53-601. DEFINITIONS. As used in this chapter, unless the context otherwise
requires:
(1) "Articles of organization" mean articles filed under section 53-607, Idaho Code, and
those articles as amended or restated.
(2) "Corporation" means a corporation formed under the laws of any state or foreign country.
(3) "Court" includes every court having jurisdiction in the case.
(4) "Event of dissociation" means an event that causes a person to cease to be a member
as provided in section 53-641, Idaho Code.
(5) "Foreign limited liability company" means an organization that is:
(a) An unincorporated association;
(b) Organized under laws of a state other than the laws of this state,
or under the laws of any foreign country;
(c) Organized under a statute pursuant to which an association may be formed that affords to each
of its members limited liability with respect to the liabilities of the entity; and
(d) Not required to be registered or organized under any statute of this state other than the
provisions of this chapter.
(6) "Limited liability company" or "domestic limited liability company" means an
organization formed under the provisions of this chapter.
(7) "Limited liability company interest" or "interest in the limited liability company"
means the interest that can be assigned under section 53-636, Idaho Code, and charged under section
53-637, Idaho Code.
(8) "Limited partnership" means a limited partnership formed under the laws of any state or
foreign country.
(9) "Manager" means, with respect to a limited liability company
that has set forth in its articles of organization that it is to be managed by managers,
the person or persons designated in accordance with section 53-621, Idaho Code.
(10) "Member" means a person or
persons who have been admitted to membership in a limited liability company as provided in section 53-640,
Idaho Code, and who have not ceased to be members as provided in section 53-641, Idaho Code.
(11) "Operating agreement" me ans any agreement, written or oral, among
all of the members as to the conduct of the business and affairs of a limited liability company.
(12) "Person" means an individual, a general partnership, a limited
partnership, a domestic or foreign limited liability company, a trust, an estate, an association, a
corporation or any other legal entity.
(13) "State" means a state, territory or possession of the United States,the District of
Columbia or the Commonwealth of Puerto Rico.
53-602. NAME. (1) The name of each limited liability company as set forth
in its articles of organization must contain the words "Limited Liability Company" or "Limited Company" or the abbreviation "L.L.C.," "L.C.," "LLC"
or "LC". The word "Limited" may be abbreviated as "Ltd." and the word
"Company" may be abbreviated as "Co." If the limited liability company,
however, is a professional services limited liability company as defined in section 53-615, Idaho Code, the name of the limited liability company as set forth in the articles of organization must end with the words
"Professional Company" or the abbreviation "P.L.L.C." or "PLLC".
(2) A limited liability company name may not be the same as or deceptively similar to:
(a) The name of any limited liability company, limited partnership or corporation existing under the laws
of this state or authorized to transact business in this state; or
(b) Any name reserved or registered under section 53-603, Idaho Code,
the general corporation laws or the Idaho limited partnership act.
(3) The provisions of subsection (2) of this section shall not apply if the applicant files with the secretary of state either of the following:
(a) The written consent of the holder of a reserved or registered name
to use a deceptively similar name if one (1) or more words are added,
altered or deleted to make the name distinguishable from the reserved
or registered name; or
(b) A certified copy of a final decree of a court of competen t
jurisdiction establishing the prior right of the applicant to the use
of the name in this state.
53-603. RESERVATION OF NAME. (1) The exclusive right to use a name may be
reserved by:
(a) Any person intending to organize a limited liability company and
to adopt that name;
(b) Any limited liability company or any foreign limited liability
company registered in this state that intends to adopt that name;
(c) Any foreign limited liability company intending to register in
this state and to adopt that name; or
(d) Any person intending to organize a foreign limited liability
company and to have it registered in this state and to adopt that name.
(2) The reservation shall be made by filing with the secretary of state
an application, executed by the applicant, to reserve a specified name. If
the secretary of state finds that the name is available for use by a
domestic or foreign limited liability company, the secretary of state shall
reserve the name for the exclusive use of the applicant for a period of
four (4) months from and after the date the application is filed with the
secretary of state.
(3) The holder of a reserved limited liability company name may renew the
reservation for successive periods of four (4) months each from the date of
the renewal under the same conditions that the holder of a reserved
corporate name may renew a corporate name reservation.
(4) The right to the exclusive use of a reserved name may be transferred
to another person by filing with the secretary of state a notice of the
transfer, executed by the applicant for whom the name was reserved, and
specifying the name to be transferred and the name and address of the
transferee. The transfer shall not extend the term during which the name is
reserved.
53-604. REGISTERED OFFICE AND REGISTERED AGENT. (1) A limited liability
company shall continuously maintain in this state
(a) A registered office that may, but need not, be the same as its place
of business; and
(b) A registered agent for service of process on the limited liability
company that is an individual resident of this state, a limited liability
company, a foreign limited liability company authorized to transact
business in this state or a corporation formed under the laws of or
authorized to transact business in this state. The business office of the
registered agent shall be identical with the registered office.
(2) If at any time after filing the articles of organization the limited
liability company appoints a new registered agent, the new registered agent
shall consent to the appointment either
(a) By signing the annual report or the statement of change of registered
office or registered agent by which the change is made; or
(b) In a writing which shall be kept available for inspection at the
registered office.
(3) A limited liability company may change its registered office or
registered agent, or both, by indicating the change on the annual report
prescribed in section 53-613, Idaho Code, or by delivering to the secretary of
state a statement setting forth
(a) The name of the limited liability company;
(b) The address of its current registered office;
(c) If the address of its registered office is to be changed, the address
to which the registered office is to be changed;
(d) The name of its current registered agent;
(e) If its registered agent is to be changed, the name of its successor
registered agent.
(4) The change of registered office or registered agent is effective on
delivery of the annual report or statement to the secretary of state.
(5) A registered agent of a limited liability company may resign as
registered agent by delivering a written notice of resignation, executed in
duplicate, to the secretary of state. The secretary of state shall mail a
copy of the notice to the limited liability company at its registered office.
The appointment of the registered agent terminates thirty (30) days after
receipt of the notice by the secretary of state or on the appointment of a
successor registered agent, whichever occurs first.
(6) If a registered agent changes its address to another place in this
state, it may change the address by delivering a statement to the secretary of
state as required in subsection (3) of this section, except that the statement
need be signed only by the registered agent. The statement shall recite that a
copy of it has been mailed to the limited liability company.
53-605. NATURE OF BUSINESS. (1) A limited liability company may be
organized under this chapter for any lawful purpose. If the purpose for which
a limited liability company is organized or its activities make it subject to
a special provision of law, the limited liability company shall also comply
with that provision.
(2) Except as limited in the articles of organization or operating
agreement, the limited liability company shall have and exercise all powers
necessary or convenient to effect its purposes including the power to render
professional services, if each member of a limited liability company who
renders professional services in Idaho is licensed or registered to render
those professional services pursuant to applicable Idaho law and section
53-615, Idaho Code.
53-606. SERVICE OF PROCESS. The registered agent appointed by the
domestic or foreign limited liability company shall be an agent of such
limited liability company upon whom any process, notice or demand required
or permitted by law to be served upon the limited liability company may be
served.
Whenever the limited liability company shall fail to appoint or maintain a
registered agent in this state, or whenever the registered agent cannot
with reasonable diligence be found at the registered office, then any
process, notice or demand may be served by mailing copies of the process,
notice or demand by registered or cer tified mail to the limited liability
company addressed to its registered office and to the members and managers
of the limited liability company as shown on the most current annual report
filed with the secretary of state, except that if a foreign limited
liability company has cancelled its registration in accordance with the
provisions of this chapter, then service may be made by mailing copies of
the process, notice or demand by registered or certified mail upon the
address as shown on the application for cancellation.
Nothing herein contained shall limit or affect the right to serve any
process, notice or demand required or permitted by law to be served upon a
limited liability company in any other manner now or hereafter permitted by
law.
53-607. FORMATION. One (1) or more persons may form a limited liability
company by signing articles of organization and delivering the signed
articles to the secretary of state for filing. The person or persons who
form a limited liability company need not be members of the limited
liability company at the time of formation or after formation has occurred.
53-608. ARTICLES OF ORGANIZATION. The articles of organization shall be
set forth in a form prescribed by the secretary of state
(1) A name for the limited liability company that satisfies the
requirements of section 53-602, Idaho Code;
(2) The address of the registered office and the name of the registered
agent at that address, as required to be maintained by the provisions of
section 53-604, Idaho Code;
(3) If management of the limited liability company is vested in a manager
or managers, a statement to that effect;
(4) If the management of the limited liability company is vested in its
members, the name and address of one (1) or more of the initial members of
the limited liability company;
(5) If the management of the limited liability company is vested in a
manager or managers, the name and address of one (1) or more of the initial
managers o f the limited liability company;
(6) If the limited liability company is a professional service limited
liability company, the principal profession for which members are duly
licensed or otherwise legally authorized to render professional services.
53-609. AMENDMENT OF ARTICLES OF ORGANIZATION -- RESTATEMENT.
(1) The articles of organization of a limited liability company may be amended by
filing articles of amendment with the secretary of state. The articles of
amendment shall set forth:
(a) The name of the limited liability company;
(b) The date the articles of organization were filed; and
(c) The amendment to the articles of organization.
(2) The articles of organization may be amended in any respect as may be
desired, so long as the articles of organization as amended contain only
provisions that may be lawfully contained in articles of organization at
the time of making the amendment and the amendments are in a form
prescribed by the secretary of state.
(3) Articles of organization may be restated at any time. Restated
articles of organization shall be filed with the secretary of state and
shall be specifically designated as such in the heading, shall state either
in the heading or in an introductory paragraph the limited liability
company's present name and, if it has been changed, its former name and the
date of the filing of its articles of organization. The restated articles
of the organization shall be in a form prescribed by the secretary of
state.
53-610. EXECUTION OF DOCUMENTS.
(1) Unless otherwise provided in any
other section of this chapter, any document required by the provisions of
this chapter to be filed with the secretary of state shall be executed:
(a) If management of the limited liability company is vested in one
(1) or more managers, by any manager;
(b) If management of the limited liability company is reserved to the
members, by any member;
(c) If the limited liability has not been formed, by the person o r
persons forming the limited liability company; or
(d) If the limited liability company is in the hands of a receiver,
trustee or other court-appointed fiduciary, by that fiduciary.
(2) The person executing the document shall sign it and state beneath or
opposite his signature the person's name and the capacity in which he
signs.
(3) The person executing the document may do so as an attorney-in-fact.
Powers of attorney relating to the execution of the document need not be
provided to or filed with the secretary of state.
53-611. FILING WITH THE SECRETARY OF STATE. The original signed copy,
together with a duplicate copy that may be either a signed, photocopied or
conformed copy, of the articles of organization or any other document
required to be filed pursuant to this chapter, shall be delivered to the
secretary of state. If the secretary of state determines that the documents
conform to the filing provisions of this chapter, it shall, when all
required filing fees have been paid:
(1) Endorse on each signed original and duplicate copy the word "filed"
and the date and time of the document's acceptance for filing;
(2) Retain the signed original in the secretary of state's files; and
(3) Return the duplicate copy to the person who filed it or to the
person's representative.
53-612. EFFECT OF FILING OF ARTICLES OF ORGANIZATION. Each copy of the
articles of organization stamped "filed" and marked with the filing date is
conclusive evidence that all conditions precedent required to be performed
by the organizers have been complied with and that the limited liability
company has been legally organized and formed under the provisions of this
chapter.
53-613. ANNUAL REPORT OF DOMESTIC AND FOREIGN LIMITED LIABILITY
COMPANIES. (1) Each domestic limited liability company, and each foreign
limited liability company authorized to do business in this state, shall file
an annual report setting forth
(a) The name of the limited liability company and the st ate or country
under the laws of which it is organized;
(b) The address of the registered office of the limited liability company
in this state, and the name of its registered agent in this state at such
address, and the address of its principal office;
(c) If the management of the limited liability company is vested in its
members, the name and address of one (1) or more of the current members of
the limited liability company;
(d) If the management of the limited liability company is vested in a
manager or managers, the name and address of one (1) or more of the
current managers of the limited liability company.
(2) Such annual report shall be made in a form prescribed by the
secretary of state, and the information therein contained shall be given as of
the date of the execution of the report. It shall be executed for the limited
liability company by a person authorized by the members if management is
vested in the members, or by a person authorized by the managers if
management is vested in the managers. Execution by such a person constitutes a
representation that the authority was granted. If the limited liability
company is in the hands of a receiver or trustee, it shall be executed on
behalf of the limited liability company by such receiver or trustee.
(3) Such annual report of a domestic or foreign limited liability company
shall be delivered to the secretary of state between the 1st day of July and
the 30th day of November of each year, except that the first annual report of
a domestic or foreign limited liability company shall be filed between the 1st
day of July and the 30th day of November of the state fiscal year (July
1--June 30) next succeeding the state fiscal year in which its articles of
organization were filed with the secretary of state, or when the certificate
of registration was issued by the secretary of state, as the case may be. The
report must be received in the office of the secre tary of state not later than
the close of business on the 30th day of November, or if that date falls on a
weekend, on the next business day. If the secretary of state finds that such
report conforms to the requirements of this chapter, he shall file the same.
If he finds that it does not so conform, he shall promptly return the same to
the limited liability company for any necessary corrections
53-615. PROFESSIONAL SERVICE LIMITED LIABILITY COMPANIES. (1) A group of individuals duly licensed or otherwise legally authorized to render the
same or allied professional services within this state or professional
corporations, partnerships or limited liability companies all of whose
shareholders, partners or members are duly licensed or otherwise legally
authorized to render the same or allied professional services within this
state may organize and become a professional company under the provisions
of this chapter for the sole and specific purpose of rendering the same and
specific professional service, allied professional services and services
ancillary to the professional services. This section shall not be deemed to
authorize allied professional services where the laws pertaining to
specific professions or the codes of ethics or professional responsibility
of any of the professions involved in such a proposed professional company
prohibit such a combination of professional services.
(2) No professional company may render professional services in this
state except through its managers, members, employees and agents who are
duly licensed or otherwise legally authorized to render such professional
services within this state. The term "employee" as used in this chapter
does not include clerks, secretaries, bookkeepers, technicians and other
assistants who are not usually and ordinarily considered by custom and
practice to be rendering professional services to the public for which a
license or other legal authorization is required.
(3) Nothing contained in this section shall be interpreted to abolish,
repeal, modify, restrict or limit the law now in effect in this state
applicable to the professional relationship and liabilities between the
person furnishing the professional services and the person receiving such
professional services and to the standards for professional conduct. Any
manager, member, agent or employee of a professional company organized
under this chapter shall remain personally and fully liable and accountable
for any negligent or wrongful acts or misconduct committed by him, or by
any person under his direct supervision and control, while rendering
professional services on behalf of the professional company to the person
for whom such professional services were being rendered. The professional
company shall be liable up to the full value of its property for any
negligent or wrongful acts or misconduct committed by any of its managers,
members, agents or employees while they are engaged on behalf of the
professional company in the rendering of professional services.
The relationship of a person whether as an individual, shareholder or a
professional corporation, partner of a partnership or member of a
professional company to a professional company organized under the
provisions of this chapter, with which such person is associated, whether
as manager, member or employee, shall in no way modify or diminish the
jurisdiction over him of the governmental authority or state agency which
licensed, certified or registered him for a particular profession.
(4) No professional company may offer membership to or accept as a member
anyone other than a person who is duly licensed or otherwise legally
authorized to render the same specific professional services as those for
which the company was organized or professional corporations, partnerships
or limited liability companies all of whose shareholders, partners or
members are duly licensed or otherwise legally authorized to render the
same specific professional services as those for which the profe ssional
company was organized. No member of a professional company shall enter into
a voting trust agreement or any other type of agreement vesting another
person with the authority to exercise the voting power of his membership.
(5) If any manager, member, agent or employee of a professional company
who has been rendering professional services within this state or accepts
employment that, pursuant to existing law, places restrictions or
limitations upon his continued rendering of such professional services, he
shall cease to be a member in such professional company in accordance with
the provisions of subsection (1)(k) of section 53-641, Idaho Code, and the
remaining members of the professional company shall take such action as is
required to terminate such membership.
(6) No member of a professional company may sell or transfer his
membership in such professional company except to another individual,
professional corporation, partnership or limited liability company eligible
to be a member of such professional company and except pursuant to the
provisions of section 53-638, Idaho Code.
(7) The provisions of this section shall not be considered as repealing,
modifying or restricting the applicable provisions of law regulating the
several professions except insofar as such laws conflict with the
provisions of this section.
(8) As used in this section:
(a) The term "professional service" means any type of service to the
public which can be rendered by a member of any profession within the
purview of his profession. For the purpose of this chapter, the
professions shall be held to include the practices of architecture,
chiropractic, dentistry, engineering, landscape architecture, law,
medicine, nursing, occupational therapy, optometry, physical therapy,
podiatry, professional geology, psychology, certified or licensed
public accountancy, social work, surveying, and veterinary medicine,
and no others.
(b) The term "professional company" means a limited liability company
organized under the provisions of this chapter for the sole and
specific purpose of rendering professional service and which has as its
members only natural persons who themselves are duly licensed or
otherwise legally authorized to render one (1) or more of the same
professional services as the professional company.
(c) The term "allied professional services" means professional
services which are so related in substance that they are frequently
offered in conjunction with one another as parts of the same service
package to the consumer.
53-616. AGENCY POWER OF MEMBERS AND MANAGERS.
(1) Except as provided in subsection (2) of this section or as provided in the articles of
organization, every member is an agent of the limited liability company for
the purpose of its business or affairs, and the act of any member,
including, but not limited to, the execution in the name of the limited
liability company of any instrument, for apparently carrying on in the
usual way the business or affairs of the limited liability company of which
he is a member, binds the limited liability company, unless the member so
acting has, in fact, no authority to act for the limited liability company
in the particular matter, and the person with whom the member is dealing
has knowledge of the fact that the member has no such authority.
(2) If the articles of organization provide that management of the
limited liability company is vested in a manager or managers:
(a) No member, solely by reason of being a member, is an agent of the
limited liability company; and
(b) Every manager is an agent of the limited liability company for the
purpose of its business or affairs, and the act of any manager,
including, but not limited to, the execution in the name of the limited
liability company of any instrument, for apparently carrying on in the
usual way the business or affairs of the limited liability company of
wh ich he is a manager binds the limited liability company, unless the
manager so acting has, in fact, no authority to act for the limited
liability company in the particular matter, and the person with whom
the manager is dealing has knowledge of the fact that the manager has
no such authority.
(3) An act of a manager or a member which is not apparently for the
carrying on in the usual way the business or affairs of the limited
liability company does not bind the limited liability company unless
authorized in accordance with an operating agreement, at the time of the
transaction or at any other time.
(4) An act of a manager or member in contravention of a restriction on
authority shall not bind the limited liability company to persons having
knowledge of the restriction.
53-617. ADMISSION OF MEMBERS AND MANAGERS. (1) Except as provided in
subsection (2) of this section, an admission or representation made by any
member concerning the business or affairs of a limited liability company
within the scope of his authority as provided for in this chapter is
evidence against the limited liability company.
(2) If the articles of organization provide that management of the
limited liability company is vested in a manager or managers:
(a) An admission or representation made by a manager concerning the
business or affairs of a limited liability company within the scope of
the manager's authority as provided for in this chapter is evidence
against the limited liability company; and
(b) The admission or representation of any member, acting solely in
the capacity of a member, shall not constitute evidence against the
limited liability company.
53-618. LIMITED LIABILITY COMPANY CHARGED WITH KNOWLEDGE OF OR NOTICE TO MEMBER OR MANAGER.
(1) Except as provided in subsection (2) of this section, notice to any member of any
matter relating to the business or
affairs of the limited liability company, and the knowledge of the member
acting in the part icular matter, acquired while a member or known at the
time of becoming a member, and the knowledge of any other member who
reasonably could and should have communicated the knowledge to the acting
member, operate as notice to or knowledge of the limited liability company,
except in the case of a fraud on the limited liability company committed by
or with the consent of that member.
(2) If the articles of organization provide that management of the
liability company is vested in a manager or managers:
(a) Notice to any manager of any matter relating to the business or
affairs of the limited liability company, and the knowledge of the
manager acting in the particular matter, acquired while a manager or
known at the time of becoming a manager, and the knowledge of any other
manager who reasonably could and should have communicated the knowledge
to the acting manager, operate as notice to or knowledge of the limited
liability company, except in the case of a fraud on the limited
liability company committed by or with the consent of that manager; and
(b) Notice to or knowledge of any member of a limited liability
company while the member is acting solely in the capacity of a member
is not notice to or knowledge of the limited liability company.
53-619. LIABILITY OF MEMBERS TO THIRD PARTIES. A person who is a member
of a limited liability company is not liable, solely by reason of being a
member, under a judgment, decree or order of a court, or in any other
manner, for a debt, obligation or liability of the limited liability
company, whether arising in contract, tort or otherwise or for the acts or
omissions of any other member, manager, agent or employee of the limited
liability company.
53-620. PARTIES TO ACTIONS. A member of a limited liability company is
not a proper party to a proceeding by or against a limited liability
company, solely by reason of being a member of the limited liability
company, except where the object of the proceedin g is to enforce a member's
right against or liability to the limited liability company or as otherwise
provided in an operating agreement.
53-621. MANAGEMENT. (1) Unless an operating agreement vests management of
the limited liability company in a manager or managers, management of the
business or affairs of the limited liability company shall be vested in the
members. Subject to any provisions in an operating agreement or this
chapter restricting or enlarging the management rights and duties of any
person or group or class of persons, the members shall have the right and
authority to manage the affairs of the limited liability company and to
make all decisions with respect thereto.
(2) If an operating agreement vests management of the limited liability
company in one (1) or more managers, then the manager or managers shall
have exclusive power to manage the business and affairs of the limited
liability company except to the extent otherwise provided in an operating
agreement. Unless otherwise provided in an operating agreement, managers:
(a) Shall be designated, appointed, elected, removed or replaced by a
vote, approval or consent of more than one-half (1/2) by numbers of the
members;
(b) Need not be members of the limited liability company or natural
persons; and
(c) Unless they are sooner removed or sooner resign, shall hold office
until their successors shall have been elected and qualified.
53-622. DUTIES OF MANAGERS AND MEMBERS. Unless otherwise provided in an
operating agreement:
(1) A member or manager shall not be liable, responsible or accountable
in damages or otherwise to the limited liability company or to the members
of the limited liability company for any action taken or failure to act on
behalf of the limited liability company unless the act or omission
constitutes gross negligence or willful misconduct.
(2) Every member and manager must account to the limited liability
company and hold as trustee for it any profit or benefit derived by that
person without the consent of more than one-half (1/2) by number of the
disinterested managers or members, or other persons participating in the
management of the business or affairs of the limited liability company,
from:
(a) Any transaction connected with the conduct or winding up of the
limited liability company; or
(b) Any use by the member or manager of its property, including, but
not limited to, confidential or proprietary information of the limited
liability company or other matters entrusted to the person as a result
of his status as manager or member.
(3) One who is a member of a limited liability company in which
management is vested in managers under section 53-621, Idaho Code, and who
is not a manager shall have no duties to the limited liability company or
to the other members solely by reason of acting in the capacity of a
member.
53-623. VOTING. (1) Unless otherwise provided in an operating agreement
or this chapter, and subject to subsection (2) of this section, the
affirmative vote, approval or consent of more than one-half (1/2) by number
of the members, if management of the limited liability company is vested in
the members, or of the managers if the management of the limited liability
company is vested in managers, shall be re quired to decide any matter
connected with the business of the limited liability company.
(2) Unless otherwise provided in writing in an operating agreement, the
affirmative vote, approval or consent of all members shall be required to:
(a) Amend a written operating agreement; or
(b) Authorize a manager or member to do any act on behalf of the
limited liability company that contravenes a written operating
agreement, including any written provision thereof which expressly
limits the purpose, business or affairs of the limited liability
company or the conduct thereof.
53-624. LIMITATION OF LIABILITY AND INDEMNIFICATION OF MEMBERS AND
MANAGERS. An operating agreement may:
(1) Eliminate or limit the personal liability of a member or manager for
monetary damages for breach of any duty provided for in section 53-622,
Idaho Code; and
(2) Provide for indemnification of a member or manager for judgments,
settlements, penalties, fines or expenses incurred in a proceeding to which
a person is a party because the person is or was a member or manager.
53-625. RECORDS AND INFORMATION. (1) Unless otherwise provided in writing
in an operating agreement, a limited liability company shall keep at its
principal place of business the following:
(a) A current and a past list, setting forth the full name and last
known mailing address of each member and manager, if any, set forth in
alphabetical order;
(b) A copy of the articles of organization and all amendments thereto,
together with executed copies of any powers of attorney pursuant to
which the articles of amendment have been executed;
(c) Copies of the limited liability company's federal, state and local
income tax returns and financial statements, if any, for the three (3)
most recent years or, if those returns and statements were not prepared
for any reason, copies of the information and statements provided to,
or which should have been provided to, the members to enable them to
prepare their federal, state and local tax returns for the period;
(d) Copies of any effective written operating agreements, and all
amendments thereto, and copies of any written operating agreements no
longer in effect;
(e) Unless contained in writing in an operating agreement:
(i) A writing setting forth the amount of cash, if any, and a
statement of the agreed value of other property or services, if
any, contributed by each member and the times at which or events
upon the happening of which any additional contributions are to be
made by each member;
(ii) A writing stating events, if any, upon the happening of
which the limited liability company is to be dissolved and its
affairs wound up; and
(iii) Other writings prepared pursuant to a requirement, if any,
in an operating agreement.
(2) Upon reasonable request, a member may, at the member's own expense,
inspect and copy during ordinary business hours any limited liability
company record, wherever the record is located.
(3) Members, if the management of the limited liability company is vested
in the members, or managers, if management of the limited liability company
is vested in managers, shall render, to the extent the circumstances render
it just and reasonable, true and full information of all things affecting
the business or affairs of the limited liability company to any member and
to the legal representative of any deceased member or of any member under
legal disability.
(4) Failure of the limited liability company to keep or maintain any of
the records or information required pursuant to this section shall not be
grounds for imposing liability on any member or manager for the debts and
obligations of the limited liability company.
53-626. CONTRIBUTIONS TO CAPITAL. A limited liability company interest
may be issued in exchange for cash, property, services rendered, guarantee
of an o bligation of the limited liability company, a promissory note or
other obligation to contribute cash or property or to perform services, or
other valuable consideration.
53-627. LIABILITY FOR CONTRIBUTIONS.
(1) A promise by a member to contribute to the limited liability company is not enforceable unless set
forth in a writing signed by the member.
(2) Unless otherwise provided in an operating agreement, a member is
obligated to the limited liability company to perform any enforceable
promise to contribute cash or property or to perform services, even if the
member is unable to perform because of death, disability or other reason.
(3) If a member does not make the required contribution of property or
services, the member is obligated, at the option of the limited liability
company, to contribute cash equal to that portion of the value of the
stated contribution that has not been made.
(4) Unless otherwise provided in an operating agreement, the obligation
of a member to make a contribution may be compromised only with the
unanimous consent of the members.
53-628. SHARING OF PROFITS. Unless otherwise provided in writing in an
operating agreement, each member shall be repaid that member's
contributions to capital and share on a per capita basis the profits and
assets remaining after all liabilities, including those to members, are
satisfied.
53-629. SHARING OF INTERIM DISTRIBUTIONS. Except as otherwise provided in
sections 53-630 and 53-646, Idaho Code, distributions of cash or other
assets of a limited liability company shall be shared among the members and
among classes of members in the manner provided in writing in an operating
agreement. If an operating agreement does not so provide in writing, each
member shall share equally in any distribution. A member is entitled to
receive distributions described in this section from a limited liability
company to the extent and at the times or upon the happening of the events
specified in an operating agreement or at the times determined by the
members or managers pursuant to section 53-623, Idaho Code.
53-630. DISTRIBUTIONS ON AN EVENT OF DISSOCIATION. Unless otherwise
provided in writing in an operating agreement, if a member dissociates from
a limited liability company without resulting in a dissolution under
section 53-642, Idaho Code;
(1) And if the member is removed as a member pursuant to section
53-641(c), Idaho Code, then the member shall receive within a reasonable
time after dissociation the fair value of the member's interest in the
limited liability company as of the date of dissociation the limited
liability company as if the limited liability company were wound up as of
that date;
(2) And if the event of dissociation is other than removal pursuant to
section 53-641(c), Idaho Code, the member shall be treated as an assignee
from the date of dissociation.
53-631. DISTRIBUTION IN KIND. Unless otherwise provided in an operating
agreement:
(1) A member, regardless of the nature of the member's contribution, has
no right to demand and receive any distribution from the limited liability
company in any form other than cash; and
(2) A member may not be compelled to accept from the limited liability
company a distribution of any asset in kind to the extent that the
percentage of the asset distributed to the member exceeds the percentage
that the member would have shared in a cash distribution equal to the value
of the property at the time of distribution.
53-632. RIGHT TO DISTRIBUTION. At the time a member becomes entitled to
receive a distribution, the member has the status of, and is entitled to
all remedies available to, a creditor of the limited liability company with
respect to the distribution.
53-633. OWNERSHIP OF LIMITED LIABILITY COMPANY PROPERTY.
(1) Property transferred to or otherwise acquired by a limited liability company is
property of the limited liability company and not of the members
individually.
(2) Property may be acquired, held and conveyed in the name of the
limited liability company. Any interest in real property may be acquired
in the name of the limited liability company, and title to any interest so
acquired shall vest in the limited liability company rather than in the
members individually.
53-634. TRANSFER OF PROPERTY. (1) Except as provided in subsection (5) of
this section, property of the limited liability company held in the name of
the limited liability company may be transferred by an instrument of
transfer executed by any member in the name of the limited liability
company.
(2) Property of the limited liability company that is held in the name of
one (1) or more members or managers with an indication in the instrument
transferring the property to them of their capacity as members or managers
of a limited liability company or of the existence of a limited liability
company, if the name of the limited liability company is not indicated, may
be transferred by an instrument of transfer executed by the persons in
whose name title is held.
(3) Property transferred under subsections (1) and (2) of this section
may be recovered by the limited liability company if it proves that the
execution of the instrument of transfer did not bind the limited liability
company under section 53-616, Idaho Code, unless the property has been
transferred by the initial transferee or a person claiming through the
initial transferee to a subsequent transferee who gives value without
having notice that the person who executed the instrument of initial
transfer lacked authority to bind the limited liability company.
(4) Property of the limited liability company held in the name of one (1)
or more persons other than the limited liability company without an
indication in the instrument transferring to the property to them of their
capacity as members or managers of a limited liability company or of the
existence of a limited liability company, may be transferred free of any
claims of the limited liability company or the members by the pe rsons in
whose name title is held to a transferee who gives value without having
notice that it is property of the limited liability company.
(5) If the articles of organization provide that management of the
limited liability company is vested in a manager or managers:
(a) Title to property of the limited liability company that is held in
the name of the limited liability company may be transferred by an
instrument of transfer executed by any manager in the name of the
limited liability company; and
(b) A member, solely by reason of being a member, shall not have
authority to transfer property of the limited liability company.
53-635. NATURE OF LIMITED LIABILIT Y COMPANY INTEREST. A limited liability
company interest is personal property.
53-636. ASSIGNMENT OF LIMITED LIABILITY COMPANY INTEREST. (1) Unless
otherwise provided in writing in an operating agreement:
(a) A limited liability company interest is assignable in whole or in
part;
(b) An assignment entitles the assignee to receive, to the extent
assigned, only the distributions to which the assignor would be
entitled;
(c) An assignment of a limited liability company interest does not
dissolve the limited liability company or entitle the assignee to
participate in the management and affairs of the limited liability
company or to become or exercise any rights of a member;
(d) Until the assignee of a limited liability company interest becomes
a member, the assignor continues to be a member and to have the power
to exercise any rights of a member, subject to the members' right to
remove the assignor pursuant to subsection (1)(c)(ii) of section
53-641, Idaho Code;
(e) Until an assignee of a limited liability company interest becomes
a member, the assignee has no liability as a member solely as a result
of the assignment; and
(f) The assignor of a limited liability company interest is not
released from his liability as a member solely as a result of the
assignment.
(2) An operating agreement may provide that a member's limited liability
company interest may be evidenced by a certificate of limited liability
company interest issued by the limited liability company and may also
provide for the assignment or transfer of any interest represented by the
certificate.
(3) Unless otherwise provided in an operating agreement, the pledge of,
or granting of a security interest, lien or other encumbrance in or against
any or all of the limited liability company interest of a member is not an
assignment and shall not cause the member to cease to be a member or to
cease to have the power to exercise any rights or powers of a member.
53-637. RIGHTS OF JUDGMENT CREDITOR. On application to a court of
competent jurisdiction by any judgment creditor of a member, the court may
charge the member's limited liability company interest with payment of the
unsatisfied amount of judgment with interest. To the extent so charged, the
judgment creditor has only the rights of an assignee of the member's
limited liability company interest. The provisions of this chapter do not
deprive any member of the benefit of any exemption laws applicable to his
limited liability company interest.
53-638. RIGHT OF ASSIGNEE TO BECOME A MEMBER.
(1) Unless otherwise provided in writing in an operating agreement, an assignee of a limited
liability company interest may become a member only if the other members
unanimously consent. The consent of a member may be evidenced in any manner
specified in writing in an operating agreement, but in the absence of such
specification, consent shall be evidenced by a written instrument, dated
and signed by the member.
(2) An assignee who becomes a member has, to the extent assigned, the
rights and powers, and is subject to the restrictions and liabilities, of a
member under the articles of organization, any operating agreement and the
provisions of this chapter. An assignee who becomes a member also is liable
for any obligations of the assignor to make contributions under section
53-627, Idaho Code. However, the assignee is not obligated for liabilities
of which the assignee had no knowledge at the time he became a member and
which could not be ascertained from any written records of the limited
liability company kept pursuant to section 53-625, Idaho Code.
(3) Unless otherwise provided in writing in an operating agreement, an
assignor is not released from his liability to the limited liability
company under section 53-627, Idaho Code, whether or not an assignee of a
limited liability company interest becomes a member.
(4) Unless otherwise provided in writing in an operating agreement, a
member who assigns his entire limited liability company interest ceases to
be a member or to have the power to exercise any rights of a member when
the assignee becomes a member with respect to the entire assigned interest.
53-639. POWERS OF ESTATE OF A DECEASED OR INCOMPETENT MEMBER. If a member
who is an individual dies or a court of competent jurisdiction adjudges the
member to be incompetent to manage his person or property, the member's
executor, administrator, guardian, conservator or other legal
representative shall have all of the rights of an assignee of the member's
interest.
53-640. ADMISSION OF MEMBERS. (1) Subject to subsection (2) of this
section, a person may become a member in a limited liability company:
(a) In the case of a person acquiring a limited liability company
interest directly from the limited liability company, upon compliance
with an operating agreement or, if an operating agreement does not so
provide in writing, upon the written consent of all members; and
(b) In the case of an assignee of a limited liability company
interest, as provided in section 53-638, Idaho Code.
(2) The effective time of admission of a member to a limited liability
company shall be the later of:
(a) The date the limited liability company is formed; or
(b) The time provided in an operating agreement or, if no such time is
provided therein, then when the person's admission is reflected in the
records of the limited liability company.
53-641. EVENTS OF DISSOCIATION. (1) A person ceases to be a member of a
limited liability company upon the occurrence of one (1) or more of the
following events
(a) The member withdraws by voluntary act from the limited liability
company as provided in subsection (3) of this section;
(b) This member ceases to be a member of the limited liability company as
provided in section 53-638, Idaho Code;
(c) The member is removed as a member
(i) In accordance with an operating agreement; or
(ii) Unless otherwise provided in writing in an operating agreement,
when the member assigns all of his interest in the limited liability
company, by an affirmative vote of a majority of the members who have
not assigned their interests;
(d) Unless otherwise provided in writing in an operating agreement or by
the written consent of all members at the time, the member (i) makes an
assignment for the benefit of creditors; (ii) files a voluntary petition
in bankruptcy; (iii) is adjudicated a bankrupt or insolvent; (iv) files a
petition or answer seeking for the member any reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief
under any statute, law or regulation; (v) files an answer or other
pleading admitting or failing to contest the material allegations of a
petition filed against the member in any proceeding of this nature; or
(vi) seeks, consents to, or acquiesces to the appointment of a trustee,
receiver or liquidator of the member or of all or any substantial part of
the member's properties;
(e) Unless otherwise provided in writing in an operating agreement or by
the written consent of all members a t the time, if within one hundred
twenty (120) days after the commencement of any proceeding against the
member seeking reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under any statute, law or
regulation, the proceeding has not been dismissed, or if within one
hundred twenty (120) days after the appointment without his consent or
acquiescence of a trustee, receiver or liquidator of the member or of all
or any substantial part of his properties, the appointment is not vacated
or stayed or if within one hundred twenty (120) days after the expiration
of any stay, the appointment is not vacated;
(f) Unless otherwise provided in writing in an operating agreement or by
the written consent of all members at the time, in the case of a member
who is an individual;
(i) The member's death; or
(ii) The entry of an order by a court of competent jurisdiction
adjudicating the member incompetent to manage his person or estate;
(g) Unless otherwise provided in writing in an operating agreement or by
the written consent of all members at the time, in the case of a member
who is a trust or is acting as a member by virtue of being a trustee of a
trust, the termination of the trust, but not merely the substitution of a
new trustee;
(h) Unless otherwise provided in writing in an operating agreement or by
the written consent of all members at the time, in the case of a member
that is a separate limited liability company, the dissolution and
commencement of winding up of the separate limited liability company;
(i) Unless otherwise provided in writing in an operating agreement or by
the written consent of all members at the time, in the case of a member
that is a corporation, the filing of articles of dissolution or forfeiture
of its corporate powers or right to do business;
(j) Unless otherwi se provided in writing in an operating agreement or by
the written consent of all members at the time, in the case of an estate,
the distribution by the fiduciary of the estate's entire interest in the
limited liability company; or
(k) In the case of a professional services limited liability company,
restrictions or limitations are placed upon a member's ability to continue
to render professional services as described in section 53-615(5), Idaho
Code.
(2) The members may provide in writing in an operating agreement for
other events the occurrence of which shall result in a person ceasing to be a
member of the limited liability company.
(3) Unless an operating agreement provides in writing that a member has
no power to withdraw by voluntary act from a limited liability company, the
member may do so at any time by giving thirty (30) days' written notice to the
other members, or such other notice as is provided for in writing in an
operating agreement. If the member has the power to withdraw but the
withdrawal is a breach of an operating agreement, or the withdrawal occurs as
a result of otherwise wrongful conduct of the member, the limited liability
company may recover from the withdrawing member damages for breach of the
operating agreement or as a result of the wrongful conduct, including the
reasonable costs of obtaining replacement of the services the withdrawn member
was obligated to perform and may offset the damages against the amount
otherwise distributable to him, in addition to pursuing any remedies provided
for in an operating agreement or otherwise available under applicable law.
Unless otherwise provided in an operating agreement, in the case of a limited
liability company for a definite term or particular undertaking, a withdrawal
by a member before the expiration of that term is a breach of the operating
agreement.
53-642. DISSOLUTION. A limited liability company is dissolved and its
affairs shall be wo und up upon the happening of the first to occur of the
following
(1) At the time or upon the occurrence of events specified in writing in
the articles of organization or an operating agreement;
(2) The written consent of all members;
(3) An event of dissociation of a member, unless
(a) The business of the limited liability company is continued by the
consent of all the remaining members on or before the 90th day following
the occurrence of any such event; or
(b) Otherwise provided in writing in an operating agreement;
(4) Entry of a decree of judicial dissolution under section 53-643, Idaho
Code; or
(5) Administrative dissolution by the secretary of state pursuant to
section 53-643B, Idaho Code.
53-643. JUDICIAL DISSOLUTION. (1) On application by or for a member, the
district court may decree dissolution of a limited liability company when it
is established
(a) That the managers or members are deadlocked in the management of the
limited liability company's affairs, and that irreparable injury to the
limited liability company is being suffered or is threatened by reason
thereof; or
(b) That the acts of the managers or members in control of the limited
liability company are illegal, oppressive or fraudulent and that
irreparable injury to the limited liability company is being suffered or
is threatened by reason thereof.
(2) After entering the decree of dissolution, the court shall direct the
winding up and liquidation of the limited liability company's business and
affairs in accordance with section 53-644, Idaho Code, and the notification of
claimants in accordance with sections 53-648 and 53-649, Idaho Code. The clerk
of the court shall deliver a certified copy of the decree to the secretary of
state, who shall file it.
53-644. WINDING UP. Unless otherwise provided in writing in an operating
agreement:
(1) The business or affairs of the limited liability company m ay be wound
up:
(a) By the members or managers who have authority pursuant to
section 53-621, Idaho Code, to manage the limited liability company
prior to dissolution; or
(b) If one (1) or more of such members or managers have engaged in
wrongful conduct, or upon other cause shown, by the district court on
application of any member or any member's legal representative or
assignee.
(2) The persons winding up the business or affairs of the limited
liability company may, in the name of, and for and on behalf of, the
limited liability company:
(a) Prosecute and defend suits;
(b) Settle and close the business of the limited liability company;
(c) Dispose of and transfer the property of the limited liability
company;
(d) Discharge the liabilities of the limited liability company; and
(e) Distribute to the members any remaining assets of the limited
liability company.
53-643A. GROUNDS FOR ADMINISTRATIVE DISSOLUTION. The secretary of state
may administratively dissolve a limited liability company under section
53-643B, Idaho Code, if
(1) The limited liability company does not deliver its annual report to
the secretary of state by the date on which it is due;
(2) The limited liability company is without a registered agent or
registered office in this state for sixty (60) days or more; or
(3) The secretary of state has credible information that the limited
liability company has failed to notify the secretary of state within sixty
(60) days after the occurrence that its registered agent or registered office
has been changed, that its registered agent has resigned, or that its
registered office has been discontinued.
53-643B. PROCEDURE FOR AND EFFECT OF ADMINISTRATIVE DISSOLUTION. (1) If the secretary of state determines that one (1) or more grounds exist under
section 53-643A, Idaho Code, for dissolving a limited liability company, he
shall give notice of his determination to the limited liabi lity company by
first class mail addressed to its principal office as indicated on its most
recent annual report or, if it has not yet filed an annual report, to its
registered office.
53-643C. REINSTATEMENT FOLLOWING ADMINISTRATIVE DISSOLUTION.
(1) A limited liability company administratively dissolved under section 53-643B,
Idaho Code, may apply to the secretary of state for reinstatement within ten
(10) years after the effective date of dissolution. The application must
(a) Recite the name of the limited liability company and the date of its
organization;
(b) State that the limited liability company applies for reinstatement;
(c) If the limited liability company's name or one deceptively similar
thereto has been appropriated by another entity whose organizational
documents are filed with the secretary of state, be accompanied either by
a consent to the use of a deceptively similar name executed by the other
entity or by articles of amendment by which the limited liability company
adopts a new name which complies with the requirements of section 53-602,
Idaho Code; and
(d) Be accompanied by a current annual report or appointment of
registered agent, as appropriate to the reason for administrative
dissolution.
(2) If the secretary of state determines that the application contains
the information required by subsection (1) of this section and that the
information is correct, he shall cancel the dissolution and prepare a
certificate of reinstatement that recites the fact and effective date of the
reinstatement, file a copy thereof and return the original to the limited
liability company.
(3) When the reinstatement is effective, it relates back to and takes
effect as of the effective date of the administrative dissolution and the
limited liability company resumes carrying on its business as if the
administrative dissolution had never occurred.
53-645. AGENCY POWER OF MANAGERS OR MEMBE RS AFTER DISSOLUTION.
(1) Except as provided in subsections (3), (4) and (5) of this section, after
dissolution of the limited liability company, each of the members having
authority to wind up the limited liability company's business and affairs
can bind the limited liability company:
(a) By any act appropriate for winding up the limited liability
company's affairs or completing transactions unfinished at dissolution;
and
(b) By any transaction that would have bound the limited liability
company if it had not been dissolved, if the other party to the
transaction does not have notice of the dissolution.
(2) The filing of the articles of dissolution shall be presumed to
constitute notice of dissolution for purposes of subsection (1)(b) of this
section.
(3) An act of a member which is not binding on the limited liability
company pursuant to subsection (1) of this section is binding if it is
otherwise authorized by the limited liability company.
(4) An act of a member which would be binding under subsection (1) of
this section or would be otherwise authorized but which is in contravention
of a restriction on authority shall not bind the limited liability company
to persons having knowledge of the restriction.
(5) If the articles of organization vest management of the limited
liability company in managers, a manager shall have the authority of a
member provided for in subsection (1) of this section, and no member shall
have such authority if the member is acting solely in the capacity of a
member.
53-646. DISTRIBUTION OF ASSETS. Upon the winding up of a limited
liability company, the assets shall be distributed as follows:
(1) Payment, or adequate provision for payment, shall be made to
creditors, including, to the extent permitted by law, members who are
creditors in satisfaction of liabilities of the limited liability company;
(2) Unless otherwise provided in writing in an operating agreement, to
members or former members in satisfaction of l iabilities for distributions
under sections 53-629 and 53-630, Idaho Code; and
(3) Unless otherwise provided in writing in an operating agreement, to
members and former members first for the return of their contributions and
second in proportion to the members' respective rights to share in
distributions from the limited liability company prior to dissolution.
53-647. ARTICLES OF DISSOLUTION. After the dissolution of the limited
liability company pursuant to subsection (1), (2) or (3) of section 53-642,
Idaho Code, the limited liability company shall file articles of dissolution
with the secretary of state which set forth
(1) The name of the limited liability company;
(2) The date of filing of its articles of organization;
(3) The reason for filing the articles of dissolution; and
(4) Any other information the members or managers filing the certificate
shall deem proper.
53-648. KNOWN CLAIMS AGAINST DISSOLVED LIMITED LIABILITY COMPANY. (1)
Upon dissolution, a limited liability company may dispose of the known
claims against it by filing articles of dissolution pursuant to section
53-647, Idaho Code, and following the procedures described in this section.
(2) The limited liability company shall notify its known claimants in
writing of the dissolution at any time after the effective date of
dissolution. The written notice must:
(a) Describe information that must be included in a claim;
(b) Provide a mailing address where a claim may be sent;
(c) State the deadline, which may not be fewer than one hundred twenty
(120) days after the later of the date of the written notice or the
filing of articles of dissolution pursuant to section 53-647, Idaho
Code, by which the limited liability company must receive the claim;
and
(d) State that the claim will be barred if not received by the
deadline.
(3) A claim against the limited liability company is barred:
(a) If a claimant who was given written notice und er subsection (2) of
this section does not deliver the claim to the limited liability
company by the deadline;
(b) If a claimant whose claim was rejected by the limited liability
company does not commence a proceeding to enforce the claim within
ninety (90) days after the date of the rejection notice.
(4) For purposes of this section, "claim" does not include a contingent
liability or a claim based on an event occurring after the effective date
of dissolution.
53-649. UNKNOWN CLAIMS AGAINST DISSOLVED LIMITED LIABILITY COMPANY.
A claim not barred under section 53-648, Idaho Code, may be enforced:
(1) Against the limited liability company, to the extent of its
undistributed assets; or
(2) If the assets have been distributed in liquidation, against a member
of the limited liability company to the extent of his pro rata share of the
claim or the assets of the limited liability company distributed to him in
liquidation, whichever is less, but a member's total liability for all
claims under the provisions of this section may not exceed the total amount
of assets distributed to him.
53-650. LAW GOVERNING FOREIGN LIMITED LIABILITY COMPANIES. Subject to the
constitution of this state, the laws of the state or other jurisdiction
under which a foreign limited liability company is organized shall govern
its organization and internal affairs and the liability and authority of
its managers and members, except that professional companies rendering
services in this state shall be subject to the laws of this state and the
code of ethics or professional responsibility which are applicable to the
professions in which such professional companies are rendering services in
this state. A foreign limited liability company may not be denied
registration by reason of any difference between those laws and the laws of
this state.
53-651. REGISTRATION. Before transacting business in this state, a
foreign limited liability company shall register with the secretary of
state by submitting to the secretary of state an original signed copy of an
application for registration as a foreign limited liability company,
together with a duplicate copy that may be either a signed, photocopied or
conformed copy, executed by a person with authority to do so under the laws
of the state or other jurisdiction of its formation. The application shall
be prescribed by the secretary of state and set forth:
(1) The name of the foreign limited liability company and, if different,
the name under which it proposes to transact business in this state;
(2) The state or other jurisdiction where formed, and date of its
formation;
(3) The name and address of a registered agent for service of process
required to be maintained by the provisions of section 53-604, Idaho Code;
(4) The address of the office required to be maintained in the state or
other jurisdiction of its formation by the laws of that state or
jurisdiction or, if not soTITLE 53 PARTNERSHIP CHAPTER 6
IDAHO LIMITED LIMITED LIABILITY COMPANY; and
(5) The application for registration of a foreign limited liability
company shall be accompanied by a certificate from the filing officer in
the jurisdiction of creation evidencing that the foreign limited liability
company is a "foreign limited liability company" as defined in section
53-601(5), Idaho Code.
53-652. ISSUANCE OF REGISTRATION. If the secretary of state finds that an
application for registration conforms to the provisions of this article and
all requisite fees have been paid, the secretary shall:
(1) Endorse on each signed original and duplicate copy the word "filed"
and the date and time of its acceptance for filing;
(2) Retain the signed original in the secretary of state's files; and
(3) Return the duplicate copy to the person who filed it or the person's
representative.
53-653. NAME OF FOREIGN LIMITED LIABILITY COMPANY. No certificate of
registration shall be issued to a foreign limited liability company unless
the name of such comp any satisfies the requirements of section 53-602,
Idaho Code. If the name under which a foreign limited liability company is
registered in the jurisdiction of its formation does not satisfy the
requirements of section 53-602, Idaho Code, to obtain or maintain a
certificate of registration the foreign limited liability company may use a
designated name that is available, and which satisfies the requirements of
section 53-602, Idaho Code.
53-654. AMENDMENTS. (1) The application for registration of a foreign
limited liability company is amended by filing a notice of amendment with
the secretary of state signed by a person with authority to do so under the
laws of the state or other jurisdiction of its formation. The notice of
amendment shall be in a form prescribed by the secretary of state and set
forth:
(a) The name of the foreign limited liability company;
(b) The date the original application for registration was filed; and
(c) The amendment to the application for registration.
(2) The application for registration may be amended in any way, provided
that the application for registration as amended contains only provisions
that may be lawfully contained in an application for registration at the
time of the amendment.
53-655. VOLUNTARY CANCELLATION OF REGISTRATION. (1) A foreign limited
liability company authorized to transact business in this state may cancel its
registration by filing with the secretary of state an application for
cancellation, which shall set forth
(a) The name of the foreign limited liability company and the state or
other jurisdiction under the laws of which it is formed;
(b) That the foreign limited liability company is not transacting
business in this state;
(c) That the foreign limited liability company surrenders its
registration to transact business in this state;
(d) That the foreign limited liability company revokes the authority of
its registered agent for service of process in this s tate and consents
that service of process in any action, suit or proceeding based upon any
cause of action arising in this state during the time the foreign limited
liability company was authorized to transact business in this state may
thereafter be made on such limited liability by service thereon in the
manner provided in section 53-606, Idaho Code;
(e) A post-office address to which a copy of any process against the
limited liability company may be served on it pursuant to the provisions
of section 53-606, Idaho Code.
(2) The application for cancellation shall be in the form and manner
designated by the secretary of state and shall be executed on behalf of the
foreign limited liability company by a person with authority to do so under
the laws of the state or other jurisdiction of its formation, or, if the
foreign limited liability company is in the hands of a receiver, trustee or
other court-appointed fiduciary, by that fiduciary.
53-655A. ADMINISTRATIVE CANCELLATION OF REGISTRATION. The secretary of
state may commence a proceeding under section 53-655B, Idaho Code, to
administratively cancel the registration of a foreign limited liability
company authorized to transact business in this state if
(1) The foreign limited liability company does not deliver its annual
report to the secretary of state by the date on which it is due;
(2) The foreign limited liability company is without a registered agent
or registered office in this state for sixty (60) days or more;
(3) The secretary of state has credible information that the foreign
limited liability company has failed to notify the secretary of state within
sixty (60) days of the occurrence that its registered agent or registered
office has changed, that its registered agent has resigned, or that its
registered office has been discontinued;
(4) The secretary of state has credible information that a member or
manager of the foreign limited liabil ity company signed a document he knew was
false in any material respect with intent that the document be delivered to
the secretary of state for filing; or
(5) The secretary of state receives a duly authenticated certificate from
the official having custody of the records of limited liability companies in
the state or country under whose law the foreign limited liability company is
organized, stating that it has been dissolved or has disappeared as a result
of a merger.
53-655B. PROCEDURE FOR AND EFFECT OF ADMINISTRATIVE CANCELLATION. (1) If the secretary of state determines that one (1) or more grounds exist under
section 53-655A, Idaho Code, for administrative cancellation of registration,
he shall give notice of his determination to the foreign limited liability
company by first class mail addressed to its principal office as indicated on
its most recent annual report or, if it has not yet filed an annual report, to
its registered office.
53-655C. APPEAL FROM ADMINISTRATIVE CANCELLATION.
(1) A foreign limited liability company may appeal the secretary of state's cancellation of its registration to the fourth district court, Ada county, Idaho, within thirty (30) days after receipt of the notice of cancellation. The foreign limited liability company appeals by petitioning the court to set aside the cancellation and attaching to the petition copies of its application for registration with the secretary of state's filing endorsement stamp and the notice of cancellation from the secretary of state.
(2) The court may summarily order the secretary of state to reinstate the registration or may take any other action the court considers appropriate.
(3) The court's final decision may be appealed as in other civil proceedings.
53-656. TRANSACTION OF BUSINESS WITHOUT REGISTRATION. (1) A foreign
limited liability company transacting business in this state may not
maintain an action, suit, or proceeding in a court of this state until it
has registered in this state.
(2) The failure of a foreign limited liability company to register in
this state does not:
(a) Impair the validity of any contract or act of the foreign limited
liability company;
(b) Affect the right of any other party to the contract to maintain
any action, suit or proceeding on the contract; or
(c) Prevent the foreign limited liability company from defending any
action, suit or proceeding in any court of this state.
(3) A foreign limited liability company which transacts business in this
state without registration shall be liable to the state for the years or
parts thereof during which it transacted business in this state without
registration in an amount equal to all fees which would have been imposed
by the provisions of this chapter upon that foreign limited liability
company had it duly registered, and all penalties imposed by the provisions
of this chapter. The attorney general may bring proceedings to recover all
amounts due this state under the provisions of this section.
(4) A foreign limited liability company which transacts business in this
state without registration shall be subject to a civil penalty, payable to
the state, not to exceed five thousand dollars ($5,000).
(5) The civil penalty set forth in subsection (4) of this section may be
recovered in an action brought within a court by the attorney general upon
a finding by the court that a foreign limited liability company has
transacted business in this state in violation of the provisions of this
chapter. The court shall issue, in addition to the imposition of a civil
penalty, an injunction restraining further transactions of the business of
the foreign limited liability company and the further exercise of any
limited liability company's rights and privileges in this state. The
foreign limited liability company shall be enjoined from transacting
business in this state until all civil penalties plus any interest and
court costs which the court may assess have been p aid and until the foreign
limited liability company has otherwise complied with the provisions of
this chapter.
(6) A member or manager of a foreign limited liability company is not
liable for the debts and obligations of the limited liability company
solely because the limited liability company transacted business in this
state without registration.
(7) Foreign limited liability companies transacting business in Idaho
prior to the effective date of this chapter, may register with the
secretary of state in accordance with the provisions of section 53-651,
Idaho Code, within two (2) months from the effective date of this chapter
without any penalty under the provisions of section 53-656(4), Idaho Code.
53-657. TRANSACTIONS NOT CONSTITUTING TRANSACTING BUSINESS. (1) The
following activities of a foreign limited liability company, among others,
do not constitute transacting business within the meaning of this chapter.
(a) Maintaining or defending any action or suit or any administrative
or arbitration proceedings or effecting the settlement thereof or the
settlement of claims or disputes;
(b) Holding meetings of its members or managers or carrying on any
other activities concerning its internal affairs;
(c) Maintaining bank accounts;
(d) Maintaining offices or agencies for the transfer, exchange and
registration of the foreign limited liability company's own securities
or interests or appointing and maintaining trustees or depositories
with respect to those securities or interests;
(e) Effecting sales through independent contractors;
(f) Soliciting or procuring orders, whether by mail or through
employees or agents or otherwise, where such orders require acceptance
outside this state before they become contracts;
(g) Creating as borrower or lender, or acquiring indebtedness or
mortgages or other security interests in real or personal property;
(h) Securing or collecting debts or enforcing any rights in property
securing the same. The provisions of this subsection shall not be
construed to allow any person or limited liability company to act in a
manner contrary to the provisions of chapter 22, title 26, Idaho Code;
(i) Owning, without more, real or personal property;
(j) Conducting an isolated transaction that is completed within thirty
(30) days and that is not one in the course of a number of repeated
transactions of a like nature; or
(k) Transacting any business in interstate commerce.
(2) The foreign limited liability company shall not be considered to be
transacting business solely because it:
(a) Owns a controlling interest in a corporation that is transacting
business;
(b) Is a limited partner of a limited partnership that is transacting
business; or
(c) Is a member or manager of a limited liability company or foreign
limited liability company that is transacting business.
(3) The provisions of this section do not apply in determining the
contracts or activities that may subject a foreign limited liability
company to service of process or taxation in this state or to regulation
under any other law of this state.
53-658. SUITS BY AND AGAINST THE LIMITED LIABILITY COMPANY. Suit may be
brought by or against a limited liability company in its own name.
53-659. AUTHORITY TO SUE ON BEHALF OF LIMITED LIABILITY COMPANY. Unless
otherwise provided in an operating agreement, a suit on behalf of the
limited liability company may be brought only in the name of the limited
liability company by:
(1) One (1) or more members of a limited liability company, whether or
not an operating agreement vests management of the limited liability
company in one (1) or more managers, who are authorized to sue by the vote
of more than one-half (1/2) by number of the members eligible to vote
thereon, unless the vote of all members shall be required pursuant to the
provisions of section 53-623, Idaho Code, provided that in determ ining the
vote required under the provisions of section 53-623, Idaho Code, the vote
of any member who has an interest in the outcome of the suit that is
adverse to the interest of the limited liability company shall be excluded;
or
(2) One (1) or more managers of a limited liability company, if an
operating agreement vests management of the limited liability company in
one (1) or more managers, who are authorized to do so by the vote required
pursuant to the provisions of section 53-623, Idaho Code, of the members
eligible to vote thereon, provided that in determining such required vote,
the vote of any manager who has an interest in the outcome of the suit that
is adverse to the interest of the limited liability company shall be
excluded.
53-660. EFFECT OF LACK OF AUTHORITY TO SUE. The lack of authority of a
member or manager to sue on behalf of the limited liability company may not
be asserted as a defense to an action by the limited liability company or
by the limited liability company as a basis for bringing a subsequent suit
on the same cause of action.
53-661. MERGER OR CONSOLIDATION. (1) Unless otherwise provided in writing
in an operating agreement, and subject to any law applicable to business
entities other than limited liability companies, one (1) or more limited
liability companies may merge or consolidate with or into one (1) or more
other business entities with the limited liability company or other
business entity as the merger or consolidation agreement shall provide
being the surviving or resulting limited liability company or other
business entity.
(2) Rights or securities of or interests in a business entity that is a
party to the merger or consolidation may be exchanged for or converted into
cash, property, obligations, rights or securities of or interests in the
surviving or resulting business entity or of any other business entity.
(3) As used in this section, "business entity" means a domestic or
foreign limited liability company or corporation.
53-662. APPROVAL OF MERGER OR CONSOLIDATION. (1) Unless otherwise
provided in writing in an operating agreement, a limited liability company
that is a party to a proposed merger or consolidation shall approve the
merger or consolidation agreement by the consent of more than one-half
(1/2) by number of the members.
(2) Each corporation and foreign limited liability company that is a
party to a proposed merger or consolidation shall approve the merger or
consolidation in the manner and by the vote required by the laws applicable
to such business entity.
(3) Each business entity that is a party to the merger or consolidation
shall have such rights to abandon the merger as are provided for in the
merger or consolidation agreement or in the laws applicable to the business
entity.
53-663. ARTICLES OF MERGER OR CONSOLIDATION. (1) The business entity
surviving or resulting from the merger or consolidation shall deliver to
the secretary of state articles of merger or consolidation executed by each
constituent entity setting forth:
(a) The name and jurisdiction of formation or organization of each
business entity which is to merge or consolidate;
(b) That an agreement of merger or consolidation has been approved and
executed by each business entity which is a party to the merger or
consolidation;
(c) The name of the surviving or resulting business entity;
(d) The future effective date of the merger or consolidation, which
shall be a date or time certain not more than thirty (30) days
subsequent to the date of filing, if it is not to be effective upon the
filing of the articles of merger or consolidation;
(e) That the agreement of merger or consolidation is on file at a
place of business of the surviving or resulting business entity, and
the address of that place of business;
(f) That a copy of the agreement of merger or consolidation will be
furnished by the surviving or resulting business entity, on request and
with out cost, to any person holding an interest in any business entity
which is to merge or consolidate; and
(g) If the surviving or resulting entity is not a business entity
organized under the laws of this state, a statement that such surviving
or resulting business entity:
(i) Agrees that it may be served with process in this state in
any proceeding for enforcement of any obligation of any business
entity party to the merger or consolidation that was organized
under the laws of this state, as well as for enforcement of any
obligation of the surviving business entity or the new business
entity arising from the merger or consolidation; and
(ii) Appoints the secretary of state as its agent for service of
process in any such proceeding, and the surviving business entity
or the new business entity shall specify the address to which a
copy of the process shall be mailed to it by the secretary of
state.
(2) A merger or consolidation takes effect upon the later of the
effective date of the filing of the articles of merger or consolidation or
the date set forth in the articles of merger or consolidation.
(3) The articles of merger or consolidation shall be executed by a
limited liability company that is a party to the merger or consolidation in
the manner provided for in section 53-610, Idaho Code, and shall be filed
with the secretary of state in the manner provided for in section 53-611,
Idaho Code.
(4) An agreement of merger or consolidation approved in accordance with
the provisions of section 53-662, Idaho Code, may effect any amendment to
an operating agreement or effect the adoption of a new operating agreement
for a limited liability company if it is the surviving or resulting limited
liability company in the merger or consolidation. An approved agreement of
merger or consolidation may also provide that the operating agreement of
any constituent limited liability company to the merger or consolidation,
including a limited liability company formed for the purpose of
consummating a merger or consolidation, shall be the operating agreement of
the surviving or resulting limited liability company. Any amendment to an
operating agreement or adoption of a new operating agreement made pursuant
to this subsection shall be effective at the effective time or date of the
merger or consolidation. The provisions of this subsection shall not be
construed to limit the accomplishment of a merger or of any of the matters
referred to herein by any other means provided for in an operating
agreement or other agreement or as otherwise permitted by law.
(5) In the case of a merger, if the surviving entity is a limited
liability company, the articles of organization shall be deemed to be
amended to the extent, if any, that changes in its articles of organization
are stated in the agreement of merger; and in the case of consolidation,
the articles of incorporation or organization of the resulting business
entity shall be included in or annexed to the articles of consolidation.
53-664. EFFECTS OF MERGER OR CONSOLIDATION. A merger or consolidation has
the following effects:
(1) The business entities that are parties to the merger or consolidation
agreement shall be a single entity, which, in the case of a merger shall be
the entity designated in the plan of merger as the surviving entity, and,
in the case of a consolidation, shall be the new entity provided for in the
plan of consolidation;
(2) Each party to the merger or consolidation agreement, except the
surviving entity or the new entity, shall cease to exist;
(3) The surviving entity or the new entity shall thereupon and thereafter
possess all the rights, privileges, immunities and powers of each
constituent entity and shall be subject to all the restrictions,
disabilities and duties of each of such constituent entities to the extent
such rights, privileges, immunities, powers, franchises, restrictions,
disabilities and duties are applicable to the type of business entity that
is the surviving entity or the new entity;
(4) All property, real, personal and mixed, and all debts due on whatever
account, including promises to make capital contributions and subscriptions
for shares, and all other causes in action, and all and every other
interest of or belonging to or due to each of the constituent entities
shall be vested in the surviving entity or the new entity without further
act or deed;
(5) The title to all real estate and any interest therein, vested in any
such constituent entity shall not revert or be in any way impaired by
reason of such merger or consolidation;
(6) The surviving entity or the new entity shall thenceforth be liable
for all liabilities and obligations of each of the constituent entities so
merged or consolidated, and any claim existing or action or proceeding
pending by or against any such constituent entity may be prosecuted as if
such merger or consolidation had not taken place, or the surviving entity
or the new entity may be substituted in the action;
(7) Neither the rights of creditors nor any liens on the property of any
constituent entity shall be impaired by the merger or consolidation;
(8) The interests in a limited liability company or shares or other
interests in a corporation that are to be converted or exchanged into
interests, shares or other securities, cash, obligations or other property
under the terms of the merger or consolidation agreement are so converted,
and the former holders thereof are entitled only to the rights provided in
the merger or consolidation agreement or the rights otherwise provided by
law.
53-665. FILING, SERVICE, AND COPYING FEES. The secretary of state shall charge and collect
(1) For filing the original articles of organization, a fee of one
hundred dollars ($100) if typed and completely included on the standard form
prescribed by the secretary of state or one hundred twenty dollars ($120) if
no t typed or if attachments are included;
(2) For filing notice of amendment and issuing a certificate of
amendment, a fee of thirty dollars ($30.00);
(3) For filing articles of merger or consolidation and issuing a
certificate of merger or consolidation, a fee of thirty dollars ($30.00);
(4) For filing articles of dissolution and issuing a certificate of
dissolution, a fee of thirty dollars ($30.00);
(5) For accepting an application for reservation of a name, or for filing
a notice of the transfer or cancellation of any name reservation, a fee of
twenty dollars ($20.00);
(6) For issuing a certificate of registration to a foreign limited
liability company, a fee of one hundred dollars ($100) if typed and completely
included on the standard form prescribed by the secretary of state or one
hundred twenty dollars ($120) if not typed or if attachments are included;
(7) For filing an application for reinstatement following administrative
dissolution, a fee of thirty dollars ($30.00);
(8) For filing a certified copy of a decree of judicial dissolution, no
fee; and
(9) For filing an application for voluntary cancellation of registration
of a foreign limited liability company, twenty dollars ($20.00).
53-666. EXECUTION BY JUDICIAL ACT. Any person who is adversely affected
by the failure or refusal of any person to execute and file any articles or
other document to be filed under this act may petition the district court
in the county where the registered office of the limited liability company
is located to direct the execution and filing of the articles or other
document. If the court finds that it is proper for the articles or other
documents to be executed and filed and that there has been failure or
refusal to execute and file such documents, it shall order the secretary of
state to file the appropriate articles or other documents.
53-667. DEFINITION OF KNOWLEDGE. (1) A person has "knowledge" of a fact
within the meaning of this chapter not only when he has actual knowledge
thereof, but also when he has knowledge of such other facts as in the
circumstances shows bad faith.
(2) A person has "notice" of a fact within the meaning of this chapter
when the person who claims the benefit of the notice:
(a) States the fact to such person; or
(b) Delivers through the mail, or by other means of communication, a
written statement of the fact to such person or to a proper person at
his place of business or residence.
53-668. RULES OF CONSTRUCTION. (1) It is intended that the provisions of
this chapter give maximum effect to the principle of freedom of contract
and to the enforceability of operating agreements.
(2) Unless displaced by particular provisions of this chapter, the
principles of law and equity supplement the provisions of this chapter.
(3) Rules that statutes in derogation of the common law are to be
strictly construed shall have no application to the provisions of this
chapter.
(4) Neither the provisions of this chapter nor any amendments thereto
shall be construed so as to impair the obligations of any contract existing
when this law or any amendments thereto go into effect, nor to affect any
action or proceedings begun or right accrued before this law or any
amendments thereto take effect.
53-669. JURISDICTION OF THE DISTRICT COURTS. The district courts shall
have jurisdiction to enforce the provisions of this chapter.
53-670. SEVERABILITY. If any provision of this chapter or its application
to any person or circumstance is held invalid, the invalidity does not
affect other provisions or applications of this chapter which can be given
effect without the invalid provision or application. To this end, the
provisions of this chapter are severable.
53-671. INTERSTATE APPLICATION. A limited liability company organized and
existing under the provisions of this chapter may conduct its business,
carry on its operations and have and exercise the powers granted by the
provisi ons of this chapter in any state or foreign country.
53-672. GOVERNING LAW. (1) The liability of members, managers, employees
and agents of a limited liability company organized and existing under the
provisions of this chapter shall at all times be governed by the provisions
of this chapter and the laws of this state.
(2) If a conflict arises between the law of this state and the laws of
any other jurisdiction with regard to the liability of a member, manager,
employee or agent of a limited liability company organized and existing
under the provisions of this chapter for the debts, obligations and
liabilities of the limited liability company, or for the acts or omissions
of another member, manager, employee or agent of the limited liability
company, the provisions of this chapter and the laws of this state shall
govern in determining such liability.
Idaho Statutes