As Introduced 1
123rd General Assembly 4
Regular Session H. B. No. 312 5
1999-2000 6
REPRESENTATIVE SALERNO 7
_________________________________________________________________ 8
A B I L L
To amend sections 1705.04, 1705.12, and 1705.43 of 10
the Revised Code to eliminate the requirement 11
that articles of organization of a limited 12
liability company specify an address for
obtaining copies of the company's operating 13
agreement or company bylaws, to eliminate certain 14
distribution rights of a member upon withdrawal
from the company and instead to treat the 15
withdrawing member as an assignee of the member's 16
membership interest in the company, and to
specify that the withdrawal of a member does not 17
dissolve a limited liability company if certain 18
requirements are satisfied.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 20
Section 1. That sections 1705.04, 1705.12, and 1705.43 of 22
the Revised Code be amended to read as follows: 23
Sec. 1705.04. (A) One or more persons, without regard to 32
residence, domicile, or state of organization, may form a limited 33
liability company. The company is formed when one or more 35
persons or their authorized representative signs and files with 36
the secretary of state articles of organization that set forth 37
all of the following: 38
(1) The name of the company; 40
(2) Except as provided in division (B) of this section, 42
the period of its duration, which may be perpetual; 43
(3) The address to which interested persons may direct 45
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requests for copies of any operating agreement and any bylaws of 46
the company; 47
(4) Any other provisions that are from the operating 49
agreement or that are not inconsistent with applicable law and 50
that the members elect to set out in the articles for the 51
regulation of the affairs of the company. 52
(B) If the articles of organization or operating agreement 54
do not set forth the period of the duration of the limited 56
liability company, its duration shall be perpetual. 57
(C) If a limited liability company is formed under this 59
chapter for the purpose of rendering a professional service, the 61
kinds of professional services authorized under Chapters 4703. 62
and 4733. of the Revised Code, or a combination of the
professional services of optometrists authorized under Chapter 63
4725. of the Revised Code, chiropractors authorized under Chapter 64
4734. of the Revised Code, psychologists authorized under Chapter 67
4732. of the Revised Code, registered or licensed practical 68
nurses authorized under Chapter 4723. of the Revised Code, 69
pharmacists authorized under Chapter 4729. of the Revised Code, 70
physical therapists authorized under sections 4755.40 to 4755.53 71
of the Revised Code, and doctors of medicine and surgery, 73
osteopathic medicine and surgery, or podiatric medicine and 74
surgery authorized under Chapter 4731. of the Revised Code, the 75
following apply:
(1) Each member, employee, or other agent of the company 77
who renders a professional service in this state and, if the 78
management of the company is not reserved to its members, each 79
manager of the company who renders a professional service in this 80
state shall be licensed, certificated, or otherwise legally 82
authorized to render in this state the same kind of professional 83
service; if applicable, the kinds of professional services 84
authorized under Chapters 4703. and 4733. of the Revised Code; 85
or, if applicable, any of the kinds of professional services of 86
optometrists authorized under Chapter 4725. of the Revised Code, 87
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chiropractors authorized under Chapter 4734. of the Revised Code, 88
psychologists authorized under Chapter 4732. of the Revised Code, 90
registered or licensed practical nurses authorized under Chapter 92
4723. of the Revised Code, pharmacists authorized under Chapter
4729. of the Revised Code, physical therapists authorized under 94
sections 4755.40 to 4755.53 of the Revised Code, or doctors of 95
medicine and surgery, osteopathic medicine and surgery, or
podiatric medicine and surgery authorized under Chapter 4731. of 96
the Revised Code. 97
(2) Each member, employee, or other agent of the company 99
who renders a professional service in another state and, if the 100
management of the company is not reserved to its members, each 101
manager of the company who renders a professional service in 102
another state shall be licensed, certificated, or otherwise 104
legally authorized to render that professional service in the 105
other state.
(D) Except for the provisions of this chapter pertaining 107
to the personal liability of members, employees, or other agents 108
of a limited liability company and, if the management of the 109
company is not reserved to its members, the personal liability of 110
managers of the company, this chapter does not restrict, limit, 111
or otherwise affect the authority or responsibilities of any 112
agency, board, commission, department, office, or other entity to 113
license, certificate, register, and otherwise regulate the 114
professional conduct of individuals or organizations of any kind 116
rendering professional services in this state or to regulate the 117
practice of any profession that is within the jurisdiction of the 118
agency, board, commission, department, office, or other entity, 119
notwithstanding that the individual is a member or manager of a 120
limited liability company and is rendering the professional 121
services or engaging in the practice of the profession through 122
the limited liability company or that the organization is a 123
limited liability company. 124
(E) No limited liability company formed for the purpose of 128
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providing a combination of the professional services, as defined
in section 1785.01 of the Revised Code, of optometrists 129
authorized under Chapter 4725. of the Revised Code, chiropractors 130
authorized under Chapter 4734. of the Revised Code, psychologists 131
authorized under Chapter 4732. of the Revised Code, registered or 133
licensed practical nurses authorized under Chapter 4723. of the
Revised Code, pharmacists authorized under Chapter 4729. of the 134
Revised Code, physical therapists authorized under sections 135
4755.40 to 4755.53 of the Revised Code, and doctors of medicine 137
and surgery, osteopathic medicine and surgery, or podiatric 138
medicine and surgery authorized under Chapter 4731. of the 139
Revised Code shall control the professional clinical judgment 141
exercised within accepted and prevailing standards of practice of 142
a licensed, certificated, or otherwise legally authorized 143
optometrist, chiropractor, psychologist, nurse, pharmacist,
physical therapist, or doctor of medicine and surgery, 147
osteopathic medicine and surgery, or podiatric medicine and
surgery in rendering care, treatment, or professional advice to 149
an individual patient. 150
This division does not prevent a hospital, as defined in 152
section 3727.01 of the Revised Code, insurer, as defined in 154
section 3999.36 of the Revised Code, or intermediary 156
organization, as defined in section 1751.01 of the Revised Code, 158
from entering into a contract with a limited liability company 159
described in this division that includes a provision requiring 160
utilization review, quality assurance, peer review, or other
performance or quality standards. Those activities shall not be 161
construed as controlling the professional clinical judgment of an 162
individual practitioner listed in this division. 163
Sec. 1705.12. Upon withdrawal, a member withdrawing from a 172
limited liability company has the right to receive any 173
distribution to which he THE MEMBER is entitled under the 175
operating agreement and, except as otherwise provided in that
agreement, the right to receive within a reasonable time after 176
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withdrawal the fair value of his membership interest as of the 178
date of withdrawal based upon his right to share in distributions 180
of the company WITHDRAWING MEMBER SHALL BE TREATED AS IF THE 181
MEMBER WERE AN ASSIGNEE OF ALL OF THE MEMBER'S MEMBERSHIP 182
INTEREST AS OF THE DATE OF WITHDRAWAL. 183
Sec. 1705.43. (A) A limited liability company organized 192
under this chapter shall be dissolved upon the occurrence of any 193
of the following events: 194
(1) The expiration of the period, if any, fixed by the 196
operating agreement or articles of organization for the duration 198
of the company;
(2) One or more events specified in writing in the 200
operating agreement as causing the dissolution of the company; 201
(3) The unanimous written agreement of all members to 203
dissolve the company; 204
(4) The EXCEPT AS PROVIDED IN DIVISION (C) OF THIS 207
SECTION, THE withdrawal of a member of the company, unless the 208
business of the company is continued by the consent of all of the 209
remaining members or under a right to continue the company that 210
is stated in writing in the operating agreement; 211
(5) Upon entry of a decree of judicial dissolution under 213
section 1705.47 of the Revised Code. 214
(B) Following the occurrence of any of the events OF 216
DISSOLUTION specified in division (A) of this section, the 217
limited liability company shall deliver to the secretary of state 218
for filing a certificate of dissolution on a form that is 219
prescribed by the secretary of state and that includes the name 220
of the company and the effective date of its dissolution. 221
(C) IF THE COMPANY WAS FORMED ON OR AFTER THE EFFECTIVE 224
DATE OF THIS AMENDMENT, OR THE COMPANY WAS FORMED PRIOR TO THE 225
EFFECTIVE DATE OF THIS AMENDMENT AND ITS ARTICLES OR OPERATING 226
AGREEMENT ARE AMENDED TO SPECIFICALLY STATE THAT THIS DIVISION 227
APPLIES TO THE COMPANY, THE WITHDRAWAL OF A MEMBER OF THE COMPANY 228
SHALL NOT CAUSE THE DISSOLUTION OF THE COMPANY EXCEPT AS MAY BE 229
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PROVIDED IN THE OPERATING AGREEMENT.
Section 2. That existing sections 1705.04, 1704.12, and 231
1705.43 of the Revised Code are hereby repealed. 232