LB234 LB234
2021 2021
LEGISLATURE OF NEBRASKA
ONE HUNDRED SEVENTH LEGISLATURE
FIRST SESSION
LEGISLATIVE BILL 234
Introduced by Flood, 19.
Read first time January 11, 2021
Committee: Banking, Commerce and Insurance
1 A BILL FOR AN ACT relating to corporations; to amend section 21-2217,
2 Reissue Revised Statutes of Nebraska, and sections 21-211, 21-214,
3 21-215, 21-2,195, 21-2,211, 21-2,212, 21-2,219, 21-2,221, 21-2,228,
4 21-301, 21-302, 21-303, 21-304, 21-305, 21-306, 21-313, 21-323,
5 21-323.01, 21-325, 21-325.01, 21-329, and 21-2216, Revised Statutes
6 Cumulative Supplement, 2020; to change provisions relating to when
7 corporate reports and occupation taxes become due and delinquent; to
8 define terms; to eliminate obsolete provisions; to harmonize
9 provisions; and to repeal the original sections.
10 Be it enacted by the people of the State of Nebraska,
-1-
LB234 LB234
2021 2021
1 Section 1. Section 21-211, Revised Statutes Cumulative Supplement,
2 2020, is amended to read:
3 21-211 (MBCA 1.28) (a) Anyone may apply to the Secretary of State to
4 furnish a certificate of existence for a domestic corporation or a
5 certificate of authorization for a foreign corporation.
6 (b) A certificate of existence or authorization sets forth:
7 (1) The domestic corporation's corporate name or the foreign
8 corporation's corporate name used in this state;
9 (2) That:
10 (i) The domestic corporation is duly incorporated under the law of
11 this state, the date of its incorporation, and the period of its duration
12 if less than perpetual; or
13 (ii) That the foreign corporation is authorized to transact business
14 in this state;
15 (3) That all fees, taxes, and penalties owed to this state have been
16 paid, if:
17 (i) Payment is reflected in the records of the Secretary of State;
18 and
19 (ii) Nonpayment affects the existence or authorization of the
20 domestic or foreign corporation;
21 (4) That its most recent quinquennial biennial report required by
22 section 21-2,228 has been filed with the Secretary of State;
23 (5) That articles of dissolution have not been filed; and
24 (6) Other facts of record in the office of the Secretary of State
25 that may be requested by the applicant.
26 (c) Subject to any qualification stated in the certificate, a
27 certificate of existence or authorization issued by the Secretary of
28 State may be relied upon as conclusive evidence that the domestic or
29 foreign corporation is in existence or is authorized to transact business
30 in this state.
31 Sec. 2. Section 21-214, Revised Statutes Cumulative Supplement,
-2-
LB234 LB234
2021 2021
1 2020, is amended to read:
2 21-214 (MBCA 1.40) In the Nebraska Model Business Corporation Act:
3 (1) Articles of incorporation means the original articles of
4 incorporation, all amendments thereof, and any other documents permitted
5 or required to be filed by a domestic business corporation with the
6 Secretary of State under any provision of the act except section
7 21-2,228. If an amendment of the articles or any other document filed
8 under the act restates the articles in their entirety, thenceforth the
9 articles shall not include any prior documents.
10 (2) Authorized shares means the shares of all classes a domestic or
11 foreign corporation is authorized to issue.
12 (3) Beneficial shareholder means a person who owns the beneficial
13 interest in shares, which may be a record shareholder or a person on
14 whose behalf shares are registered in the name of an intermediary or
15 nominee.
16 (4) Conspicuous means so written, displayed, or presented that a
17 reasonable person against whom the writing is to operate should have
18 noticed it. For example, text in italics, boldface, contrasting color,
19 capitals, or underlined, is conspicuous.
20 (5) Corporation, domestic corporation, or domestic business
21 corporation means a corporation for profit, which is not a foreign
22 corporation, incorporated under or subject to the provisions of the act.
23 (6) Deliver or delivery means any method of delivery used in
24 conventional commercial practice, including delivery by hand, mail,
25 commercial delivery, and, if authorized in accordance with section
26 21-215, by electronic transmission.
27 (7) Distribution means a direct or indirect transfer of money or
28 other property, except its own shares, or incurrence of indebtedness by a
29 corporation to or for the benefit of its shareholders in respect of any
30 of its shares. A distribution may be in the form of a declaration or
31 payment of a dividend; a purchase, redemption, or other acquisition of
-3-
LB234 LB234
2021 2021
1 shares; a distribution of indebtedness; or otherwise.
2 (8) Document means (i) any tangible medium on which information is
3 inscribed, and includes any writing or written instrument, or (ii) an
4 electronic record.
5 (9) Domestic unincorporated entity means an unincorporated entity
6 whose internal affairs are governed by the laws of this state.
7 (10) Effective date of notice is defined in section 21-215.
8 (11) Electronic means relating to technology having electrical,
9 digital, magnetic, wireless, optical, electromagnetic, or similar
10 capabilities.
11 (12) Electronic record means information that is stored in an
12 electronic or other medium and is retrievable in paper form through an
13 automated process used in conventional commercial practice, unless
14 otherwise authorized in accordance with subsection (k) of section 21-215.
15 (13) Electronic transmission or electronically transmitted means any
16 form or process of communication not directly involving the physical
17 transfer of paper or another tangible medium, which (i) is suitable for
18 the retention, retrieval, and reproduction of information by the
19 recipient and (ii) is retrievable in paper form by the recipient through
20 an automated process used in conventional commercial practice, unless
21 otherwise authorized in accordance with subsection (k) of section 21-215.
22 (14) Eligible entity means a domestic or foreign unincorporated
23 entity or a domestic or foreign nonprofit corporation.
24 (15) Eligible interests means interests or memberships.
25 (16) Employee includes an officer but not a director. A director may
26 accept duties that make the director also an employee.
27 (17) Entity includes domestic and foreign business corporation;
28 domestic and foreign nonprofit corporation; limited liability company;
29 estate; trust; domestic and foreign unincorporated entity; and state,
30 United States, and foreign government.
31 (18) The phrase facts objectively ascertainable outside of a filed
-4-
LB234 LB234
2021 2021
1 document or plan is defined in subsection (k) of section 21-203.
2 (19) Expenses means reasonable expenses of any kind that are
3 incurred in connection with a matter.
4 (20) Filing entity means an unincorporated entity that is of a type
5 that is created by filing a public organic document.
6 (21) Foreign corporation means a corporation incorporated under a
7 law other than the law of this state which would be a business
8 corporation if incorporated under the laws of this state.
9 (22) Foreign nonprofit corporation means a corporation incorporated
10 under a law other than the law of this state which would be a nonprofit
11 corporation if incorporated under the laws of this state.
12 (23) Foreign unincorporated entity means an unincorporated entity
13 whose internal affairs are governed by an organic law of a jurisdiction
14 other than this state.
15 (24) Governmental subdivision includes authority, county, district,
16 and municipality.
17 (25) Includes denotes a partial definition.
18 (26) Individual means a natural person.
19 (27) Interest means either or both of the following rights under the
20 organic law of an unincorporated entity:
21 (i) The right to receive distributions from the entity either in the
22 ordinary course or upon liquidation; or
23 (ii) The right to receive notice or vote on issues involving its
24 internal affairs, other than as an agent, assignee, proxy, or person
25 responsible for managing its business and affairs.
26 (28) Interest holder means a person who holds of record an interest.
27 (29) Means denotes an exhaustive definition.
28 (30) Membership means the rights of a member in a domestic or
29 foreign nonprofit corporation.
30 (31) Nonfiling entity means an unincorporated entity that is of a
31 type that is not created by filing a public organic document.
-5-
LB234 LB234
2021 2021
1 (32) Nonprofit corporation or domestic nonprofit corporation means a
2 corporation incorporated under the laws of this state and subject to the
3 provisions of the Nebraska Nonprofit Corporation Act.
4 (33) Notice is defined in section 21-215.
5 (34) Organic document means a public organic document or a private
6 organic document.
7 (35) Organic law means the statute governing the internal affairs of
8 a domestic or foreign business or nonprofit corporation or unincorporated
9 entity.
10 (36) Owner liability means personal liability for a debt,
11 obligation, or liability of a domestic or foreign business or nonprofit
12 corporation or unincorporated entity that is imposed on a person:
13 (i) Solely by reason of the person's status as a shareholder,
14 member, or interest holder; or
15 (ii) By the articles of incorporation, bylaws, or an organic
16 document under a provision of the organic law of an entity authorizing
17 the articles of incorporation, bylaws, or an organic document to make one
18 or more specified shareholders, members, or interest holders liable in
19 their capacity as shareholders, members, or interest holders for all or
20 specified debts, obligations, or liabilities of the entity.
21 (37) Person includes an individual and an entity.
22 (38) Principal office means the office, in or out of this state, so
23 designated in the quinquennial biennial report where the principal
24 executive offices of a domestic or foreign corporation are located.
25 (39) Private organic document means any document, other than the
26 public organic document, if any, that determines the internal governance
27 of an unincorporated entity. Where a private organic document has been
28 amended or restated, the term means the private organic document as last
29 amended or restated.
30 (40) Public organic document means the document, if any, that is
31 filed of public record to create an unincorporated entity. Where a public
-6-
LB234 LB234
2021 2021
1 organic document has been amended or restated, the term means the public
2 organic document as last amended or restated.
3 (41) Proceeding includes civil suit and criminal, administrative,
4 and investigatory action.
5 (42) Public corporation means a corporation that has shares listed
6 on a national securities exchange or regularly traded in a market
7 maintained by one or more members of a national securities association.
8 (43) Qualified director is defined in section 21-217.
9 (44) Quinquennial report means the report to be delivered to the
10 Secretary of State pursuant to section 21-2,228. Such report shall be due
11 on March 1, 2025, and on March 1 of every fifth year thereafter.
12 (45) (44) Record date means the date established under sections
13 21-237 to 21-252 or 21-253 to 21-283 on which a corporation determines
14 the identity of its shareholders and their shareholdings for purposes of
15 the Nebraska Model Business Corporation Act. The determinations shall be
16 made as of the close of business on the record date unless another time
17 for doing so is specified when the record date is fixed.
18 (46) (45) Record shareholder means (i) the person in whose name
19 shares are registered in the records of the corporation or (ii) the
20 person identified as the beneficial owner of shares in a beneficial
21 ownership certificate pursuant to section 21-265 on file with the
22 corporation to the extent of the rights granted by such certificate.
23 (47) (46) Secretary means the corporate officer to whom the board of
24 directors has delegated responsibility under subsection (c) of section
25 21-2,105 for custody of the minutes of the meetings of the board of
26 directors and of the shareholders and for authenticating records of the
27 corporation.
28 (48) (47) Shareholder means, unless varied for purposes of a
29 specific provision, a record shareholder.
30 (49) (48) Shares means the units into which the proprietary
31 interests in a corporation are divided.
-7-
LB234 LB234
2021 2021
1 (50) (49) Sign or signature means, with present intent to
2 authenticate or adopt a document:
3 (i) To execute or adopt a tangible symbol to a document, and
4 includes any manual, facsimile, or conformed signature; or
5 (ii) To attach to or logically associate with an electronic
6 transmission an electronic sound, symbol, or process, and includes an
7 electronic signature in an electronic transmission.
8 (51) (50) State, when referring to a part of the United States,
9 includes a state and commonwealth, and their agencies and governmental
10 subdivisions, and a territory and insular possession, and their agencies
11 and governmental subdivisions, of the United States.
12 (52) (51) Subscriber means a person who subscribes for shares in a
13 corporation, whether before or after incorporation.
14 (53) (52) Unincorporated entity means an organization or artificial
15 legal person that either has a separate legal existence or has the power
16 to acquire an estate in real property in its own name and that is not any
17 of the following: A domestic or foreign business or nonprofit
18 corporation, an estate, a trust, a state, the United States, or a foreign
19 government. The term includes a general partnership, limited liability
20 company, limited partnership, business trust, joint stock association,
21 and unincorporated nonprofit association.
22 (54) (53) United States includes district, authority, bureau,
23 commission, department, and any other agency of the United States.
24 (55) (54) Voting group means all shares of one or more classes or
25 series that under the articles of incorporation or the act are entitled
26 to vote and be counted together collectively on a matter at a meeting of
27 shareholders. All shares entitled by the articles of incorporation or the
28 act to vote generally on the matter are for that purpose a single voting
29 group.
30 (56) (55) Voting power