaction of the Department of

12  State that on or before May 1 such report was deposited in the

13  United States mail in a sealed envelope, properly addressed

14  with postage prepaid, shall be deemed timely compliance with

15  this requirement.

16         (3)  If an annual report does not contain the

17  information required by this section, the Department of State

18  shall promptly notify the reporting domestic or foreign

19  limited liability company in writing and return the report to

20  it for correction.  If the report is corrected to contain the

21  information required by this section and delivered to the

22  Department of State within 30 days after the effective date of

23  notice, it is deemed to be timely filed.

24         (4)  Each report shall be executed by the limited

25  liability company by a managing member or manager or, if the

26  limited liability company is in the hands of a receiver or

27  trustee, shall be executed on behalf of the limited liability

28  company by such receiver or trustee, and the signing thereof

29  shall have the same legal effect as if made under oath,

30  without the necessity of appending such oath thereto.

31

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  1         (5)  The first annual report shall be delivered to the

  2  Department of State between January 1 and May 1 of the year

  3  following the calendar year in which a domestic limited

  4  liability company was organized or a foreign limited liability

  5  company was authorized to transact business.  Subsequent

  6  annual reports shall be delivered to the Department of State

  7  between January 1 and May 1 of the subsequent calendar years.

  8         (6)  Information in the annual report shall be current

  9  as of the date the annual report is executed on behalf of the

10  limited liability company.

11         (7)  Any limited liability company failing to file an

12  annual report which complies with the requirements of this

13  section shall not be permitted to prosecute, maintain, or

14  defend any action in any court of this state until such report

15  is filed and all fees, penalties, and taxes due under this

16  chapter are paid and shall be subject to dissolution or

17  cancellation of its certificate of authority to do business as

18  provided in this chapter.

19         608.452  Fees of the Department of State.--The fees of

20  the Department of State under this chapter are as follows:

21         (1)  For furnishing a certified copy, $30 $52.50.

22         (2)  For filing original articles of organization, or

23  articles of revocation of dissolution, or a foreign limited

24  liability company's application for a certificate of authority

25  to transact business, $100 $250.

26         (3)  For filing articles of merger of limited liability

27  companies or other business entities, $25 per constituent

28  party to the merger, unless a specific fee is required for a

29  party in other applicable law a supplemental affidavit

30  declaring the amount of capital contributions of the members

31

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  1  when there is an increase in capital contribution beyond the

  2  anticipated amount, $250.

  3         (4)  For filing an annual report, $50 $100.

  4         (5)  For filing an application for reinstatement after

  5  an administrative or judicial dissolution or a revocation of

  6  authority to transact business, $100 $500.

  7         (6)  For filing a certificate designating a registered

  8  agent or changing a registered agent, $25 $35.

  9         (7)  For filing a registered agent's statement of

10  resignation from an active limited liability company, $85

11  $87.50.

12         (8)  For filing a registered agent's statement of

13  resignation from a dissolved limited liability company, $25

14  $35.

15         (9)  For filing any other limited liability company

16  document, $25 $52.50.

17         (10)  For furnishing a certificate of status, $5 A

18  supplemental corporate fee imposed pursuant to s. 607.193.

19         608.455  Waiver of notice.--When, under the provisions

20  of this chapter or under the provisions of the articles of

21  organization or operating agreement regulations of a limited

22  liability company, notice is required to be given to a member

23  of a limited liability company or to a manager of a limited

24  liability company having a manager or managers, a waiver in

25  writing signed by the person or persons entitled to the

26  notice, whether made before or after the time for notice to be

27  given, is equivalent to the giving of notice.

28         608.463  Service of process.--

29         (1)  Process against a limited liability company may be

30  served:

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  1         (a)  In accordance with chapter 48 or chapter 49, as if

  2  the company were a partnership.

  3         (b)  Upon the registered agent at the agent's street

  4  his or her business address.

  5         (2)  Any notice to or demand on a company organized

  6  pursuant to this chapter may be made:

  7         (a)  By delivery to a manager of the company, if the

  8  management of the limited liability company is vested in a

  9  manager, or by delivery to a any member, if the management of

10  the limited liability company is vested in the members.

11         (b)  By mailing a writing, which notice or demand in

12  writing is mailed to the registered office of the company in

13  this state or to another address in this state which is the

14  principal office of the company.

15         (3)  Nothing contained in this section shall limit or

16  affect the right to serve, in any other manner now or

17  hereafter permitted by law, any process, notice, or demand

18  required or permitted by law to be served upon a limited

19  liability company.

20         608.471  Tax exemption on income of certain limited

21  liability companies.--

22         (1)  A limited liability company classified as a

23  partnership for federal income tax purposes, or a single

24  member limited liability company which is disregarded as an

25  entity separate from its owner for federal income tax

26  purposes, and organized pursuant to this chapter or qualified

27  to do business in this state as a foreign limited liability

28  company is not an "artificial entity" within the purview of s.

29  220.02 and is not subject to the tax imposed under chapter

30  220.

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  1         (2)  The income of a limited liability company that is

  2  classified as a partnership for federal income tax purposes

  3  and that is organized pursuant to this chapter or is qualified

  4  to do business in this state as a foreign limited liability

  5  company shall not be subject to the Florida Income Tax Code

  6  and the tax levied pursuant to chapter 220.

  7         (2)(3)  For purposes of taxation under chapter 220, a

  8  limited liability company formed in this state or authorized

  9  to transact business in this state as a foreign limited

10  liability company shall be classified as a partnership, or a

11  limited liability company which has only one member shall be

12  disregarded as an entity separate from its owner for federal

13  income tax purposes, unless classified otherwise for federal

14  income tax purposes, in which case the limited liability

15  company shall be classified identically to its classification

16  for federal income tax purposes.  For purposes of taxation

17  under chapter 220, a member or an assignee of a member of a

18  limited liability company formed in this state or qualified to

19  do business in this state as a foreign limited liability

20  company shall be treated as a resident or nonresident partner

21  unless classified otherwise for federal income tax purposes,

22  in which case the member or assignee of a member shall have

23  the same status as such member or assignee of a member has for

24  federal income tax purposes.

25         608.502  Consequences of transacting business without

26  authority.--

27         (1)  A foreign limited liability company transacting

28  business in this state without a certificate of authority may

29  not maintain a proceeding in any court in this state until it

30  obtains a certificate of authority.

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  1         (2)  The successor to a foreign limited liability

  2  company that transacted business in this state without a

  3  certificate of authority and the assignee of a cause of action

  4  arising out of that business may not maintain a proceeding

  5  based on that cause of action in any court in this state until

  6  the foreign limited liability company or its successor obtains

  7  a certificate of authority.

  8         (3)  A court may stay a proceeding commenced by a

  9  foreign limited liability company or its successor or assignee

10  until it determines whether the foreign limited liability

11  company or its successor requires a certificate of authority.

12  If it so determines, the court may further stay the proceeding

13  until the foreign limited liability company or its successor

14  obtains the certificate.

15         (4)  A foreign limited liability company which

16  transacts business in this state without authority to do so

17  shall be liable to this state for the years or parts thereof

18  during which it transacted business in this state without

19  authority in an amount equal to all fees, penalties, and taxes

20  which would have been imposed by this chapter upon such

21  limited liability company had it duly applied for and received

22  authority to transact business in this state as required by

23  this chapter. In addition to the payments thus prescribed,

24  such limited liability company shall be liable for a civil

25  penalty of not less than $500 or more than $1,000 for each

26  year or part thereof during which it transacts business in

27  this state without a certificate of authority.  The Department

28  of State may collect all penalties due under this subsection.

29         (5)  Notwithstanding subsections (1) and (2), the

30  failure of a foreign limited liability company to obtain a

31  certificate of authority does not impair the validity of any

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  1  of its contracts, deeds, mortgages, security interests, or

  2  acts or prevent it from defending any proceeding in this

  3  state.

  4         (6)  A member or a manager of a foreign limited

  5  liability company is not liable for the obligations of the

  6  foreign limited liability company solely by reason of the

  7  limited liability company's having transacted business in this

  8  state without a certificate of authority.

  9         (7)  If a foreign limited liability company transacts

10  business in this state without a certificate of authority, the

11  foreign limited liability company appoints the Secretary of

12  State as its agent for substitute service of process pursuant

13  to s. 48.181 for claims arising out of the transaction of

14  business in this state.

15         608.503  Application for certificate of authority.--

16         (1)  A foreign limited liability company may apply for

17  a certificate of authority to transact business in this state

18  by delivering an application to the Department of State for

19  filing. Such application shall be made on forms prescribed and

20  furnished by the Department of State and shall set forth:

21         (a)  The name of the foreign limited liability company,

22  which shall satisfy the requirements of s. 608.506.

23         (b)  The jurisdiction under the law of which it is

24  organized.

25         (c)  Its date of organization and period of duration.

26         (d)  The street address of its principal office.

27         (e)  The street address of its registered office in

28  this state and the name of its registered agent at that

29  office.

30

31

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  1         (f)  Whether or not the limited liability company is

  2  manager-managed and, if so, the names and usual business

  3  addresses of its managing members or managers.

  4         (g)  The nature of the business or purposes to be

  5  conducted or promoted in this state.

  6         (h)(g)  Such additional information as may be necessary

  7  or appropriate in order to enable the Department of State to

  8  determine whether such limited liability company is entitled

  9  to file an application for authority to transact business in

10  this state and to determine and assess the fees, penalties,

11  and taxes payable as prescribed in this chapter.

12         (2)  The foreign limited liability company shall

13  deliver with the completed application an affidavit as

14  provided in s. 608.407(2), as well as a certificate of

15  existence, or a document of similar import, duly authenticated

16  by the official having custody of records in the jurisdiction

17  under the law of which it is organized, not more than 90 days

18  prior to delivery of the application to the Department of

19  State, by the Secretary of State or other official having

20  custody of records in the jurisdiction under the law of which

21  it is incorporated.  A translation of the certificate, under

22  oath of the translator, shall be attached to a certificate

23  which is in a language other than the English language.

24         (3)  A foreign limited liability company shall not be

25  denied authority to transact business in this state by reason

26  of the fact that the laws of the jurisdiction under which such

27  limited liability company is organized governing its

28  organization and internal affairs differ from the laws of this

29  state.

30         608.504  Amended certificate of authority.--

31

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  1         (1)  A foreign limited liability company authorized to

  2  transact business in this state shall make application to the

  3  Department of State to obtain an amended certificate of

  4  authority if any statement in the company's application was

  5  false or becomes false due to change in circumstances or if

  6  the foreign limited liability company it changes:

  7         (a)  Its limited liability company name.

  8         (b)  The period of its duration.

  9         (c)  The jurisdiction of its organization.

10         (2)  Such application shall be made within 30 days

11  after the occurrence of any change set forth in subsection

12  (1), shall be made on forms prescribed by the Department of

13  State, shall be executed and filed in the same manner as an

14  original application for authority, and shall set forth:

15         (a)  The name of the foreign limited liability company

16  as it appears on the records of the Department of State.

17         (b)  The jurisdiction of its organization.

18         (c)  The date it was authorized to do business in this

19  state.

20         (d)  If the name of the foreign limited liability

21  company has been changed, the name relinquished, the new name,

22  a statement that the change of name has been effected under

23  the laws of the jurisdiction of its organization, and the date

24  the change was effected.

25         (e)  If the amendment changes its period of duration, a

26  statement of such change.

27         (f)  If the amendment changes the jurisdiction of its

28  organization, a statement of such change.

29         (3)  The requirements of s. 608.503 for obtaining an

30  original certificate of authority apply to obtaining an

31  amended certificate under this section.

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  1         608.505  Effect of certificate of authority.--

  2         (1)  A certificate of authority authorizes the foreign

  3  limited liability company to which it is issued to transact

  4  business in this state subject, however, to the right of the

  5  Department of State to suspend or revoke the certificate as

  6  provided in this chapter.

  7         (2)  A foreign limited liability company with a valid

  8  certificate of authority has the same but no greater rights

  9  and privileges than a domestic limited liability company.

10  Unless has the same but no greater privileges as, and, except

11  as otherwise provided by this chapter, a foreign limited

12  liability company is subject to the same duties, restrictions,

13  penalties, and liabilities now or later imposed on, a domestic

14  limited liability company of like character.

15         (3)  This chapter does not authorize this state to

16  regulate the organization or internal affairs of a foreign

17  limited liability company authorized to transact business in

18  this state.  The laws of the state or other jurisdiction under

19  which a foreign limited liability company is organized govern

20  the foreign limited liability company's organization, internal

21  affairs, and the liability of its managers, members, and their

22  transferees.

23         608.507  Registered office and registered agent of

24  foreign limited liability company.--Each foreign limited

25  liability company authorized to transact business in this

26  state must continuously maintain in this state:

27         (1)  A registered office that may be the same as any of

28  its places of business.

29         (2)  A registered agent, who may be:

30         (a)  An individual who resides in this state and whose

31  business office is identical with the registered office;

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  1         (b)  A domestic corporation or domestic limited

  2  liability company the business office of which is identical

  3  with the registered office; or

  4         (c)  A foreign corporation or foreign limited liability

  5  company authorized to transact business in this state the

  6  business office of which is identical with the registered

  7  office.

  8         608.508  Change of registered office and registered

  9  agent of foreign limited liability company.--

10         (1)  A foreign limited liability company authorized to

11  transact business in this state may change its registered

12  office or registered agent by delivering to the Department of

13  State for filing a statement of change which satisfies the

14  requirements of s. 608.408 and sets forth:

15         (a)  Its name.

16         (b)  The street address of its current registered

17  office.

18         (c)  If the current registered office is to be changed,

19  the street address of its new registered office.

20         (d)  The name of its current registered agent.

21         (e)  If the current registered agent is to be changed,

22  the name of its new registered agent and the new agent's

23  written consent, either on the statement or attached to it, to

24  the appointment.

25         (f)  That, after the change or changes are made, the

26  street address of its registered office and the business

27  office of its registered agent will be identical.

28         (2)  If a registered agent changes the street address

29  of such agent's his or her business office, the registered

30  agent he or she may change the street address of the

31  registered office of any foreign limited liability company for

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  1  which the agent he or she is the registered agent by notifying

  2  the limited liability company in writing of the change and

  3  signing, either manually or in facsimile, and delivering to

  4  the Department of State for filing a statement of change that

  5  complies with the requirements of paragraphs (1)(a)-(f) and

  6  recites that the limited liability company has been notified

  7  of the change.

  8         608.512  Grounds for revocation of authority to

  9  transact business.--The Department of State may commence a

10  proceeding under s. 608.513 to revoke the certificate of

11  authority of a foreign limited liability company authorized to

12  transact business in this state if:

13         (1)  The foreign limited liability company has failed

14  to file its annual report with the Department of State within

15  the time required by this chapter.

16         (2)  The foreign limited liability company does not

17  pay, within the time required by this chapter, any fees,

18  taxes, or penalties imposed by this chapter or other law.

19         (3)  The foreign limited liability company is without a

20  registered agent or registered office in this state for 30

21  days or more.

22         (4)  The foreign limited liability company does not

23  notify the Department of State under s. 608.508 or s. 608.509

24  that its registered agent has resigned or that its registered

25  office has been discontinued within 30 days after the

26  resignation or discontinuance.

27         (5)  The foreign limited liability company's period of

28  duration has expired.

29         (6)  A member, manager, or agent of the foreign limited

30  liability company signed a document the member, manager, or

31  agent he or she knew was false in any material respect with

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  1  intent that the document be delivered to the Department of

  2  State for filing.

  3         (7)  The Department of State receives a duly

  4  authenticated certificate from the Secretary of State or other

  5  official having custody of records in the jurisdiction under

  6  the law of which the foreign limited liability company is

  7  incorporated stating that it has been dissolved or disappeared

  8  as a result of a merger.

  9         (8)  The foreign limited liability company has failed

10  to answer truthfully and fully, within the time prescribed in

11  s. 608.448 by this chapter, interrogatories propounded by the

12  Department of State.

13         (9)  The foreign limited liability company failed to

14  amend its certificate of authority as required by s. 608.504.

15         608.5135  Revocation; application for reinstatement.--

16         (1)(a)  If A foreign limited liability company the

17  certificate of authority of a limited liability company which

18  has been revoked, the foreign limited liability company

19  pursuant to s. 608.513 may apply to the Department of State

20  for reinstatement at any time after the effective date of

21  revocation of authority.  The application must:

22         1.  Recite the name of the foreign limited liability

23  company and the effective date of its revocation of authority;

24         2.  State that the ground or grounds for revocation of

25  authority either did not exist or have been eliminated and

26  that no further grounds currently exist for revocation of

27  authority;

28         3.  State that the foreign limited liability company's

29  name satisfies the requirements of s. 608.506; and

30         4.  State that all taxes, fees, and penalties owed by

31  the limited liability company and computed at the rate

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  1  provided by law at the time the foreign limited liability

  2  company applies for reinstatement have been paid; or

  3         (b)  As an alternative, the foreign limited liability

  4  company may submit a current annual report, signed by the

  5  registered agent and a manager or managing member, which

  6  substantially complies with the requirements of paragraph (a).

  7         (2)  If the Department of State determines that the

  8  application contains the information required by subsection

  9  (1) and that the information is correct, it shall cancel the

10  certificate of revocation of authority.

11         (3)  When the reinstatement is effective, it relates

12  back to and takes effect as of the effective date of the

13  revocation of authority, and the foreign limited liability

14  company resumes carrying on its business as if the revocation

15  of authority had never occurred.

16         (4)  The name of the foreign limited liability company

17  the certificate of authority of which has been revoked is not

18  available for assumption or use by another limited liability

19  company until 1 year after the effective date of revocation of

20  authority unless the limited liability company provides the

21  Department of State with an affidavit executed as required by

22  s. 608.408 permitting the immediate assumption or use of its

23  name by another limited liability company.

24         (5)  If the name of the foreign limited liability

25  company has been lawfully assumed in this state by another

26  limited liability company, the Department of State shall

27  require the foreign limited liability company to comply with

28  s. 608.506 before accepting its application for reinstatement.

29         608.601  Member's derivative actions.--

30         (1)  A person may not commence a proceeding in the

31  right of a domestic or foreign limited liability company

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  1  unless the person was a member of the limited liability

  2  company when the transaction complained of occurred or unless

  3  the person became a member through transfer by operation of

  4  law from one who was a member at that time.

  5         (2)  A complaint in a proceeding brought in the right

  6  of a limited liability company must be verified and allege

  7  with particularity the demand made to obtain action by the

  8  managing members of a member-managed company or the managers

  9  of a manager-managed company and that the demand was refused

10  or ignored. If the limited liability company commences an

11  investigation of the charges made in the demand or complaint,

12  the court may stay any proceeding until the investigation is

13  completed.

14         (3)  The court may dismiss a derivative proceeding if,

15  on motion by the limited liability company, the court finds

16  that one of the groups specified in paragraphs (a)-(c) has

17  made a determination in good faith after conducting a

18  reasonable investigation upon which its conclusions are based

19  that the maintenance of the derivative suit is not in the best

20  interests of the limited liability company. The limited

21  liability company shall have the burden of proving the

22  independence and good faith of the group making the

23  determination and the reasonableness of the investigation. The

24  determination shall be made by:

25         (a)  A majority vote of independent managing members of

26  a member-managed company or of independent managers of a

27  manager-managed company present at a meeting of the managing

28  members of a member-managed company or of managers of a

29  manager-managed company, if the independent managing members

30  or managers, as applicable, constitute a quorum;

31

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  1         (b)  A majority vote of a committee consisting of two

  2  or more independent managing members of a member-managed

  3  company or of independent managers of a manager-managed

  4  company appointed by a majority vote of independent managing

  5  members or managers, as applicable, present at a meeting of

  6  the managing members of a member-managed company or of

  7  managers of a manager-managed company, whether or not such

  8  independent managing members or managers, as applicable,

  9  constitute a quorum; or

10         (c)  A panel of one or more independent persons

11  appointed by the court upon motion by the limited liability

12  company.

13         (4)  A proceeding commenced under this section may not

14  be discontinued or settled without the court's approval. If

15  the court determines that a proposed discontinuance or

16  settlement will substantially affect the interest of the

17  limited liability company's members or a class, series, or

18  voting group of members, the court shall direct that notice be

19  given to the members affected. The court may determine which

20  party or parties to the proceeding shall bear the expense of

21  giving the notice.

22         (5)  On termination of the proceeding, the court may

23  require the plaintiff to pay any defendant's reasonable

24  expenses, including reasonable attorney's fees, incurred in

25  defending the proceeding if it finds that the proceeding was

26  commenced without reasonable cause.

27         (6)  The court may award reasonable expenses for

28  maintaining the proceeding, including reasonable attorney's

29  fees, to a successful plaintiff or to the person commencing

30  the proceeding who receives any relief, whether by judgment,

31  compromise, or settlement, and require that the person account

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  1  for the remainder of any proceeds to the limited liability

  2  company; however, this subsection does not apply to any relief

  3  rendered for the benefit of injured members only and limited

  4  to a recovery of the loss or damage of the injured members.

  5         (7)  For purposes of this section, "member" includes a

  6  beneficial owner whose limited liability company interests are

  7  held in a voting trust or held by a nominee on the member's

  8  behalf.

  9         608.701  Application of corporation case law to set

10  aside limited liability.--In any case in which a party seeks

11  to hold the members of a limited liability company personally

12  responsible for the liabilities or alleged improper actions of

13  the limited liability company, the court shall apply the case

14  law which interprets the conditions and circumstances under

15  which the corporate veil of a corporation may be pierced under

16  the law of this state.

17         608.702  Certificates and certified copies to be

18  received in evidence.--All certificates issued by the

19  Department of State in accordance with this chapter, and all

20  copies of records filed in the Department of State in

21  accordance with this chapter when certified by the Department

22  of State, shall be taken and received in all courts, public

23  offices, and official bodies as prima facie evidence of the

24  facts therein stated. A certificate under the seal of the

25  Department of State, as to the existence or nonexistence of

26  the facts relating to a limited liability company or foreign

27  limited liability company, shall be taken and received in all

28  courts, public offices, and official bodies as prima facie

29  evidence of the existence or nonexistence of the facts therein

30  stated.

31         608.703  Interrogatories by Department of State.--

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  1         (1)  The Department of State may direct to any limited

  2  liability company or foreign limited liability company subject

  3  to this chapter, and to any member or manager of any limited

  4  liability company or foreign limited liability company subject

  5  to this chapter, any interrogatories reasonably necessary and

  6  proper to enable the Department of State to ascertain whether

  7  the limited liability company or foreign limited liability

  8  company has complied with all of the provisions of this

  9  chapter applicable to the limited liability company or foreign

10  limited liability company. The interrogatories shall be

11  answered within 30 days after the date of mailing, or within

12  such additional time as fixed by the Department of State. The

13  answers to the interrogatories shall be full and complete and

14  shall be made in writing and under oath. If the

15  interrogatories are directed to an individual, they shall be

16  answered by the individual, and if directed to a limited

17  liability company or foreign limited liability company, they

18  shall be answered by a manager of a manager-managed company, a

19  member of a member-managed company, or a fiduciary if the

20  company is in the hands of a receiver, trustee, or other

21  court-appointed fiduciary.

22         (2)  The Department of State need not file any record

23  in a court of competent jurisdiction to which the

24  interrogatories relate until the interrogatories are answered

25  as provided in this chapter, and not then if the answers

26  thereto disclose that the record is not in conformity with the

27  requirements of this chapter or if the Department of State has

28  determined that the parties to such document have not paid all

29  fees, taxes, and penalties due and owing this state. The

30  Department of State shall certify to the Department of Legal

31  Affairs, for such action as the Department of Legal Affairs

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  1  may deem appropriate, all interrogatories and answers which

  2  disclose a violation of this chapter.

  3         (3)  The Department of State may, based upon its

  4  findings hereunder or as provided in s. 213.053(14), bring an

  5  action in circuit court to collect any penalties, fees, or

  6  taxes determined to be due and owing the state and to compel

  7  any filing, qualification, or registration required by law. In

  8  connection with such proceeding, the department may, without

  9  prior approval by the court, file a lis pendens against any

10  property owned by the corporation and may further certify any

11  findings to the Department of Legal Affairs for the initiation

12  of any action permitted pursuant to this chapter which the

13  Department of Legal Affairs may deem appropriate.

14         (4)  The Department of State shall have the power and

15  authority reasonably necessary to enable it to administer this

16  chapter efficiently, to perform the duties herein imposed upon

17  it, and to adopt reasonable rules necessary to carry out its

18  duties and functions under this chapter.

19         Section 2.  Sections 608.4062, 608.412, 608.424, and

20  608.4494, Florida Statutes, are repealed.

21         Section 3.  This act shall take effect October 1, 1999.

22

23          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
24                             SB 1696

25

26  The committee substitute authorizes the pension plan of a
    limited liability company to include employees of the company.
27
    Clarifies the definition of "recklessness."
28

29

30

31

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