As Passed by the Senate 1
123rd General Assembly 4
Regular Session Am. Sub. H. B. No. 312 5
1999-2000 6
REPRESENTATIVES SALERNO-BUCHY-TIBERI-CORE-PERZ-O'BRIEN-OLMAN- 8
DePIERO-AMSTUTZ-WILLAMOWSKI-SENATOR CUPP 9
_________________________________________________________________ 11
A B I L L
To amend sections 1705.04, 1705.08, 1705.12, and 13
1705.43 of the Revised Code to eliminate the 14
requirement that articles of organization of a 15
limited liability company specify an address for
obtaining copies of the company's operating 16
agreement or company bylaws and that the articles 17
must be amended if that address is changed, to 18
eliminate certain distribution rights of a member
upon withdrawal from the company and instead to 19
treat the withdrawing member as an assignee of 20
the member's membership interest in the company,
to specify that the withdrawal of a member does 21
not dissolve a limited liability company if 22
certain requirements are satisfied, and to
declare an emergency. 23
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 25
Section 1. That sections 1705.04, 1705.08, 1705.12, and 27
1705.43 of the Revised Code be amended to read as follows: 28
Sec. 1705.04. (A) One or more persons, without regard to 37
residence, domicile, or state of organization, may form a limited 38
liability company. The company is formed when one or more 40
persons or their authorized representative signs and files with 41
the secretary of state articles of organization that set forth 42
all of the following: 43
(1) The name of the company; 45
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(2) Except as provided in division (B) of this section, 47
the period of its duration, which may be perpetual; 48
(3) The address to which interested persons may direct 50
requests for copies of any operating agreement and any bylaws of 51
the company; 52
(4) Any other provisions that are from the operating 54
agreement or that are not inconsistent with applicable law and 55
that the members elect to set out in the articles for the 56
regulation of the affairs of the company. 57
(B) If the articles of organization or operating agreement 59
do not set forth the period of the duration of the limited 61
liability company, its duration shall be perpetual. 62
(C) If a limited liability company is formed under this 64
chapter for the purpose of rendering a professional service, the 66
kinds of professional services authorized under Chapters 4703. 67
and 4733. of the Revised Code, or a combination of the
professional services of optometrists authorized under Chapter 68
4725. of the Revised Code, chiropractors authorized under Chapter 69
4734. of the Revised Code, psychologists authorized under Chapter 72
4732. of the Revised Code, registered or licensed practical 73
nurses authorized under Chapter 4723. of the Revised Code, 74
pharmacists authorized under Chapter 4729. of the Revised Code, 75
physical therapists authorized under sections 4755.40 to 4755.53 76
of the Revised Code, mechanotherapists authorized under section 77
4731.151 of the Revised Code, and doctors of medicine and 78
surgery, osteopathic medicine and surgery, or podiatric medicine 79
and surgery authorized under Chapter 4731. of the Revised Code, 80
the following apply:
(1) Each member, employee, or other agent of the company 82
who renders a professional service in this state and, if the 83
management of the company is not reserved to its members, each 84
manager of the company who renders a professional service in this 85
state shall be licensed, certificated, or otherwise legally 87
authorized to render in this state the same kind of professional 88
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service; if applicable, the kinds of professional services 89
authorized under Chapters 4703. and 4733. of the Revised Code; 90
or, if applicable, any of the kinds of professional services of 91
optometrists authorized under Chapter 4725. of the Revised Code, 92
chiropractors authorized under Chapter 4734. of the Revised Code, 93
psychologists authorized under Chapter 4732. of the Revised Code, 95
registered or licensed practical nurses authorized under Chapter 97
4723. of the Revised Code, pharmacists authorized under Chapter
4729. of the Revised Code, physical therapists authorized under 99
sections 4755.40 to 4755.53 of the Revised Code,
mechanotherapists authorized under section 4731.151 of the 100
Revised Code, or doctors of medicine and surgery, osteopathic 101
medicine and surgery, or podiatric medicine and surgery 102
authorized under Chapter 4731. of the Revised Code. 103
(2) Each member, employee, or other agent of the company 105
who renders a professional service in another state and, if the 106
management of the company is not reserved to its members, each 107
manager of the company who renders a professional service in 108
another state shall be licensed, certificated, or otherwise 110
legally authorized to render that professional service in the 111
other state.
(D) Except for the provisions of this chapter pertaining 113
to the personal liability of members, employees, or other agents 114
of a limited liability company and, if the management of the 115
company is not reserved to its members, the personal liability of 116
managers of the company, this chapter does not restrict, limit, 117
or otherwise affect the authority or responsibilities of any 118
agency, board, commission, department, office, or other entity to 119
license, certificate, register, and otherwise regulate the 120
professional conduct of individuals or organizations of any kind 122
rendering professional services in this state or to regulate the 123
practice of any profession that is within the jurisdiction of the 124
agency, board, commission, department, office, or other entity, 125
notwithstanding that the individual is a member or manager of a 126
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limited liability company and is rendering the professional 127
services or engaging in the practice of the profession through 128
the limited liability company or that the organization is a 129
limited liability company. 130
(E) No limited liability company formed for the purpose of 134
providing a combination of the professional services, as defined
in section 1785.01 of the Revised Code, of optometrists 135
authorized under Chapter 4725. of the Revised Code, chiropractors 136
authorized under Chapter 4734. of the Revised Code, psychologists 137
authorized under Chapter 4732. of the Revised Code, registered or 139
licensed practical nurses authorized under Chapter 4723. of the
Revised Code, pharmacists authorized under Chapter 4729. of the 140
Revised Code, physical therapists authorized under sections 141
4755.40 to 4755.53 of the Revised Code, mechanotherapists 142
authorized under section 4731.151 of the Revised Code, and 143
doctors of medicine and surgery, osteopathic medicine and 144
surgery, or podiatric medicine and surgery authorized under 145
Chapter 4731. of the Revised Code shall control the professional 148
clinical judgment exercised within accepted and prevailing
standards of practice of a licensed, certificated, or otherwise 149
legally authorized optometrist, chiropractor, psychologist, 150
nurse, pharmacist, physical therapist, mechanotherapist, or 151
doctor of medicine and surgery, osteopathic medicine and surgery, 154
or podiatric medicine and surgery in rendering care, treatment, 156
or professional advice to an individual patient. 157
This division does not prevent a hospital, as defined in 159
section 3727.01 of the Revised Code, insurer, as defined in 161
section 3999.36 of the Revised Code, or intermediary 163
organization, as defined in section 1751.01 of the Revised Code, 165
from entering into a contract with a limited liability company 166
described in this division that includes a provision requiring 167
utilization review, quality assurance, peer review, or other
performance or quality standards. Those activities shall not be 168
construed as controlling the professional clinical judgment of an 169
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individual practitioner listed in this division. 170
Sec. 1705.08. (A) The articles of organization of a 179
limited liability company may be amended at any time and for any 180
proper purpose by filing a certificate of amendment with the 181
secretary of state. However, a certificate of amendment amending 182
the articles of organization shall be filed within thirty days 183
after the occurrence of any of the following: 184
(1) The name of the limited liability company is changed; 186
(2) The period of the limited liability company's duration 188
is changed; 189
(3) The address to which persons may direct requests for 191
copies of any operating agreements or bylaws of the limited 192
liability company is changed; 193
(4) Any other information that is set forth in the 195
articles of organization is changed. 196
(B) A member of a limited liability company in which the 198
management is reserved to its members, or a manager of a limited 199
liability company in which the management is not reserved to its 200
members, promptly shall file or cause to be filed a certificate 201
of amendment upon discovering that a statement in the articles of 202
organization was materially false when made or that any other 203
information set forth in the articles of organization has changed 204
making the articles materially inaccurate. 205
(C)(1) A certificate of amendment filed pursuant to 207
division (A) or (B) of this section shall be on a form prescribed 208
by the secretary of state and shall set forth all of the 209
following: 210
(a) The name of the limited liability company; 212
(b) The date of the filing of the limited liability 214
company's articles of organization that are being amended; 215
(c) The amendment to the limited liability company's 217
articles of organization. 218
(2) The certificate of amendment shall be executed by a 220
member, manager, or authorized representative of the limited 221
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liability company, which person shall also certify that he THE 222
PERSON is authorized to execute the certificate. 224
(D) The articles of organization of a limited liability 226
company may be restated at any time by filing a restatement of 227
the articles of organization with the secretary of state. The 228
restatement shall be certified by a member, manager, or 229
authorized representative of the limited liability company, which 230
person shall also certify that he THE PERSON is authorized to 231
execute the restatement. 233
Sec. 1705.12. Upon withdrawal, a member withdrawing from a 242
limited liability company has the right to receive any 243
distribution to which he THE MEMBER is entitled under the 245
operating agreement and, except as otherwise provided in that
agreement, the right to receive within a reasonable time after 246
withdrawal the fair value of his membership interest as of the 248
date of withdrawal based upon his right to share in distributions 250
of the company WITHDRAWING MEMBER SHALL BE TREATED AS IF THE 251
MEMBER WERE AN ASSIGNEE OF ALL OF THE MEMBER'S MEMBERSHIP 252
INTEREST AS OF THE DATE OF WITHDRAWAL. 253
Sec. 1705.43. (A) A limited liability company organized 262
under this chapter shall be dissolved upon the occurrence of any 263
of the following events: 264
(1) The expiration of the period, if any, fixed by the 266
operating agreement or articles of organization for the duration 268
of the company;
(2) One or more events specified in writing in the 270
operating agreement as causing the dissolution of the company; 271
(3) The unanimous written agreement of all members to 273
dissolve the company; 274
(4) The EXCEPT AS PROVIDED IN DIVISION (C) OF THIS 277
SECTION, THE withdrawal of a member of the company, unless the 278
business of the company is continued by the consent of all of the 279
remaining members or under a right to continue the company that 280
is stated in writing in the operating agreement; 281
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(5) Upon entry of a decree of judicial dissolution under 283
section 1705.47 of the Revised Code. 284
(B) Following the occurrence of any of the events OF 286
DISSOLUTION specified in division (A) of this section, the 287
limited liability company shall deliver to the secretary of state 288
for filing a certificate of dissolution on a form that is 289
prescribed by the secretary of state and that includes the name 290
of the company and the effective date of its dissolution. 291
(C) IF THE COMPANY WAS FORMED ON OR AFTER THE EFFECTIVE 294
DATE OF THIS AMENDMENT, OR THE COMPANY WAS FORMED PRIOR TO THE 295
EFFECTIVE DATE OF THIS AMENDMENT AND ITS ARTICLES OR OPERATING 296
AGREEMENT ARE AMENDED TO SPECIFICALLY STATE THAT THIS DIVISION 297
APPLIES TO THE COMPANY, THE WITHDRAWAL OF A MEMBER OF THE COMPANY 298
SHALL NOT CAUSE THE DISSOLUTION OF THE COMPANY EXCEPT AS MAY BE 299
PROVIDED IN THE OPERATING AGREEMENT.
Section 2. That existing sections 1705.04, 1705.08, 301
1705.12, and 1705.43 of the Revised Code are hereby repealed. 303
Section 3. Sections 1 and 2 of this act shall take effect 305
on December 1, 1999, or the earliest time permitted by law, 306
whichever is later.
Section 4. This act is hereby declared to be an emergency 308
measure necessary for the immediate preservation of the public 310
peace, health, and safety. The reason for such necessity is that 311
it is crucial that this act be enacted into law at the earliest 312
possible time to enable incorporating and corporate entities to 313
utilize the changes that are created by this act prior to the end
of 1999. Therefore, this act shall go into immediate effect. 314