CSSSHB 420(STA): "An Act relating to limited liability companies; and providing for an effective date."
00CS FOR SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 420(STA) 01 "An Act relating to limited liability companies; and providing for an effective 02 date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 10 is amended by adding a new chapter to read: 05 CHAPTER 50. LIMITED LIABILITY COMPANY ACT. 06 ARTICLE 1. PURPOSES AND ACTIVITIES. 07 Sec. 10.50.010. AUTHORIZED PURPOSES. A limited liability company may 08 be organized under this chapter for any lawful purpose. 09 Sec. 10.50.015. COMPLIANCE WITH OTHER LAWS. If an activity of a 10 limited liability company or the purpose for which a limited liability company is 11 organized is subject to another provision of law, the company shall also comply with 12 the other provision of law. 13 ARTICLE 2. NAME; REGISTERED OFFICE AND AGENT; 14 SERVICE OF PROCESS.
01 Sec. 10.50.020. LIMITED LIABILITY COMPANY NAME. (a) The name 02 of a limited liability company stated in the company's articles of organization must 03 contain the words "limited liability company" or the abbreviation "L.L.C.," or "LLC". 04 The word "limited" may be abbreviated as "Ltd.," and the word "company" may be 05 abbreviated as "Co." 06 (b) The name of a city, borough, or village may be used in a limited liability 07 company name; however, the name may not contain the word "city," "borough," or 08 "village" or otherwise imply that the company is a municipality. 09 (c) A person may not adopt a name that contains the words "limited liability 10 company" unless the person is organized under this chapter or is registered as a foreign 11 limited liability company under this chapter. 12 Sec. 10.50.025. DISTINGUISHABLE NAMES. The name of a limited 13 liability company must be distinguishable on the records of the department from 14 (1) the name of a limited liability company, limited partnership, or 15 corporation organized under the laws of this state; 16 (2) the name of a foreign limited liability company that is registered 17 under this chapter; 18 (3) the name of a foreign corporation that is authorized to transact 19 business in this state; 20 (4) a name reserved or registered under AS 10.06.110 - 10.06.145 or 21 this chapter; or 22 (5) a name reserved under AS 10.35. 23 Sec. 10.50.030. RIGHT TO RESERVE NAME. The exclusive right to use a 24 name may be reserved by a 25 (1) person intending to organize a limited liability company and to 26 adopt the name; 27 (2) person intending to organize a foreign limited liability company and 28 to register under this chapter; 29 (3) limited liability company, or a foreign limited liability company 30 registered under this chapter, that intends to change its name; or 31 (4) foreign limited liability company that intends to register under this
01 chapter and to adopt the name. 02 Sec. 10.50.035. APPLICATION TO RESERVE COMPANY NAME. 03 Reservation of a name under AS 10.50.030 is made by filing an application with the 04 department. If the department finds that the name is available for use by a limited 05 liability company, and is not a reserved or registered business name under AS 10.35 06 or this chapter, the department shall reserve it for the exclusive use of the applicant 07 for a period of 120 days. 08 Sec. 10.50.038. TRANSFER OF RESERVED NAME. The holder of a name 09 reserved under AS 10.50.030 may transfer the right to the exclusive use of the name 10 to another person by filing a notice of transfer with the department, signed by the 11 holder of the name, and specifying the name and address of the transferee. 12 Sec. 10.50.040. REGISTRATION OF COMPANY NAME. A limited liability 13 company or a foreign limited liability company may register its name if the name is 14 distinguishable on the records of the department from the names identified under 15 AS 10.50.025. 16 Sec. 10.50.043. USE OF NONDISTINGUISHABLE NAME. Organization or 17 registration under this chapter, or registration of a name under this chapter, gives the 18 person who has organized or registered under this chapter, or registered a name under 19 this chapter, exclusive right to the use of the name. The person may enjoin the use 20 of a name that is not distinguishable from the name to which the person has the 21 exclusive right and the person has a cause of action for damages against a person who 22 uses a name that is not distinguishable from the name to which the person has the 23 exclusive right. 24 Sec. 10.50.048. PROCEDURE FOR REGISTRATION OF COMPANY 25 NAME. Registration of a name under AS 10.50.040 is made by filing with the 26 department 27 (1) a signed application for registration setting out the name of the 28 company, the state or territory under the laws of which it is organized, the date of 29 organization, a statement that it is conducting affairs, and a brief statement of its 30 principal activities; and 31 (2) proof from the jurisdiction where the company is organized that
01 indicates that the company is organized in that jurisdiction if the company is a foreign 02 limited liability company. 03 Sec. 10.50.050. DURATION OF REGISTERED NAME. The registration of 04 a name under AS 10.50.040 is effective until the close of the calendar year in which 05 the application for registration is filed. 06 Sec. 10.50.053. RENEWAL OF REGISTERED NAME. (a) The registration 07 of a name under AS 10.50.040 may be renewed each year by 08 (1) filing an application for renewal setting out the facts required in an 09 original application for registration; 10 (2) filing proof of organization required for an original registration; and 11 (3) paying a fee established by the department. 12 (b) An application for renewal shall be filed between October 1 and December 13 31 in each year. The renewal extends the registration for the following calendar year. 14 Sec. 10.50.055. REGISTERED OFFICE AND REGISTERED AGENT. A 15 limited liability company shall continuously maintain in this state a registered agent 16 and a registered office. The registered office may be the same as the office of the 17 company. The registered agent may be either an individual resident of this state whose 18 business office is the same as the registered office, or a domestic or foreign 19 corporation authorized to transact business in this state whose business office is the 20 same as the registered office. 21 Sec. 10.50.060. CHANGE OF REGISTERED OFFICE OR AGENT. (a) A 22 limited liability company may change its registered office, agent, or both, by filing 23 with the department a verified signed statement that includes 24 (1) the name of the company; 25 (2) the address of its registered office; 26 (3) the address of its new registered office if the registered office is to 27 be changed; 28 (4) the name of its registered agent; 29 (5) the name of its new registered agent, if the registered agent is to 30 be changed; and 31 (6) a statement that the change is authorized by the company's
01 manager, or, if the company is not managed by a manager, by the members. 02 (b) If the department finds that the verified statement complies with this 03 chapter, the department shall file it in the department's office. The change becomes 04 effective when the statement is filed. 05 Sec. 10.50.063. CHANGE OR RESIGNATION OF REGISTERED AGENT. 06 (a) A registered agent of a limited liability company may change the location of the 07 agent's office from one address to another in this state. The agent may change the 08 registered office for each company for which the person is acting as registered agent 09 by filing in the department a statement setting out the name of the agent, the address 10 of the agent's office before change, the address to which the office is changed, and a 11 list of companies for which the person is the registered agent. The statement shall be 12 executed by the registered agent in the individual name of the agent or, if the agent 13 is a corporation, it shall be executed and verified by its president or a vice-president. 14 The statement shall be delivered to the department and the limited liability company 15 and if the department finds that the statement complies with this chapter, the 16 department shall file it. The change becomes effective when the statement is filed. 17 (b) A registered agent may resign by filing a written notice and an exact copy 18 of the notice with the department. The written notice of resignation must set out the 19 latest address of the principal office of the company and the name, address, and title 20 of the manager, or, if the company is managed by its members, the names and 21 addresses of the members of the company known by the agent. The department shall 22 immediately mail a copy of the notice to the company at its principal office. The 23 resignation becomes effective 30 days after the filing of the written notice, unless the 24 company sooner appoints a successor registered agent, as provided in AS 10.50.060. 25 Sec. 10.50.065. SERVICE OF PROCESS ON COMPANY. (a) The registered 26 agent of a limited liability company is an agent upon whom process, notice, or demand 27 required or permitted by law to be served upon the company may be served. 28 (b) If a limited liability company fails to appoint or maintain a registered agent 29 in this state, or if its registered agent cannot, with reasonable diligence, be found at the 30 registered office, the commissioner is an agent of the company upon whom the 31 process, notice, or demand may be served. A person may serve the commissioner
01 under this subsection by 02 (1) serving on the commissioner or the designee of the commissioner 03 a copy of the process, notice, or demand, with any papers required by law to be 04 delivered in connection with the service, and a fee established by the department by 05 regulation; 06 (2) sending to the company being served by certified mail a notice that 07 service has been made on the commissioner under this subsection and a copy of the 08 process, notice, or demand and accompanying papers; notice to the company shall be 09 sent to 10 (A) the address of the last registered office of the company as 11 shown by the records on file in the department; and 12 (B) the address, the use of which the person initiating the 13 proceedings knows or, on the basis of reasonable inquiry, has reason to believe 14 is most likely to result in actual notice; and 15 (3) filing with the appropriate court or other body, as part of the return 16 of service, the return receipt of mailing and an affidavit of the person initiating the 17 proceedings that this section has been complied with. 18 (c) The commissioner shall keep a record of processes, notices, and demands 19 served upon the commissioner under this section. 20 (d) This section does not affect the right to serve process, notice, or demand 21 required or permitted by law to be served upon a company in any other manner 22 permitted. 23 ARTICLE 3. ORGANIZATION AND DURATION. 24 Sec. 10.50.070. ORGANIZERS. Two or more persons may organize a limited 25 liability company by signing articles of organization and delivering the signed articles 26 to the department for filing. A person who organizes a limited liability company may 27 be a person who is not a member of the company when the company is organized or 28 after the company is organized. 29 Sec. 10.50.075. CONTENTS OF ARTICLES OF ORGANIZATION. The 30 articles of organization of a limited liability company must state 31 (1) the name of the company;
01 (2) the purpose for which the company is organized, which may be 02 stated to be, or to include, the conduct of any or all lawful affairs for which a limited 03 liability company may be organized under this chapter; 04 (3) the mailing address of the company's registered office and the name 05 of the company's registered agent; 06 (4) if an election has been made that the existence of the company will 07 continue until a certain date or event, a statement of the election and the date or event; 08 (5) if applicable, that the company will be managed by a manager; and 09 (6) any other provision for the regulation of the internal affairs of the 10 company that is consistent with this chapter and the laws of this state if the persons 11 organizing the company elect to include the provision in the articles of organization. 12 Sec. 10.50.078. DISCLOSURE OF COMPANY PURPOSES. The organizers 13 delivering articles of organization under AS 10.50.070 shall deliver with the articles 14 a separate statement of the codes from the identification codes established under 15 AS 10.06.870 that most closely describe the activities in which the company will 16 initially engage. 17 Sec. 10.50.080. EFFECTIVE DATE OF ORGANIZATION. A limited liability 18 company is organized when the articles of organization for the company that conforms 19 to the filing requirements of this chapter are delivered to the department for filing 20 under AS 10.50.820. 21 Sec. 10.50.085. ELECTION OF DURATION. (a) If an election to continue 22 the existence of a limited liability company until a certain date or event is made and 23 stated in the articles of organization, the company's existence continues until the date 24 or event unless the company is dissolved under AS 10.50.400 for a reason that can 25 cause dissolution while the election is in effect. 26 (b) An election under (a) of this section may not be revoked unless the 27 election is revoked by the persons, if any, who are identified in the election at the time 28 the election is made as having the power to revoke the election. 29 (c) An election under (a) of this section may expressly limit the membership 30 terminations that can cause dissolution under AS 10.50.400(3). 31 Sec. 10.50.090. CONCLUSIVE EVIDENCE OF COMPLIANCE. A copy of
01 the articles of organization that is stamped "filed" and marked with the filing date is 02 conclusive evidence that the organizers of the limited liability company have complied 03 with all conditions precedent required to be performed by the organizers and that the 04 company has been organized under this chapter. 05 Sec. 10.50.095. OPERATING AGREEMENT. The members of a limited 06 liability company may adopt an operating agreement for the company and may amend 07 and repeal the agreement. The articles of organization may restrict or eliminate the 08 power of the members to adopt, amend, or repeal an operating agreement. 09 ARTICLE 4. AMENDMENT OF ARTICLES. 10 Sec. 10.50.100. AMENDMENT OF ARTICLES. (a) A limited liability 11 company may amend its articles of organization in any respect if the articles as 12 amended contain only the provisions that are required or permitted by this chapter to 13 be included in the original articles of organization at the time of the amendment. 14 (b) A limited liability company may amend its articles of organization by filing 15 articles of amendment with the department. The articles of amendment must state the 16 (1) name of the company; 17 (2) date the articles of organization were filed; and 18 (3) amendment adopted by the company. 19 Sec. 10.50.105. RESTATEMENT OF ARTICLES. A limited liability 20 company may restate its articles of organization at any time. The company shall file 21 its restated articles with the department. The restated articles of organization must be 22 specifically designated as restated articles in the title to the restated articles and must 23 state, either in the title or in an introductory paragraph, the 24 (1) company's present and, if the name is changed, all of the 25 company's former names; and 26 (2) date of the filing of the company's original articles of organization. 27 ARTICLE 5. MANAGEMENT. 28 Sec. 10.50.110. MANAGEMENT GENERALLY. (a) Except as otherwise 29 provided in the company's articles of organization, the members of a limited liability 30 company manage the affairs and make the decisions of the company. Management by 31 the members is subject to a provision in an operating agreement or this chapter
01 limiting or increasing the management rights and duties of the members, including 02 limits or increases placed on a class of members or an individual member. 03 (b) If a limited liability company is managed by a manager, the manager has 04 the exclusive power to manage the affairs of the company to the extent authorized by 05 the operating agreement. 06 Sec. 10.50.115. APPOINTMENT, REMOVAL, AND REPLACEMENT OF 07 MANAGERS. Except as otherwise provided in an operating agreement of a limited 08 liability company, a manager of the company may not be appointed, removed, or 09 replaced, unless more than one-half of all of the members of the company authorize 10 the appointment, removal, or replacement. 11 Sec. 10.50.120. MANAGER ELIGIBILITY. Unless otherwise provided in an 12 operating agreement of the company, a manager of a limited liability company may 13 be a person who is not an individual or a member of the company. A company may 14 have more than one manager. 15 Sec. 10.50.125. TENURE OF MANAGER. (a) Unless otherwise provided in 16 an operating agreement of the company, a manager of a limited liability company 17 holds office until the manager's successor is elected and qualified, unless the manager 18 resigns or is removed earlier. 19 (b) A manager of a limited liability company may resign by giving written 20 notice to the other managers, or, if there is only one manager for the company, to the 21 members of the company. The resignation is effective when the notice is given, unless 22 the notice specifies a later time for the effectiveness of the resignation. If the 23 resignation is effective at a future time, a successor may be selected to take office 24 when the resignation becomes effective. 25 Sec. 10.50.130. LIMITATION OF MEMBER FIDUCIARY DUTY. Unless 26 otherwise provided in an operating agreement of the company, if a person is a member 27 of a limited liability company that is managed by a manager and if the person is not 28 a manager, the person does not have the fiduciary duty of a manager to the company 29 or to the other members of the company when the person acts solely in the capacity 30 of a member. 31 Sec. 10.50.135. DUTY OF CARE. (a) A person who is a manager or a
01 managing member of a limited liability company shall perform the duties of 02 management in good faith, in a manner the person reasonably believes to be in the best 03 interests of the company, and with the care, including reasonable inquiry, that an 04 ordinarily prudent person in a like position would use under similar circumstances. 05 Except as provided in (b) of this section, the person is entitled to rely on information, 06 opinions, reports, or statements, including financial statements and other financial data, 07 in each case prepared or presented by 08 (1) an employee of the company whom the person reasonably believes 09 to be reliable and competent in the matters presented; or 10 (2) counsel, public accountants, or other professionals or experts as to 11 matters that the person reasonably believes to be within the professional's or expert's 12 competence. 13 (b) A person is not acting in good faith under (a) of this section if the person 14 has knowledge concerning the matter in question that makes reliance otherwise 15 permitted by (a) of this section unwarranted. 16 Sec. 10.50.140. CONFLICTS OF INTEREST. (a) A contract or other 17 transaction between a limited liability company and a manager or managing member 18 of a limited liability company, or between a limited liability company and a limited 19 liability company, foreign limited liability company, corporation, firm, or association 20 in which a manager or managing member of the company has a material financial 21 interest, is not void or voidable because the manager or managing member or the other 22 company, corporation, firm, or association are parties or because the manager or 23 managing member is present at the meeting that authorizes, approves, or ratifies the 24 contract or transaction, if the material facts as to the transaction and as to the interest 25 of the manager or managing member are fully disclosed or known to the members and 26 the contract or transaction is approved by the members in good faith, with the 27 interested manager or managing member not being entitled to vote. 28 (b) The fact that a manager or managing member of a limited liability 29 company is a manager or managing member of another entity involved in the 30 transaction does not alone constitute a material financial interest within the meaning 31 of this section. A manager or managing member is not interested within the meaning
01 of this section in a decision fixing the compensation of another manager or managing 02 member as a manager or managing member of the company, notwithstanding the fact 03 that the first manager or managing member is also receiving compensation from the 04 company. 05 (c) A contract or other transaction between a manager or managing member 06 and a limited liability company or association of which one or more managers or 07 managing members of the company are managers or managing members is not void 08 or voidable because the managers or managing members are present at the meeting that 09 authorizes, approves, or ratifies the contract or transaction, if the material facts of the 10 transaction and the manager's or managing member's other management position are 11 fully disclosed or known to the members and the members authorize, approve, or ratify 12 the contract or transaction in good faith by a sufficient vote without counting the vote 13 of the common manager or managing member or the contract or transaction is 14 approved by the members in good faith. This subsection does not apply to contracts 15 or transactions covered by (a) of this section. 16 (d) Nothing in this section affects the prohibitions or restraints imposed by 17 AS 45.50.562 - 45.50.596. 18 Sec. 10.50.145. LOANS TO MANAGERS, MANAGING MEMBERS, AND 19 EMPLOYEES. (a) A loan may not be extended by a limited liability company to an 20 employee without authorization by the company's managers or managing members. 21 A loan may not be extended to a manager or a managing member of a limited liability 22 company without the approval of two-thirds of the company's members. An employee 23 who is also a manager or managing member is considered a manager or managing 24 member for purposes of this section. A member is not disqualified from voting on a 25 loan to a member as a manager or managing member because of personal interest. 26 (b) A loan to a manager, managing member, or employee and a loan secured 27 by the limited liability company interests of the company may not be made unless the 28 loan would be permissible as a distribution under AS 10.50.290 - 10.50.345. A loan 29 under this subsection impairs the retained earnings or paid-in capital accounts to the 30 extent of the loan. 31 (c) For purposes of this section, a loan may consist of cash, securities, or
01 personal or real property. 02 (d) If a limited liability company acts as a guarantor on a loan to a manager, 03 managing member, or employee, the guarantee is treated as a loan under this section. 04 (e) A manager, managing member, or employee of an affiliated limited liability 05 company is a manager, managing member, or employee of the lending company for 06 purposes of this section. 07 (f) A loan is to be judged by the duties of managers and managing members 08 to act in good faith in a manner reasonably believed to be in the best interests of the 09 company and with the care, including reasonable inquiry, that an ordinarily prudent 10 person in a like position would use under similar circumstances. 11 Sec. 10.50.148. INDEMNIFICATION OF MANAGERS, MANAGING 12 MEMBERS, EMPLOYEES, AND AGENTS; INSURANCE. (a) A limited liability 13 company may indemnify a person who was, is, or is threatened to be made a party to 14 a completed, pending, or threatened action or proceeding, whether civil, criminal, 15 administrative, or investigative, other than an action by or in the right of the company, 16 by reason of the fact that the person is or was a manager, managing member, 17 employee, or agent of the company, or is or was serving at the request of the company 18 as a manager, managing member, employee, or agent of another limited liability 19 company, partnership, joint venture, trust, or other enterprise. Indemnification may 20 include reimbursement of expenses, attorney fees, judgments, fines, and amounts paid 21 in settlement actually and reasonably incurred by the person in connection with the 22 action or proceeding if the person acted in good faith and in a manner the person 23 reasonably believed to be in or not opposed to the best interests of the company, and, 24 with respect to a criminal action or proceeding, the person had no reasonable cause to 25 believe the conduct was unlawful. The termination of an action or proceeding by 26 judgment, order, settlement, conviction, or upon a plea of nolo contendere or its 27 equivalent, does not create a presumption that the person did not act in good faith and 28 in a manner which the person reasonably believed to be in or not opposed to the best 29 interests of the company, and, with respect to a criminal action or proceeding, the 30 person had reasonable cause to believe that the conduct was unlawful. 31 (b) A limited liability company may indemnify a person who was, is, or is
01 threatened to be made a party to a completed, pending, or threatened action by or in 02 the right of the company to procure a judgment in its favor by reason of the fact that 03 the person is or was a manager, managing member, employee, or agent of the 04 company, or is or was serving at the request of the company as a manager, managing 05 member, employee, or agent of another limited liability company, partnership, joint 06 venture, trust, or other enterprise. Indemnification may include reimbursement for 07 expenses and attorney fees actually and reasonably incurred by the person in 08 connection with the defense or settlement of the action if the person acted in good 09 faith and in a manner the person reasonably believed to be in or not opposed to the 10 best interests of the company. Indemnification may not be made in respect of any 11 claim, issue, or matter as to which the person has been adjudged to be liable for 12 negligence or misconduct in the performance of the person's duty to the company 13 except to the extent that the court in which the action was brought determines upon 14 application that, despite the adjudication of liability, in view of all the circumstances 15 of the case, the person is fairly and reasonably entitled to indemnity for expenses that 16 the court considers proper. 17 (c) To the extent that a manager, managing member, employee, or agent of a 18 limited liability company has been successful on the merits or otherwise in defense of 19 an action or proceeding referred to in (a) or (b) of this section, or in defense of a 20 claim, issue, or matter in the action or proceeding, the manager, managing member, 21 employee, or agent shall be indemnified against expenses and attorney fees actually 22 and reasonably incurred in connection with the defense. 23 (d) Unless otherwise ordered by a court, indemnification under (a) or (b) of 24 this section may only be made by a company upon a determination that 25 indemnification of the manager, managing member, employee, or agent is proper in 26 the circumstances because the manager, managing member, employee, or agent has 27 met the applicable standard of conduct set out in (a) and (b) of this section. The 28 determination shall be made by the members. 29 (e) The company may pay or reimburse the reasonable expenses incurred in 30 defending a civil or criminal action or proceeding in advance of the final disposition 31 in the manner provided in (d) of this section if
01 (1) in the case of a manager or managing member, the manager or 02 managing member furnishes the company with a written affirmation of a good faith 03 belief that the standard of conduct described in AS 10.50.135(a) has been met; 04 (2) the manager, managing member, employee, or agent furnishes the 05 company a written unlimited general undertaking, executed personally or on behalf of 06 the individual, to repay the advance if it is ultimately determined that an applicable 07 standard of conduct was not met; and 08 (3) a determination is made that the facts then known to those making 09 the determination would not preclude indemnification under this chapter. 10 (f) The indemnification provided by this section is not exclusive of any other 11 rights to which a person seeking indemnification may be entitled. The right to 12 indemnification continues as to a person who has ceased to be a manager, managing 13 member, employee, or agent, and inures to the benefit of the heirs, executors, and 14 administrators of the person. 15 (g) A limited liability company may purchase and maintain insurance on behalf 16 of a person who is or was a manager, managing member, employee, or agent of the 17 company, or is or was serving at the request of the company as a manager, managing 18 member, employee, or agent of another limited liability company, partnership, joint 19 venture, trust, or other enterprise against any liability asserted against the person and 20 incurred by the person in that capacity, or arising out of that status, whether or not the 21 company has the power to indemnify the person against the liability under the 22 provisions of this section. 23 Sec. 10.50.150. AUTHORIZATION OF COMPANY AFFAIRS. (a) Unless 24 otherwise provided in an operating agreement of the company, the company's articles 25 of organization, or by this chapter, if the company is not managed by a manager, the 26 consent of more than one-half of all of the members of a limited liability company is 27 required to decide the affairs of the company. 28 (b) Unless otherwise provided in an operating agreement of the company or 29 by this chapter, the consent of more than one-half of the number of managers of a 30 limited liability company is required to decide the affairs of the company. 31 (c) Notwithstanding (a) and (b) of this section, and unless another level of
01 member consent is required in an operating agreement of the company, the consent of 02 two-thirds of the members of a limited liability company is required to 03 (1) amend the articles of organization; 04 (2) amend an operating agreement of the company; or 05 (3) authorize a manager or member to perform an act on behalf of the 06 company that contravenes an operating agreement of the company, including an act 07 that contravenes a provision of the operating agreement that expressly limits the 08 purposes, affairs, or conduct of the affairs of the company. 09 (d) For the purposes of (c) of this section, the required level of consent 10 established by an operating agreement may not be less than a majority of the members. 11 ARTICLE 6. ADMISSION AND WITHDRAWAL OF MEMBERS. 12 Sec. 10.50.155. ADMISSION OF MEMBERS. A person may become a 13 member in a limited liability company if the person acquires a limited liability 14 company interest 15 (1) directly from the limited liability company 16 (A) in compliance with an operating agreement of the company; 17 or 18 (B) with the written consent of all of the members of the 19 company if an operating agreement of the company does not provide for 20 acquiring an interest directly from the company; or 21 (2) by assignment of the interest by a company member in compliance 22 with AS 10.50.165. 23 Sec. 10.50.160. EFFECTIVE DATE OF ADMISSION. The effective date of 24 the admission of a member to a limited liability company is the later of the date 25 (1) when the company is organized; 26 (2) established in an operating agreement of the company; or 27 (3) when the person's admission is reflected in the records of the 28 company if an operating agreement of the company does not establish an effective 29 date. 30 Sec. 10.50.165. AUTHORIZATION FOR ASSIGNEE TO BECOME 31 MEMBER. (a) Unless otherwise provided in an operating agreement of the company,
01 an assignee of a limited liability company interest may not become a member unless 02 all other members consent. 03 (b) An operating agreement of the company may specify the manner for 04 evidencing the consent required by (a) of this section. If an operating agreement does 05 not specify the manner for evidencing the consent, the consent is evidenced by a 06 written instrument that is dated and signed by the members. 07 Sec. 10.50.170. RIGHTS, POWERS, AND LIABILITIES OF ASSIGNEE 08 WHO BECOMES A MEMBER. (a) An assignee who becomes a member has, to the 09 extent assigned, the rights and powers of a member under the articles of organization, 10 an operating agreement, and this chapter, and is subject to the restrictions and 11 liabilities of a member under the articles of organization, an operating agreement, and 12 this chapter. 13 (b) In addition to the liabilities imposed under (a) of this section, an assignee 14 of a limited liability company interest who becomes a member of the company is liable 15 for an obligation of the assignor to make a contribution under AS 10.50.280 that is not 16 imposed by the articles of organization, an operating agreement, or otherwise by this 17 chapter. 18 (c) Notwithstanding (a) and (b) of this section, an assignee who becomes a 19 member is not liable for liabilities that are unknown to the assignee when the assignee 20 becomes a member and that cannot be determined from the written records of the 21 company maintained under AS 10.50.860. 22 Sec. 10.50.180. RIGHTS OF ASSIGNOR WHEN ASSIGNEE BECOMES A 23 MEMBER. Unless otherwise provided in an operating agreement of the company, 24 when an assignee of a member's limited liability company interest becomes a member 25 of the company with respect to the assignor's entire interest, the assignor ceases to be 26 a member or to have the power to exercise the rights of a member. 27 Sec. 10.50.185. VOLUNTARY TERMINATION OF MEMBERSHIP. (a) A 28 person's membership in a limited liability company terminates if the person withdraws 29 voluntarily from the company. 30 (b) Unless an operating agreement of the company provides that a member 31 may not withdraw voluntarily from the company, a member of a limited liability
01 company may withdraw as a member voluntarily at any time by giving 30 days' 02 written notice to the other members, or by giving other notice that is established by 03 an operating agreement of the company. 04 Sec. 10.50.190. WITHDRAWAL BEFORE END OF TERM OR 05 UNDERTAKING. Unless otherwise provided in an operating agreement of the 06 company, if a limited liability company has a definite term or particular undertaking, 07 the withdrawal of a member of the company before the end of the term or the 08 accomplishment of the undertaking is a breach of the operating agreement. 09 Sec. 10.50.195. REMEDIES FOR WRONGFUL WITHDRAWAL. (a) If the 10 voluntary withdrawal of a member with the power to withdraw from the company 11 breaches an operating agreement of the company, or if the withdrawal occurs as a 12 result of otherwise wrongful conduct of the member, a limited liability company may 13 recover from the withdrawing member damages that are for the breach of the operating 14 agreement or that result from the wrongful conduct, including the reasonable costs of 15 obtaining replacement of any services the withdrawn member was obligated to 16 perform. 17 (b) A limited liability company may offset the damages authorized under (a) 18 of this section against the amount that is otherwise distributable to the withdrawing 19 member, and may pursue other remedies allowed in an operating agreement of the 20 company or otherwise available under applicable law. 21 Sec. 10.50.205. REMOVAL OF MEMBER. (a) A person's membership in 22 a limited liability company may not be terminated by removal except as provided by 23 (b) or (c) of this section. 24 (b) Except as provided in (c) of this section, a person's membership in a 25 limited liability company terminates if the person assigns all of the person's interest 26 in the company and if a majority of the members who have not assigned their interests 27 in the company authorize the removal of the person as a member. 28 (c) If an operating agreement of the company provides for the removal of a 29 member with or without cause, a person's membership in a limited liability company 30 terminates if the person is removed as a member in the manner and under the 31 circumstances provided in the agreement.
01 Sec. 10.50.210. EFFECT OF DEATH OR INCOMPETENCY ON 02 MEMBERSHIP. Unless otherwise provided in an operating agreement or by the 03 written consent of all of the members at the time, the membership of a member of a 04 limited liability company who is an individual terminates if the member dies, or if a 05 court of competent jurisdiction enters an order adjudicating the member incompetent 06 to manage the member's person or property. 07 Sec. 10.50.215. TERMINATION OF TRUST OR DISTRIBUTION OF 08 INTEREST BY ESTATE MEMBERSHIP. (a) Unless otherwise provided in an 09 operating agreement of the company or by the written consent of all of the members 10 of the company at the time, the limited liability company membership held by a trust 11 or trustee terminates when the trust terminates. In this subsection, "terminates" does 12 not include the substitution of a new trustee. 13 (b) Unless otherwise provided in an operating agreement of the company or 14 by the written consent of all of the members of the company at the time, the limited 15 liability company membership held by an estate terminates when the estate's entire 16 limited liability company interest is distributed by the fiduciary of the estate. 17 Sec. 10.50.220. TERMINATION ON DISSOLUTION OF MEMBER. (a) 18 Unless otherwise provided in an operating agreement of the company or by the written 19 consent of all of the members of the company at the time, a limited liability company 20 membership of a member that is a separate limited liability company terminates when 21 the member dissolves and begins to wind up its affairs. 22 (b) Unless otherwise provided in an operating agreement of the company or 23 by the written consent of all of the members of the company at the time, a limited 24 liability company membership of a member that is a corporation terminates when the 25 corporation is dissolved and 90 days lapse without reinstatement. 26 Sec. 10.50.225. OTHER EVENTS TERMINATING MEMBERSHIP. (a) 27 Unless otherwise provided in writing in an operating agreement of the company or 28 authorized by the written consent of all of the members of the company at the time, 29 a person's membership in a limited liability company terminates when the person 30 (1) makes an assignment for the benefit of creditors; 31 (2) files a voluntary petition in bankruptcy;
01 (3) is adjudicated a bankrupt or insolvent; 02 (4) files a petition or answer seeking for the person a reorganization, 03 arrangement, composition, readjustment, liquidation, dissolution, or similar relief under 04 law; 05 (5) files an answer or other pleading admitting or failing to contest the 06 material allegations of a petition filed against the member in a proceeding in the nature 07 of (1) - (4) of this subsection; or 08 (6) seeks, consents to, or acquiesces in the appointment of a trustee, 09 receiver, or liquidator of the person or of all or a substantial part of the person's 10 property. 11 (b) Unless otherwise provided in writing in an operating agreement of the 12 company or consented to in writing by all of the members of the company at the time, 13 a person's membership in a limited liability company terminates when 14 (1) a proceeding against the person seeking reorganization, 15 arrangement, composition, readjustment, liquidation, dissolution, or similar relief is not 16 dismissed within 120 days after the commencement of the proceeding; or 17 (2) an appointment, without the person's consent, of a trustee, receiver, 18 or liquidator of the person or of all or a substantial part of the person's property is not 19 vacated or stayed within 120 days after the appointment or after the expiration of the 20 stay. 21 (c) The members of a limited liability company may provide in writing in an 22 operating agreement that other events terminate a membership. 23 Sec. 10.50.240. EFFECT OF ELECTION. If an election to continue a limited 24 liability company until a certain date or event is made under AS 10.50.085(a), 25 10.50.185 - 10.50.225(a) and (b) do not apply to the termination of the membership 26 of a member unless the member is also a manager of the company. 27 ARTICLE 7. RELATIONSHIP TO THIRD PARTIES. 28 Sec. 10.50.250. AGENCY POWER OF MEMBERS AND MANAGERS. (a) 29 Except as provided in (b) and (c) of this section, a member of a limited liability 30 company is an agent of the company for the purpose of conducting the company's 31 affairs. A member's act, including the execution of an instrument in the name of the
01 company, that appears to be performed in the usual and customary way of conducting 02 business, binds the company, unless the member does not in fact have the authority to 03 act for the company in the particular matter and the person with whom the member 04 is dealing knows that the member does not have the authority to act for the company 05 in the particular matter. 06 (b) If a limited liability company is managed by a manager, a member is not, 07 solely by reason of being a member, an agent of the company. 08 (c) If a limited liability company is managed by a manager, a manager is an 09 agent of a limited liability company for the purpose of conducting its affairs, and a 10 manager's act, including the execution of an instrument in the name of the company, 11 that appears to be performed in the usual and customary way of conducting business 12 binds the company, unless the manager does not in fact have the authority to act for 13 the company in the particular matter and the person with whom the manager is dealing 14 knows that the manager does not have the authority to act for the company in the 15 particular matter. 16 (d) A limited liability company manager's or member's act that does not 17 appear to be performed in the usual and customary way of conducting business does 18 not bind the company, unless the act is authorized by an operating agreement of the 19 company when the act is performed or at another time. 20 (e) A limited liability company manager's or member's act that contravenes 21 a restriction on the manager's or member's authority does not bind the company with 22 regard to persons who know about the restriction. 23 Sec. 10.50.255. ADMISSIONS OF MEMBERS AND MANAGERS. (a) 24 Except as provided in (b) of this section, an admission or representation made by a 25 member of a limited liability company about the affairs of the company is evidence 26 against the company if the admission or representation is within the scope of the 27 member's authority under this chapter. 28 (b) If a limited liability company is managed by a manager, an admission or 29 representation made by a 30 (1) manager about the affairs of the company is evidence against the 31 company if the admission or representation is within the scope of the manager's
01 authority under this chapter; and 02 (2) member, acting solely in the capacity of a member, is not evidence 03 against the company. 04 Sec. 10.50.260. LIMITED LIABILITY COMPANY CHARGED WITH 05 KNOWLEDGE OF OR NOTICE TO MEMBER OR MANAGER. (a) Except as 06 provided in (b) and (c) of this section, and except for a fraud on the company 07 committed by or with the consent of the member who has the knowledge or receives 08 the notice, the following operate as notice to or knowledge of a limited liability 09 company: 10 (1) notice given to a company member of a matter relating to the 11 affairs of the company; 12 (2) the knowledge of a company member acting in the particular matter, 13 whether acquired while a member or known at the time of becoming a member; and 14 (3) the knowledge of a company member who reasonably could and 15 should have communicated the knowledge to a member acting in the particular matter. 16 (b) If the company is managed by a manager, the following operate as notice 17 to or knowledge of a limited liability company, except for a fraud on the company 18 committed by or with the consent of the manager who has the knowledge or receives 19 the notice: 20 (1) notice given to a manager of a matter relating to the affairs of the 21 limited liability company; 22 (2) the knowledge of the manager acting in the particular matter, 23 acquired while a manager or known at the time of becoming a manager; and 24 (3) the knowledge of a company manager who reasonably could and 25 should have communicated the knowledge to the manager acting in the particular 26 matter. 27 (c) If the company is managed by a manager, notice to, or the knowledge of, 28 a member of a limited liability company while the member is acting solely in the 29 capacity of a member does not operate as notice to or knowledge of the company. 30 Sec. 10.50.265. LIABILITY OF MEMBERS TO THIRD PARTIES. A person 31 who is a member of a limited liability company is not liable, solely by reason of being
01 a member, under a judgment, decree, or order of a court, or in another manner, for a 02 liability of the company, whether the liability arises in contract, tort, or another form, 03 or for the acts or omissions of another member, manager, agent, or employee of the 04 company. 05 ARTICLE 8. CONTRIBUTIONS. 06 Sec. 10.50.275. CONSIDERATION FOR COMPANY INTERESTS. An 07 interest in a limited liability company may be issued for property or services rendered. 08 A member who has contributed property or services rendered may also contribute a 09 promissory note or other obligation to contribute property or services. 10 Sec. 10.50.280. LIABILITY FOR CONTRIBUTIONS. (a) Notwithstanding 11 AS 09.25.010 - 09.25.020, a promise by a member of a limited liability company to 12 contribute property or services to the company is not enforceable unless the promise 13 is stated in a writing signed by the member. 14 (b) Unless otherwise provided in an operating agreement of the company, a 15 member of a limited liability company is liable for performing an enforceable promise 16 made to the company to contribute property or services, even if the member is unable 17 to perform because of death, disability, or another reason. 18 (c) If a member of a limited liability company does not make the member's 19 required contribution of property or services, the member shall, at the option of the 20 company, contribute cash equal to that portion of value of the required contribution 21 that has not been made. 22 (d) Unless otherwise provided in an operating agreement of the company, an 23 assignor of a limited liability company interest is not released from the assignor's 24 liability to the company under this section, even if the assignee becomes a member 25 with respect to the assigned interest. 26 Sec. 10.50.285. COMPROMISE OF CONTRIBUTION. Unless otherwise 27 provided in an operating agreement of the company, the obligation of a member to 28 make a contribution to a limited liability company may not be compromised, unless 29 all of the other members consent to the compromise. 30 ARTICLE 9. DISTRIBUTIONS. 31 Sec. 10.50.290. SHARING OF PROFITS. Subject to AS 10.50.305 -
01 10.50.320, and unless otherwise provided in an operating agreement of the company, 02 a member of a limited liability company shall be repaid the member's contribution to 03 capital and shares equally in the profits and other assets of the company remaining 04 after all liabilities, including liabilities to members, are satisfied. 05 Sec. 10.50.295. INTERIM DISTRIBUTIONS UNDER OPERATING 06 AGREEMENT. Subject to AS 10.50.305 - 10.50.320, if a limited liability company 07 makes an interim distribution of its assets to its members, the company shall make the 08 distribution to the members in the manner provided in an operating agreement of the 09 company. The operating agreement of the company may authorize different interim 10 distributions for different classes of members. 11 Sec. 10.50.300. INTERIM DISTRIBUTIONS WITHOUT OPERATING 12 AGREEMENT. Subject to AS 10.50.305 - 10.50.320, if an operating agreement of the 13 company does not provide for the interim distribution of the assets of the company, 14 when a limited liability company makes an interim distribution of its assets, the interim 15 distributions to each member of the company shall be equal. 16 Sec. 10.50.305. RESTRICTIONS ON DISTRIBUTIONS. (a) A distribution 17 may not be made by a limited liability company if, after giving effect to the 18 distribution, 19 (1) the company would not be able to pay its debts as they become due 20 in the usual course of conducting its affairs; or 21 (2) the limited liability company's assets would be less than the sum 22 of its liabilities plus, unless otherwise provided in an operating agreement, the amount 23 that would be needed, if the limited liability company were to be dissolved at the time 24 of the distribution, to satisfy the preferential rights of other members upon dissolution 25 that are superior to the rights of the member receiving the distribution. 26 (b) A limited liability company may base a determination that a distribution 27 is not prohibited under (a) of this section on 28 (1) financial statements prepared on the basis of accounting practices 29 and principles that are reasonable under the circumstances; or 30 (2) a fair valuation or other method that is reasonable under the 31 circumstances.
01 (c) Except as provided in (e) of this section, the effect of a distribution in 02 accordance with (a) of this section is measured as of the date 03 (1) the distribution is authorized if the payment occurs within 120 days 04 after the date of authorization; or 05 (2) payment is made if the payment occurs more than 120 days after 06 the date of authorization. 07 (d) If the terms of an indebtedness provide that payment of principal and 08 interest is to be made only if and to the extent that payment of a distribution to 09 members could then be made under this section, indebtedness of a limited liability 10 company, including indebtedness issued as a distribution, is not a liability for purposes 11 of determinations made under (b) of this section. 12 (e) If indebtedness is issued as a distribution, each payment of principal or 13 interest on the indebtedness is treated as a distribution, and the effect of the 14 distribution is measured on the date the payment is actually made. 15 Sec. 10.50.315. ADDITIONAL RESTRICTIONS IN ARTICLES OR 16 OPERATING AGREEMENT. Nothing in this chapter prohibits additional restrictions 17 upon the purchase or redemption of a company's own limited liability company 18 interests by provision in the articles of organization or operating agreement of the 19 limited liability company or in another agreement entered into by the company. 20 Sec. 10.50.320. LIABILITY OF MEMBERS RECEIVING PROHIBITED 21 DISTRIBUTIONS; SUIT AGAINST MEMBERS. (a) A member of a limited liability 22 company who receives a distribution prohibited by this chapter with knowledge of 23 facts indicating the impropriety of the distribution is liable to the company for the 24 benefit of all of the creditors or members entitled to institute an action under (b) of 25 this section for the amount received by the member with interest at the legal rate on 26 judgments until paid. The liability of the member under this subsection may not 27 exceed the liabilities of the company owed to nonconsenting creditors at the time of 28 the violation and the injury suffered by nonconsenting members. 29 (b) Suit may be brought in the name of the company to enforce the liability 30 to 31 (1) creditors arising under (a) of this section for a violation of
01 AS 10.50.305 against any or all members liable by any one or more creditors of the 02 company whose debts or claims arose before the time of the distribution to members 03 and who have not consented to the distribution, whether or not they have reduced their 04 claims to judgment; or 05 (2) members arising under (a) of this section for a violation of 06 AS 10.50.305 against any or all members liable by any one or more members holding 07 preferred limited liability company interests outstanding at the time of the distribution 08 who have not consented to the distribution, without regard to the provisions of 09 AS 10.50.735. 10 (c) A member sued under this section may compel contribution from all other 11 members liable under this section. 12 (d) This section does not affect the liability that a member may have under 13 other applicable law. 14 Sec. 10.50.330. TIME FOR INTERIM DISTRIBUTIONS. A member of a 15 limited liability company is entitled to receive interim distributions under AS 10.50.295 16 - 10.50.300 at the times or upon the happening of the events specified in an operating 17 agreement of the company, or at the times determined by the members or managers 18 under AS 10.50.150. 19 Sec. 10.50.335. DISTRIBUTIONS WHEN A PERSON CEASES TO BE A 20 MEMBER. (a) Except for termination under AS 10.50.205, when the limited liability 21 company membership of a person terminates and the termination does not cause 22 dissolution of the company, the company shall distribute to the person any distribution 23 that the person was entitled to receive before the person's membership terminated. 24 (b) In addition to a distribution made under (a) of this section, a limited 25 liability company shall distribute to a terminating member the amount of the member's 26 limited liability company interest. If an operating agreement of the company does not 27 provide the amount of the distribution or a method for determining the amount of the 28 distribution, the company shall make the distribution within a reasonable time after 29 termination and the amount of the distribution is the fair value of the member's limited 30 liability company interest as of the date of termination based on the member's right 31 to share in distributions from the company.
01 (c) If an election to continue a limited liability company until a certain date 02 or event is in effect under AS 10.50.085, then (a) and (b) of this section do not apply 03 to the termination of the membership of a member unless the member is also a 04 manager of the company. 05 Sec. 10.50.340. DISTRIBUTION IN KIND. (a) Unless otherwise provided 06 in an operating agreement of the company, a member, regardless of the nature of the 07 member's contribution, may not demand and receive a distribution from a limited 08 liability company in a form other than cash. 09 (b) Unless otherwise provided in an operating agreement of the company, a 10 limited liability company may not compel a member of the company to accept from 11 the company a distribution of a company asset in a form other than cash to the extent 12 that the percentage of the asset distributed to the member exceeds the percentage that 13 the member would have shared in a cash distribution equal to the value of the asset 14 at the time of distribution. 15 Sec. 10.50.345. RIGHT TO DISTRIBUTION. When a member of a limited 16 liability company is entitled to receive a distribution from the company, the member 17 is a creditor of the company with respect to the distribution, and is entitled to all 18 remedies available to a creditor of the company. 19 Sec. 10.50.348. INAPPLICABILITY TO WINDING UP AND 20 INVOLUNTARY OR VOLUNTARY DISSOLUTION. AS 10.50.290 - 10.50.340 do 21 not apply in a proceeding for winding up and dissolution of a limited liability 22 company. 23 ARTICLE 10. OWNERSHIP AND TRANSFER OF PROPERTY. 24 Sec. 10.50.350. OWNERSHIP OF COMPANY PROPERTY. (a) Property 25 transferred to or otherwise acquired by a limited liability company is the property of 26 the company and is not the property of the members individually. 27 (b) A limited liability company shall acquire, hold, and convey property, 28 including real property, in the name of the company. If a limited liability company 29 acquires an interest in property, the company holds the title to the interest and not the 30 members individually. 31 Sec. 10.50.355. TRANSFER OF PROPERTY. (a) Except as provided in (b)
01 of this section, a limited liability company may transfer the property of the company 02 if the company uses an instrument of transfer signed by a member of the company in 03 the name of the company. 04 (b) If the company is managed by a manager, 05 (1) title to limited liability company property may be transferred by an 06 instrument of transfer signed by a manager of the company in the name of the 07 company; and 08 (2) a member, solely by reason of being a member, does not have the 09 authority to transfer the property of the company. 10 Sec. 10.50.360. RECOVERY OF PROPERTY. A limited liability company 11 may recover property transferred under AS 10.50.355 if the company proves that the 12 execution of the instrument of transfer did not bind the company under AS 10.50.250, 13 unless the property has been transferred by the initial transferee, or by a person 14 claiming through the initial transferee, to a subsequent transferee who gives value 15 without having notice that the person who signed the instrument of initial transfer 16 lacked authority to bind the company. 17 Sec. 10.50.370. NATURE OF INTEREST IN COMPANY. A limited liability 18 company interest is personal property. 19 Sec. 10.50.375. ASSIGNMENT OF INTEREST IN COMPANY. (a) A 20 person may assign a limited liability company interest in whole or in part. 21 (b) The assignment of a limited liability company interest entitles the assignee 22 to receive, to the extent assigned, only the distributions to which the assignor is 23 entitled. 24 (c) The assignment of a limited liability company interest does not dissolve 25 the company or entitle the assignee to participate in the management and affairs of the 26 company, to become a member, or to exercise the rights of a member. Unless the 27 assignee of the interest becomes a member with respect to the interest, the assignor 28 continues to be a member and may exercise the rights of a member, subject to the 29 members' right to remove the assignor under AS 10.50.205. 30 (d) Unless the assignee becomes a member, an assignee of a limited liability 31 company interest is not liable as a member solely as a result of the assignment.
01 (e) The assignor of a limited liability company interest is not released, solely 02 as a result of the assignment, from the assignor's liability as a member. 03 (f) An operating agreement may establish terms different from those in (a) - 04 (e) of this section. 05 (g) Unless otherwise provided in an operating agreement of the company, the 06 pledge of, or granting of a security interest, lien, or other encumbrance in or against, 07 a part or all of a member's limited liability company interest is not an assignment 08 under this section and does not terminate the membership or the rights and powers of 09 the member. 10 Sec. 10.50.380. RIGHTS OF JUDGMENT CREDITORS. (a) If a judgment 11 creditor of a limited liability company member applies to a court of competent 12 jurisdiction, the court may charge the member's limited liability company interest for 13 payment of the unsatisfied amount of the judgment. 14 (b) To the extent a limited liability company interest is charged under (a) of 15 this section, the judgment creditor has only the rights of an assignee of the member's 16 interest. 17 Sec. 10.50.385. POWERS OF ESTATE OF A DECEASED OR 18 INCOMPETENT MEMBER. If a member who is an individual dies or if a court of 19 competent jurisdiction determines the member to be incompetent to manage the 20 member's person or property, the member's executor, administrator, guardian, 21 conservator, or other legal representative has the rights of an assignee of the member's 22 interest, if the member's interest has not been terminated. 23 Sec. 10.50.390. POWERS OF DISSOLVED OR TERMINATED ENTITY. 24 If a member who is not an individual terminates or is dissolved, the member's legal 25 representative or successor has the rights of an assignee of the member's interest. 26 ARTICLE 11. DISSOLUTION. 27 Sec. 10.50.400. DISSOLUTION. A limited liability company is dissolved and 28 its affairs shall be wound up if 29 (1) an event occurs that is identified in the articles of organization or 30 an operating agreement as causing dissolution; if an election under AS 10.50.085(a) 31 is in effect, the event does not cause dissolution unless the event is identified in the
01 articles or operating agreement before or at the same time the election is stated in the 02 articles; 03 (2) all of the members of the company consent in writing unless an 04 election under AS 10.50.085(a) is in effect; 05 (3) a person's membership in the company terminates, unless 06 (A) the affairs of the company are continued by the consent of 07 all of the remaining members on or before the 90th day following the 08 termination of the membership; 09 (B) an operating agreement provides otherwise; or 10 (C) an election under AS 10.50.085(a) is in effect and 11 (i) the election provides that the termination does not 12 cause the company to dissolve; or 13 (ii) the person whose membership terminates is not a 14 manager of the company; or 15 (4) the superior court enters a decree for judicial dissolution of the 16 company under AS 10.50.405. 17 Sec. 10.50.405. DISSOLUTION BY COURT. On application by or for a 18 member of a limited liability company, the superior court may order the company 19 dissolved if the court determines that it is not reasonably practicable for the company 20 to conduct its affairs in conformity with an operating agreement of the company. 21 Sec. 10.50.408. INVOLUNTARY DISSOLUTION. (a) A limited liability 22 company may be dissolved involuntarily by the commissioner if 23 (1) the company is delinquent six months in filing its biennial report 24 or in paying a fee or a penalty; 25 (2) the company has failed for 30 days to appoint and maintain a 26 registered agent in the state; 27 (3) the company has failed for 30 days after change of its registered 28 office or registered agent to file in the office of the commissioner a statement of the 29 change; or 30 (4) a misrepresentation of material facts has been made in the 31 application, report, affidavit, or other document submitted under this chapter.
01 (b) A limited liability company may not be dissolved under this section unless 02 the commissioner has given the company written notice of its delinquency, failure, or 03 misrepresentation by certified mail addressed to its registered agent, registered office, 04 manager, or members at the last known address as shown by the records of the 05 commissioner. If the company fails, within 60 days after the notice is sent by certified 06 mail, to contest the alleged delinquency, failure, or misrepresentation, it may be 07 dissolved under (d) of this section. 08 (c) If, following a hearing, the commissioner determines the presence of the 09 delinquency, failure, or misrepresentation providing grounds for involuntary dissolution 10 under this section, the company may appeal to the superior court. The court shall 11 either sustain the commissioner or direct the commissioner to take action the court 12 considers proper. 13 (d) If a limited liability company has given cause for involuntary dissolution 14 and has failed to correct the neglect, omission, delinquency, or noncompliance as 15 provided in this section, and there has not been a controlling order of the superior 16 court, the commissioner shall dissolve the company by issuing a certificate of 17 involuntary dissolution containing a statement that the company has been dissolved, 18 the date, and the reason for which it was dissolved. The original certificate of 19 dissolution shall be placed in the department files and a copy of it mailed to the 20 company at its registered office or in care of its registered agent, manager, or members 21 at the last known address, as shown by the records of the commissioner. Upon the 22 issuance of the certificate of involuntary dissolution, the existence of the company 23 ceases, except as otherwise provided in this chapter, and its name shall be available 24 to use and may be adopted by another company on a date that is six months or later 25 after the dissolution. 26 (e) A company dissolved under this section may be reinstated within two years 27 from the date of the certificate of involuntary dissolution if it is established to the 28 satisfaction of the commissioner that in fact there was no cause for the dissolution, or 29 if the delinquency, failure, or misrepresentation resulting in dissolution has been 30 corrected and payment made of double the amount delinquent along with the amount 31 the company would have paid had it not been dissolved during the two-year period.
01 Reinstatement may not be authorized if the name of the company is not distinguishable 02 upon the records of the department, unless the company being reinstated amends its 03 articles of organization to change its name to conform with the provisions of this 04 chapter. 05 Sec. 10.50.410. AUTHORITY TO WIND UP. Unless otherwise provided in 06 an operating agreement, the affairs of a limited liability company may be wound up 07 by the 08 (1) members or managers who have authority under AS 10.50.110 to 09 manage the company before dissolution; or 10 (2) superior court on the application of a member of the company or 11 the member's legal representative or assignee if 12 (A) a member or manager identified in (1) of this subsection 13 has engaged in wrongful conduct; or 14 (B) other cause is shown. 15 Sec. 10.50.415. ACTS OF WINDING UP. Unless otherwise provided in an 16 operating agreement of the company, a person winding up the affairs of a limited 17 liability company may, in the name of, and for and on behalf of, the company, 18 (1) prosecute and defend court actions; 19 (2) settle and close the affairs of the company; 20 (3) dispose of and transfer the property of the company; 21 (4) discharge the liabilities of the company; and 22 (5) distribute to the members the assets of the company. 23 Sec. 10.50.420. AGENCY POWER OF MANAGER OR MEMBER AFTER 24 DISSOLUTION. (a) Except as provided in (b) - (d) of this section, after dissolution 25 of a limited liability company, a member having authority to wind up the company's 26 affairs can bind the company by an act that 27 (1) is appropriate for winding up the company's affairs or completing 28 transactions unfinished at dissolution; or 29 (2) would have bound the company if the company had not been 30 dissolved, if the other party to the transaction does not have notice of the dissolution; 31 in this paragraph, filing the articles of dissolution is presumed to constitute notice of
01 the dissolution. 02 (b) A member's act that is not binding on the limited liability company under 03 (a) of this section binds the company if the act is otherwise authorized by the 04 company. 05 (c) A member's act that violates a restriction on the member's authority does 06 not bind the member's limited liability company with regard to a person who knows 07 about the restriction, even if the member's act would otherwise be binding under (a) 08 of this section or is otherwise authorized. 09 (d) If the company is managed by a manager, a member does not have the 10 authority to bind the company if the member is acting solely in the capacity of a 11 member, and a manager of the company can bind the company by an act that 12 (1) is appropriate for winding up the company's affairs or completing 13 transactions unfinished at dissolution; or 14 (2) would have bound the company if the company had not been 15 dissolved if the other party to the transaction does not have notice of the dissolution; 16 in this paragraph, filing the articles of dissolution is presumed to constitute notice of 17 the dissolution. 18 Sec. 10.50.425. DISTRIBUTION OF ASSETS. Upon the winding up of a 19 limited liability company, the assets of the company shall be distributed in the 20 following manner and order of priority: 21 (1) payment, or adequate provision for payment, to creditors, including, 22 to the extent permitted by law, members who are creditors and not covered by (2) of 23 this section, in satisfaction of the liabilities of the company; 24 (2) unless otherwise provided in an operating agreement of the 25 company, payment to members or former members in satisfaction of the company's 26 liabilities for distributions under AS 10.50.295 - 10.50.335; 27 (3) unless otherwise provided in an operating agreement of the 28 company, to members and former members in the following order of priority: 29 (A) for the return of their contributions; and 30 (B) in proportion to the members' respective rights to share in 31 distributions from the company before dissolution.
01 Sec. 10.50.430. ARTICLES OF DISSOLUTION. After the dissolution of a 02 limited liability company under AS 10.50.400, the limited liability company may file 03 articles of dissolution with the department. The articles must state 04 (1) the name of the company; 05 (2) the date of filing of the company's articles of organization and of 06 any amendments to the articles of organization; 07 (3) the reason for filing the articles of dissolution; 08 (4) the effective date, which must be a specific date, of the articles of 09 dissolution if the articles of dissolution are not to be effective when filed; and 10 (5) other information determined appropriate by the members or 11 managers filing the articles. 12 Sec. 10.50.435. KNOWN CLAIMS AGAINST DISSOLVED LIMITED 13 LIABILITY COMPANY. (a) Upon dissolution, a limited liability company may 14 dispose of the known claims against it by filing articles of dissolution under 15 AS 10.50.430 and following the procedures described in this section. 16 (b) A dissolved limited liability company shall notify its known claimants in 17 writing of the dissolution at any time after the effective date of dissolution. The 18 written notice must 19 (1) describe the information that must be included in the claim; 20 (2) provide a mailing address where the claim may be sent; 21 (3) state the deadline, which may not be fewer than 120 days after the 22 later of the date of the written notice or the filing of articles of dissolution under 23 AS 10.50.430, for the company to receive the claim; and 24 (4) state that the claim is barred if it is not received by the company 25 by the deadline. 26 (c) A claim against a limited liability company is barred if a claimant 27 (1) who was given written notice under (b) of this section does not 28 deliver the claim to the company by the deadline; or 29 (2) whose claim is rejected by the company does not begin a 30 proceeding to enforce the claim within 90 days after the date of the rejection notice. 31 (d) In this section, "claim" does not include a contingent liability or a claim
01 based on an event occurring after the effective date of dissolution. 02 Sec. 10.50.440. UNKNOWN CLAIMS AGAINST DISSOLVED LIMITED 03 LIABILITY COMPANY. (a) If a limited liability company publishes a newspaper 04 notice in accordance with (b) of this section and files articles of dissolution under 05 AS 10.50.430, the following claims are barred unless the claimant commences a 06 proceeding to enforce the claim against the company within three years after the later 07 of the publication date of the newspaper notice or the filing of the articles of 08 dissolution: 09 (1) a claim by a claimant who did not receive written notice under 10 AS 10.50.435; 11 (2) a claim sent within the time allowed if the company does not act 12 on the claim; 13 (3) a claim that is contingent or based on an event occurring after the 14 effective date of dissolution. 15 (b) The notice published under (a) of this section shall be published once in 16 a newspaper of general circulation in the judicial district where the company's 17 principal office, or its registered office if it does not have a principal office in this 18 state, is located in this state, and must 19 (1) describe the information that must be included in a claim; 20 (2) provide a mailing address where the claim may be sent; 21 (3) state that a claim against the company is barred unless a proceeding 22 to enforce the claim is begun within three years after the publication of the notice; and 23 (4) request that persons with claims against the company present them 24 in writing to the company as provided in the notice. 25 (c) A claim may be enforced under this section 26 (1) against the company to the extent of the company's undistributed 27 assets; or 28 (2) if the company's assets have been distributed in liquidation, against 29 a member of the company to the extent of the member's pro rata share of the claim 30 or of the assets of the company distributed to the member in liquidation, whichever is 31 less; a member's total liability for all claims under this section may not exceed the
01 total amount of assets of the company that are distributed to the member. 02 ARTICLE 12. MERGER AND CONSOLIDATION. 03 Sec. 10.50.500. AUTHORITY FOR MERGER OR CONSOLIDATION. 04 Unless otherwise provided in an operating agreement of the company, and subject to 05 the law applicable to the other limited liability company, a limited liability company 06 may merge or consolidate with or into a limited liability company or a foreign limited 07 liability company. 08 Sec. 10.50.505. CONVERSION OF RIGHTS AND INTERESTS. The rights 09 of or interests in a limited liability company that is a party to a merger or 10 consolidation may be exchanged for or converted into cash, property, obligations, 11 rights or interests in the surviving or resulting limited liability company. 12 Sec. 10.50.510. APPROVAL OF MERGER OR CONSOLIDATION. (a) 13 Unless otherwise provided in an operating agreement of the company, a limited 14 liability company may not approve a proposed merger or consolidation unless the 15 merger or consolidation is approved by all of the members of the company. 16 (b) A foreign limited liability company that is a party to a proposed merger 17 or consolidation may not approve the merger or consolidation unless the merger or 18 consolidation is approved in the manner and by the vote required by the law applicable 19 to the foreign limited liability company. 20 (c) A party to a merger or consolidation under this chapter may abandon the 21 merger or consolidation as provided in the merger or consolidation agreement. 22 Sec. 10.50.515. DELIVERY OF ARTICLES OF MERGER OR 23 CONSOLIDATION. The limited liability company that survives or results from a 24 merger or consolidation under this chapter shall file with the department articles of 25 merger or consolidation signed by each limited liability company that is a party to the 26 merger or consolidation. 27 Sec. 10.50.520. CONTENTS OF ARTICLES OF MERGER OR 28 CONSOLIDATION. The articles of merger or consolidation required by AS 10.50.515 29 must state 30 (1) the name of each limited liability company that is a party to the 31 merger or consolidation;
01 (2) the jurisdiction where each limited liability company that is a party 02 to the merger or consolidation was organized; 03 (3) that an agreement of merger or consolidation has been approved and 04 signed by each limited liability company that is a party to the merger or consolidation; 05 (4) the name of the surviving or resulting limited liability company; 06 (5) the future effective date, which must be a specific date, of the 07 merger or consolidation if the merger or consolidation is not effective when the articles 08 are filed; 09 (6) that the agreement of merger or consolidation is on file at an office 10 of the surviving or resulting limited liability company and the address of the office; 11 (7) that a copy of the agreement of merger or consolidation will be 12 furnished by the surviving or resulting limited liability company on request and 13 without cost to a person holding an interest in a limited liability company that is a 14 party to the merger or consolidation; 15 (8) if the surviving or resulting limited liability company is not 16 organized under the laws of this state, a statement that the surviving or resulting 17 limited liability company 18 (A) agrees that it may be served with process in this state in a 19 proceeding to enforce an obligation of a company that is a party to the merger 20 or consolidation and that was organized under the laws of this state, and to 21 enforce an obligation of the surviving or resulting company; 22 (B) appoints the department as its agent for service of process 23 in an enforcement proceeding under (A) of this paragraph; and 24 (C) the address to which a copy of the process may be mailed 25 to the surviving or resulting company by the department. 26 Sec. 10.50.525. EXECUTION OF ARTICLES OF MERGER OR 27 CONSOLIDATION. Articles of merger or consolidation shall be signed by a limited 28 liability company that is a party to the merger or consolidation. 29 Sec. 10.50.530. EQUIVALENT TO ARTICLES OF DISSOLUTION. Articles 30 of merger or consolidation constitute articles of dissolution for a limited liability 31 company that is not the surviving or resulting limited liability company in the merger
01 or consolidation. 02 Sec. 10.50.535. EFFECTIVE DATE OF MERGER OR CONSOLIDATION. 03 A merger or consolidation under AS 10.50.500 - 10.50.565 takes effect upon the later 04 of the effective date of the filing of the articles of merger or consolidation or an 05 effective date stated in the articles of merger or consolidation. 06 Sec. 10.50.540. USE OF MERGER OR CONSOLIDATION AGREEMENT 07 TO AMEND OR ADOPT OPERATING AGREEMENT. (a) An agreement of merger 08 or consolidation approved under AS 10.50.510 may amend an operating agreement of 09 a limited liability company or adopt a new operating agreement for the company if the 10 company is the surviving or resulting limited liability company in the merger or 11 consolidation. 12 (b) An approved agreement of merger or consolidation may provide that the 13 operating agreement of a limited liability company that is a party to the merger or 14 consolidation, including a limited liability company organized for the purpose of 15 consummating a merger or consolidation, is the operating agreement of a limited 16 liability company that is the surviving or resulting limited liability company. 17 (c) An amendment to an operating agreement or the adoption of a new 18 operating agreement under this section is effective when the merger or consolidation 19 is effective. 20 (d) This subsection is not intended to limit the accomplishment of a merger 21 or of a matter referred to in this section by other means provided for in an operating 22 agreement or in another agreement or as otherwise permitted by law. 23 Sec. 10.50.545. GENERAL EFFECTS OF MERGER OR CONSOLIDATION. 24 (a) When a merger or consolidation becomes effective, the limited liability companies 25 that are parties to a merger or consolidation agreement become a single limited 26 liability company that, in the case of a merger, is the limited liability company named 27 in the plan of merger as the surviving limited liability company, and, in the case of a 28 consolidation, is the limited liability company named in the plan of consolidation as 29 the resulting limited liability company. 30 (b) When a merger or consolidation becomes effective, a limited liability 31 company that is a party to the merger or consolidation agreement and that is not the
01 surviving or resulting limited liability company ceases to exist. 02 (c) The surviving limited liability company of a merger or the limited liability 03 company resulting from a consolidation possesses all the rights, privileges, immunities, 04 and powers of each limited liability company that is a party to the merger or 05 consolidation agreement and is subject to all the restrictions, disabilities, and duties of 06 each limited liability company that is a party to the merger or consolidation to the 07 extent the rights, privileges, immunities, powers, franchises, restrictions, disabilities, 08 and duties apply to the type of limited liability company that is the surviving limited 09 liability company or the resulting limited liability company. 10 Sec. 10.50.550. EFFECT OF MERGER OR CONSOLIDATION ON 11 PROPERTY OF COMPANIES. The real and personal property, the debts due, 12 including promises to make capital contributions, other choses in action, and the other 13 interests of the limited liability companies that are parties to a merger or consolidation 14 belong to the surviving or resulting limited liability company without further action by 15 the companies. 16 Sec. 10.50.555. EFFECT OF MERGER OR CONSOLIDATION ON 17 LIABILITIES. (a) The surviving or resulting limited liability company in a merger 18 or consolidation is liable for the liabilities of the limited liability companies that are 19 parties to the merger or consolidation. 20 (b) A claim, action, or other proceeding that exists at the time of the merger 21 or consolidation and that is pending by or against a limited liability company that is 22 a party to a merger or consolidation may be pursued as if the merger or consolidation 23 had not taken place, or the surviving or resulting limited liability company may be 24 substituted in the claim, action, or other proceeding. 25 Sec. 10.50.560. RIGHTS OF CREDITORS. The rights of creditors and liens 26 on the property of a limited liability company that is a party to a merger or 27 consolidation are not impaired by the merger or consolidation. 28 Sec. 10.50.565. CONVERSION AT MERGER OR CONSOLIDATION. (a) 29 Upon a merger or consolidation, the limited liability company interests that are to be 30 converted or exchanged into interests, cash, obligations, or other property under the 31 terms of a merger or consolidation agreement are converted as provided by the merger
01 or consolidation agreement. 02 (b) Upon a merger or consolidation, the former holders of interests converted 03 under (a) of this section have the rights provided in the merger or consolidation 04 agreement or otherwise provided by law. 05 Sec. 10.50.590. DEFINITION. In AS 10.50.500 - 10.50.590, "limited liability 06 company" means a limited liability company organized under this chapter or a foreign 07 limited liability company. 08 ARTICLE 13. FOREIGN LIMITED LIABILITY COMPANIES. 09 Sec. 10.50.600. GOVERNING LAW. (a) Subject to the constitution of this 10 state, the law of the state or other jurisdiction under which a foreign limited liability 11 company is organized governs the organization and internal affairs of the company. 12 (b) The department may not deny registration to a foreign limited liability 13 company because of differences between the law of this state and the law of the state 14 or other jurisdiction under which the foreign limited liability company is organized. 15 Sec. 10.50.605. REGISTRATION REQUIRED. Before conducting affairs in 16 this state, a foreign limited liability company shall register with the department. To 17 register, the company shall deliver to the department an application for registration as 18 a foreign limited liability company. 19 Sec. 10.50.610. EXECUTION OF REGISTRATION APPLICATION. An 20 application for registration filed by a foreign limited liability company under 21 AS 10.50.605 shall be signed by a person who is authorized by the law of the state or 22 other jurisdiction where the company was organized to sign the application. 23 Sec. 10.50.615. CONTENTS OF REGISTRATION APPLICATION. (a) An 24 application for the registration of a foreign limited liability company must state 25 (1) the name of the foreign limited liability company and, if different, 26 the name the company proposes to use in this state; 27 (2) the state or other jurisdiction where the company was organized, 28 and date of its organization; 29 (3) the name and address of the company's registered agent; 30 (4) that the department is appointed the agent of the company for 31 service of process if the foreign limited liability company fails to appoint or maintain
01 a registered agent under AS 10.50.635; 02 (5) the address of the office required by the state or other jurisdiction 03 of the company's organization to be maintained in that state or other jurisdiction, or, 04 if the state or other jurisdiction does not require an office to be maintained in that state 05 or other jurisdiction, the principal office of the company; 06 (6) the purpose the company proposes to pursue in the conduct of its 07 affairs in this state and the codes from the identification code established under 08 AS 10.06.870 that most closely describe the activities in which the company will 09 engage in this state; 10 (7) the names and addresses of the managers of the company, or, if the 11 company is not managed by a manager, the names and addresses of the members of 12 the company; 13 (8) the name and address of each person owning at least a five percent 14 interest in the company and the percentage of interest owned by that person in the 15 company; and 16 (9) that the company is a foreign limited liability company. 17 (b) In addition to the information required by (a) of this section, an application 18 must include proof from the jurisdiction where the company was organized that 19 indicates that the company was organized in that jurisdiction. 20 Sec. 10.50.620. NAME. The department may not file the application for 21 registration of a foreign limited liability company unless the name of the company 22 satisfies the requirements of AS 10.50.020 - 10.50.025. If the name under which a 23 foreign limited liability is organized in the state or other jurisdiction of its organization 24 does not satisfy the requirements of AS 10.50.020 - 10.50.025, the company may 25 register under AS 10.50.605 if the company uses an assumed name that is available 26 to the company under this chapter and that satisfies the requirements of AS 10.50.020 - 10.50.025. 27 Sec. 10.50.623. CHANGE OF NAME. If a foreign limited liability company 28 that is registered under this chapter changes its name to one under which it may not 29 register under this chapter, the registration of the company is suspended and the 30 company may not conduct affairs in this state until it has changed its name to a name 31 available to it under the laws of this state.
01 Sec. 10.50.625. AMENDMENT OF REGISTRATION. A foreign limited 02 liability company may amend its registration by filing an amendment of registration 03 with the department that is signed by a person who has the authority to sign it under 04 the law of the state or other jurisdiction of the company's organization. 05 Sec. 10.50.630. CONTENTS OF AMENDMENT OF REGISTRATION. (a) 06 The amendment of registration filed by a foreign limited liability company must state 07 the 08 (1) name of the company; 09 (2) date the original application for registration was filed; and 10 (3) amendment. 11 (b) The application for registration may be amended in any way if the 12 application for registration as amended contains only provisions that this chapter allows 13 to be contained in an application for registration at the time of amendment. 14 Sec. 10.50.635. REGISTERED OFFICE AND REGISTERED AGENT OF 15 FOREIGN COMPANY. A foreign limited liability company registered under this 16 chapter shall have and continuously maintain in the state a registered 17 (1) office that may be, but need not be, the same as its office in this 18 state; and 19 (2) agent, who may be either an individual resident in this state whose 20 business office is identical to the registered office, a corporation organized under 21 AS 10.06, or a foreign corporation authorized to transact business in this state, that has 22 a business office identical to the registered office. 23 Sec. 10.50.637. CHANGE OF REGISTERED OFFICE OR REGISTERED 24 AGENT OF FOREIGN COMPANY. A foreign limited liability company registered 25 under this chapter may change its registered office or change its registered agent, or 26 both, upon filing with the department a signed statement setting out 27 (1) the name of the company; 28 (2) the address of its registered office; 29 (3) the address of the new registered office if the address of its 30 registered office is to be changed; 31 (4) the name of its registered agent;
01 (5) the name of its new registered agent if its registered agent is to be 02 changed; 03 (6) that the address of its registered office and the address of the 04 business office of its registered agent, as changed, will be identical; and 05 (7) that the change is authorized by the company. 06 Sec. 10.50.638. FILING OF STATEMENT OF CHANGE. If the department 07 finds that the statement conforms to the provisions of this chapter, the department shall 08 file the statement, and upon the filing, the change of address of the registered office, 09 or the appointment of a new registered agent, or both, as the case may be, becomes 10 effective. 11 Sec. 10.50.640. SERVICE OF PROCESS ON FOREIGN COMPANY. The 12 registered agent appointed by a foreign limited liability company registered under this 13 chapter shall be an agent of the company upon whom process, notice, or demand 14 required or permitted by law to be served upon the company may be served. 15 Sec. 10.50.645. SERVICE ON COMMISSIONER. When a foreign limited 16 liability company that is registered under this chapter, or that conducts affairs in this 17 state without being registered under this chapter, fails to appoint or maintain a 18 registered agent in this state, when a registered agent cannot with reasonable diligence 19 be found at the registered office, or when the registration of a foreign company is 20 suspended or revoked, the commissioner is an agent upon whom process, notice, or 21 demand may be served. Service is made upon the commissioner as provided in 22 AS 10.50.065(b). 23 Sec. 10.50.650. REVOCATION OF REGISTRATION. (a) The registration 24 of a foreign limited liability company authorizing the company to conduct affairs in 25 this state may be revoked by the commissioner if 26 (1) the company fails to file its biennial report within the time 27 established by this chapter, or fails to pay fees or penalties established by this chapter 28 when they are due and payable; 29 (2) the company fails to appoint and maintain a registered agent in this 30 state; 31 (3) the company fails, after change of its registered office or registered
01 agent, to file with the commissioner a statement of the change as required by this 02 chapter; or 03 (4) a misrepresentation of a material matter has been made in an 04 application, report, affidavit, or other document submitted under this chapter. 05 (b) The commissioner may not revoke the registration of a foreign limited 06 liability company unless the 07 (1) commissioner has given the company at least 60 days notice by 08 certified mail addressed to its registered agent at its registered office; and 09 (2) company fails before revocation to file the report, pay the fees or 10 penalties, file the required statement of change of registered agent or registered office, 11 or correct the misrepresentation. 12 (c) Upon revoking a registration, the commissioner shall 13 (1) issue a certificate of revocation in duplicate; 14 (2) file one of the certificates in the commissioner's office; and 15 (3) mail one of the certificates of revocation to the limited liability 16 company at its registered office. 17 (d) Upon the issuance of the certificate of revocation, the authority of the 18 limited liability company to conduct affairs in this state ceases. 19 Sec. 10.50.653. APPEAL FROM REVOCATION OF REGISTRATION. If 20 the commissioner revokes the registration of a foreign limited liability company to 21 conduct affairs in this state under this chapter, the company may appeal to the superior 22 court. The court shall either sustain the action of the commissioner or direct the 23 commissioner to take action the court considers proper. 24 Sec. 10.50.655. AUTHORITY TO CANCEL REGISTRATION. A foreign 25 limited liability company registered in this state may cancel its registration by filing 26 an application for cancellation with the department. 27 Sec. 10.50.660. CONTENTS OF APPLICATION FOR CANCELLATION. 28 An application for cancellation filed by a foreign limited liability company must state 29 (1) the name of the company and the state or other jurisdiction where 30 the company was organized; 31 (2) that the company is not conducting affairs in this state;
01 (3) that the company cancels its registration in this state; 02 (4) that the company revokes the authority of its registered agent for 03 service of process in this state and consents that service of process may subsequently 04 be made on the company by service on the commissioner for a cause of action arising 05 in this state during the time the company was registered in this state; and 06 (5) an address for mailing a copy of a process to the company. 07 Sec. 10.50.665. FORM, MANNER, AND EXECUTION OF APPLICATION 08 FOR CANCELLATION. The application for cancellation must be in the form and 09 manner designated by the department and shall be signed on behalf of the foreign 10 limited liability company by 11 (1) a person with authority to sign the application under the law of the 12 state or other jurisdiction of its organization; or 13 (2) if the company is controlled by a receiver, trustee, or other 14 court-appointed fiduciary, by the receiver, trustee, or other fiduciary. 15 Sec. 10.50.670. EFFECT OF CANCELLATION OF REGISTRATION. The 16 cancellation of a registration under this chapter does not terminate the authority of the 17 commissioner to accept service of process on the foreign limited liability company 18 with respect to causes of action arising out of the company's conduct of affairs in this 19 state. 20 Sec. 10.50.675. CONDUCTING AFFAIRS WITHOUT REGISTRATION. (a) 21 A foreign limited liability company conducting affairs in this state may not maintain 22 an action or other proceeding in a court of this state until it has registered in this state. 23 (b) The failure of a foreign limited liability company to register in this state 24 does not 25 (1) impair the validity of a contract or act of the company; 26 (2) affect the right of another party to a contract of the company to 27 maintain an action or proceeding on the contract; or 28 (3) prevent the company from defending an action or other proceeding 29 in a court of this state. 30 Sec. 10.50.690. LIABILITY FOR FEES AND PENALTIES. A foreign limited 31 liability company that conducts affairs in this state without registration is liable to the
01 department for the following fees and penalties for the full or partial years when it 02 conducts affairs in this state without registration: 03 (1) the fees that would have been imposed by this chapter on the 04 company if the company had been registered under this chapter; or 05 (2) the penalties imposed by this chapter. 06 Sec. 10.50.700. CIVIL PENALTY. (a) A foreign limited liability company 07 that conducts affairs in this state without registration is subject to a civil penalty 08 payable to the state not to exceed $10,000 for each calendar year, including a partial 09 year, the company conducts affairs in this state without being registered under this 10 chapter. 11 (b) The civil penalty imposed in (a) of this section may be recovered in an 12 action brought in the superior court by the attorney general. 13 Sec. 10.50.710. INJUNCTIVE RELIEF. (a) Upon application to the court, 14 if a court finds that a foreign limited liability company has conducted affairs in this 15 state in violation of this chapter, the court may issue, in addition to imposing a civil 16 penalty, an injunction restraining the company from conducting further affairs in this 17 state and from further exercising the company's rights and privileges in this state. 18 (b) An injunction issued under (a) of this section may continue until the civil 19 penalties, interest, and court costs assessed by the court have been paid and until the 20 foreign limited liability company otherwise complies with this chapter. 21 Sec. 10.50.715. NONLIABILITY OF MEMBER OR MANAGER. A member 22 or manager of a foreign limited liability company is not liable for the debts and 23 obligations of the company solely because the company conducts affairs in this state 24 without registration. 25 Sec. 10.50.720. TRANSACTIONS NOT CONSTITUTING CONDUCTING 26 AFFAIRS. The activities of a foreign limited liability company that are not considered 27 to be conducting affairs in this state for the purposes of AS 10.50.600 - 10.50.720 28 include 29 (1) maintaining, defending, or settling a court action or other 30 proceeding or a claim; 31 (2) holding meetings of the members or managers of the company;
01 (3) maintaining bank accounts; 02 (4) selling through independent contractors; 03 (5) soliciting or procuring orders by mail, through employees, agents, 04 or otherwise, if the orders require acceptance outside the state before becoming binding 05 contracts; 06 (6) creating as borrower or lender, or acquiring, indebtedness or 07 mortgages or other security interests in real or personal property; 08 (7) securing or collecting debts, or enforcing rights in property securing 09 debts; 10 (8) conducting an isolated transaction that is completed within 30 days 11 and that is not part of a course of repeated transactions of a similar nature; or 12 (9) conducting affairs in interstate commerce. 13 ARTICLE 14. SUITS BY AND AGAINST LIMITED 14 LIABILITY COMPANIES. 15 Sec. 10.50.730. ACTIONS AGAINST COMPANIES. A court action may be 16 brought by or against a limited liability company. The court action may be brought 17 in the name of the company. 18 Sec. 10.50.735. AUTHORITY TO SUE ON BEHALF OF COMPANY. (a) 19 Except as provided in AS 10.50.320, and unless otherwise provided in an operating 20 agreement of the company, a person may not bring a court action on behalf of a 21 limited liability company in the name of the company unless the person is authorized 22 under (b) or (c) or this section to bring the action. 23 (b) Whether or not the company is managed by a manager, a member of a 24 limited liability company may bring a court action on behalf of the company in the 25 name of the company if the member is authorized to bring the action by more than 26 one-half of all of the members of the company who are eligible to consent to the 27 authorization, unless a larger number of the members are required under 28 AS 10.50.150(c) for the authorization. When determining whether the required number 29 of members consent under AS 10.50.150, the total number of all members does not 30 include a member who has an interest in the outcome of the action that is adverse to 31 the interest of the company and the member with the adverse interest is excluded from
01 determining the authorization. 02 (c) A manager of a limited liability company may bring a court action on 03 behalf of the company in the name of the company if the manager is authorized to 04 bring the action by the consent required under AS 10.50.150 of the members eligible 05 to consent to the authorization. When determining the number of managers required 06 to consent under AS 10.50.150, the number does not include a manager who has an 07 interest in the outcome of the action that is adverse to the interest of the company and 08 the manager with the adverse interest is excluded from determining the authorization. 09 ARTICLE 15. BIENNIAL REPORT. 10 Sec. 10.50.750. BIENNIAL REPORT REQUIRED. A limited liability 11 company and a foreign limited liability company conducting affairs in this state shall 12 file a biennial report within the time established by this chapter. 13 Sec. 10.50.755. CONTENTS OF BIENNIAL REPORT. A biennial report 14 must set out 15 (1) the name of the company and the state or country where it is 16 organized; 17 (2) the address of the registered office of the company in this state, and 18 the name of its registered agent in this state at that address, and, in the case of a 19 foreign limited liability company, the address of its principal office in the state or 20 country where it is organized; 21 (3) the names and addresses of the managers of the company, or, if the 22 company is not managed by a manager, the names and addresses of the members of 23 the company; 24 (4) the name and address of each person owning at least a five percent 25 interest in the company and the percentage of interest owned by that person in the 26 company. 27 Sec. 10.50.760. FILING OF BIENNIAL REPORT. (a) A biennial report 28 required by AS 10.50.750 shall be filed with the department and is due before 29 January 2 of the filing year. A limited liability company filing articles of organization 30 and a foreign limited liability company registering during an even-numbered year shall 31 file the biennial report each even-numbered year. A limited liability company filing
01 articles of organization and a foreign limited liability company registering during an 02 odd-numbered year shall file the biennial report each odd-numbered year. The biennial 03 report is delinquent if not filed before February 1 of each odd- or even-numbered year 04 as provided in this section. 05 (b) Proof to the satisfaction of the department that on or before February 1 the 06 report was deposited in the United States mail in a sealed envelope, properly addressed 07 with postage prepaid, is compliance with (a) of this section. 08 (c) The department shall file the report if it conforms to the requirements of 09 this chapter. If the department finds that the report does not conform to the 10 requirements of this chapter, the report shall promptly be returned to the company for 11 necessary corrections. 12 (d) Upon receipt of a form from the department, a limited liability company 13 shall file a biennial report within six months after original organization. 14 Sec. 10.50.765. FILING NOTICE OF CHANGE OF MANAGERS OR 15 MANAGING MEMBERS. (a) In the event of a change of the manager of a limited 16 liability company or of a foreign limited liability company registered under this 17 chapter, or of a member of the company, if the members manage the company, during 18 the first year of the biennial reporting period, the company shall file a notice of change 19 amending the biennial report of the company before the following January 2. 20 (b) The notice shall be filed with the department and shall state the name and 21 current mailing address of the manager or member not included in the company's last 22 filed biennial report, and the name of the person replaced and the office held. 23 ARTICLE 16. MISCELLANEOUS PROVISIONS. 24 Sec. 10.50.800. COMPANY CERTIFICATES. An operating agreement of a 25 limited liability company may authorize the company to issue a certificate as evidence 26 of a limited liability company interest. An operating agreement may also authorize 27 and provide for the assignment or transfer of the interest represented by the certificate. 28 Sec. 10.50.810. SUBMISSION OF DOCUMENTS TO DEPARTMENT. 29 When a document is required or allowed to be delivered to or filed with the 30 department under this chapter, the person delivering the document shall deliver to the 31 department the required fee, the original signed document, and an exact copy of the
01 document. 02 Sec. 10.50.820. FILING OF DOCUMENTS BY DEPARTMENT. (a) If the 03 department determines that a document filed under this chapter conforms to the filing 04 requirements of this chapter, the department shall 05 (1) mark on the original signed document and on the exact copy the 06 word "filed" and the date and time of the document's acceptance for filing; 07 (2) retain the original signed document in the department's files; and 08 (3) return the exact copy to the person who filed the document or to 09 the person's representative. 10 (b) The department may not file a document if the requirements of this section 11 are not met. 12 Sec. 10.50.830. DISAPPROVAL OF WRITING BY DEPARTMENT; 13 APPEAL. If the department fails to approve articles of organization, amendment, 14 merger, consolidation, or dissolution, or any other document required by this chapter 15 to be approved by the department, the department shall, within 10 days after the 16 delivery of the document to the department, give written notice of disapproval to the 17 person, limited liability company, or foreign limited liability company, delivering the 18 document, and specifying the reasons for disapproval. The person or company may 19 appeal the disapproval to the superior court. 20 Sec. 10.50.840. EXECUTION OF DOCUMENTS. (a) Unless otherwise 21 provided in this chapter, a document required by this chapter to be filed with the 22 department by or for a limited liability company shall be signed by 23 (1) a manager of the company if the company is managed by a 24 manager; 25 (2) a member of the company if the articles of organization do not 26 provide that the company is managed by a manager; 27 (3) a person organizing the company if the company is not organized; 28 (4) the fiduciary if the company is controlled by a receiver, trustee, or 29 other court-appointed fiduciary. 30 (b) A person signing a document filed with the department under this chapter 31 shall state beneath or opposite the signature the person's name and the capacity in
01 which the person signs. 02 (c) A person signing a document filed with the department under this chapter 03 may sign as an attorney-in-fact, but is not required to provide or file with the 04 department a document authorizing the person to act as attorney-in-fact for the signing 05 of a document. 06 Sec. 10.50.850. FILING AND OTHER FEES. The department shall charge 07 fees established by the department by regulation adopted under AS 44.62 08 (Administrative Procedure Act) for 09 (1) filing the original articles of organization; 10 (2) filing an amendment of registration; 11 (3) filing articles of merger or consolidation; 12 (4) filing articles of dissolution; 13 (5) issuing a document not otherwise covered by this section; 14 (6) furnishing a copy of a document; 15 (7) accepting an application for reservation of a name, or filing a notice 16 of the transfer or cancellation of a name reservation; 17 (8) filing a statement of change of address for a registered office or 18 registered agent; 19 (9) accepting service of a notice, demand, or process upon the 20 department; 21 (10) filing the application for registration of a foreign limited liability 22 company; 23 (11) registering a name, reserving a name, or renewing a name 24 registration under this chapter; or 25 (12) filing another document allowed or required under this chapter. 26 Sec. 10.50.860. MAINTENANCE OF RECORDS. Unless otherwise provided 27 in an operating agreement, a limited liability company shall keep at its main office 28 (1) current and past lists that state in alphabetical order the full name 29 and last known mailing address of every member and manager of the company; 30 (2) a copy of the company's articles of organization and amendments 31 to the articles, including a signed copy of a power of attorney used by a person who
01 signed articles of amendment for the company; 02 (3) a copy of the company's federal, state, and local income tax returns 03 and financial statements, if any, for the three most recent years or, if the returns and 04 statements are not prepared, a copy of the information and statements provided to, or 05 that should have been provided to, the members to enable the members to prepare their 06 federal, state, and local tax returns for the three-year period; 07 (4) a copy of any effective operating agreement of the company, 08 amendments to the agreement, and former operating agreements; 09 (5) unless contained in an operating agreement, 10 (A) a document stating the amount of cash contributed by a 11 member of the company, the agreed value of other property or services 12 contributed by a member, and when a member is to make additional 13 contributions; 14 (B) a document stating the events, if any, that cause the 15 company to be dissolved and its affairs wound up; and 16 (C) other documents that an operating agreement requires the 17 company to prepare. 18 Sec. 10.50.870. INSPECTION OF RECORDS. (a) A limited liability 19 company shall make its books and records of account, or certified copies of them, 20 reasonably available for inspection and copying at its registered office or principal 21 office in the state by a member of the company. Member inspection shall be upon 22 written demand stating with reasonable particularity the purpose of the inspection. The 23 inspection may be in person or by agent or attorney, at a reasonable time and for a 24 proper purpose. Only books and records of account, minutes, and the record of 25 members directly connected to the stated purpose of the inspection may be inspected 26 or copied. 27 (b) A manager, or, if the company is not managed by a manager, a member, 28 who, or a limited liability company that, refuses to allow a member, or the agent or 29 attorney of the member, to examine and make copies from its books and records of 30 account, minutes, and record of members, for a proper purpose, is liable to the member 31 for a penalty in the amount of 10 percent of the value of the limited liability company
01 interests owned by the member or $5,000, whichever is greater, in addition to other 02 damages or remedy given the member by law. It is a defense to an action for 03 penalties under this section that the person suing has within two years sold or offered 04 for sale a list of members of the company or any other limited liability company or 05 has aided or abetted a person in procuring a list of members for this purpose, or has 06 improperly used information secured through a prior examination of the books and 07 records of account, minutes, or record of members of the company or any other limited 08 liability company, or was not acting in good faith or for a proper purpose in making 09 the person's demand. 10 (c) Nothing in this chapter impairs the power of a court, upon proof by a 11 member of a demand properly made and for a proper purpose, to compel the 12 production for examination by the member of the books and records of account, 13 minutes, and record of members of a limited liability company. 14 Sec. 10.50.880. DISCLOSURE OF INFORMATION. The members of a 15 limited liability company, if the articles of organization do not provide that the 16 company is managed by a manager, or the manager of the company, if the articles of 17 organization provide that the company is managed by a manager, shall provide, to the 18 extent just and reasonable under the circumstances, true and full information of all 19 matters that affect the members of a company to a member or to the legal 20 representative of a deceased member or a member under a legal disability. 21 Sec. 10.50.890. WAIVER OF NOTICE. If notice is required to be given to 22 a member or manager of a limited liability company under the provisions of this 23 chapter or under the provisions of the articles of organization or an operating 24 agreement of the company, a waiver of the notice in writing signed by the person 25 entitled to notice, whether before or after the time stated for notice, is equivalent to 26 the giving of notice. 27 ARTICLE 17. GENERAL PROVISIONS. 28 Sec. 10.50.900. REGULATIONS. In addition to the regulations the 29 department is required to adopt under this chapter, the department may adopt other 30 regulations under AS 44.62 (Administrative Procedure Act) to implement this chapter. 31 Sec. 10.50.910. INTERSTATE APPLICATION. A limited liability company
01 that is organized and existing under this chapter may conduct its affairs and exercise 02 the powers granted by this chapter in another jurisdiction, subject to the laws of that 03 jurisdiction. 04 Sec. 10.50.990. DEFINITIONS. In this chapter, unless the context indicates 05 otherwise, 06 (1) "articles of organization" means the articles of organization filed 07 under AS 10.50.070 and the articles as amended or restated; 08 (2) "commissioner" means the commissioner of commerce and 09 economic development; 10 (3) "corporation" means a corporation organized under the laws of this 11 or another state, or of this or another country; 12 (4) "department" means the Department of Commerce and Economic 13 Development; 14 (5) "filed," unless expressly provided otherwise, means filed with the 15 department; 16 (6) "foreign limited liability company" means an organization that is 17 (A) not incorporated; 18 (B) organized under the law of a state other than this state, or 19 under the law of a foreign country; 20 (C) organized under a statute that affords to each of its 21 members limited liability regarding the liabilities of the organization; and 22 (D) not required to be registered under a statute of this state 23 other than this chapter; 24 (7) "interim distribution" means a distribution of the assets of a limited 25 liability company to the company's members, except as provided under AS 10.50.335 26 and 10.50.425; 27 (8) "know" means to have actual knowledge or to know other facts that 28 demonstrate bad faith in the circumstances; this definition applies also to the 29 derivatives of "know," including "known," "unknown," and "knowledge"; 30 (9) "limited liability company" or "domestic limited liability company" 31 means an organization organized under this chapter;
01 (10) "limited liability company interest" means an interest in a limited 02 liability company issued under AS 10.50.275; 03 (11) "limited partnership" means a limited partnership organized under 04 AS 32.11 or under the law of another state or a foreign country; 05 (12) "manager" means a person who manages a limited liability 06 company, if the articles of organization provide that the company is managed by a 07 manager; 08 (13) "managing member" means a member of a limited liability 09 company if the company's articles of organization do not provide that the company is 10 managed by a manager; 11 (14) "member" means a person who has been admitted to membership 12 in a limited liability company under AS 10.50.155 - 10.50.160 and whose membership 13 has not terminated under AS 10.50.180 - 10.50.185 or 10.50.205 - 10.50.225; 14 (15) "operating agreement" means a written agreement among all of the 15 members of a limited liability company about conducting the affairs of the company; 16 (16) "property" includes cash; 17 (17) "state" means a state, territory, or possession of the United States, 18 and includes the District of Columbia, the Commonwealth of Puerto Rico, the Northern 19 Mariana Islands, Guam, the Virgin Islands, American Samoa, and the Trust Territory 20 of the Pacific Islands. 21 Sec. 10.50.995. SHORT TITLE. This chapter may be cited as the Alaska 22 Limited Liability Act. 23 * Sec. 2. AS 10.06.105(c) is amended to read: 24 (c) A person may not adopt a name that contains the word "corporation", 25 "incorporated", or "limited", or an abbreviation of one of these words, unless the 26 person has been issued a certificate of incorporation, or, in the case of a foreign 27 corporation, a certificate of authority, by the commissioner. This subsection does not 28 prohibit a limited liability company or a limited partnership from using the word 29 "limited" or an abbreviation of "limited" in its name. 30 * Sec. 3. AS 45.55.130(12) is amended to read: 31 (12) "security" means a note; stock; treasury stock; bond; debenture;
01 evidence of indebtedness; certificate of interest or participation in any profit-sharing 02 agreement; a limited liability company interest under AS 10.50; collateral-trust 03 certificates; preorganization certificate or subscription; transferable share; investment 04 contract; voting-trust certificate; certificate of deposit for a security; a certificate of 05 interest or participation in an oil, gas, or mining title or lease or in payments out of 06 production under the title or lease or in any sale of or indenture or bond or contract 07 for the conveyance of land or any interest in land; an option on a contract for the 08 future delivery of agricultural or mineral commodities or any other commodity offered 09 or sold to the public and not regulated by the Commodity Futures Trading 10 Commission; however, the contract or option is not subject to the provisions of 11 AS 45.55.070 if it is sold or purchased on the floor of a bona fide exchange or board 12 of trade and offered or sold to the public by a broker-dealer or agent registered under 13 this chapter; investment of money or money's worth including goods furnished or 14 services performed in the risk capital of a venture with the expectation of some benefit 15 to the investor where the investor has no direct control over the investment or policy 16 decision of the venture; or, in general, any interest or instrument commonly known as 17 a "security," or any certificate of interest or participation in, temporary or interim 18 certificate for, receipt for, guarantee of, or warrant or right to subscribe to or purchase, 19 any of the foregoing; "security" does not include an insurance or endowment policy 20 or annuity contract under which an insurance company promises to pay a fixed or 21 variable sum of money either in a lump sum or periodically for life or for some other 22 specified period; 23 * Sec. 4. This Act takes effect January 1, 1995.