91
st Legislative Session _ 2016
Committee: House Judiciary
Wednesday, February 17, 2016
P - Present
E - Excused
A - Absent
Roll Call
P DiSanto
P Gibson
P Haugaard
P Hunt
P Johns
P Killer
P Langer
P Latterell
P Peterson (Kent)
P Russell
P Westra
P Stevens, Vice-Chair
P Mickelson, Chair
OTHERS PRESENT: See Original Minutes
The meeting was called to order by Representative Mark Mickelson, Chair.
MOTION: TO APPROVE THE MINUTES OF WEDNESDAY FEBRUARY 10, 2016
Moved by: Peterson (Kent)
Second by: Gibson
Action: Prevailed by voice vote.
HB 1167: revise certain provisions regarding the use of a suspended imposition of sentence
for a misdemeanor and a felony.
Presented by: Representative Haugaard
Proponents: Paul Bachand, States Attorney Association
MOTION: AMEND HB 1167
1167yb
On the printed bill, delete everything after the enacting clause and insert:
" Section 1. That § 23A-27-13 be amended to read:
23A-27-13. Upon receiving a verdict or plea of guilty for a misdemeanor or felony not
punishable by death or life imprisonment by a person never before convicted of a crime which at the
time of conviction thereof would constitute a felony in this state, a court having jurisdiction of the
defendant, if satisfied that the ends of justice and the best interest of the public as well as the
defendant will be served thereby, may, without entering a judgment of guilt, and with the consent
of the defendant, suspend the imposition of sentence and place the defendant on probation for such
period and upon such terms and conditions as the court may deem best. No person who has
previously been granted, whether in this state or any other, a suspended imposition of sentence for
a felony, is eligible to be granted a second suspended imposition of sentence for a felony. A court
may revoke such suspension at any time during the probationary period and impose and execute
sentence without diminishment or credit for any of the probationary period.
Section 2. That the code be amended by adding a NEW SECTION to read:
Upon receiving a verdict or plea of guilty for a misdemeanor, a court having jurisdiction of the
defendant, if satisfied that the ends of justice and the best interest of the public as well as the
defendant will be served thereby, may, without entering a judgment of guilt, and with the consent
of the defendant, suspend the imposition of sentence and place the defendant on probation for such
period and upon such terms and conditions as the court may deem best. No person who has
previously been granted, whether in this state or any other, a suspended imposition of sentence for
a misdemeanor, is eligible to be granted a second suspended imposition of sentence for a
misdemeanor. A court may revoke such suspension at any time during the probationary period and
impose and execute sentence without diminishment or credit for any of the probationary period."
Moved by: Peterson (Kent)
Second by: Langer
Action: Prevailed by voice vote.
MOTION: DO PASS HB 1167 AS AMENDED
Moved by: Langer
Second by: Johns
Action: Prevailed by roll call vote. (10-0-3-0)
Voting Yes: DiSanto, Gibson, Haugaard, Johns, Killer, Langer, Peterson (Kent), Russell, Stevens,
Mickelson
Excused: Hunt, Latterell, Westra
MOTION: PLACE HB 1167 ON CONSENT CALENDAR
Moved by: Langer
Second by: Johns
Action: Failed by voice vote.
HB 1068: adopt the South Dakota Nonprofit Corporation Act.
Presented by: Representative Stevens
MOTION: AMEND HB 1068
1068rc
On the printed bill, delete everything after the enacting clause and insert:
" Section 1. That § 47-22-4 be amended to read:
47-22-4. Corporations may be organized under this chapter for any lawful purpose, including,
but not limited to, any one or more of the following purposes:
(1) Agricultural;
(2) Animal husbandry;
(3) Athletic;
(4) Benevolent;
(5) Charitable;
(6) Civic;
(7) Cultural;
(8) Educational;
(9) Eleemosynary;
(10) Fraternal;
(11) Horticultural;
(12) Literary;
(13) Patriotic;
(14) Political;
(15) Religious;
(16) Scientific;
(17) Social; and
(18) Professional, commercial, industrial, or trade association. However, labor unions,
cooperative organizations, other than housing cooperatives, communals, and
organizations subject to any of the provisions of the banking laws of this state may not be
organized under this chapter. Notwithstanding any other provision of this title, any
insurance organization formed under this chapter is subject to Title 58.
Section 2. That § 47-22-5 be amended to read:
47-22-5. Three One or more natural persons of the age of majority may act as incorporators of
a corporation by delivering to the secretary of state the articles of incorporation for such corporation.
Delivery may be made by electronic transmission if and to the extent permitted by the Office of the
Secretary of State. If the document is filed in typewritten or printed form and not transmitted
electronically, the Office of the Secretary of State may require one exact or conformed copy to be
delivered with the document.
Section 3. That chapter 47-22 be amended by adding a NEW SECTION to read:
Notwithstanding any provision to the contrary in chapters 47-22 to 47-28, inclusive, filings with
the Office of Secretary of State may be made by electronic transmission if and to the extent permitted
by the Office of Secretary of State.
Section 4. That chapter 47-22 be amended by adding a NEW SECTION to read:
Notwithstanding any provision to the contrary in chapters 47-22 to 47-28, inclusive, filings with
the Office of Secretary of State may specify delayed effective time and date, and if it does so the
document becomes effective at the time and date specified. If a delayed effective date is indicated,
but no time is specified, the document is effective at the close of business on that date. A delayed
effective date for a document may not be later than the ninetieth day after the date it is filed.
Section 5. That § 47-23-2.1 be amended to read:
47-23-2.1. No director, trustee, committee member, or officer serving without compensation,
other than reimbursement for actual expenses, of any corporation organized under this chapter or
under similar laws of another state, and which is exempt from taxation pursuant to Section 501(a)
of the Internal Revenue Code, 26 U.S.C. Section 501(a) and is listed as an exempt organization in
Section 501(c) of the Internal Revenue Code, 26 U.S.C. Section 501(c), or any hospital organized
pursuant to chapter 34-8, 34-9, or 34-10 is liable, and no cause of action may be brought, for
damages resulting from the exercise of judgment or discretion in connection with the duties or
responsibilities of such director, trustee, committee member, or officer while acting in an official
capacity as such director, trustee, committee member, or officer, unless the act or omission involved
willful or wanton misconduct. The immunity provided by this section applies to any member of an
advisory board, serving without compensation, other than reimbursement for actual expenses, of any
corporation described by this section.
Section 6. That § 47-23-4 be amended to read:
47-23-4. An annual meeting of the members of a corporation shall be held at such time as may
be provided in the bylaws. Failure to hold the annual meeting at the designated time shall not work
a forfeiture or dissolution of the corporation. The articles of incorporation or bylaws may provide
that an annual or regular meeting of members does not need to be held at a geographic location and
may instead be held by any means of electronic communication which allows the members to read
or hear the proceedings substantially concurrently with their occurrence, vote on matters submitted
to the members, pose questions, and make comments.
Section 7. That § 47-23-6 be amended to read:
47-23-6. Any action required by chapters 47-22 to 47-28, inclusive, to be taken at a meeting of
the members or directors of a corporation, or any action which may be taken at a meeting of the
members or directors or of a committee of directors, may be taken without a meeting if a consent in
writing, setting forth the action so taken, shall be signed by all the members entitled to vote with
respect to the subject matter thereof, or all of the directors, or all of the members of the committee
of directors, as the case may be. If permitted in the articles of incorporation or the bylaws, such
consent and signature may be transmitted by any reasonable means including, but not limited to,
traditional mail, hand delivery, email, or electronic facsimile.
Such consent shall have the same force and effect as a unanimous vote, and may be stated as such
in any articles or document filed with the secretary of state under chapters 47-22 to 47-28, inclusive.
Section 8. That § 47-23-7 be amended to read:
47-23-7. Unless otherwise provided in the articles of incorporation or the bylaws, written notice
stating the place, day, and hour of the meeting and, in the case of a special meeting, the purpose or
purposes for which the meeting is called, shall be delivered not less than ten nor more than fifty days
before the date of the meeting, either personally or by mail, by or at the direction of the president,
or the secretary, or the officers or persons calling the meeting, to each member entitled to vote at
such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United
States mail addressed to the member at his address as it appears on the records of the corporation,
with postage thereon prepaid. If permitted in the articles of incorporation or the bylaws, notice of
meetings may be given by any reasonable means including, but not limited to, traditional mail, hand
delivery, email, or electronic facsimile.
Section 9. That § 47-23-9 be amended to read:
47-23-9. A member entitled to vote may vote in person or, unless the articles of incorporation
or the bylaws otherwise provide, may vote by proxy executed in writing by the member or by his
duly authorized attorney in fact. No proxy shall be valid after eleven months from the date of its
execution, unless otherwise provided in the proxy.
Where directors or officers are to be elected by
members, the bylaws may provide that such elections may be conducted by mail. Except as otherwise
provided in the articles of incorporation or bylaws, any action that may be taken at any annual,
regular, or special meeting of members may be taken without a meeting if the corporation delivers
a ballot to every member entitled to vote on the matter. Each ballot must:
(1) Set forth each proposed action;
(2) Provide an opportunity to vote for or against, or withhold a vote for, each proposed
action;
(3) Be delivered to each member by any means of transmission set forth in the bylaws or
articles of incorporation. If no method is set forth in the bylaws or articles of
incorporation, ballots may be delivered by any reasonable means, including, but not
limited to, traditional mail, hand delivery, email, or electronic facsimile;
(4) Indicate the number of responses needed to meet the quorum requirements;
(5) State the percentage of approvals necessary to approve each matter other than election of
directors; and
(6) Specify the time by which a ballot must be received in order to be counted.
Unless otherwise provided in the articles of incorporation or bylaws, approval by ballot, pursuant
to this section, of action other than election of directors is valid only when the number of votes cast
by ballot equals or exceeds the quorum required to be present at a meeting authorizing the action,
and the number of approvals equals or exceeds the number of votes that would be required to
approve the matter at a meeting at which the total number of votes cast was the same as the number
of votes cast by ballot. Except as otherwise provided in the articles of incorporation or bylaws, a
ballot may not be revoked.
Section 10. That § 47-23-13 be amended to read:
47-23-13. The Except as authorized by § 47-23-22, the affairs of a corporation shall be managed
by a board of directors. Directors need not be members of the corporation unless the articles of
incorporation or the bylaws so require. The articles of incorporation or the bylaws may prescribe
other qualifications for directors.
Section 11. That § 47-23-22 be amended to read:
47-23-22. If the articles of incorporation or the bylaws so provide, the board of directors
, by
resolution adopted by a majority of the directors in office, may designate one or more committees
each of which shall consist of
two one or more directors
, which and such additional members as
specified in the resolution which such additional members need not be a director or member of the
nonprofit corporation, or resident of the state. Such committees, to the extent provided in such
resolution, in the articles of incorporation or in the bylaws of the corporation, shall have and exercise
the authority or function of the board of directors in the management of the corporation; but the. The
designation of such committees and the delegation thereto of authority shall not operate to relieve
the board of directors, or any individual director of any responsibility imposed upon it or him any
individual director by law except those responsibilities related to the authority or function the
committee is authorized to exercise. Other committees not having and exercising the authority of the
board of directors in the management of the corporation may be designated by a resolution adopted
by a majority of the directors present at a meeting at which a quorum is present. Members of
committees created under this section have the same rights of indemnification and immunity as are
provided to the board of directors in chapters 47-22 to 47-28, inclusive, unless otherwise provided
in the articles of incorporation or bylaws.
Section 12. That § 47-24-1 be amended to read:
47-24-1. Each corporation shall keep correct and complete books and records of account and
shall keep minutes of the proceedings of its members, board of directors, and committees having any
of the authority of the board of directors; and shall keep at its registered office or principal office a
record of the names and addresses of its members entitled to vote. If authorized by the articles of
incorporation or bylaws, the records required by this section may be kept in electronic format.
Section 13. That § 47-24-17 be amended to read:
47-24-17. Upon At least ten days prior to the sale, transfer, conversion, or merger of at least
thirty percent of the assets of a nonprofit corporation, the corporation shall give written notice to the
attorney general. The following information shall, within sixty days of such sale, transfer, or merger,
be submitted to the secretary of state:
(1) Name and address of the parties involved in the sale, transfer, conversion, or merger;
(2) Terms and conditions of the sale, transfer, conversion, or merger;
(3) Dollar value of the assets being sold, transferred, converted, or merged, including an
account of how the value was determined; and
(4) An explanation of how the sale, transfer, conversion, or merger furthers the purpose of
the nonprofit corporation.
The information shall be submitted on forms provided by the secretary of state.
Section 14. That the code be amended by adding a NEW SECTION to read:
At least ten days prior to a meeting to dissolve under chapter 47-26, or conversion from a
nonprofit corporation to a domestic business corporation or other business entity authorized by law,
the corporation shall provide notice to the attorney general which notice shall include a copy of the
plan for distribution of assets required pursuant to § 47-26-6 or plan of conversion pursuant to
section 23 or 24 of this Act.
Section 15. That the code be amended by adding a NEW SECTION to read:
If so provided in the articles of incorporation or bylaws of the corporation, any written notice
required to be provided to any member or director pursuant to any provision of chapters 47-22 to
47-28, inclusive, may be sent by any reasonable means of transmission set forth in the articles of
incorporation or bylaws of the corporation, including, but not limited to, traditional mail, hand
delivery, email, or electronic facsimile.
Section 16. That the code be amended by adding a NEW SECTION to read:
Terms used in sections 16 to 37, inclusive, of this Act, mean:
(1) "Conversion," a transaction authorized by sections 23 to 37, inclusive, of this Act;
(2) "Converting corporation," the domestic or foreign nonprofit or business corporation that
approves a conversion pursuant to sections 23 to 37, inclusive, of this Act, or the
applicable laws of the foreign jurisdiction;
(3) "Converting entity," the domestic or foreign entity that approves a conversion pursuant
to sections 23 to 37, inclusive, of this Act;
(4) "Domesticated corporation," the domesticating corporation as it continues in existence
after a domestication;
(5) "Domesticating corporation," the domestic nonprofit corporation that adopts a plan of
domestication pursuant to sections 18 to 22, inclusive, of this Act, or the foreign nonprofit
corporation that approves a domestication pursuant to the applicable laws of the foreign
jurisdiction;
(6) "Domestication," a transaction authorized by sections 18 to 22, inclusive, of this Act;
(7) "Surviving corporation," the corporation as it continues in existence immediately after
consummation of a for-profit conversion pursuant to sections 18 to 37, inclusive, of this
Act;
(8) "Surviving entity," the unincorporated entity as it continues in existence immediately after
consummation of an entity conversion pursuant to sections 18 to 37, inclusive, of this Act.
Section 17. That the code be amended by adding a NEW SECTION to read:
If a domestic or foreign nonprofit corporation may not be a party to a merger or sale of its assets
without the approval of the attorney general, the Division of Insurance, or the Public Utilities
Commission, the corporation may not be a party to a conversion or domestication without the prior
approval of that agency.
Section 18. That the code be amended by adding a NEW SECTION to read:
(a) A foreign nonprofit corporation may become a domestic nonprofit corporation only if the
domestication is authorized by the laws of the foreign jurisdiction.
(b) A domestic nonprofit corporation may become a foreign nonprofit corporation if the
domestication is permitted by the laws of the foreign jurisdiction. Regardless of whether the
laws of the foreign jurisdiction require the adoption of a plan of domestication, the domestication
must be approved by the adoption by the corporation of a plan of domestication.
(c) The plan of domestication must include:
(1) A statement of the jurisdiction in which the corporation is to be domesticated;
(2) The terms and conditions of the domestication;
(3) The manner and basis of canceling or reclassifying the memberships of the corporation
following its domestication into memberships, obligations, rights to acquire memberships,
cash, other property, or any combination of the foregoing; and
(4) Any desired amendments to the articles of incorporation or bylaws of the corporation
following its domestication.
(d) The plan of domestication may also include a provision that the plan may be amended prior
to filing the document required by the laws of this state or the other jurisdiction to consummate the
domestication; except that, subsequent to approval of the plan by the members, the plan may not be
amended without the approval of the members to change:
(1) The amount or kind of memberships, obligations, rights to acquire memberships, cash,
or other property to be received by the members under the plan;
(2) The articles of incorporation to be in effect immediately following the domestication; or
(3) Any of the other terms or conditions of the plan if the change would adversely affect any
of the members in any material respect.
(e) If any debt security, note or similar evidence of indebtedness for money borrowed, whether
secured or unsecured, or a contract of any kind, issued, incurred or executed by a domestic nonprofit
corporation before the effective date of this Act contains a provision applying to a merger of the
corporation and the document does not refer to a domestication of the corporation, the provision
shall be deemed to apply to a domestication of the corporation until such time as the provision is
amended subsequent to that date.
Section 19. That the code be amended by adding a NEW SECTION to read:
In the case of a domestication of a domestic nonprofit corporation in a foreign jurisdiction:
(1) The plan of domestication must be adopted by the board of directors;
(2) After adopting the plan of domestication the board of directors must submit the plan to
the members for their approval, if there are members entitled to vote on the plan. The
board of directors must also transmit to the members a recommendation that the members
approve the plan, unless the board of directors makes a determination that because of
conflicts of interest or other special circumstances it should not make such a
recommendation, in which case the board of directors must transmit to the members the
basis for that determination;
(3) The board of directors may condition its submission of the plan of domestication to the
members on any basis;
(4) If the approval of the members is to be given at a meeting, the corporation must notify
each member, whether or not entitled to vote, of the meeting of members at which the
plan of domestication is to be submitted for approval. The notice must state that the
purpose, or one of the purposes, of the meeting is to consider the plan and must contain
or be accompanied by a copy or summary of the plan. The notice must include or be
accompanied by a copy of the proposed articles of incorporation and bylaws to be in effect
immediately after the domestication;
(5) Unless the articles of incorporation or bylaws, or the board of directors acting pursuant
to subdivision (3) of this section, requires a greater vote or a greater number of votes to
be present, the approval of the plan of domestication by the members requires the
approval of the members at a meeting at which a quorum exists, and, if any class of
members is entitled to vote as a separate group on the plan, the approval of each such
separate class at a meeting at which a quorum of the class exists;
(6) Separate voting by classes is required by each class of members that:
(i) Are to be reclassified under the plan of domestication into a different class of
memberships, or into obligations, rights to acquire memberships, cash, other
property, or any combination of the foregoing;
(ii) Would be entitled to vote as a separate group on a provision of the plan that, if
contained in a proposed amendment to articles of incorporation, would require
action by separate classes; or
(iii) Is entitled under the articles of incorporation or bylaws to vote as a class to approve
an amendment of the articles of incorporation;
(7) If any provision of the articles of incorporation, bylaws, or an agreement to which any of
the directors, members of a designated body, or members are parties, adopted or entered
into before the effective date of this Act, applies to a merger of the corporation and that
document does not refer to a domestication of the corporation, the provision shall be
deemed to apply to a domestication of the corporation until such time as the provision is
amended subsequent to that date.
Section 20. That the code be amended by adding a NEW SECTION to read:
(a) Articles of domestication must be signed on behalf of the domesticating corporation by
any officer or other duly authorized representative. The articles of domestication must set forth:
(1) The name and jurisdiction of incorporation of the domesticating corporation;
(2) The name and jurisdiction of incorporation of the domesticated entity; and
(3) If the domesticating corporation is a domestic nonprofit corporation, a statement that the
plan of domestication was approved in accordance with the laws of this state, or, if the
domesticating corporation is a foreign nonprofit corporation, a statement that the
domestication was approved in accordance with the laws of its jurisdiction of
incorporation.
(b) If the domesticated corporation is a domestic nonprofit corporation, the articles of
domestication shall contain all of the provisions required to be contained in the articles of
incorporation of a nonprofit corporation as set forth in § 47-22-6. The name of the domesticated
corporation must satisfy the requirements of §§ 47-22-7 and 47-22-8.1.
(c) The articles of domestication must be delivered to the Office of the Secretary of State for
filing.
(d) If the domesticating corporation is a qualified foreign nonprofit corporation, its certificate of
authority is cancelled automatically on the effective date of its domestication.
Section 21. That the code be amended by adding a NEW SECTION to read:
(a) Except as otherwise prohibited by law, when a domestication becomes effective:
(1) The title to all real and personal property, both tangible and intangible, of the
domesticating corporation remains in the domesticated corporation without reversion or
impairment;
(2) The liabilities of the domesticating corporation remain the liabilities of the domesticated
corporation;
(3) An action or proceeding pending against the domesticating corporation continues against
the domesticated corporation as if the domestication had not occurred;
(4) The articles of domestication, or the articles of incorporation attached to the articles of
domestication, constitute the articles of incorporation of a foreign corporation
domesticating in this state;
(5) The memberships in the domesticating corporation are reclassified into memberships,
obligations, rights to acquire memberships, or cash or other property in accordance with
the terms of the domestication, and the members are entitled only to the rights provided
by those terms; and
(6) The domesticating corporation is deemed to:
(i) Be incorporated under and subject to the same body of law of as the domesticated
corporation for all purposes; and
(ii) Be the same corporation without interruption as the domesticating corporation.
(b) The personal liability of a member in a foreign nonprofit corporation that is domesticated in
this state is as follows:
(1) The domestication does not discharge any personal liability under the laws of the foreign
jurisdiction to the extent any such personal liability arose before the effective time of the
articles of domestication;
(2) The member does not have personal liability under the laws of the foreign jurisdiction for
any debt, obligation, or liability of the corporation that arises after the effective time of
the articles of domestication;
(3) The provisions of the laws of the foreign jurisdiction continue to apply to the collection
or discharge of any personal liability preserved by subdivision (1), as if the domestication
had not occurred;
(4) The member has whatever rights of contribution from other members are provided by the
laws of the foreign jurisdiction with respect to any personal liability preserved by
subdivision (1), as if the domestication had not occurred.
Section 22. That the code be amended by adding a NEW SECTION to read:
(a) Unless otherwise provided in a plan of domestication of a domestic nonprofit corporation,
after the plan has been adopted and approved, and at any time before the domestication has become
effective, it may be abandoned by the board of directors without action by the members.
(b) If a domestication is abandoned under paragraph (a) after articles of domestication have been
filed with the Office of the Secretary of State but before the domestication has become effective, a
statement that the domestication has been abandoned in accordance with this section, signed by an
officer or other duly authorized representative, must be delivered to the Office of the Secretary of
State for filing prior to the effective date of the domestication. The statement takes effect upon filing
and the domestication is abandoned and does not become effective.
(c) If the domestication of a foreign nonprofit corporation in this state is abandoned in
accordance with the laws of the foreign jurisdiction after articles of domestication are filed with the
Office of the Secretary of State, a statement that the domestication has been abandoned, signed by
an officer or other duly authorized representative, must be delivered to the Office of the Secretary
of State for filing. The statement takes effect upon filing and the domestication is abandoned and
does not become effective.
Section 23. That the code be amended by adding a NEW SECTION to read:
(a) A domestic nonprofit corporation may become a domestic business corporation pursuant to
a plan of for-profit conversion.
(b) A domestic nonprofit corporation may become a foreign business corporation if the for-profit
conversion is permitted by the laws of the foreign jurisdiction. Regardless of whether the laws of the
foreign jurisdiction require the adoption of a plan of for-profit conversion, the foreign for-profit
conversion shall be approved by the adoption by the domestic nonprofit corporation of a plan of
for-profit conversion.
(c) The plan of for-profit conversion must include:
(1) The terms and conditions of the conversion;
(2) The manner and basis of:
(i) Issuing at least one share in the corporation following its conversion; and
(ii) Otherwise reclassifying the memberships in the corporation, if any, following its
conversion into shares and other securities, obligations, rights to acquire shares or
other securities, cash, other property, or any combination of the foregoing;
(3) Any desired amendments to the articles of incorporation or bylaws of the corporation
following its conversion; and
(4) If the domestic nonprofit corporation is to be converted to a foreign business corporation,
a statement of the jurisdiction in which the corporation will be incorporated after the
conversion.
(d) The plan of for-profit conversion may also include a provision that the plan may be amended
prior to filing articles of for-profit conversion, except that subsequent to approval of the plan by the
members the plan may not be amended without the approval of the members to change:
(1) The amount or kind of shares and other securities, obligations, rights to acquire shares or
other securities, cash, or other property to be received by the members under the plan;
(2) The articles of incorporation to be in effect immediately following the conversion; or
(3) Any of the other terms or conditions of the plan if the change would adversely affect any
of the members in any material respect.
(e) If any debt security, note, or similar evidence of indebtedness for money borrowed, whether
secured or unsecured, or a contract of any kind, issued, incurred, or executed by a domestic nonprofit
corporation before the effective date of this Act contains a provision applying to a merger of the
corporation and the document does not refer to a for-profit conversion of the corporation, the
provision shall be deemed to apply to a for-profit conversion of the corporation until such time as
the provision is amended subsequent to that date.
(f) The attorney general shall be provided with notice of the proposed for-profit conversion at
least ten days prior to any conversion.
Section 24. That the code be amended by adding a NEW SECTION to read:
In the case of a conversion of a domestic nonprofit corporation to a domestic or foreign business
corporation:
(1) The plan of for-profit conversion must be adopted by the board of directors;
(2) After adopting the plan of for-profit conversion, the board of directors must submit the
plan to the members for their approval if there are members entitled to vote on the plan.
The board of directors must also transmit to the members a recommendation that the
members approve the plan, unless the board of directors makes a determination that
because of conflicts of interest or other special circumstances it should not make such a
recommendation, in which case the board of directors must transmit to the members the
basis for that determination;
(3) The board of directors may condition its submission of the plan of for-profit conversion
to the members on any basis;
(4) If the approval of the members is to be given at a meeting, the corporation must notify
each member of the meeting of members at which the plan of for-profit conversion is to
be submitted for approval. The notice must state that the purpose, or one of the purposes,
of the meeting is to consider the plan and must contain or be accompanied by a copy or
summary of the plan. The notice shall include or be accompanied by a copy of the
proposed articles of incorporation to be in effect immediately after the for-profit
conversion;
(5) Unless the articles of incorporation, or the board of directors acting pursuant to
subdivision (3), require a greater vote or a greater number of votes to be present, the
approval of the plan of for-profit conversion by the members requires the approval of each
class of members of the corporation voting as a separate class at a meeting at which a
quorum of the class exists; and
(6) If any provision of the articles of incorporation, bylaws, or an agreement to which any of
the directors or members are parties, adopted or entered into before the effective date of
this Act, applies to a merger of the corporation and the document does not refer to a
for-profit conversion of the corporation, the provision shall be deemed to apply to a
for-profit conversion of the corporation until such time as the provision is amended
subsequent to that date.
Section 25. That the code be amended by adding a NEW SECTION to read:
(a) Articles of for-profit conversion must be signed on behalf of the converting corporation by
any officer or other duly authorized representative. The articles must set forth:
(1) If the surviving corporation is a domestic business corporation, the name of the
corporation immediately before the filing of the articles of for-profit conversion and if that
name does not satisfy the requirements of the business corporation act, or the corporation
desires to change its name in connection with the conversion, a name that satisfies the
requirements of the business corporation act;
(2) If the surviving corporation is a foreign business corporation, its name after the
conversion and its jurisdiction of incorporation; and
(3) A statement that the plan of for-profit conversion was duly approved by the members in
the manner required by this Act and the articles of incorporation.
(b) If the surviving corporation is a domestic business corporation, the articles of for-profit
conversion shall either contain all of the provisions that the business corporation act requires to be
set forth in the articles of incorporation of a domestic business corporation and any other desired
provisions permitted by the business corporation act, or shall have attached articles of incorporation
that satisfy the requirements of the business corporation act. In either case, provisions that would not
be required to be included in restated articles of incorporation of a domestic business corporation
may be omitted, except that the name and address of the initial registered agent of the business
corporation must be included.
(c) The articles of for-profit conversion must be delivered to the Office of the Secretary of State
for filing.
Section 26. That the code be amended by adding a NEW SECTION to read:
(a) Except as otherwise prohibited by law, when a conversion of a domestic nonprofit
corporation to a domestic or foreign business corporation becomes effective:
(1) The title to all real and personal property, both tangible and intangible, of the corporation
remains in the corporation without reversion or impairment;
(2) The liabilities of the corporation remain the liabilities of the corporation;
(3) An action or proceeding pending against the corporation continues against the corporation
as if the conversion had not occurred;
(4) The articles of incorporation of the domestic or foreign business corporation become
effective;
(5) The memberships of the corporation are reclassified into shares or other securities,
obligations, rights to acquire shares or other securities, or into cash or other property in
accordance with the plan of conversion, and the members are entitled only to the rights
provided in the plan of for-profit conversion; and
(6) The corporation is deemed to:
(i) Be a domestic or foreign business corporation for all purposes; and
(ii) Be the same corporation without interruption as the nonprofit corporation.
(b) The personal liability of a member in a domestic nonprofit corporation that converts to a
domestic business corporation is as follows:
(1) The conversion does not discharge any personal liability of the member as a member of
the nonprofit corporation to the extent any such personal liability arose before the
effective time of the articles of for-profit conversion;
(2) The member does not have personal liability for any debt, obligation, or liability of the
business corporation that arises after the effective time of the articles of for-profit
conversion;
(3) The laws of this state continue to apply to the collection or discharge of any personal
liability preserved by subdivision (1), as if the conversion had not occurred;
(4) The member has whatever rights of contribution from other members are provided by the
laws of this state with respect to any personal liability preserved by subdivision (1), as if
the conversion had not occurred.
(c) A member who becomes subject to personal liability for some or all of the debts, obligations,
or liabilities of the business corporation has personal liability only for those debts, obligations, or
liabilities of the business corporation that arise after the effective time of the articles of for-profit
conversion.
Section 27. That the code be amended by adding a NEW SECTION to read:
(a) Unless otherwise provided in a plan of for-profit conversion of a domestic nonprofit
corporation, after the plan has been adopted and approved, and at any time before the for-profit
conversion has become effective, it may be abandoned by the board of directors without action by
the members.
(b) If a for-profit conversion is abandoned under paragraph (a) after articles of for-profit
conversion are filed with the Office of the Secretary of State but before the for-profit conversion has
become effective, a statement that the for-profit conversion has been abandoned in accordance with
this section, signed by an officer or other duly authorized representative, must be delivered to the
Office of the Secretary of State for filing prior to the effective date of the for-profit conversion. The
statement takes effect upon filing and the for-profit conversion is abandoned and does not become
effective.
Section 28. That the code be amended by adding a NEW SECTION to read:
A foreign business corporation may become a domestic nonprofit corporation if the
domestication and conversion is permitted by the laws of the foreign jurisdiction.
Section 29. That the code be amended by adding a NEW SECTION to read:
(a) After the conversion of a foreign business corporation to a domestic nonprofit corporation
is authorized as required by the laws of the foreign jurisdiction, articles of domestication and
conversion shall be signed by any officer or other duly authorized representative. The articles shall
set forth:
(1) The name of the corporation immediately before the filing of the articles of domestication
and conversion and, if that name is unavailable for use in this state or the corporation
desires to change its name in connection with the domestication and conversion, a name
that satisfies the requirements §§ 47-22-7 and 47-22-8.1;
(2) The jurisdiction of incorporation of the corporation immediately before the filing of the
articles of domestication and conversion and the date the corporation was incorporated
in that jurisdiction; and
(3) A statement that the domestication and conversion of the corporation in this state was
duly authorized as required by the laws of the jurisdiction in which the corporation was
incorporated immediately before its domestication and conversion in this state.
(b) The articles of domestication and conversion shall contain all of the provisions required to
be contained in the articles of incorporation of a nonprofit corporation as set forth in § 47-22-6. The
name of the domesticated corporation must satisfy the requirements of §§ 47-22-7 and 47-2-2-8.1.
(c) The articles of domestication and conversion must be delivered to the Office of the Secretary
of State for filing.
Section 30. That the code be amended by adding a NEW SECTION to read:
(a) When a domestication and conversion of a foreign business corporation to a domestic
nonprofit corporation becomes effective:
(1) The title to all real and personal property, both tangible and intangible, of the corporation
remains in the corporation without reversion or impairment;
(2) The liabilities of the corporation remain the liabilities of the corporation;
(3) An action or proceeding pending against the corporation continues against the corporation
as if the domestication and conversion had not occurred;
(4) The articles of domestication and conversion, or the articles of incorporation attached to
the articles of domestication and conversion, constitute the articles of incorporation of the
corporation;
(5) Memberships, securities, obligations, rights to acquire memberships or securities of the
corporation, or cash or other property shall be issued or paid as provided pursuant to the
laws of the foreign jurisdiction; and
(6) The corporation is deemed to:
(i) Be a domestic corporation for all purposes; and
(ii) Be the same corporation without interruption as the foreign business corporation.
(b) The personal liability of a shareholder of the foreign business corporation who becomes a
member of the domestic nonprofit corporation in the domestication and conversion is as follows:
(1) The domestication and conversion does not discharge any personal liability under the laws
of the foreign jurisdiction to the extent any such personal liability arose before the
effective time of the articles of domestication and conversion;
(2) The member does not have personal liability under the laws of the foreign jurisdiction for
any debt, obligation, or liability of the corporation that arises after the effective time of
the articles of domestication and conversion;
(3) The provisions of the laws of the foreign jurisdiction continue to apply to the collection
or discharge of any personal liability preserved by subdivision (1), as if the domestication
and conversion had not occurred;
(4) The member has whatever rights of contribution from other members are provided by the
laws of the foreign jurisdiction with respect to any personal liability preserved by
subdivision (1), as if the domestication and conversion had not occurred.
(c) A shareholder of a foreign business corporation who becomes subject to personal liability for
some or all of the debts, obligations, or liabilities of the corporation as a result of its domestication
and conversion in this state has personal liability only for those debts, obligations, or liabilities of
the corporation that arise after the effective time of the articles of domestication and conversion.
Section 31. That the code be amended by adding a NEW SECTION to read:
If the domestication and conversion of a foreign business corporation to a domestic nonprofit
corporation is abandoned in accordance with the laws of the foreign jurisdiction after articles of
domestication and conversion have been filed with the Office of the Secretary of State, a statement
that the domestication and conversion has been abandoned, signed by an officer or other duly
authorized representative, must be delivered to the Office of the Secretary of State for filing. The
statement takes effect upon filing and the domestication and conversion is abandoned and does not
become effective.
Section 32. That the code be amended by adding a NEW SECTION to read:
(a) Except as otherwise prohibited by law, when a conversion under sections 28 to 37, inclusive,
of this Act, becomes effective:
(1) The title to all real and personal property, both tangible and intangible, of the converting
entity remains in the surviving entity without reversion or impairment;
(2) The liabilities of the converting entity remain the liabilities of the surviving entity;
(3) An action or proceeding pending against the converting entity continues against the
surviving entity as if the conversion had not occurred;
(4) In the case of a surviving entity that is a filing entity, its articles of incorporation or
governing documents and rules become effective;
(5) The memberships or interests of the converting entity are reclassified into memberships,
interests, other securities, obligations, rights to acquire memberships, interests or
securities, or into cash or other property in accordance with the plan of conversion; and
the members or of the converting entity are entitled only to the rights provided to them
under the terms of the conversion and to any appraisal rights they may have under the
governing law of the converting entity; and
(6) The surviving entity is deemed to:
(i) Be incorporated or organized under and subject to the governing law of the
converting entity for all purposes; and
(ii) Be the same nonprofit corporation or unincorporated entity without interruption as
the converting entity.
(b) A member who is subject to personal liability for some or all of the debts, obligations, or
liabilities of the surviving entity has personal liability only for those debts, obligations, or liabilities
of the surviving entity that arise after the effective time of the articles of entity conversion.
Section 33. That the code be amended by adding a NEW SECTION to read:
(a) Unless otherwise provided in a plan of entity conversion of a domestic nonprofit corporation,
after the plan is adopted and at any time before the entity conversion has become effective, it may
be abandoned by the board of directors without action by the members.
(b) If an entity conversion is abandoned after articles of entity conversion are filed with the
Office of the Secretary of State but before the entity conversion becomes effective, a statement that
the entity conversion has been abandoned in accordance with this section, signed by an officer or
other duly authorized representative, must be delivered to the Office of the Secretary of State for
filing prior to the effective date of the entity conversion. Upon filing, the statement takes effect and
the entity conversion is abandoned and does not become effective.
Section 34. That the code be amended by adding a NEW SECTION to read:
A domestic business corporation may become a domestic nonprofit corporation pursuant to a
plan of nonprofit conversion only if incorporating pursuant to this Act is not prohibited by any other
law of this state. If the law of a domestic business corporation does not provide procedures for the
approval of either a nonprofit conversion or a merger, a plan of nonprofit conversion must be
adopted and approved, and the conversion effectuated in accordance with this Act.
Section 35. That the code be amended by adding a NEW SECTION to read:
(a) The plan of nonprofit conversion must be adopted by the shareholders. The plan for nonprofit
conversion must include:
(1) The terms and conditions of the conversion;
(2) The manner and basis of reclassifying the shareholders in the corporation;
(3) Any desired amendments to the articles of incorporation or bylaws of the corporation
following its conversion;
(4) The articles of incorporation to be in effect immediately following the conversion; and
(5) Any of the terms or conditions of the plan if the change would adversely affect any of the
shareholders in any material respect.
The plan for nonprofit conversion may also include a provision that the plan may be amended
prior to filing articles of nonprofit conversion
(b) After the plan for nonprofit conversion is authorized, the articles of conversion must be
signed on behalf of the converting corporation by any officer or other duly authorized representative.
The articles shall set forth:
(1) The name of the corporation immediately before the filing of the articles of conversion
and, if that name is unavailable for use in this state or the corporation desires to change
its name in connection with the conversion, a name that satisfies the requirements of §§
47-22-7 and 47-2-8.1;
(2) The jurisdiction of incorporation of the corporation immediately before the filing of the
articles of conversion and the date the corporation was incorporated; and
(3) A statement that the conversion of the corporation in this state was duly authorized as
required by the laws of this state.
(c) The articles of conversion shall contain all of the provisions required to be contained in the
articles of incorporation of a nonprofit corporation as set forth in § 47-22-6 and any other desired
provisions permitted to be included. Provisions that would not be required to be included in restated
articles of incorporation may be omitted, except that the name and address of the initial registered
agent of the domestic business corporation must be included.
(d) The articles of nonprofit conversion must be delivered to the Office of the Secretary of State
for filing.
Section 36. That the code be amended by adding a NEW SECTION to read:
(a) When a conversion of a domestic business corporation to a domestic nonprofit corporation
becomes effective:
(1) The title to all real and personal property, both tangible and intangible, of the corporation
remains in the corporation without reversion or impairment;
(2) The liabilities of the corporation remain the liabilities of the corporation;
(3) An action or proceeding pending against the corporation continues against the corporation
as if the conversion had not occurred;
(4) The articles of conversion, or the articles of incorporation attached to the articles of
conversion, constitute the articles of incorporation of the corporation;
(5) Memberships, securities, obligations, rights to acquire memberships or securities of the
corporation, or cash or other property shall be issued or paid as provided pursuant to the
laws of this state; and
(6) The corporation is deemed to:
(i) Be a domestic nonprofit corporation for all purposes; and
(ii) Be the same corporation without interruption.
(b) The personal liability of a shareholder of the domestic business corporation who becomes a
member of the domestic nonprofit corporation in the conversion is as follows:
(1) The conversion does not discharge any personal liability under the laws of this state to the
extent any such personal liability arose before the effective time of the articles of
conversion;
(2) The member does not have personal liability under the laws of this state for any debt,
obligation, or liability of the corporation that arises after the effective time of the articles
of conversion;
(3) The provisions of the laws of this state continue to apply to the collection or discharge of
any personal liability preserved by subdivision (1), as if the conversion had not occurred;
(4) The member has whatever rights of contribution from other members are provided by the
laws of this state with respect to any personal liability preserved by subdivision (1), as if
the conversion had not occurred.
(c) A shareholder of a domestic business corporation who becomes subject to personal liability
for some or all of the debts, obligations, or liabilities of the corporation as a result of its conversion
in this state has personal liability only for those debts, obligations, or liabilities of the corporation
that arise after the effective time of the articles of conversion.
Section 37. That the code be amended by adding a NEW SECTION to read:
If the conversion of a domestic business corporation to a domestic nonprofit corporation is
abandoned in accordance with the laws of this state after articles of conversion have been filed with
the Office of the Secretary of State, a statement that the conversion has been abandoned, signed by
an officer or other duly authorized representative, must be delivered to the Office of the Secretary
of State for filing. The statement takes effect upon filing and the conversion is abandoned and does
not become effective."
Moved by: Stevens
Second by: Gibson
Action: Prevailed by voice vote.
THE CHAIR DEFERRED HB 1068 UNTIL MONDAY, FEBRUARY 22, 2016
HB 1244: revise provisions related to the sex offender registry
Presented by: Representative Gibson
Proponents: Eli Leher, Washington, D.C., self
Nicole Pittman, self
Marty Jackley, Attorney General
Angel Runnels, Sioux Falls, self
Joanna Lawler, Rapid City, self
Ryan Kolbeck, SD American Criminal Defense Lawyers, Sioux Falls (Handouts: #1)
MOTION: DO PASS HB 1244
Moved by: Stevens
Second by: Killer
Action: Prevailed by roll call vote. (12-0-1-0)
Voting Yes: DiSanto, Gibson, Haugaard, Hunt, Johns, Killer, Langer, Peterson (Kent), Russell,
Westra, Stevens, Mickelson
Excused: Latterell
MOTION: PLACE HB 1244 ON CONSENT CALENDAR
Moved by: Langer
Action: Died for lack of a second.
HB 1133: require that a risk assessment is completed and reviewed before the release of a
person charged with certain domestic crimes.
Presented by: Representative Gibson
Proponents: Michael Moore, Beadle Co., self (Handouts: #2, #3, #4)
Greg Sattizahn, Unified Judicial System
Dick Tieszen, South Dakota Sheriff's Association
Dianna Miller, Network Against Family Violence
MOTION: AMEND HB 1133
1133ya
On page 1, line 7, of the printed bill, delete "South Dakota" and insert "validated".
On page 1, line 8, overstrike "A" and insert "Information from any risk assessment relative to
bond or conditions of release shall be provided to a".
On page 1, line 9, delete everything after "court" and insert "shall determine when".
Moved by: Stevens
Second by: Peterson (Kent)
Action: Prevailed by voice vote.
MOTION: AMEND HB 1133
1133ra
On page 1, line 8, of the printed bill, delete "and the State's Attorney".
Moved by: Johns
Second by: Langer
Action: Prevailed by voice vote.
MOTION: DO PASS HB 1133 AS AMENDED
Moved by: Stevens
Second by: Johns
Action: Prevailed by roll call vote. (10-2-1-0)
Voting Yes: DiSanto, Gibson, Haugaard, Hunt, Johns, Killer, Peterson (Kent), Russell, Westra,
Stevens
Voting No: Langer, Mickelson
Excused: Latterell
HB 1171: permit the court additional time to determine whether a petition for a domestic
protection order may be heard as though the petition was for a stalking protection order.
Presented by: Representative Gibson
Proponents: Kimberly Zachrison, Huron, self
MOTION: AMEND HB 1171
1171ya
On page 1, after line 11 of the printed bill, insert:
" Section 2. That § 22-19A-8.1 be amended to read:
22-19A-8.1. If a petition for a protection order alleging the existence of stalking or physical
injury is filed with the court pursuant to § 22-19A-8 and, if the court, upon an initial review,
determines that the allegations do not support the existence of stalking or physical injury, but that
the allegations do support the existence of domestic abuse pursuant to § 25-10-3, the court, in its
discretion, may hear and act upon the petition as though the petition had been filed under § 25-10-3
and subject to the provisions of chapter 25-10. ".
Moved by: Hunt
Second by: Westra
Action: Prevailed by voice vote.
MOTION: DO PASS HB 1171 AS AMENDED
Moved by: Killer
Second by: Gibson
Action: Failed by roll call vote. (5-7-1-0)
Voting Yes: DiSanto, Gibson, Killer, Peterson (Kent), Russell
Voting No: Haugaard, Hunt, Johns, Langer, Westra, Stevens, Mickelson
Excused: Latterell
MOTION: DEFER HB 1171 TO THE 41
ST LEGISLATIVE DAY
Moved by: Johns
Second by: Langer
Action: Prevailed by roll call vote. (9-3-1-0)
Voting Yes: Haugaard, Hunt, Johns, Langer, Peterson (Kent), Russell, Westra, Stevens,
Mickelson
Voting No: DiSanto, Gibson, Killer
Excused: Latterell
HB 1132: require the submission of sexual assault kits for testing.
Presented by: Representative Gibson
Proponents: Marty Jackley, Attorney General
Cindy Flakoll, Concerned Women For America Legislative Action Committee
MOTION: DO PASS HB 1132
Moved by: Killer
Second by: Stevens
Action: Was not acted on.
MOTION: SUBSTITUTE MOTION AMEND HB 1132
1132ra
On page 3 of the printed bill, delete lines 14 to 18, inclusive.
Moved by: Haugaard
Second by: Hunt
Action: Failed by roll call vote. (5-7-1-0)
Voting Yes: Haugaard, Hunt, Johns, Langer, Westra
Voting No: DiSanto, Gibson, Killer, Peterson (Kent), Russell, Stevens, Mickelson
Excused: Latterell
MOTION: SUBSTITUTE MOTION AMEND HB 1132
1132rb
On page 3 of the printed bill, delete line 18, and insert "conviction may be overturned on the
grounds of that failure.".
Moved by: Haugaard
Second by: Russell
Action: Withdrawn.
MOTION: SUBSTITUTE MOTION AMEND HB 1132
1132rd
On page 3, line 17, of the printed bill, delete everything after "." .
On page 3, delete line 18.
Moved by: Johns
Second by: Haugaard
Action: Prevailed by voice vote.
MOTION: DO PASS HB 1132 AS AMENDED
Moved by: Stevens
Second by: Peterson (Kent)
Action: Prevailed by roll call vote. (12-0-1-0)
Voting Yes: DiSanto, Gibson, Haugaard, Hunt, Johns, Killer, Langer, Peterson (Kent), Russell,
Westra, Stevens, Mickelson
Excused: Latterell
MOTION: PLACE HB 1132 ON CONSENT CALENDAR
Moved by: Langer
Action: Died for lack of a second.
HB 1243: prohibit the unauthorized sharing of certain private images on the internet.
Presented by: Representative Gibson
Proponents: Kimberly Zachrison, Huron, self
Opponents: Justin Smith, South Dakota Newspaper Association
Ryan Kolbeck, SD American Criminal Defense Lawyers, Sioux Falls
MOTION: AMEND HB 1243
1243ya
On page 2, after line 1 of the printed bill, insert:
" Section 2. That chapter 22-21 be amended by adding a NEW SECTION to read:
Nothing in this Act shall be construed to impose liability on a provider of an electronic
communication service, an information service, a mobile service, including a commercial mobile
service, a telecommunication service, an interactive computer service, or a cable service as those
terms are defined under federal law.".
Moved by: Gibson
Second by: Peterson (Kent)
Action: Prevailed by voice vote.
MOTION: AMEND HB 1243
1243ra
On page 1, line 5, of the printed bill, after "disseminate" insert ", including electronically,".
On page 1, line 7, after "clothing," insert "or with another person depicted in a sexual manner,".
On page 1, line 10, delete everything after "." .
On page 1, delete lines 11 and 12.
On page 1, line 13, delete everything before "A" .
Moved by: Gibson
Second by: Langer
Action: Prevailed by voice vote.
MOTION: DO PASS HB 1243 AS AMENDED
Moved by: Killer
Second by: Gibson
Action: Was not acted on.
MOTION: SUBSTITUTE MOTION AMEND HB 1243
1243rb
On the previously adopted amendment (1243ra), in the first instruction, delete ", including
electronically," and insert "in any form"
Moved by: Haugaard
Second by: Gibson
Action: Prevailed by voice vote.
MOTION: DO PASS HB 1243 AS AMENDED
Moved by: Johns
Second by: Killer
Action: Prevailed by roll call vote. (8-4-1-0)
Voting Yes: DiSanto, Gibson, Johns, Killer, Latterell, Peterson (Kent), Russell, Mickelson
Voting No: Haugaard, Hunt, Langer, Stevens
Excused: Westra
MOTION: ADJOURN
Moved by: Stevens
Second by: Haugaard
Action: Prevailed by voice vote.
Liz Markley
____________________________
Committee Secretary
G. Mark Mickelson, Chair
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