Chapter 1705: LIMITED LIABILITY COMPANIES

1705.01 Limited liability company definitions.

As used in this chapter:

(A) "Business" means every trade, occupation, or profession.

(B) "Contribution" means any cash, property, services rendered, promissory note, or other binding obligation to contribute cash or property or to perform services that a member contributes to a limited liability company in the capacity as a member.

(C) "Conveyance" means every assignment, lease, mortgage, or encumbrance.

(D) "Entity" means any of the following:

(1) A corporation existing under the laws of this state or any other state;

(2) Any of the following organizations existing under the laws of this state, the United States, or any other state:

(a) A business trust or association;

(b) A real estate investment trust;

(c) A common law trust;

(d) An unincorporated business or for profit organization, including a general or limited partnership;

(e) A limited liability company.

(E) "Incompetent" has the same meaning as in section 2111.01 of the Revised Code.

(F) "Knowledge," of a fact, means actual knowledge of that fact and knowledge of other facts that under the circumstances shows bad faith.

(G) "Member" means a person whose name appears on the records of the limited liability company as the owner of a membership interest in that company.

(H) "Membership interest" means a member's share of the profits and losses of a limited liability company and the right to receive distributions from that company.

(I) "Notice" means that the person who claims the benefit of the notice has done one of the following:

(1) Stated the fact to the person entitled to notice;

(2) Delivered through the mail or by other means of communication a written statement of the fact to the person entitled to notice or to a proper person at the place of business or residence of the person entitled to receive a notice.

(J) "Operating agreement" means all of the valid written or oral agreements of the members or, in the case of a limited liability company consisting of one member, a written declaration of that member, as to the affairs of a limited liability company and the conduct of its business.

(K) "Person" means any natural person; partnership, limited partnership, trust, estate, association, limited liability company, or corporation; any custodian, nominee, trustee, executor, administrator, or other fiduciary; or any other individual or entity in its own or any representative capacity.

(L) "Professional association" and "professional service" have the same meanings as in section 1785.01 of the Revised Code.

(M) "State" has the same meaning as in section 1.59 of the Revised Code and additionally includes a foreign country and any province, territory, or other political subdivision of a foreign country.

(N) "Tribunal" means a court or, if provided in the operating agreement or otherwise agreed, an arbitrator, arbitration panel, or other tribunal.

Amended by 129th General AssemblyFile No.72, HB 48, §1, eff. 5/4/2012.

Amended by 129th General AssemblyFile No.28, HB 153, §101.01, eff. 9/29/2011.

Effective Date: 11-21-1997

1705.02 Purposes of company - assistance in national defense.

A limited liability company may be formed for any purpose or purposes for which individuals lawfully may associate themselves, including for any profit or nonprofit purpose, except that, if the Revised Code contains special provisions for the formation of any designated type of corporation other than a professional association, a limited liability company shall not be formed for the purpose or purposes for which that type of corporation may be formed. At the request or direction of the government of the United States or any agency of that government, a limited liability company may transact any lawful business in aid of the national defense or in the prosecution of any war in which the United States is engaged.

Effective Date: 07-01-1994; 2008 HB160 06-20-2008

1705.03 Authority of limited liability company.

(A) A limited liability company may sue and be sued.

(B) Unless otherwise provided in its articles of organization, a limited liability company may take property of any description or any interest in property of any description by gift, devise, or bequest and may make donations for the public welfare or for charitable, scientific, or educational purposes.

(C) In carrying out the purposes stated in its articles of organization or operating agreement and subject to limitations prescribed by law or in its articles of organization or its operating agreement, a limited liability company may do all of the following:

(1) Purchase or otherwise acquire, lease as lessee or lessor, invest in, hold, use, encumber, sell, exchange, transfer, and dispose of property of any description or any interest in property of any description;

(2) Make contracts;

(3) Form or acquire the control of other domestic or foreign limited liability companies;

(4) Be a shareholder, partner, member, associate, or participant in other profit or nonprofit enterprises or ventures;

(5) Conduct its affairs in this state and elsewhere;

(6) Render in this state and elsewhere a professional service, the kinds of professional services authorized under Chapters 4703. and 4733. of the Revised Code, or a combination of the professional services of optometrists authorized under Chapter 4725. of the Revised Code, chiropractors authorized under Chapter 4734. of the Revised Code to practice chiropractic or acupuncture, psychologists authorized under Chapter 4732. of the Revised Code, registered or licensed practical nurses authorized under Chapter 4723. of the Revised Code, pharmacists authorized under Chapter 4729. of the Revised Code, physical therapists authorized under sections 4755.40 to 4755.56 of the Revised Code, occupational therapists authorized under sections 4755.04 to 4755.13 of the Revised Code, mechanotherapists authorized under section 4731.151 of the Revised Code, and doctors of medicine and surgery, osteopathic medicine and surgery, or podiatric medicine and surgery authorized under Chapter 4731. of the Revised Code;

(7) Borrow money;

(8) Issue, sell, and pledge its notes, bonds, and other evidences of indebtedness;

(9) Secure any of its obligations by mortgage, pledge, or deed of trust of all or any of its property;

(10) Guarantee or secure obligations of any person;

(11) Do all things permitted by law and exercise all authority within or incidental to the purposes stated in its articles of organization.

(D) In addition to the authority conferred by division (C) of this section and irrespective of the purposes stated in its articles of organization or operating agreement but subject to any limitations stated in those articles or its operating agreement, a limited liability company may invest funds not currently needed in its business in any securities if the investment does not cause the company to acquire control of another enterprise whose activities and operations are not incidental to the purposes stated in the articles of organization of the company.

(E)

(1) No lack of authority or limitation upon the authority of a limited liability company shall be asserted in any action except as follows:

(a) By the state in an action by it against the company;

(b) By or on behalf of the company in an action against a manager, an officer, or any member as a member;

(c) By a member as a member in an action against the company, a manager, an officer, or any member as a member;

(d) In an action involving an alleged improper issue of a membership interest in the company.

(2) Division (E)(1) of this section applies to any action commenced in this state upon any contract made in this state by a foreign limited liability company.

Effective Date: 03-22-1999; 04-06-2007; 2007 SB33 08-22-2007

1705.04 Articles of organization.

(A) One or more persons, without regard to residence, domicile, or state of organization, may form a limited liability company. The articles of organization shall be signed and filed with the secretary of state and shall set forth all of the following:

(1) The name of the company;

(2) Except as provided in division (B) of this section, the period of its duration, which may be perpetual;

(3) Any other provisions that are from the operating agreement or that are not inconsistent with applicable law and that the members elect to set out in the articles for the regulation of the affairs of the company.

The legal existence of the company begins upon the filing of the articles of organization or on a later date specified in the articles of organization that is not more than ninety days after the filing.

(B) If the articles of organization or operating agreement do not set forth the period of the duration of the limited liability company, its duration shall be perpetual.

(C) If a limited liability company is formed under this chapter for the purpose of rendering a professional service, the kinds of professional services authorized under Chapters 4703. and 4733. of the Revised Code, or a combination of the professional services of optometrists authorized under Chapter 4725. of the Revised Code, chiropractors authorized under Chapter 4734. of the Revised Code to practice chiropractic or acupuncture, psychologists authorized under Chapter 4732. of the Revised Code, registered or licensed practical nurses authorized under Chapter 4723. of the Revised Code, pharmacists authorized under Chapter 4729. of the Revised Code, physical therapists authorized under sections 4755.40 to 4755.56 of the Revised Code, occupational therapists authorized under sections 4755.04 to 4755.13 of the Revised Code, mechanotherapists authorized under section 4731.151 of the Revised Code, and doctors of medicine and surgery, osteopathic medicine and surgery, or podiatric medicine and surgery authorized under Chapter 4731. of the Revised Code, the following apply:

(1) Each member, employee, or other agent of the company who renders a professional service in this state and, if the management of the company is not reserved to its members, each manager of the company who renders a professional service in this state shall be licensed, certificated, or otherwise legally authorized to render in this state the same kind of professional service; if applicable, the kinds of professional services authorized under Chapters 4703. and 4733. of the Revised Code; or, if applicable, any of the kinds of professional services of optometrists authorized under Chapter 4725. of the Revised Code, chiropractors authorized under Chapter 4734. of the Revised Code to practice chiropractic or acupuncture, psychologists authorized under Chapter 4732. of the Revised Code, registered or licensed practical nurses authorized under Chapter 4723. of the Revised Code, pharmacists authorized under Chapter 4729. of the Revised Code, physical therapists authorized under sections 4755.40 to 4755.56 of the Revised Code, occupational therapists authorized under sections 4755.04 to 4755.13 of the Revised Code, mechanotherapists authorized under section 4731.151 of the Revised Code, or doctors of medicine and surgery, osteopathic medicine and surgery, or podiatric medicine and surgery authorized under Chapter 4731. of the Revised Code.

(2) Each member, employee, or other agent of the company who renders a professional service in another state and, if the management of the company is not reserved to its members, each manager of the company who renders a professional service in another state shall be licensed, certificated, or otherwise legally authorized to render that professional service in the other state.

(D) Except for the provisions of this chapter pertaining to the personal liability of members, employees, or other agents of a limited liability company and, if the management of the company is not reserved to its members, the personal liability of managers of the company, this chapter does not restrict, limit, or otherwise affect the authority or responsibilities of any agency, board, commission, department, office, or other entity to license, certificate, register, and otherwise regulate the professional conduct of individuals or organizations of any kind rendering professional services in this state or to regulate the practice of any profession that is within the jurisdiction of the agency, board, commission, department, office, or other entity, notwithstanding that the individual is a member or manager of a limited liability company and is rendering the professional services or engaging in the practice of the profession through the limited liability company or that the organization is a limited liability company.

(E) No limited liability company formed for the purpose of providing a combination of the professional services, as defined in section 1785.01 of the Revised Code, of optometrists authorized under Chapter 4725. of the Revised Code, chiropractors authorized under Chapter 4734. of the Revised Code to practice chiropractic or acupuncture, psychologists authorized under Chapter 4732. of the Revised Code, registered or licensed practical nurses authorized under Chapter 4723. of the Revised Code, pharmacists authorized under Chapter 4729. of the Revised Code, physical therapists authorized under sections 4755.40 to 4755.56 of the Revised Code, occupational therapists authorized under sections 4755.04 to 4755.13 of the Revised Code, mechanotherapists authorized under section 4731.151 of the Revised Code, and doctors of medicine and surgery, osteopathic medicine and surgery, or podiatric medicine and surgery authorized under Chapter 4731. of the Revised Code shall control the professional clinical judgment exercised within accepted and prevailing standards of practice of a licensed, certificated, or otherwise legally authorized optometrist, chiropractor, chiropractor practicing acupuncture through the state chiropractic board, psychologist, nurse, pharmacist, physical therapist, occupational therapist, mechanotherapist, or doctor of medicine and surgery, osteopathic medicine and surgery, or podiatric medicine and surgery in rendering care, treatment, or professional advice to an individual patient.

This division does not prevent a hospital, as defined in section 3727.01 of the Revised Code, insurer, as defined in section 3999.36 of the Revised Code, or intermediary organization, as defined in section 1751.01 of the Revised Code, from entering into a contract with a limited liability company described in this division that includes a provision requiring utilization review, quality assurance, peer review, or other performance or quality standards. Those activities shall not be construed as controlling the professional clinical judgment of an individual practitioner listed in this division.

Effective Date: 05-16-2002; 04-06-2007; 2007 SB33 08-22-2007

1705.05 Name - transfer - reservation.

(A) The name of a limited liability company shall include the words, "limited liability company," without abbreviation or shall include one of the following abbreviations: "LLC," "L.L.C.," "limited," "ltd.," or "ltd".

(B)

(1) Except as provided in this section and in sections 1701.75 , 1701.78 , 1701.82 , 1705.36 , and 1705.37 of the Revised Code, the secretary of state shall not accept for filing in the secretary of state's office the articles of organization of a limited liability company if the company name set forth in the articles is not distinguishable on the records of the secretary of state from the name of any of the following:

(a) Any other limited liability company, whether the name is of a domestic limited liability company or of a foreign limited liability company registered as a foreign limited liability company under this chapter;

(b) Any corporation, whether the name is of a domestic corporation or of a foreign corporation holding a license as a foreign corporation under the laws of this state pursuant to Chapter 1701., 1702., or 1703. of the Revised Code;

(c) Any limited liability partnership, whether the name is of a domestic limited liability partnership or a foreign limited liability partnership registered pursuant to Chapter 1775. or 1776. of the Revised Code;

(d) Any limited partnership, whether the name is of a domestic limited partnership or a foreign limited partnership registered pursuant to Chapter 1782. of the Revised Code;

(e) Any trade name to which the exclusive right, at the time in question, is registered in the office of the secretary of state pursuant to Chapter 1329. of the Revised Code.

(2) The secretary of state may accept for filing in the secretary of state's office the articles of organization of a limited liability company whose name set forth in the articles is not distinguishable on the records of the secretary of state from any trade name or the name of another limited liability company, corporation, limited liability partnership, or limited partnership if there also is filed in the secretary of state's office the consent of the other entity or, in the case of a registered trade name, the person in whose name is registered the exclusive right to the use of the particular name.

(C) A consent given by an entity or person in whose name is registered the exclusive right to use a trade name, to the use of a name by a limited liability company, shall be in the form of an instrument, prescribed by the secretary of state, that is signed by an authorized officer or other authorized representative of the consenting entity or person in whose name the trade name is registered.

(D) If a judicial sale or a judicial transfer by sale, transfer of good will, or otherwise involves the right to use the name of a domestic limited liability company or of a foreign limited liability company registered as a foreign limited liability company under this chapter, then, at the request of the purchaser or transferee of that right, the secretary of state shall accept for filing articles of organization of a limited liability company with a name that is the same as or similar to the name of the other limited liability company if there also is filed in the secretary of state's office a certified copy of the court order or decree that confirms or otherwise evidences the purchase or transfer.

(E) Any person that wishes to reserve a name for a proposed new limited liability company or any limited liability company that intends to change its name may submit to the secretary of state, on a form prescribed by the secretary of state, a written application for the exclusive right to use a specified name as the name of the company. If the secretary of state finds, consistent with this section, that the specified name is available for use, the secretary of state shall file the application. From the date of the filing, the applicant has the exclusive right for one hundred eighty days to use the specified name as the name of the limited liability company, counting the date of the filing as the first of the one hundred eighty days. The right so obtained may be transferred by the applicant or other holder of the right by filing in the office of the secretary of state a written transfer, on a form prescribed by the secretary of state, that states the name and address of the transferee.

Effective Date: 06-06-2001; 2008 HB332 08-06-2008

1705.06 Statutory agent.

(A) Each limited liability company shall maintain continuously in this state an agent for service of process on the company. The agent shall be one of the following:

(1) A natural person who is a resident of this state ;

(2) A domestic or foreign corporation , nonprofit corporation, limited liability company, partnership, limited partnership, limited liability partnership, limited partnership association, professional association, business trust, or unincorporated nonprofit association that has a business address in this state. If the agent is an entity other than a domestic corporation, the agent shall meet the requirements of Title XVII of the Revised Code for an entity of the agent's type to transact business or exercise privileges in this state.

(B)

(1) The secretary of state shall not accept original articles of organization of a limited liability company for filing unless the articles are accompanied by both of the following:

(a) A written appointment of an agent as described in division (A) of this section that is signed by an authorized member, manager, or other representative of the limited liability company;

(b) A written acceptance of the appointment that is signed by the designated agent on a form prescribed by the secretary of state.

(2) In cases not covered by division (B)(1) of this section, the limited liability company shall appoint the agent described in division (A) of this section and shall file with the secretary of state, on a form prescribed by the secretary of state, a written appointment of that agent that is signed as described in division (K) of this section and a written acceptance of the appointment that is signed by the designated agent.

(3) For purposes of divisions (B)(1) and (2) of this section, the filed written acceptance of an agent's appointment shall be a signed original document or a photocopy, facsimile, or similar reproduction of a signed original document.

(C) The written appointment of an agent described in division (A) of this section shall set forth the name of the agent and the agent's address in this state, including the street and number or other particular description of that address. It otherwise shall be in the form that the secretary of state prescribes. The secretary of state shall keep a record of the names of limited liability companies and the names and addresses of their agents.

(D) If any agent described in division (A) of this section dies, resigns, or moves outside of this state, the limited liability company shall appoint forthwith another agent and file with the secretary of state, on a form prescribed by the secretary of state, a written appointment of the agent and acceptance of appointment as described in division (B)(2) of this section.

(E) If the agent described in division (A) of this section changes the agent's address from the address stated in the records of the secretary of state, the agent or the limited liability company shall file forthwith with the secretary of state, on a form prescribed by the secretary of state, a written statement setting forth the new address.

(F) An agent described in division (A) of this section may resign by filing with the secretary of state, on a form prescribed by the secretary of state, a written notice of resignation that is signed by the agent and by mailing a copy of that notice to the limited liability company at the current or last known address of its principal office. The notice shall be mailed to the company on or prior to the date that the notice is filed with the secretary of state and shall set forth the name of the company, the name and current address of the agent, the current or last known address, including the street and number or other particular description, of the company's principal office, a statement of the resignation of the agent, and a statement that a copy of the notice has been sent to the company within the time and in the manner specified in this division. The authority of the resigning agent terminates thirty days after the filing of the notice with the secretary of state.

(G) A limited liability company may revoke the appointment of its agent described in division (A) of this section by filing with the secretary of state, on a form prescribed by the secretary of state, a written appointment of another agent and an acceptance of appointment in the manner described in division (B)(2) of this section and a statement indicating that the appointment of the former agent is revoked.

(H)

(1) Any legal process, notice, or demand required or permitted by law to be served upon a limited liability company may be served upon the company as follows:

(a) If the agent described in division (A) of this section is a natural person, by delivering a copy of the process, notice, or demand to the agent;

(b) If the agent is not a natural person, by delivering a copy of the process, notice, or demand to the address of the agent in this state as contained in the records of the secretary of state.

(2) If the agent described in division (A) of this section cannot be found or no longer has the address that is stated in the records of the secretary of state or the limited liability company has failed to maintain an agent as required by this section and if the party or the agent or representative of the party that desires service of the process, notice, or demand files with the secretary of state an affidavit that states that one of those circumstances exists and states the most recent address of the company that the party who desires service has been able to ascertain after a diligent search, then the service of the process, notice, or demand upon the secretary of state as the agent of the company may be initiated by delivering to the secretary of state four copies of the process, notice, or demand accompanied by a fee of five dollars. The secretary of state shall give forthwith notice of that delivery to the company at either its principal office as shown upon the secretary of state's records or at any different address specified in the affidavit of the party desiring service and shall forward to the company at either address by certified mail, return receipt requested, a copy of the process, notice, or demand. Service upon the company is made when the secretary of state gives the notice and forwards the process, notice, or demand as set forth in division (H)(2) of this section.

(I) The secretary of state shall keep a record of each process, notice, and demand that pertains to a limited liability company and that is delivered to the secretary of state's office under this section or another law of this state that authorizes service upon the secretary of state in connection with a limited liability company. In that record, the secretary of state shall record the time of each delivery of that type and the secretary of state's subsequent action with respect to the process, notice, or demand.

(J) This section does not limit or affect the right to serve any process, notice, or demand upon a limited liability company in any other manner permitted by law.

(K) The written appointment of an agent or a written statement filed by the company with the secretary of state shall be signed by an authorized member, manager, or other representative of the company.

Amended by 130th General Assembly File No. 62, SB 98, §1, eff. 2/18/2014.

Effective Date: 06-06-2001

1705.07 Acceptance of articles of organization and other certificates - filing not constructive notice of contents.

(A) If articles of organization or other certificates relating to a limited liability company are submitted to the secretary of state and the secretary of state finds that they comply with this chapter, the secretary of state shall accept the articles or other certificates for filing and shall make a copy of the articles or other certificates for the secretary of state's records by microfilm or by any authorized photostatic or digitized process. Evidence of the filing shall be returned to the person who filed it.

(B) The secretary of state is not required to file any document that relates to a limited liability company except documents required to be filed under this chapter. The duties imposed upon the secretary of state by this chapter are ministerial. The secretary of state shall not make any determination regarding the legal sufficiency of any document that is presented for filing under this chapter, and that appears on its face to be legally sufficient.

(C) No person dealing with a limited liability company is charged with constructive notice of the contents of any document by reason of its filing with the secretary of state.

Effective Date: 07-29-1998

1705.08 Filing of certificate of amendment of articles.

(A) The articles of organization of a limited liability company may be amended at any time and for any proper purpose by filing a certificate of amendment with the secretary of state. However, a certificate of amendment amending the articles of organization shall be filed within thirty days after the occurrence of any of the following:

(1) The name of the limited liability company is changed;

(2) The period of the limited liability company's duration is changed;

(3) Any other information that is set forth in the articles of organization is changed.

(B) A member of a limited liability company in which the management is reserved to its members, or a manager of a limited liability company in which the management is not reserved to its members, promptly shall file or cause to be filed a certificate of amendment upon discovering that a statement in the articles of organization was materially false when made or that any other information set forth in the articles of organization has changed making the articles materially inaccurate.

(C)

(1) A certificate of amendment filed pursuant to division (A) or (B) of this section shall be on a form prescribed by the secretary of state and shall set forth all of the following:

(a) The name of the limited liability company;

(b) The date of the filing of the limited liability company's articles of organization that are being amended;

(c) The amendment to the limited liability company's articles of organization.

(2) The certificate of amendment shall be executed by a member, manager, or authorized representative of the limited liability company, which person shall also certify that the person is authorized to execute the certificate.

(D) The articles of organization of a limited liability company may be restated at any time by filing a restatement of the articles of organization with the secretary of state. The restatement shall be certified by a member, manager, or authorized representative of the limited liability company, which person shall also certify that the person is authorized to execute the restatement.

Effective Date: 12-03-1999

1705.081 Effect of operating agreement.

(A) Except as otherwise provided in division (B) of this section, an operating agreement governs relations among members and between members, any managers, and the limited liability company. A limited liability company is bound by the operating agreement of its member or members whether or not the limited liability company executes the operating agreement. To the extent the operating agreement does not otherwise provide, this chapter governs relations among the members and between the members, any managers, and the limited liability company.

(B) The operating agreement may not do any of the following:

(1) Vary the rights and duties under section 1705.04 of the Revised Code;

(2) Unreasonably restrict the right of access to books and records under section 1705.22 of the Revised Code;

(3) Eliminate the duty of loyalty under division (C) of section 1705.161 of the Revised Code or division (B) of section 1705.281 of the Revised Code, but the operating agreement may identify activities that do not violate the duty of loyalty , and all of the members or a number or percentage of members specified in the operating agreement may authorize or ratify, after full disclosure of all material facts, a specific act or transaction that otherwise would violate the duty of loyalty;

(4) Eliminate the duty of care under division (C) of section 1705.161 of the Revised Code or division (C) of section 1705.281 of the Revised Code, but the operating agreement may prescribe the standards by which the duty is to be measured;

(5) Eliminate the obligation of good faith and fair dealing under division (D) of section 1705.281 of the Revised Code, but the operating agreement may prescribe the standards by which the performance of the obligation is to be measured ;

(6) Eliminate the duties of a manager under division (B) of section 1705.29 of the Revised Code, but the operating agreement may prescribe in writing the standards by which performance is to be measured or identify activities that do not violate the manager's duties ;

(7) Vary the requirement to wind up the limited liability company's business in cases specified in division (A) or (B) of section 1705.47 of the Revised Code;

(8) Restrict the rights of third parties under this chapter.

Amended by 129th General AssemblyFile No.169, HB 247, §1, eff. 3/22/2013.

Added by 129th General AssemblyFile No.72, HB 48, §1, eff. 5/4/2012.

1705.09 Contributions.

(A) The contributions of a member may be made in cash, property, services rendered, a promissory note, or any other binding obligation to contribute cash or property or to perform services; by providing any other benefit to the limited liability company; or by any combination of these.

(B) A promise by a member to contribute to the limited liability company is not enforceable unless it is set forth in a writing signed by the member.

(C) Except as otherwise provided in the operating agreement, a member is obligated to the limited liability company to perform any enforceable promise to contribute cash or other property or to perform services, even if the member is unable to perform the promise because of death, disability, or another reason. If a member fails to make a required contribution of property or services, then, at the option of the limited liability company, the member is obligated to contribute cash equal to the portion of the value as stated in the records required to be kept under section 1705.28 of the Revised Code of the stated contribution that the member has failed to make. This right of the company is in addition to and not in lieu of any other rights, including, but not limited to, the right to specific performance, that the company may have against the member under the operating agreement or applicable law.

(D) Unless otherwise provided in the operating agreement, the obligation of a member to make a contribution or to return money or other property paid or distributed in violation of this chapter may be compromised only by the consent of all of the members.

Effective Date: 07-01-1994; 10-12-2006

1705.10 Allocating profits and losses.

The profits, losses, income, gains, deductions, credits, or similar items of a limited liability company shall be allocated among the members and classes of members in the manner provided in writing in the operating agreement. If the operating agreement does not provide in writing for an allocation, the allocation shall be made on the basis of the value as stated in the records of the company required to be kept under section 1705.28 of the Revised Code of the contributions made by each member to the extent they have been received by the company and have not been returned.

Effective Date: 07-01-1994

1705.11 Distributions to members.

(A) A limited liability company from time to time may distribute cash or other property to its members. Unless otherwise provided in the operating agreement, distributions that are made shall be made to the members in proportion to the value as stated in the records of the company required to be kept under section 1705.28 of the Revised Code of the contributions made by each member to the extent the contributions have been received by the company and have not been returned.

(B) Except to the extent otherwise provided in the operating agreement, when a member becomes entitled to receive a distribution from the limited liability company, the member also becomes, and is entitled to all the remedies available to, a creditor of the company with respect to the distribution.

Effective Date: 10-04-1996

1705.12 Rights of withdrawing member.

Upon withdrawal, a member withdrawing from a limited liability company has the right to receive any distribution to which the member is entitled under the operating agreement and, except as otherwise provided in that agreement, the withdrawing member shall be treated as if the member were an assignee of all of the member's membership interest as of the date of withdrawal.

Effective Date: 12-03-1999

1705.13 Distribution in kind.

Except as provided in writing in the operating agreement and regardless of the nature of his contribution, a member has no right to demand and receive any distribution from a limited liability company in any form other than cash. Except as provided in writing in the operating agreement, a member may not be compelled to accept a distribution of any asset in kind from a limited liability company if the percentage of the asset distributed to him is greater or less than the percentage in which he shares in distributions from the company.

Effective Date: 07-01-1994

1705.14 Person becomes member of company - admission of additional members.

(A) A person becomes a member at the time that a limited liability company is formed or at any later time that is specified in the records of the company for becoming a member.

(B) After the filing of the articles of organization of a limited liability company, a person may be admitted as an additional member in either of the following ways:

(1) If he acquires an interest directly from the limited liability company, upon compliance with the operating agreement or, if the operating agreement does not so provide, upon the written consent of all of the members;

(2) If he is an assignee of the interest of a member who has the power as provided in writing in the operating agreement to grant the assignee the right to become a member, upon the exercise of that power and compliance with any conditions limiting the grant or exercise of the power.

Effective Date: 07-01-1994

1705.15 Person ceases to be member of company.

Except as approved by the specific written consent of all members at the time, a person ceases to be a member of a limited liability company upon the occurrence of any of the following events of withdrawal:

(A) A member resigns or withdraws as a member in accordance with the operating agreement or under section 1705.16 or 1705.18 of the Revised Code.

(B) A member is removed or expelled as a member in accordance with the operating agreement.

(C) Unless otherwise provided in writing in the operating agreement, the member does any of the following:

(1) Makes an assignment for the benefit of creditors;

(2) Files a voluntary petition in bankruptcy;

(3) Is adjudicated a bankrupt or insolvent;

(4) Files a petition or answer in any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief proceeding under any law or rule that seeks for himself any of those types of relief;

(5) Files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against him in any proceeding seeking the relief described in division (C)(4) of this section.

(D) Unless otherwise provided in writing in the operating agreement, a period of one hundred twenty days has elapsed after the commencement against the member of any proceeding seeking the relief described in division (C)(4) of this section, and the proceeding has not been dismissed; a period of ninety days has elapsed after the appointment of a trustee, receiver, or liquidator for the member or for all or any substantial part of his properties without the member's consent or acquiescence, and the appointment has not been vacated or stayed; or a period of ninety days has elapsed after the expiration of that stay, and the appointment has not been vacated.

(E) Unless otherwise provided in writing in the operating agreement, a member who is an individual dies or is adjudicated an incompetent.

(F) Unless otherwise provided in writing in the operating agreement, the trust of which a member is a trustee terminates. This division does not apply to the mere substitution of a new trustee.

(G) Unless otherwise provided in writing in the operating agreement, if a member is a partnership, the dissolution and commencement of winding up of the partnership.

(H) Unless otherwise provided in writing in the operating agreement, if a member is a separate limited liability company, the dissolution and commencement of winding up of the separate limited liability company.

(I) Unless otherwise provided in writing in the operating agreement, if a member is a corporation, a certificate of dissolution or its equivalent is filed for the corporation, or its charter is revoked and is not reinstated within ninety days after the revocation.

(J) Unless otherwise provided in writing in the operating agreement, if a member is an estate, the distribution of the estate's membership interest.

Effective Date: 07-01-1994

1705.16 Withdrawal of member from company.

(A) Except as provided in division (C) of this section, if the management of a limited liability company is reserved to its members, a member may withdraw from the company at any time by giving written notice to the other members. If the withdrawal violates the operating agreement, then, in addition to exercising any remedies otherwise available under applicable law, the company may recover from the withdrawing member damages for breach of the operating agreement and may offset the damages against the amount otherwise distributable to the withdrawing member on account of the withdrawing member's membership interest.

(B) Except as provided in division (C) of this section, if the management of a limited liability company is not reserved to its members, the operating agreement may prohibit withdrawal or may specify the time at which or the events the occurrence of which entitle a member to withdraw. If the operating agreement does not prohibit withdrawal, does not specify the time at which or the events upon the occurrence of which a member may withdraw, and does not indicate a definite time for the dissolution and the winding up of the company, a member may withdraw after giving at least six-months written notice of the proposed withdrawal to each nonwithdrawing member at its address as set forth in the records of the company that are required to be kept under section 1705.28 of the Revised Code.

(C) If the limited liability company was formed on or after the effective date of this amendment, or the company was formed prior to the effective date of this amendment and its articles of organization or operating agreement specifically state that this division applies to the company, a member may withdraw from the company only at the time or upon the occurrence of an event specified in writing in the articles of organization or the operating agreement.

Effective Date: 11-21-1997

1705.161 Withdrawal of member.

(A) Upon a member's withdrawal from a limited liability company, the member's right to participate in the management and conduct of the limited liability company's business terminates.

(B) Upon a member's withdrawal, the member's duty of loyalty under division (B)(3) of section 1705.281 of the Revised Code terminates.

(C) Upon a member's withdrawal, a member's duty of loyalty under divisions (B)(1) and (2) of section 1705.281 of the Revised Code and duty of care under division (C) of section 1705.281 of the Revised Code continue only with regard to matters arising and events occurring before the member's withdrawal.

Added by 129th General AssemblyFile No.72, HB 48, §1, eff. 5/4/2012.

1705.17 Membership interest is personal property.

A membership interest in a limited liability company is personal property.

Effective Date: 07-01-1994

1705.18 Assignment of membership interest.

(A) Except as otherwise provided in the operating agreement, a membership interest in a limited liability company is assignable in whole or in part. An assignment of a membership interest does not dissolve the company or entitle the assignee to become or to exercise any rights of a member. An assignment entitles the assignee only to receive, to the extent assigned, the distributions of cash and other property and the allocations of profits, losses, income, gains, deductions, credits, or similar items to which the assignee's assignor would have been entitled. Except as otherwise provided in the operating agreement, an assignor ceases to be a member upon assignment of all the assignor's membership interest. Unless otherwise provided in an operating agreement and except to the extent assumed by agreement of an assignee, until an assignee of a membership interest becomes a member, the assignee does not have liability as a member solely because of the assignment.

(B) A substitute member of a limited liability company or an assignee of a membership interest in a limited liability company is bound by the operating agreement whether or not the substitute member or assignee executes the operating agreement.

Amended by 129th General AssemblyFile No.72, HB 48, §1, eff. 5/4/2012.

Effective Date: 10-04-1996

1705.19 Rights of judgment creditor.

(A) If any judgment creditor of a member of a limited liability company applies to a court of common pleas to charge the membership interest of the member with payment of the unsatisfied amount of the judgment with interest, the court may so charge the membership interest. To the extent the membership interest is so charged, the judgment creditor has only the rights of an assignee of the membership interest as set forth in section 1705.18 of the Revised Code. Nothing in this chapter deprives a member of the member's statutory exemption.

(B) An order charging the membership interest of a member of a limited liability company is the sole and exclusive remedy that a judgment creditor may seek to satisfy a judgment against the membership interest of a member or a member's assignee.

(C) No creditor of a member of a limited liability company or a member's assignee shall have any right to obtain possession of, or otherwise exercise legal or equitable remedies with respect to, the property of the limited liability company.

(D) A limited liability company or one or more members of a limited liability company who are not subject to a charging order entered in favor of a judgment creditor may at any time pay to the judgment creditor the full amount then still due under the judgment and by that payment succeed to the rights of that judgment creditor.

Amended by 129th General AssemblyFile No.72, HB 48, §1, eff. 5/4/2012.

Effective Date: 07-01-1994; 10-12-2006

1705.20 Assignee may become member.

(A) An assignee of a membership interest in a limited liability company may become a member if and to the extent that the assignor gives the assignee that right and either of the following occurs:

(1) The assignor has been given the authority in writing in the operating agreement to give an assignee the right to become a member.

(2) All other members consent.

(B) An assignee who has become a member has to the extent assigned the rights and powers of a member under the operating agreement and this chapter and is subject to the restrictions and liabilities of a member under the operating agreement and this chapter. An assignee who becomes a member also is liable for the obligations of his assignor to make contributions as provided in section 1705.09 of the Revised Code. An assignee is not obligated for liabilities that could not be ascertained from a written operating agreement and that were unknown to the assignee at the time he became a member.

(C) An assignor is not released from his liability to a limited liability company under section 1705.09 of the Revised Code whether or not the assignee becomes a member.

Effective Date: 07-01-1994

1705.21 Legal representative of member.

(A) Except as otherwise provided in the operating agreement or articles of organization, if a member who is an individual dies or is adjudged an incompetent, the member's executor, administrator, guardian, or other legal representative may exercise all of the member's rights as a member for the purpose of settling the member's estate or administering the member's property, including any authority that the member had to give an assignee the right to become a member.

(B) If a member is a corporation, trust, general or limited partnership, or other entity and is dissolved or terminated, the powers of the member may be exercised by its legal representative or successor.

Effective Date: 07-01-1994; 2007 HB134 10-18-2007

1705.22 Right of member to information.

(A)

(1) Subject to any reasonable standards stated in the operating agreement or otherwise established by the members, each member has the right to obtain from the limited liability company all of the following from time to time and upon reasonable demand for any purpose reasonably related to its membership interest in the company:

(a) True and full information regarding the status of the business and the financial condition of the company;

(b) Promptly after becoming available, a copy of the federal, state, and local income tax returns of the company for each year;

(c) A current list of the name and last known business, residence, or mailing address of each member;

(d) If the management of the company is not reserved to its members, a current list of the name and last known business, residence, or mailing address of each manager of the company;

(e) A copy of the articles of organization, all amendments to the articles, and any written powers of attorney pursuant to which the articles and the amendments have been executed;

(f) A copy of any written operating agreement, all amendments to that operating agreement, and executed copies of any written powers of attorney pursuant to which the operating agreement and the amendments have been executed;

(g) True and full information regarding the date on which each member became a member and the amount of cash, and a description and statement of the agreed value of any other property or services, that have been contributed by each member and that each member has agreed to contribute in the future;

(h) Other information regarding the affairs of the company that is just and reasonable.

(2) The reasonable standards authorized by division (A)(1) of this section may include standards governing the type and nature of information and documents that are to be furnished, the time and location at which they are to be furnished, and the person who is to pay the expense of furnishing them.

(B) Unless otherwise provided in the operating agreement, a limited liability company has the right to keep confidential from its members for a reasonable period of time any information that the company reasonably considers to be in the nature of trade secrets or any other information as follows:

(1) Information the disclosure of which the company in good faith reasonably believes is not in the best interest of the company or could damage the company or its business;

(2) Information that the company is required by law or by agreement with a third person to keep confidential.

(C) A limited liability company may maintain its records in a form other than a written form if the form used is capable of conversion into written form within a reasonable time.

(D) A limited liability company may require that any demand under this section be in writing and state its purpose.

(E) In complying with this section, the limited liability company may elect to do either or both of the following:

(1) Provide a member with the right to examine documents in person or by agent or attorney and to make copies or extracts of the documents;

(2) Provide to a member true and accurate copies of documents responsive to the demand.

Effective Date: 07-01-1994

1705.23 Liability for return of unauthorized distribution or payment.

A member who knowingly receives any distribution or payment made contrary to the articles of organization or the operating agreement of a limited liability company is liable to the company for the amount received by him that is in excess of the amount that could have been paid or distributed without a violation of the articles or the operating agreement. No action shall be brought by or on behalf of the company upon a cause of action arising under this section at any time after two years from the day on which the violation of the articles or operating agreement occurs.

Effective Date: 07-01-1994

1705.24 Vesting of management authority.

Unless otherwise provided in writing in the operating agreement, the management of a limited liability company shall be vested in its members in proportion to their contributions to the capital of the company, as adjusted from time to time to properly reflect any additional contributions or withdrawals by the members.

Effective Date: 07-01-1994

1705.25 Authority of managers.

(A) If the management of a limited liability company is reserved to its members, all of the following apply:

(1) Every member is an agent of the company for the purpose of its business, and the act of every member, including the execution in the company name of any instrument for apparently carrying on in the usual way the business of the company binds the company, unless the member so acting has in fact no authority to act for the company in the particular matter, and the person with whom he is dealing has knowledge of the fact that he does not have that authority.

(2) Unless the act is authorized by the other members, an act of a member that is not apparently for the carrying on the business of a limited liability company in the usual way does not bind the company.

(3) Unless authorized by the other members or unless the other members have abandoned the business, one or more but less than all of the members of a limited liability company have no authority to do any of the following:

(a) Assign the property of the company in trust for creditors or on the assignee's promise to pay the debts of the company;

(b) Dispose of the good will of the business of the company;

(c) Do any other act that would make it impossible to carry on the ordinary business of the company;

(d) Confess a judgment;

(e) Submit a claim or liability of the company to arbitration or reference.

(B) Except as provided in the operating agreement, if the management of a limited liability company is not reserved to its members, all of the following apply:

(1) Every manager is an agent of the company for the purpose of its business, and the act of every manager, including the execution in the company name of any instrument for apparently carrying on in the usual way the business of the company binds the company, unless the manager so acting has in fact no authority to act for the company in the particular matter, and the person with whom he is dealing has knowledge of the fact that he does not have that authority.

(2) Unless it is authorized by the members, an act of a manager that is not apparently for the carrying on the business of a limited liability company in the usual way does not bind the company.

(3) Unless authorized by the members or unless the limited liability company has dissolved, managers of the company have no authority to engage in any of the conduct listed in divisions (A)(3)(a) to (e) of this section.

(C) Except as otherwise provided in the operating agreement, a person who is both a manager and a member of a limited liability company has the rights and powers of a manager, is subject to the restrictions and liabilities of a manager, and, to the extent of his membership interest, has the rights and powers of a member and is subject to the restrictions and liabilities of a member.

Effective Date: 07-01-1994

1705.26 Right to vote on per capita or other basis.

The operating agreement of a limited liability company may grant to all or a specified group of its members the right to vote on a per capita or other basis upon any matter.

Effective Date: 07-01-1994

1705.27 Adoption of bylaws.

The members of a limited liability company or, if and to the extent authorized by its members, the managers of a limited liability company may adopt bylaws that are not inconsistent with the articles of organization or the operating agreement and that are for the regulation of the members, the managers, or any other matter affecting the management of the company, including, but not limited to, books and records of account, minutes of proceedings, meetings, requirements for notices of meetings, computation of time for notice, method of giving notice, quorum requirements, written action in lieu of a meeting, waiver of notice, proxies, and officers.

Effective Date: 07-01-1994

1705.28 Principal office shall keep certain records.

(A) The principal office of a limited liability company need not be in this state. The company shall keep at its principal office all of the following:

(1) A current list of the full names, in alphabetical order, and last known business or residence address of each member;

(2) A copy of the articles of organization, all amendments to the articles, and executed copies of any powers of attorney pursuant to which the articles or the amendments have been executed;

(3) A copy of any written operating agreement, all amendments to that operating agreement, and executed copies of any written powers of attorney pursuant to which the operating agreement and the amendments have been executed;

(4) Copies of any federal, state, and local income tax returns and reports of the company for the three most recent years;

(5) Copies of any financial statements of the company for the three most recent years;

(6) Unless contained in a written operating agreement, a writing setting forth all of the following:

(a) The amount of cash, and a description and statement of the agreed value of any other property or services, that each member has contributed and has agreed to contribute in the future;

(b) Each time at which and each event on the occurrence of which any additional contribution agreed to be made by each member is to be made;

(c) Any right of the company to make to a member, or of a member to receive, any distribution that includes a return of all or any part of his contribution;

(d) Each event upon the occurrence of which the company is to be dissolved and its affairs wound up.

(B) The records required to be kept pursuant to division (A) of this section are subject to section 1705.22 of the Revised Code.

Effective Date: 07-01-1994

1705.281 Members duties to LLC and other members.

(A) The only fiduciary duties a member owes to a limited liability company and the other members are the duty of loyalty and the duty of care set forth in divisions (B) and (C) of this section.

(B) A member's duty of loyalty to the limited liability company and the other members is limited to the following:

(1) To account to the limited liability company and hold as trustee for the limited liability company any property, profit, or benefit derived by the member in the conduct and winding up of the limited liability company's business or derived from a use by the member of the limited liability company's property, including the appropriation of a limited liability company opportunity;

(2) To refrain from dealing with the limited liability company in the conduct or winding up of the limited liability company's business as or on behalf of a party having an interest adverse to the limited liability company;

(3) To refrain from competing with the limited liability company in the conduct of the limited liability company's business before the dissolution of the limited liability company.

(C) A member's duty of care to the limited liability company in the conduct and winding up of the limited liability company's business is limited to refraining from engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law.

(D) A member shall discharge duties to the limited liability company and the other members pursuant to this chapter or under the operating agreement and shall exercise any rights consistent with the obligation of good faith and fair dealing.

(E) A member does not violate a duty or obligation under this chapter or under the operating agreement merely because the member's conduct furthers the member's own interest.

(F) A member may lend money to and transact other business with the limited liability company and as to each loan or transaction the rights and obligations of the member are the same as those of a person who is not a member, subject to other applicable law.

(G) This section applies to a person winding up the limited liability company's business as the personal or legal representative of the last surviving member as if the person were a member.

Added by 129th General AssemblyFile No.72, HB 48, §1, eff. 5/4/2012.

1705.282 Duties of member manager.

(A) A manager of a limited liability company who was appointed in writing and has agreed in writing to serve as a manager and who is also a member or who is serving as the representative of a member owes to the limited liability company and the other members the duties of a manager.

(B) Except as otherwise provided in division (A) of this section, a manager of a limited liability company who is a member or who is serving as the representative of a member owes to the limited liability company and the other members only the duties that would be owed by the member.

Added by 129th General AssemblyFile No.72, HB 48, §1, eff. 5/4/2012.

1705.29 Managers - powers and duties.

(A) If the operating agreement of a limited liability company provides for managers, then the business of the company shall be exercised by or under the direction of its managers, except to the extent applicable law or the operating agreement provides otherwise.

(B) If a manager's duties are not governed by division (B) of section 1705.282 of the Revised Code, then the only fiduciary duties a manager owes to the limited liability company are the duties to act in good faith, in a manner the manager reasonably believes to be in or not opposed to the best interests of the company, and with the care that an ordinarily prudent person in a similar position would use under similar circumstances.

(C) For purposes of division (B) of this section:

(1) A manager of a limited liability company shall not be found to have violated division (B) of this section unless it is proved, by clear and convincing evidence, in any action brought against the manager, including, but not limited to, an action involving or affecting a termination or potential termination of service to the company as a manager or service in any other position or relationship with the company, that the manager has not acted in good faith, in a manner the manager reasonably believes to be in or not opposed to the best interests of the company, or with the care that an ordinarily prudent person in a similar position would use under similar circumstances.

(2) A manager shall not be considered to be acting in good faith if the manager has knowledge concerning a particular matter that would cause reliance on information, opinions, reports, or statements that are prepared or presented by the persons described in section 1705.30 of the Revised Code to be unwarranted.

(3) Nothing in division (C) of this section limits relief available under section 1705.31 of the Revised Code.

(D) A manager of a limited liability company is liable in damages for any action that the manager takes or fails to take as a manager only if it is proved, by clear and convincing evidence, in a court with jurisdiction that the manager's action or failure to act involved an act or omission undertaken with deliberate intent to cause injury to the company or undertaken with reckless disregard for the best interests of the company. Nothing contained in this division limits the relief available under section 1705.31 of the Revised Code. This division does not apply if and only to the extent that, at the time of the act or omission of a manager that is the subject of complaint, the articles of organization or the operating agreement of the company state by specific reference to this division that its provisions do not apply to the company.

Amended by 129th General AssemblyFile No.72, HB 48, §1, eff. 5/4/2012.

Effective Date: 07-01-1994

1705.30 Relying on information.

In performing his duties or exercising his authority, a member or manager of a limited liability company is entitled to rely on information, opinions, reports, or statements, including, but not limited to, financial statements and other financial data, that are prepared or presented by the following persons:

(A) One or more members, managers, officers, or employees of the company who the member or manager reasonably believes are reliable and competent in the matters prepared or presented;

(B) Counsel, public accountants, or other persons as to matters that the member or manager reasonably believes are within the person's professional or expert competence.

Effective Date: 07-01-1994

1705.31 Contracts involving members, managers, or officers.

(A) Unless otherwise provided in the operating agreement, the following apply:

(1) No contract, action, or transaction is void or voidable with respect to a limited liability company because it is between or affects the company and one or more of its members, managers, or officers, or because it is between or affects the company and any other person in which one or more of its members, managers, or officers are members, managers, directors, trustees, or officers or have a financial or personal interest, or because one or more interested members, managers, or officers participate in or vote at the meeting that authorizes the contract, action, or transaction, if any of the following applies:

(a) The material facts as to his or their relationship or interest and as to the contract, action, or transaction are disclosed or are known to the members or managers, and the members or managers, in good faith reasonably justified by those facts, authorize the contract, action, or transaction by the affirmative vote of a majority of the disinterested members or managers, even though the disinterested members or managers constitute less than a quorum of the members or managers.

(b) The material facts as to his or their relationship or interest and as to the contract, action, or transaction are disclosed or are known to the members entitled to vote on the contract, action, or transaction, and the contract, action, or transaction is specifically approved at a meeting of the members held for that purpose by the affirmative vote of the members entitled to exercise a majority of the voting power of the company held by persons not interested in the contract, action, or transaction.

(c) The contract, action, or transaction is fair to the company as of the time it is authorized or approved by the members or managers.

(2) Common or interested managers may be counted in determining the presence of a quorum at a meeting of the managers that authorize a contract, action, or transaction.

(3) Irrespective of any financial or personal interest of any member or manager, the members of a limited liability company by the affirmative vote of a majority of the voting power of the company if the management of the company is reserved to the members, or the managers of a limited liability company by the affirmative vote of a majority of those in office if the management of the company is not reserved to its members, have authority to establish reasonable compensation for services rendered to the company by its members, managers, and officers or may delegate that authority to one or more managers or officers. The reasonable compensation may include pension, disability, and death benefits.

(B) For purposes of this section:

(1) A member or manager is not an interested member or manager solely because the subject of a contract, action, or transaction may involve or affect a change in control of the limited liability company or his continuation as a member or manager of the limited company.

(2) "Action" means a resolution adopted by the members or managers of a limited liability company.

Effective Date: 07-01-1994

1705.32 Indemnifying manager, officer, employee, or agent.

(A) A limited liability company may indemnify or agree to indemnify any person who was or is a party, or who is threatened to be made a party, to any threatened, pending, or completed civil, criminal, administrative, or investigative action, suit, or proceeding, other than an action by or in the right of the company, because he is or was a manager, member, partner, officer, employee, or agent of the company or is or was serving at the request of the company as a manager, director, trustee, officer, employee, or agent of another limited liability company, corporation, partnership, joint venture, trust, or other enterprise. The company may indemnify or agree to indemnify a person in that position against expenses, including attorney's fees, judgments, fines, and amounts paid in settlement that actually and reasonably were incurred by him in connection with the action, suit, or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the company and, in connection with any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit, or proceeding by judgment, order, settlement, or conviction or upon a plea of nolo contendere or its equivalent does not create of itself a presumption that the person did not act in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the company and, in connection with any criminal action or proceeding, a presumption that he had reasonable cause to believe that his conduct was unlawful.

(B) A limited liability company may indemnify or agree to indemnify any person who was or is a party or who is threatened to be made a party to any threatened, pending, or completed action or suit by or in the right of the company to procure a judgment in its favor, because he is or was a manager, officer, employee, or agent of the company or is or was serving at the request of the company as a manager, member, partner, director, trustee, officer, employee, or agent of another limited liability company, corporation, partnership, joint venture, trust, or other enterprise. The company may indemnify or agree to indemnify a person in that position against expenses, including attorney's fees, that were actually and reasonably incurred by him in connection with the defense or settlement of the action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the company, except that an indemnification shall not be made in respect of any claim, issue, or matter as to which the person is adjudged to be liable for negligence or misconduct in the performance of his duty to the company unless and only to the extent that the court of common pleas or the court in which the action or suit was brought determines, upon application, that, despite the adjudication of liability but in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnification for expenses that the court considers proper.

(C) To the extent that a manager, officer, employee, or agent of a limited liability company has been successful on the merits or otherwise in defense of any action, suit, or proceeding referred to in division (A) or (B) of this section or has been successful in defense of any claim, issue, or matter in an action, suit, or proceeding referred to in those divisions, he shall be indemnified against expenses, including attorney's fees, that were actually and reasonably incurred by him in connection with the action, suit, or proceeding.

(D)

(1) Unless ordered by a court and subject to division (C) of this section, any indemnification under division (A) or (B) of this section shall be made by the limited liability company only as authorized in the specific case, upon a determination that indemnification of the manager, officer, employee, or agent is proper under the circumstances because he has met the applicable standard of conduct set forth in division (A) or (B) of this section. The determination shall be made in any of the following ways:

(a) By a majority vote of a quorum consisting of managers of the indemnifying company who were not and are not parties to or threatened to be made parties to the action, suit, or proceeding referred to in division (A) or (B) of this section;

(b) Whether or not a quorum as described in division (D)(1)(a) of this section is obtainable and if a majority vote of a quorum of disinterested managers so directs, in a written opinion by independent legal counsel other than an attorney, or a firm having associated with it an attorney, who has been retained by or who has performed services for the company or any person to be indemnified within the past five years;

(c) By the members;

(d) By the court of common pleas or the court in which the action, suit, or proceeding referred to in division (A) or (B) of this section was brought.

(2) Any determination made by the disinterested managers under division (D)(1)(a) of this section or by independent legal counsel under division (D)(1)(b) of this section shall be promptly communicated to the person who threatened or brought an action or suit by or in the right of the limited liability company under division (B) of this section. Within ten days after receipt of that notification, the person has the right to petition the court of common pleas or the court in which the action or suit was brought to review the reasonableness of the determination.

(E) The indemnification authorized by this section is not exclusive of and shall be in addition to any other rights granted to those seeking indemnification under the operating agreement, any other agreement, a vote of members or disinterested managers of the limited liability company, or otherwise, both as to action in their official capacities and as to action in another capacity while holding their offices or positions. The indemnification shall continue as to a person who has ceased to be a manager, officer, employee, or agent of the company and shall inure to the benefit of his heirs, executors, and administrators.

(F) A limited liability company may purchase and maintain insurance or furnish similar protection, including, but not limited to, trust funds, letters of credit, or self-insurance, for or on behalf of any person who is or was a manager, member, partner, officer, employee, or agent of the company or who is or was serving at the request of the company as a manager, director, trustee, officer, employee, or agent of another limited liability company, corporation, partnership, joint venture, trust, or other enterprise. The insurance or similar protection purchased or maintained for those persons may be for any liability asserted against them and incurred by them in any capacity described in this division or for any liability arising out of their status as described in this division, whether or not the company would have the power to indemnify them against that liability under this section. Insurance may be so purchased from or so maintained with a person in which the company has a financial interest.

(G) The authority of a limited liability company to indemnify persons pursuant to division (A) or (B) of this section does not limit the payment of expenses as they are incurred, in advance of the final disposition of an action, suit, or proceeding, or the payment of indemnification, insurance, or other protection that may be provided pursuant to division (E) or (F) of this section. Divisions (A) and (B) of this section do not create any obligation to repay or return payments made by the company pursuant to division (E) or (F) of this section.

(H) As used in this section, "limited liability company" includes all constituent limited liability companies in a consolidation or merger and the new or surviving entity. Any person who is or was a manager, officer, employee, or agent of a constituent limited liability company or who is or was a manager, officer, employee, or agent of a constituent limited liability company as a manager, director, trustee, officer, employee, or agent of another limited liability company, corporation, partnership, joint venture, trust, or other enterprise stands in the same position under this section with respect to the new or surviving entity as he would if he had served the new or surviving entity in the same capacity.

Effective Date: 07-01-1994

1705.33 Usury laws not applicable.

No domestic or foreign limited liability company and no person acting on its behalf shall interpose the defense or make the claim of usury in any action or proceeding upon or with reference to any obligation of that company. The notes, bonds, other evidences of indebtedness, mortgages, pledges, and deeds of trust of a limited liability company shall not be set aside, impaired, or adjudged invalid by reason of anything contained in any laws prohibiting or otherwise pertaining to usury or regulating interest rates.

Effective Date: 07-01-1994

1705.34 Holding and conveyance of property.

Real and personal property owned or purchased by a limited liability company shall be held and owned in the name of the company. Conveyance of that property shall be made in the name of the company.

Effective Date: 07-01-1994

1705.35 Execution of instruments and documents.

Instruments and documents providing for the acquisition, mortgage, or disposition of property of a limited liability company are valid and binding upon the company if the instruments or documents are executed by one or more members of the company or, if the management of the company has not been reserved to its members, by one or more of its managers.

Effective Date: 07-01-1994

1705.36 Merger or consolidation into domestic limited liability company.

(A) Pursuant to an agreement of merger, a domestic limited liability company and one or more additional domestic or foreign entities may be merged into a surviving domestic limited liability company. Pursuant to an agreement of consolidation, one or more domestic or foreign entities may be consolidated into a new domestic limited liability company. If any constituent entity is formed or organized under the laws of any state other than this state or under any chapter of the Revised Code other than this chapter, the merger or consolidation also must be permitted by the chapter of the Revised Code under which each domestic constituent entity exists and by the laws under which each foreign constituent entity exists.

(B) The agreement of merger or consolidation shall set forth all of the following:

(1) The name and the form of entity of each constituent entity and the state under the laws of which each constituent entity exists;

(2) In the case of a merger, both of the following:

(a) That one or more specified constituent domestic limited liability companies or other specified constituent domestic or foreign entities will be merged into a specified surviving domestic limited liability company. The name of the surviving limited liability company may be the same as or similar to that of any constituent corporation or constituent limited liability company.

(b) If management of the surviving domestic limited liability company is not reserved to its members, any changes in the managers of the surviving domestic limited liability company.

(3) In the case of a consolidation, all of the following:

(a) That the constituent domestic or foreign entities will be consolidated into a new domestic limited liability company. The name of the new limited liability company may be the same as or similar to that of any constituent corporation or constituent limited liability company.

(b) The operating agreement of the new domestic limited liability company or a provision that the written operating agreement of a specified constituent domestic or foreign limited liability company, a copy of which is attached to the consolidation agreement, with any amendments set forth in the agreement of consolidation, will be the operating agreement of the new domestic limited liability company;

(c) The name and address of the statutory agent upon whom any process, notice, or demand against any constituent entity or the new domestic limited liability company may be served;

(d) If management of the new domestic limited liability company is not reserved to its members, the names of the managers of the new domestic limited liability company or a provision that all of the managers of one or more specified constituent domestic or foreign limited liability companies will constitute the initial managers of the new domestic limited liability company.

(4) All statements and matters required to be set forth in an agreement of merger or consolidation by the laws under which each constituent entity exists;

(5) The terms of the merger or consolidation, the mode of carrying the terms into effect, and the manner and basis of converting the interests in the constituent entities into, or substituting the interests in the constituent entities for, interests, shares, evidences of indebtedness, other securities, cash, rights, any other property, or any combination of interests, shares, evidences of indebtedness, other securities, cash, rights, or any other property of the surviving domestic limited liability company, of the new domestic limited liability company, or of any other entity. No conversion or substitution shall be effected if there are reasonable grounds to believe that the conversion or substitution would render the surviving or new domestic limited liability company unable to pay its obligations as they become due in the usual course of its affairs.

(C) The agreement of merger or consolidation also may set forth any of the following:

(1) The effective date of the merger or consolidation, which date may be on or after the date of the filing of the certificate of merger or consolidation;

(2) A provision authorizing one or more of the constituent entities to abandon the proposed merger or consolidation prior to the filing of the certificate of merger or consolidation by action of the members of a constituent limited liability company or, if the management of a constituent limited liability company is not reserved to its members, of the managers of the constituent limited liability company, by action of the directors of a constituent corporation, or by action of the comparable representatives of any other constituent entity;

(3) In the case of a merger, any amendments to the operating agreement of the surviving domestic limited liability company, or a provision that the written operating agreement of a specified constituent limited liability company other than the surviving domestic limited liability company, with any amendments that are set forth in the agreement of merger, agreement will be the operating agreement of the surviving domestic limited liability company;

(4) A statement of, or a statement of the method of determining, the fair value of the assets to be owned by the surviving or new domestic limited liability company;

(5) The parties to the agreement of merger or consolidation in addition to the constituent entities;

(6) Any additional provision necessary or desirable with respect to the proposed merger or consolidation.

(D) To effect a merger or consolidation, the agreement of merger or consolidation shall be adopted by the managers of each constituent domestic limited liability company in which management is not reserved to its members and by the members of each constituent domestic limited liability company, other than the surviving domestic limited liability company in the case of a merger. The agreement of merger or consolidation also shall be adopted by or otherwise authorized by or on behalf of each other constituent entity in accordance with the laws under which it exists. In the case of a merger, the agreement of merger also shall be adopted or approved by the members of the surviving domestic limited liability company if either of the following conditions exists:

(1) The operating agreement of that company requires that the agreement of merger be adopted or approved by the members.

(2) The agreement of merger agreement makes any change to the operating agreement of that company or authorizes any action that, if the change were made or the action were authorized apart from the merger, the change or action would require adoption or approval by the members.

(E) Whether or not they are entitled to vote or act, all members of a constituent domestic limited liability company shall be given written notice of any meeting of the members of that company or of any proposed action by the members of that company when the meeting or action is to adopt or approve an agreement of merger or consolidation. The notice shall be given to the members in person or by mail at their addresses as they appear on the records of the constituent domestic limited liability company and, unless the operating agreement provides a shorter or longer period, shall be given not less than seven days and not more than sixty days before the date of the meeting or the effective date of the action. The notice shall be accompanied by a copy or summary of the material provisions of the agreement of merger or consolidation.

(F) For domestic limited liability companies in which management is not reserved to the members, the vote or action of the managers of a constituent domestic limited liability company that is required to adopt an agreement of merger or consolidation is the unanimous vote or action of the managers or any different number or proportion that the operating agreement provides. The vote or action of the members of a constituent domestic limited liability company that is required to adopt or approve an agreement of merger or consolidation is the unanimous vote or action of the members or any different number or proportion that the operating agreement provides. If the agreement of merger or consolidation would have an effect or authorize any action that under any applicable provision of law or the operating agreement could be effected or authorized only by or pursuant to a specified vote or action of members or of any class or group of members, the agreement of merger or consolidation also shall be adopted or approved by the same vote or action as would be required to effect that change or authorize that action.

(G) At any time before the filing of the certificate of merger or consolidation, the merger or consolidation may be abandoned by the managers of any constituent limited liability company, the directors of any constituent corporation, or the comparable representatives of any other constituent entity if the managers, directors, or other representatives are authorized to do so by the agreement of merger or consolidation or by the same vote or action as was required to adopt that agreement. The agreement of merger or consolidation may contain a provision authorizing the managers of any constituent limited liability company in which the management is not reserved to its members, the members of any constituent limited liability company, the directors of any constituent corporation, or the comparable representatives of any other constituent entity to amend the agreement of merger or consolidation at any time before the filing of the certificate of merger or consolidation, except that, after the adoption or approval of the agreement of merger or consolidation by the members of any constituent domestic limited liability company, the managers of a constituent domestic limited liability company in which the management is not reserved to its members are not authorized to amend the agreement of merger or consolidation to do any of the following:

(1) Alter or change the amount or kind of interests, shares, evidences of indebtedness, other securities, cash, rights, or other property to be received by the members of the constituent domestic limited liability company in conversion of or in substitution for their interests;

(2) Alter or change any term of the operating agreement of the surviving or new domestic limited liability company, except for any alterations or changes that otherwise could be adopted by the managers of the surviving or new domestic limited liability company if its management is not reserved to its members;

(3) Alter or change any other terms and conditions of the agreement of merger or consolidation if any of the alterations or changes, alone or in the aggregate, would materially adversely affect the members of any class or group of members of the constituent domestic limited liability company.

Effective Date: 07-01-1994

1705.361 Conversion of another entity into domestic limited liability company.

(A) Subject to division (B)(2) of this section, pursuant to a written declaration of conversion as provided in this section, a domestic or foreign entity other than a domestic limited liability company may be converted into a domestic limited liability company. The conversion also must be permitted by the chapter of the Revised Code or by the laws under which the converting entity exists.

(B)

(1) The written declaration of conversion shall set forth all of the following:

(a) The name and form of entity that is being converted, the name of the entity into which the entity will be converted, and the jurisdiction of formation of the converting entity;

(b) The articles of organization of the converted domestic limited liability company;

(c) The operating agreement of the converted domestic limited liability company or a provision that a written agreement of the converting entity, a copy of which is attached to the declaration of conversion, with any amendments set forth in the declaration of conversion, will be the operating agreement of the converted entity;

(d) If management of the converted entity is not reserved to its members, the names of the managers of the converted entity;

(e) All statements and matters required to be set forth in an instrument of conversion by the laws under which the converting entity exists;

(f) The terms of the conversion; the mode of carrying them into effect; and the manner and basis of converting the interests or shares of the converting entity into, or substituting the interests or shares in the converting entity for, interests, evidences of indebtedness, other securities, cash, rights, or any other property or any combination of interests, evidences of indebtedness, other securities, cash, rights, or any other property of the converted company.

(2) No conversion or substitution described in this section shall be effected if there are reasonable grounds to believe that the conversion or substitution would render the converted company unable to pay its obligations as they become due in the usual course of its affairs.

(C) The written declaration of conversion may set forth any of the following:

(1) The effective date of the conversion, which date may be on or after the date of the filing of the certificate of conversion pursuant to section 1705.381 of the Revised Code;

(2) A provision authorizing the converting entity to abandon the proposed conversion by action of authorized representatives of the converting entity taken prior to the filing of the certificate of conversion pursuant to section 1705.381 of the Revised Code;

(3) A statement of, or a statement of the method to be used to determine, the fair value of the assets owned by the converting entity at the time of the conversion;

(4) The parties to the declaration of conversion in addition to the converting entity;

(5) Any additional provision necessary or desirable with respect to the proposed conversion or the converted entity.

(D) At any time before the filing of the certificate of conversion pursuant to section 1705.381 of the Revised Code, the conversion may be abandoned by any representatives authorized to do so by the declaration of conversion, or by the same vote as was required to adopt the declaration of conversion.

Effective Date: 10-12-2006

1705.37 Merger or consolidation into entity other than domestic limited liability company.

(A) Pursuant to an agreement of merger between the constituent entities as provided in this section, a domestic limited liability company and one or more additional domestic or foreign entities may be merged into a surviving entity other than a domestic limited liability company. Pursuant to an agreement of consolidation between the constituent entities as provided in this section, a domestic limited liability company and one or more additional domestic or foreign entities may be consolidated into a new entity other than a domestic limited liability company. The merger or consolidation must be permitted by the chapter of the Revised Code under which each constituent domestic entity exists and by the laws under which each foreign constituent entity exists.

(B) The agreement of merger or consolidation shall set forth all of the following:

(1) The name and the form of entity of each constituent entity and the state under the laws of which each constituent entity exists;

(2) In the case of a merger, that one or more specified constituent entities will be merged into a specified surviving foreign or domestic entity other than a domestic limited liability company;

(3) In the case of a consolidation, that one or more specified constituent entities will be consolidated into a new foreign or domestic entity other than a domestic limited liability company;

(4) If the surviving or new entity is a foreign limited liability company, all additional statements and matters, other than the name and address of the statutory agent, that would be required by section 1705.36 of the Revised Code if the surviving or new entity were a domestic limited liability company;

(5) The name and the form of entity of the surviving or new entity, which name may be the same as or similar to that of any constituent corporation or constituent limited liability company, the state under the laws of which the surviving entity exists or the new entity is to exist, and the location of the principal office of the surviving or new entity;

(6) All additional statements and matters required to be set forth in the agreement of merger or consolidation by the laws under which each constituent entity exists and, in the case of a consolidation, the laws under which the new entity is to exist;

(7) The consent of the surviving or new entity to be sued and served with process, notices, and demands in this state and the irrevocable appointment of the secretary of state as its agent to accept service of process in any action or proceeding in this state to enforce against the surviving or new entity any obligation of any constituent domestic limited liability company or the rights of a dissenting member of any constituent domestic limited liability company;

(8) If the surviving or new entity is a foreign corporation that desires to transact business in this state as a foreign corporation, a statement to that effect, together with a statement regarding the appointment of a statutory agent and service of any process, notice, or demand upon that statutory agent or the secretary of state, as required when a foreign corporation applies for a license to transact business in this state;

(9) If the surviving or new entity is a foreign limited partnership that desires to transact business in this state as a foreign limited partnership, a statement to that effect, together with all of the information required under section 1782.49 of the Revised Code when a foreign limited partnership registers to transact business in this state;

(10) If the surviving or new entity is a foreign limited liability company that desires to transact business in this state as a foreign limited liability company, a statement to that effect, together with all of the information required under section 1705.54 of the Revised Code when a foreign limited liability company registers to transact business in this state.

(C) Consistent with the laws under which the surviving entity exists or the new entity is to exist, the agreement of merger or consolidation also may set forth any additional provisions permitted by the laws of any state under the laws of which any constituent entity exists.

(D) To effect the merger or consolidation, the agreement of merger or consolidation shall be adopted by the managers and members of each constituent domestic limited liability company in the same manner and with the same notice to and vote or action of managers, members, or particular classes or groups of members as is required by section 1705.36 of the Revised Code. The agreement of merger or consolidation also shall be approved or otherwise authorized by or on behalf of each other constituent entity in accordance with the laws under which it exists.

(E) At any time before the filing of the certificate of merger or consolidation, the merger or consolidation may be abandoned by the managers of any constituent limited liability company, the directors of any constituent corporation, or the comparable representatives of any other constituent entity if the managers, directors, or other representatives are authorized to do so by the agreement of merger or consolidation. The agreement of merger or consolidation may contain a provision authorizing the managers of any constituent limited liability company in which the management is not reserved to its members, the members of any constituent limited liability company, the directors of any constituent corporation, or the comparable representatives of any other constituent entity to amend the agreement of merger or consolidation at any time before the filing of the certificate of merger or consolidation, except that, after the adoption of the agreement of merger or consolidation by the members of any constituent domestic limited liability company, the managers of a constituent domestic limited liability company in which the management is not reserved to its members are not authorized to amend the agreement of merger or consolidation to do any of the following:

(1) Alter or change the amount or kind of interests, shares, evidences of indebtedness, other securities, cash, rights, or other property to be received by the members of the constituent domestic limited liability company in conversion of or in substitution for their interests;

(2) If the surviving or new entity is a limited liability company, alter or change any term of the operating agreement of the surviving or new limited liability company, except for any alterations or changes that otherwise could be adopted by the managers of the surviving or new limited liability company if its management is not reserved to its members;

(3) If the surviving or new entity is a corporation or any other entity other than a limited liability company, alter or change any term of the articles of incorporation or comparable instrument of the surviving or new corporation or other entity, except for alterations or changes that otherwise could be adopted by the directors or comparable representatives of the surviving or new corporation or other entity;

(4) Alter or change any other terms and conditions of the agreement of merger or consolidation if any of the alterations or changes, alone or in the aggregate, would materially adversely affect the members of any class or group of members of a constituent domestic limited liability company.

Effective Date: 07-01-1994

1705.371 Conversion of domestic limited liability company into another entity.

(A) Subject to division (B)(2) of this section, pursuant to a written declaration of conversion as provided in this section, a domestic limited liability company may be converted into a domestic or foreign entity other than a domestic limited liability company. The conversion also must be permitted by the chapter of the Revised Code or by the laws under which the converted entity will exist.

(B)

(1) The written declaration of conversion shall set forth all of the following:

(a) The name of the domestic limited liability company that is being converted, the name of the entity into which the entity will be converted, the form of the converted entity, and the jurisdiction of formation of the converted entity;

(b) If the converted entity is a domestic entity, the complete terms of all documents required under the applicable chapter of the Revised Code to form the converted entity;

(c) If the converted entity is a foreign entity, all of the following:

(i) The complete terms of all documents required under the law of its formation to form the converted entity;

(ii) The consent of the converted entity to be sued and served with process in this state, and the irrevocable appointment of the secretary of state as the agent of the converted entity to accept service of process in this state to enforce against the converted entity any obligation of the converting company or to enforce the rights of a dissenting member of the converting company;

(iii) If the converted entity desires to transact business in this state, the information required to qualify or be licensed under the applicable chapter of the Revised Code.

(d) All other statements and matters required to be set forth in the declaration of conversion by the applicable chapter of the Revised Code if the converted entity is a domestic entity, or by the laws under which the converted entity will be formed, if the converted entity is a foreign entity;

(e) The terms of the conversion; the mode of carrying them into effect; and the manner and basis of converting the interests or shares of the converting company into, or substituting the interests in the converting company for, interests, evidences of indebtedness, other securities, cash, rights, or any other property or any combination of interests, evidences of indebtedness, other securities, cash, rights, or any other property of the converted entity.

(2) No conversion or substitution described in this section shall be effected if there are reasonable grounds to believe that the conversion or substitution would render the converted entity unable to pay its obligations as they become due in the usual course of its affairs.

(C) The written declaration of conversion may set forth any of the following:

(1) The effective date of the conversion, which date may be on or after the date of the filing of the certificate of conversion pursuant to section 1705.381 of the Revised Code;

(2) A provision authorizing the converting company to abandon the proposed conversion by action of the members or managers of the converting company taken prior to the filing of the certificate of conversion pursuant to section 1705.381 of the Revised Code;

(3) A statement of, or a statement of the method to be used to determine, the fair value of the assets owned by the converting company at the time of the conversion;

(4) The parties to the declaration of conversion in addition to the converting company;

(5) Any additional provision necessary or desirable with respect to the proposed conversion or the converted entity.

(D) The members of the converting domestic limited liability company and, if management is not reserved to its members, the managers of the converting entity must adopt the declaration of conversion in order to effect the conversion.

(E)

(1) All members, whether or not they are entitled to vote or act, shall be given written notice of any meeting of members or of any proposed action by members, which meeting or action is to adopt a declaration of conversion. The notice shall be given to the members either as provided in writing in the operating agreement or by mail at the members' addresses as they appear on the records of the company, or in person. Unless the operating agreement provides a shorter or longer period, notice described in division (E)(1) of this section shall be given not less than seven and not more than sixty days before the meeting or the effective date of the action.

(2) The notice described in division (E)(1) of this section shall be accompanied by a copy or a summary of the material provisions of the declaration of conversion.

(F) The unanimous vote or action by the members of a converting company, or a different number or proportion as provided in writing in the operating agreement, is required to adopt a declaration of conversion.

If the declaration of conversion would have an effect or authorize any action that under any applicable provision of law or the operating agreement could be effected or authorized only by or pursuant to a specified vote or action of the members, or of any class or group of members, the declaration of conversion also must be adopted or approved by the same vote or action as would be required to effect that change or to authorize that action.

(G)

(1) At any time before the filing of the certificate of conversion pursuant to section 1705.381 of the Revised Code, the conversion may be abandoned by all of the members of the converting company or by any representatives authorized to do so by the declaration of conversion, or by the same vote as was required to adopt the declaration of conversion.

(2) The declaration of conversion may contain a provision authorizing less than all of the members to amend the declaration of conversion at any time before the filing of the certificate of conversion pursuant to section 1705.381 of the Revised Code, except that, after the adoption of the declaration of conversion by the members, less than all of the members are not authorized to amend the declaration of conversion to do any of the following:

(a) Alter or change the amount or kind of interests, shares, evidences of indebtedness, other securities, cash rights, or any other property to be received by the members of the converting company in conversion of, or substitution for, their interests;

(b) Alter or change any term of the organizational documents of the converted entity except for alterations or changes that are adopted with the vote or action of the persons the vote or action of which would be required for the alteration or change after the conversion;

(c) Alter or change any other terms and conditions of the declaration of conversion if any of the alterations or changes, alone or in the aggregate, materially and adversely would affect the members or any class or group of members of the converting company.

Effective Date: 10-12-2006

1705.38 Certificate of merger or consolidation.

(A) Upon the adoption by each constituent entity of an agreement of merger or consolidation pursuant to section 1705.36 or 1705.37 of the Revised Code, a certificate of merger or consolidation shall be filed with the secretary of state that is signed by a manager of each constituent limited liability company in which the management is not reserved to its members, by at least one member of each other constituent limited liability company, by at least one general partner of each constituent partnership, and by an authorized representative of each other constituent entity. The certificate shall be on a form prescribed by the secretary of state and shall set forth only the information required by this section.

(B)

(1) The certificate of merger or consolidation shall set forth all of the following:

(a) The name and the form of entity of each constituent entity and the state under the laws of which each constituent entity exists;

(b) A statement that each constituent entity has complied with all of the laws under which it exists and that the laws permit the merger or consolidation;

(c) The name and mailing address of the person or entity that is to provide, in response to any written request made by a shareholder, partner, or other equity holder of a constituent entity, a copy of the agreement of merger or consolidation;

(d) The effective date of the merger or consolidation, which date may be on or after the date of the filing of the certificate;

(e) The signature of the representative or representatives authorized to sign the certificate on behalf of each constituent entity and the office held or the capacity in which the representative is acting;

(f) A statement that the agreement of merger or consolidation is authorized on behalf of each constituent entity and that the persons who signed the certificate on behalf of each entity are authorized to do so;

(g) In the case of a merger, a statement that one or more specified constituent entities will be merged into a specified surviving entity or, in the case of a consolidation, a statement that the constituent entities will be consolidated into a new entity;

(h) In the case of a merger, if the surviving entity is a foreign entity not licensed to transact business in this state, the name and address of the statutory agent upon whom any process, notice, or demand may be served;

(i) In the case of a consolidation, the name and address of the statutory agent upon whom any process, notice, or demand against any constituent entity or the new entity may be served.

(2) In the case of a consolidation into a new domestic corporation, limited liability company, or limited partnership, the articles of incorporation, the articles of organization, or the certificate of limited partnership of the new domestic entity shall be filed with the certificate of merger or consolidation.

(3) In the case of a merger into a domestic corporation, limited liability company, or limited partnership, any amendments to the articles of incorporation, articles of organization, or certificate of limited partnership of the surviving domestic entity shall be filed with the certificate of merger or consolidation.

(4) If the surviving or new entity is a foreign entity that desires to transact business in this state as a foreign corporation, limited liability company, or limited partnership, the certificate of merger or consolidation shall be accompanied by the information required by division (B)(8), (9), or (10) of section 1705.37 of the Revised Code.

(5) If a foreign or domestic corporation licensed to transact business in this state is a constituent entity and the surviving or new entity resulting from the merger or consolidation is not a foreign or domestic corporation that is to be licensed to transact business in this state, the certificate of merger or consolidation shall be accompanied by the affidavits, receipts, certificates, or other evidence required by division (H) of section 1701.86 of the Revised Code, with respect to each domestic constituent corporation, and by the affidavits, receipts, certificates, or other evidence required by division (C) or (D) of section 1703.17 of the Revised Code, with respect to each foreign constituent corporation licensed to transact business in this state.

(C) If any constituent entity in a merger or consolidation is organized or formed under the laws of a state other than this state or under any chapter of the Revised Code other than this chapter, there also shall be filed in the proper office all documents that are required to be filed in connection with the merger or consolidation by the laws of that state or by that chapter.

(D) Upon the filing of a certificate of merger or consolidation and other filings as described in division (C) of this section or at any later date that the certificate of merger or consolidation specifies, the merger or consolidation is effective.

(E)

(1) Upon request and payment of the fee specified in division (D) of section 111.16 of the Revised Code, the secretary of state shall furnish the secretary of state's certificate setting forth all of the following:

(a) The name and form of entity of each constituent entity and the states under the laws of which each constituent entity existed prior to a merger or consolidation;

(b) The name and the form of entity of the surviving or new entity and the state under the laws of which the surviving entity exists or the new entity is to exist;

(c) The date of the filing of the certificate of merger or consolidation in the secretary of state's office;

(d) The effective date of the merger or consolidation.

(2) The certificate of the secretary of state or a copy of a certificate of merger or consolidation that has been certified by the secretary of state may be filed for record in the office of the county recorder of any county in this state and, if filed, shall be recorded in the official records of that county. For that recording, the county recorder shall charge and collect the same fees as for recording a deed.

Amended by 130th General Assembly File No. 41, HB 72, §1, eff. 1/30/2014.

Effective Date: 06-06-2001

1705.381 Filing of certificate of conversion - effective date.

(A) Upon the adoption of a declaration of conversion pursuant to section 1705.361 or 1705.371 of the Revised Code, or at a later time as authorized by the declaration of conversion, a certificate of conversion that is signed by an authorized representative of the converting entity shall be filed with the secretary of state. The certificate shall be on a form prescribed by the secretary of state and shall set forth only the information required by this section.

(B)

(1) The certificate of conversion shall set forth all of the following:

(a) The name and the form of entity of the converting entity and the state under the laws of which the converting entity exists;

(b) A statement that the converting entity has complied with all of the laws under which it exists and that those laws permit the conversion;

(c) The name and mailing address of the person or entity that is to provide a copy of the declaration of conversion in response to any written request made by a shareholder, partner, or member of the converting entity;

(d) The effective date of the conversion, which date may be on or after the date of the filing of the certificate pursuant to this section;

(e) The signature and title of the representative or representatives authorized to sign the certificate on behalf of the converting entity;

(f) A statement that the declaration of conversion is authorized on behalf of the converting entity and that each person signing the certificate on behalf of the converting entity is authorized to do so;

(g) The name and the form of the converted entity and the state under the laws of which the converted entity will exist;

(h) If the converted entity is a foreign entity that will not be licensed in this state, the name and address of the statutory agent upon whom any process, notice or demand may be served.

(2) In the case of a conversion into a new domestic corporation, limited liability company, limited partnership, or other partnership, any organizational document that would be filed upon the creation of the converted entity shall be filed with the certificate of conversion.

(3) If the converted entity is a foreign entity that desires to transact business in this state, the certificate of conversion shall be accompanied by the information required by division (B)(8), (9), or (10) of section 1705.37 of the Revised Code.

(4) If a foreign or domestic corporation licensed to transact business in this state is the converting entity, the certificate of conversion shall be accompanied by the affidavits, receipts, certificates, or other evidence required by division (H) of section 1701.86 of the Revised Code with respect to a converting domestic corporation or by the affidavits, receipts, certificates, or other evidence required by division (C) or (D) of section 1703.17 of the Revised Code with respect to a foreign corporation.

(C) If the converting entity or the converted entity is organized or formed under the laws of a state other than this state or under any chapter of the Revised Code other than this chapter, all documents required to be filed in connection with the conversion by the laws of that state or that chapter shall be filed in the proper office.

(D) Upon the filing of a certificate of conversion and other filings required by division (C) of this section or at any later date that the certificate of conversion specifies, the conversion is effective, subject to the limitation that no conversion will be effective if there are reasonable grounds to believe that the conversion would render the converted entity unable to pay its obligations as they become due in the usual course of its affairs.

(E) The secretary of state shall furnish, upon request and payment of the fee specified in division (K)(2) of section 111.16 of the Revised Code, the secretary of state's certificate setting forth all of the following:

(1) The name and form of entity of the converting entity and the state under the laws of which it existed prior to the conversion;

(2) The name and the form of entity of the converted entity and the state under the law of which it will exist;

(3) The date of filing of the certificate of conversion with the secretary of state and the effective date of the conversion.

(F) The certificate of the secretary of state, or a copy of the certificate of conversion certified by the secretary of state, may be filed for record in the office of the county recorder of any county in this state and, if filed, shall be recorded in the official records of that county. For the recording, the county recorder shall charge and collect the same fee as in the case of deeds.

Amended by 130th General Assembly File No. 41, HB 72, §1, eff. 1/30/2014.

Effective Date: 10-12-2006

1705.39 Conditions following merger or consolidation.

(A) When a merger or consolidation becomes effective, all of the following apply:

(1) The separate existence of each constituent entity, other than the surviving entity in a merger, ceases, except that whenever a conveyance, assignment, transfer, deed, or other instrument or act is necessary to vest property or rights in the surviving or new entity, the members, managers, officers, directors, or other authorized representatives of the respective constituent entities shall execute, acknowledge, and deliver the instruments and do the acts. For these purposes, the existence of the constituent entities and the authority of their respective members, managers, officers, directors, or other representatives is continued notwithstanding the merger or consolidation.

(2) In the case of a consolidation, the new entity exists when the consolidation becomes effective. If the new entity is a domestic limited liability company, the written operating agreement contained in or provided for in the agreement of consolidation shall be its original operating agreement.

(3) In the case of a merger in which the surviving entity is a limited liability company, except as otherwise provided in the agreement of merger, the written operating agreement of the surviving limited liability company that is in effect immediately prior to the time that the merger becomes effective shall be its operating agreement after the merger.

(4) The surviving or new entity possesses all of the following, and all of the following are vested in the surviving or new entity without further act or deed:

(a) Except to the extent limited by mandatory provisions of applicable law, the following:

(i) All assets and property of every description of each constituent entity and every interest in the assets and property of each constituent entity, wherever the assets, property, and interests are located. Title to any real estate or any interest in real estate that was vested in any constituent entity shall not revert or in any way be impaired by reason of the merger or consolidation.

(ii) The rights, privileges, immunities, powers, franchises, and authority of each constituent entity, whether of a public or private nature.

(b) All obligations belonging to or due to each constituent entity.

(5) The surviving or new entity is liable for all of the obligations of each constituent entity, including liability to dissenting members, dissenting partners, dissenting shareholders, or other dissenting equity holders. Any claim existing or any action or proceeding pending by or against any constituent entity may be prosecuted to judgment with right of appeal as if the merger or consolidation had not taken place, or the surviving or new entity may be substituted in place of any constituent entity in an action or proceeding of that nature.

(6) All rights of creditors of each constituent entity are preserved unimpaired. All liens on the property of any constituent entity are preserved unimpaired but only on the property that was affected by the respective liens immediately prior to the effective date of the merger or consolidation. If a general partner of a constituent partnership is not a general partner of the entity surviving or the new entity resulting from the merger or consolidation, then the former general partner shall have no liability for any obligation incurred after the merger or consolidation except to the extent that a former creditor of the constituent partnership in which the former general partner was a partner extends credit to the surviving or new entity reasonably believing that the former general partner continued as a general partner of the surviving or new entity.

(B) If a general partner of a constituent partnership is not a general partner of the entity surviving or the new entity resulting from the merger or consolidation, the provisions of division (B) of section 1782.434 of the Revised Code shall apply.

(C) In the case of a merger of a constituent domestic limited liability company into a foreign surviving limited liability company, corporation, or limited partnership that is not licensed or registered to transact business in this state or in the case of a consolidation of a constituent domestic limited liability company into a new foreign limited liability company, corporation, or limited partnership, if the surviving or new entity intends to transact business in this state and the certificate of merger or consolidation is accompanied by the information described in division (B)(4) of section 1705.38 of the Revised Code, then, on the effective date of the merger or consolidation, the surviving or new entity shall be considered to have complied with the requirements for procuring a license to transact business in this state as a foreign corporation or the requirements for registration to transact business in this state as a foreign limited liability company or limited partnership, whichever applies. A copy of the certificate of merger or consolidation certified by the secretary of state constitutes the application for registration prescribed for a foreign limited liability company or foreign limited partnership and the license certificate prescribed for a foreign corporation.

(D) Any action to set aside any merger or consolidation on the ground of noncompliance with any section of the Revised Code applicable to the merger or consolidation shall be brought within ninety days after the effective date of the merger or consolidation or forever be barred.

(E) In the case of an entity organized or existing under the laws of any state other than this state, this section is subject to the laws of the other state under which that entity exists or of the other state in which that entity has property.

Effective Date: 07-01-1994

1705.391 Legal effect of conversion - action to set aside.

(A) Upon a conversion becoming effective, all of the following apply:

(1) The converting entity is continued in the converted entity.

(2) The converted entity exists, and the converting entity ceases to exist.

(3) The converted entity possesses both of the following, and both of the following continue in the converted entity without any further act or deed:

(a) Except to the extent limited by the requirements of applicable law, both of the following:

(i) All assets and property of every description of the converting entity and every interest in the assets and property of the converting entity, wherever the assets, property, and interests are located. Title to any real estate or any interest in real estate that was vested in the converting entity does not revert or in any way is impaired by reason of the conversion.

(ii) The rights, privileges, immunities, powers, franchises, and authority, whether of a public or a private nature, of the converting entity.

(b) All obligations belonging or due to the converting entity.

(4) All the rights of creditors of the converting entity are preserved unimpaired, and all liens upon the property of the converting entity are preserved unimpaired. If a general partner of a converting partnership is not a general partner of the entity resulting from the conversion, then the former general partner has no liability for any obligation incurred after the conversion except to the extent that a former creditor of the converting partnership in which the former general partner was a general partner extends credit to the converted entity reasonably believing that the former general partner continues as a general partner of the converted entity.

(B) In the case of a conversion into a foreign corporation, limited liability company, or partnership that is not licensed or registered to transact business in this state, if the converted entity intends to transact business in this state, and the certificate of conversion is accompanied by the information described in division (B)(4) of section 1705.38 of the Revised Code, then on the effective date of the conversion, the converted entity is considered to have complied with the requirements for procuring a license or for registration to transact business in this state as a foreign corporation, limited liability company, limited partnership, or limited liability partnership as the case may be. In such a case, a copy of the certificate of conversion certified by the secretary of state constitutes the license certificate prescribed for a foreign corporation or the application for registration prescribed for a foreign limited liability company, foreign limited partnership, or foreign limited liability partnership.

(C) Any action to set aside any conversion on the ground that any section of the Revised Code applicable to the conversion has not been complied with shall be brought within ninety days after the effective date of the conversion or is forever barred.

(D) In the case of a converting or converted entity organized or existing under the laws of any state other than this state, this section is subject to the laws of the state under which that entity exists or in which it has property.

Effective Date: 10-12-2006

1705.40 Dissenting members entitled to relief.

Unless otherwise provided in writing in the operating agreement of a constituent domestic limited liability company, the following are entitled to relief as dissenting members as provided in section 1705.41 of the Revised Code:

(A) Members of a domestic limited liability company that is being merged or consolidated into a surviving or new domestic or foreign entity pursuant to section 1705.36 or 1705.37 of the Revised Code;

(B) In the case of a merger into a domestic limited liability company, members of the surviving domestic limited liability company who, under section 1705.36 of the Revised Code, are entitled to vote or act on the adoption or approval of the agreement of merger, but only as to the membership interests entitling them to so vote or act;

(C) Members of a domestic limited liability company that is being converted pursuant to section 1705.371 of the Revised Code.

Effective Date: 07-01-1994; 10-12-2006

1705.41 Dissenting members - compliance with section - fair cash value of membership interest.

(A) A member of a domestic limited liability company is entitled to relief as a dissenting member as described in section 1705.40 of the Revised Code only in compliance with this section.

(B) If a proposal of merger , consolidation , or conversion is to be submitted to the members of a domestic limited liability company at a meeting, a dissenting member must be a member and a record holder of the membership interests as to which the dissenting member seeks relief as of the date fixed for the determination of members entitled to notice of the meeting, and those membership interests must not have been voted in favor of the proposal. Not later than ten days after the date on which the vote on the proposal was taken at the meeting of the members, the dissenting member shall deliver to the company a written demand for payment to the dissenting member of the fair cash value of the membership interests as to which the dissenting member seeks relief. The demand shall state the address of the dissenting member, the number and class of the membership interests, and the amount claimed by the dissenting member as the fair cash value of the membership interests.

(C) If the proposal of merger , consolidation , or conversion is to be submitted to the members of a domestic limited liability company for their written approval or other action without a meeting, a dissenting member must be a member and a record holder of the membership interests as to which the dissenting member seeks relief as of the date that the written request for approval or other action is sent to the members entitled to act or otherwise approve the proposal, and the dissenting member must not have indicated the dissenting member's approval of the proposal in the dissenting member's capacity as record holder of the membership interests. Not later than fifteen days after the date on which the request for approval or other action was mailed to the members, the dissenting member shall deliver to the company a written demand for payment to the dissenting member of the fair cash value of the membership interests as to which the dissenting member seeks relief. The demand shall state the address of the dissenting member, the number and class of the membership interests, and the amount claimed by the dissenting member as the fair cash value of the membership interests.

(D) A written demand for payment of the fair cash value of membership interests that is served on a domestic limited liability company under this section constitutes service on the surviving or new entity resulting from the merger or consolidation or on the entity resulting from a conversion, whether the demand is served before, on, or after the effective date of the merger , consolidation, or conversion.

(E)

(1) If the membership interests as to which a dissenting member seeks relief are represented by certificates and if the domestic limited liability company sends to the dissenting member at the address specified in the dissenting member's demand for payment of the fair cash value of those interests a request for the certificates representing those interests, the dissenting member shall deliver the requested certificates to the company within fifteen days from the date on which the request is sent to the dissenting member so that the company may endorse a legend on the certificates to the effect that a demand for the fair cash value of those membership interests has been made. The company promptly shall return the endorsed certificates to the dissenting member.

At the option of the company, the failure of the dissenting member to deliver the certificates as described in this division shall terminate the dissenting member's rights as a dissenting member. If exercised, the option shall be exercised by a written notice sent to the dissenting member within twenty days after the lapse of the fifteen-day period described in this division, unless a court for good cause shown otherwise directs.

If membership interests represented by a certificate on which a legend has been endorsed under this division are transferred, each new certificate issued for the membership interests shall bear a similar legend and the name of the original dissenting holder of the membership interests.

(2) Upon receiving from a dissenting member a demand for payment of the fair cash value of membership interests that are not represented by a certificate, a domestic limited liability company shall make an appropriate notation of the demand in its records. If uncertificated membership interests for which payment has been demanded are to be transferred, any writing sent to evidence the transfer shall bear the legend required for certificated membership interests as described in division (E)(1) of this section.

(3) A transferee of membership interests who receives a certificate endorsed with a legend as described in division (E)(1) of this section and a transferee of uncertificated membership interests with respect to which a notation has been made as described in division (E)(2) of this section acquires only the rights in the domestic limited liability company that the original dissenting member had immediately after the serving of the demand for payment of the fair cash value of the membership interests.

(4) A request for certificates under division (E)(1) of this section by a domestic limited liability company is not an admission by it that the member is entitled to relief under this section.

(F) Unless the operating agreement of the domestic limited liability company in which the dissenting member was a member provides a reasonable basis for determining and paying the fair cash value of the membership interests as to which the dissenting member seeks relief or unless that company and the dissenting member have come to an agreement on the fair cash value of those interests, within three months after the service of the demand for payment of the fair cash value of those interests, the dissenting member, that company, or the surviving or new entity may file a complaint under section 1705.42 of the Revised Code.

The complaint shall be filed in the court of common pleas of the county in which the principal office of the limited liability company that issued the membership interest is located or was located when the proposal for merger , consolidation, or conversion was adopted or approved by the members of that company. Within three months after the service of the demand for payment of the fair cash value of the membership interests of the dissenting member, other dissenting members may join as plaintiffs or may be joined as defendants in the proceeding described in section 1705.42 of the Revised Code, and any two or more proceedings commenced by dissenting members may be consolidated.

(G) The right of a dissenting member to receive the fair cash value for the membership interests as to which the dissenting member seeks relief, the obligation of the dissenting member to sell those interests, the right of the domestic limited liability company to purchase those interests, and the obligation of the company to pay the fair cash value for those interests terminate if any of the following applies:

(1) Unless the company waives the failure, the dissenting member fails to comply with this section.

(2) The company abandons the merger , consolidation, or conversion or is finally enjoined or prevented from carrying it out, or the members rescind their adoption or approval of the merger , consolidation, or conversion.

(3) The dissenting member withdraws the dissenting member's demand for payment of the fair cash value of the membership interests with the consent of the company.

(4) All of the following apply:

(a) The operating agreement of the domestic limited liability company in which the dissenting member was a member does not provide a reasonable basis for determining and paying the dissenting member the fair cash value of the dissenting member's membership interests.

(b) The company and the dissenting member have not agreed upon the fair cash value of the membership interests.

(c) Neither the dissenting member nor the company has filed, joined, or been joined in a complaint under division (F) of this section within the three-month period provided in that division.

(H) Unless otherwise provided in the operating agreement of the domestic limited liability company in which the dissenting member was a member, from the time that the dissenting member delivers the demand for payment of the fair cash value of the membership interests as to which the dissenting member seeks relief until the termination of the rights and obligations arising from that demand or the purchase of those interests by the company, all other rights accruing from those interests, including voting or distribution rights, are suspended. If, during the suspension, any distribution is paid in money upon membership interests of the class of those interests or any dividend, distribution, or interest is paid in money upon any securities issued in extinguishment of or in substitution for those interests, an amount equal to the dividend, distribution, or interest that, except for the suspension, would have been payable upon those interests or those securities shall be paid to the record holder of those interests or securities as a credit upon the fair cash value of those interests. If the right to receive the fair cash value of those interests is terminated other than by the purchase of those interests by the company, all rights of the dissenting member shall be restored and all distributions that, except for the suspension, would have been made shall be made to the record holder of those interests at the time of termination.

Effective Date: 07-01-1994; 10-12-2006

1705.42 Complaint for relief - payment of fair cash value.

(A)

(1) When authorized by division (F) of section 1705.41 of the Revised Code, a dissenting member of a domestic limited liability company may file a complaint for the relief described in this section. The complaint shall contain a brief statement of the relevant facts, including the vote or action by the members of that company pertaining to the merger , consolidation, or conversion and the facts entitling the dissenting member to the relief described in this section, and a demand for that relief. When authorized by division (F) of section 1705.41 of the Revised Code, the company, or a surviving or new entity or converted entity, also may file a complaint under this section. Notwithstanding the Rules of Civil Procedure, no answer to a complaint filed under this section is required.

(2) Upon the filing of the complaint and upon motion of the complainant, the court shall enter an order that fixes a date for a hearing on the complaint and that requires the service of a copy of the complaint and a notice of its filing and the date for the hearing on the defendants in the manner prescribed in the Rules of Civil Procedure for the service of process. On the date fixed for the hearing or any adjournment of the hearing, the court shall determine from the complaint and from all evidence submitted at the hearing by the parties whether the dissenting member is entitled to be paid the fair cash value of any membership interests and, if the dissenting member is to be so paid, the number and class of those interests. If the court finds that the dissenting member is to be so paid, it may appoint one or more persons as appraisers to receive evidence as to the fair cash value and to make recommendations to the court relative to the amount of the fair cash value. The appraisers shall have the power and authority that the court specifies in the order of appointment, and the court shall fix reasonable compensation for their services.

After receiving the recommendations of any appointed appraisers or if appraisers are not appointed, the court shall make findings as to the fair cash value of the membership interests and render judgment against the limited liability company for the payment of that fair cash value and interest at the rate and from the date that the court considers equitable. The costs of the proceeding, including reasonable compensation to any appraisers as fixed by the court, shall be assessed or apportioned as the court considers equitable.

(3) The proceeding described in this section is a special proceeding, and final orders in it may be vacated, modified, or reversed on appeal pursuant to the Rules of Appellate Procedure and, to the extent not in conflict with those rules, Chapter 2505. of the Revised Code. If, during the pendency of any proceeding described in this section, an action or proceeding is commenced to enjoin or otherwise prevent the carrying out of the merger or consolidation or other action as to which the member has dissented, the proceeding commenced under this section shall be stayed until the final determination of the other action or proceeding.

(4) Unless division (G) of section 1705.41 of the Revised Code is applicable, the fair cash value of the membership interests that is agreed upon by the dissenting member and the limited liability company or fixed by a court in a proceeding under this section shall be paid within thirty days after the later of the final determination of the fair cash value in a proceeding under this section or the date of the consummation of the merger , consolidation, or conversion. Upon the occurrence of the later event, payment of the fair cash value shall be made to those entitled to the payment as follows:

(a) Immediately to the holders of uncertificated membership interests;

(b) Upon and simultaneously with the surrender to the limited liability company of certificates representing the membership interests to the holders of certificated membership interests.

(B) If the proposal of merger , consolidation , or conversion was submitted to the members of a domestic limited liability company at a meeting, the fair cash value of the membership interests as to any of those members that seek relief shall be determined as of the day before the day on which the vote on the proposal was taken. If the proposal of merger , consolidation , or conversion was submitted to the members of a domestic limited liability company for written approval or other action without a meeting, the fair cash value of the membership interests as to which those members seek relief shall be determined as of the day before the day on which the request for approval or other action was sent.

The fair cash value of a membership interest for purposes of this section is the amount that a willing seller who is under no compulsion to sell would be willing to accept and that a willing buyer who is under no compulsion to purchase would be willing to pay, but the fair cash value paid to any member shall not exceed the amount specified in the demand for payment of that member. In computing the fair cash value of a membership interest, any appreciation or depreciation in market value resulting from the merger , consolidation, or conversion shall be excluded.

Effective Date: 07-01-1994; 10-12-2006

1705.43 Dissolution of company.

(A) A limited liability company organized under this chapter shall be dissolved upon the occurrence of any of the following events:

(1) The expiration of the period, if any, fixed by the operating agreement or articles of organization for the duration of the company;

(2) One or more events specified in writing in the operating agreement as causing the dissolution of the company;

(3) The unanimous written agreement of all members to dissolve the company;

(4) Except as provided in division (C) of this section, the withdrawal of a member of the company, unless the business of the company is continued by the consent of all of the remaining members or under a right to continue the company that is stated in writing in the operating agreement;

(5) Upon entry of a decree of judicial dissolution under section 1705.47 of the Revised Code.

(B) Following the occurrence of any of the events of dissolution specified in this section, the limited liability company shall deliver to the secretary of state for filing a certificate of dissolution on a form that is prescribed by the secretary of state and that includes the name of the company and the effective date of its dissolution.

(C) If the company was formed on or after the effective date of this amendment, or the company was formed prior to the effective date of this amendment and its articles or operating agreement are amended to specifically state that this division applies to the company, the withdrawal of a member of the company shall not cause the dissolution of the company except as may be provided in the operating agreement.

Effective Date: 12-03-1999

1705.44 Winding up of affairs.

Except as otherwise provided in the operating agreement, the members of a dissolved limited liability company who have not wrongfully dissolved the company, a liquidating trustee selected by those members, or, if the management of the company has not been reserved to its members, its managers may wind up the affairs of the company. Upon application of any member of a dissolved limited liability company or his legal representative or assignee, the court of common pleas may wind up the affairs of the company or may cause its affairs to be wound up by a liquidating trustee appointed by the court.

Effective Date: 07-01-1994

1705.45 Authority of persons winding up.

(A) A dissolved limited liability company continues its existence until the winding up of its affairs is completed. In the name of and on behalf of the company, the persons winding up its affairs may do any of the following:

(1) If authorized by the operating agreement, continue the business of the company in order to maximize its value as a going concern for eventual sale;

(2) Collect the assets of the company and gradually settle and close its business;

(3) Dispose of and convey the property of the company that will not be distributed in kind to its members;

(4) Discharge or make reasonable provision for the liabilities of the company;

(5) Distribute to the members any remaining assets of the company;

(6) Do every other act necessary to wind up and liquidate the business and affairs of the company.

(B) Dissolution of a limited liability company does not do any of the following:

(1) Transfer title to the assets of the company;

(2) Prevent commencement of a proceeding by or against the company in its name;

(3) Abate or suspend a proceeding pending by or against the company on the date of dissolution;

(4) Terminate the authority of the statutory agent of the company;

(5) Unless otherwise provided in the operating agreement, terminate the authority of any manager, officer, or other agent of the company;

(6) Unless the terms of the contract otherwise provide, terminate any contractual rights or obligations of the company.

Effective Date: 07-01-1994

1705.46 Distributing assets - paying claims and obligations.

(A) Upon the winding up of a limited liability company and the liquidation of its assets, the assets shall be distributed in the following order:

(1) To the extent permitted by law, to members who are creditors and other creditors in satisfaction of liabilities of the company other than liabilities for distributions to members;

(2) Except as otherwise provided in the operating agreement, to members and former members in satisfaction of liabilities for distributions to members;

(3) Except as otherwise provided in the operating agreement, to members as follows:

(a) First, for the return of their contributions;

(b) Second, with respect to their membership interests.

(B) A limited liability company that is winding up its affairs and liquidating its assets shall pay or make reasonable provision to pay all claims and obligations, including all contingent, conditional, or unmatured claims and obligations that are known to the company and all claims and obligations that are known to the company but with respect to which the claimant or obligee is unknown. If there are sufficient assets, the claims and obligations shall be paid in full or any provision to pay them shall be made in full. If there are insufficient assets, the claims and obligations shall be paid or provided for according to their priority, and claims and obligations of equal priority shall be paid ratably to the extent of the assets available for their payment. Unless otherwise provided in the operating agreement, any remaining assets shall be distributed as provided in division (A) of this section.

Effective Date: 07-01-1994

1705.47 Dissolution by tribunal.

On application by a member of a limited liability company, the tribunal may declare a limited liability company dissolved, and the limited liability company's business shall be wound up upon the occurrence of any of the following events:

(A) An event that makes it unlawful for all or substantially all of the business of the limited liability company to be continued, but a cure of illegality within ninety days after notice to the limited liability company of the event is effective retroactively to the date of the event for purposes of this section;

(B) A determination by the tribunal that any of the following is true:

(1) The economic purpose of the limited liability company is likely to be unreasonably frustrated.

(2) Another member has engaged in conduct relating to the limited liability company's business that makes it not reasonably practicable to carry on the business with that member.

(3) It is not otherwise reasonably practicable to carry on the limited liability company's business in conformity with the operating agreement.

Amended by 129th General AssemblyFile No.72, HB 48, §1, eff. 5/4/2012.

Effective Date: 07-01-1994

1705.48 Personal liability.

Except as otherwise provided by this chapter or any other provision of the Revised Code, including, but not limited to, sections 3734.908 , 5739.33 , 5743.57 , 5747.07 , and 5753.02 of the Revised Code, all of the following apply:

(A) The debts, obligations, and liabilities of a limited liability company, whether arising in contract, tort, or otherwise, are solely the debts, obligations, and liabilities of the limited liability company.

(B) Neither the members of the limited liability company nor any managers of the limited liability company are personally liable to satisfy any judgment, decree, or order of a court for, or are personally liable to satisfy in any other manner, a debt, obligation, or liability of the company solely by reason of being a member or manager of the limited liability company.

(C) Nothing in this chapter affects any personal liability of a member of a limited liability company or any manager of a limited liability company for the member's or manager's own actions or omissions.

(D) This chapter does not affect any statutory or common law of this or another state that pertains to the relationship between an individual who renders a professional service and a recipient of that service, including, but not limited to, any contract or tort liability arising out of acts or omissions committed or omitted during the course of rendering the professional service.

Amended by 128th General AssemblyFile No.38, HB 519, §1, eff. 9/10/2010.

Effective Date: 07-01-1994

1705.49 Member commencing action on behalf of company.

A member of a limited liability company in which the management is not reserved to its members may commence an action on behalf of the company to recover a judgment in its favor if the managers of the company with authority to commence the action have refused to do so or if an effort to cause those managers to commence the action is not likely to succeed.

Effective Date: 07-01-1994

1705.50 Plaintiff's status as member.

In a derivative action commenced pursuant to section 1705.49 of the Revised Code, the plaintiff shall be a member at the time of bringing the action. The plaintiff shall also have been a member at the time of the transaction of which he complains unless his status as a member devolved upon him by operation of law or pursuant to the operating agreement from a person who was a member at the time of the transaction.

Effective Date: 07-01-1994

1705.51 Complaint in derivative action.

In a derivative action commenced pursuant to section 1705.49 of the Revised Code, the complaint shall set forth with particularity the effort of the plaintiff to secure commencement of the action by the managers or the reasons for not making the effort.

Effective Date: 07-01-1994

1705.52 Dividing proceeds.

If a derivative action commenced pursuant to section 1705.49 of the Revised Code is successful in whole or in part or if anything is received by the plaintiff as a result of a judgment, compromise, or settlement of the action or a claim in the action, the court may award the plaintiff reasonable expenses, including reasonable attorney's fees, and shall direct him to remit to the company the remainder of the proceeds received by him.

Effective Date: 07-01-1994

1705.53 Laws governing foreign limited liability company.

Subject to any contrary provisions of the Ohio Constitution, the laws of the state under which a foreign limited liability company is organized govern its organization and internal affairs and the liability of its members. A foreign limited liability company may not be denied a certificate of registration as a foreign limited liability company in this state because of any difference between the laws of the state under which it is organized and the laws of this state. However, a foreign limited liability company that applies for registration under this chapter to render a professional service in this state, as a condition to obtaining and maintaining a certificate of registration, shall comply with the requirements of division (C) of section 1705.04 of the Revised Code and shall comply with the requirements of Chapters 4703. and 4733. of the Revised Code if the kinds of professional services authorized under those chapters are to be rendered or with the requirements of Chapters 4723., 4725., 4729., 4731., 4732., 4734., and 4755. of the Revised Code if a combination of the professional services of optometrists authorized under Chapter 4725. of the Revised Code, chiropractors authorized under Chapter 4734. of the Revised Code to practice chiropractic or acupuncture, psychologists authorized under Chapter 4732. of the Revised Code, registered or licensed practical nurses authorized under Chapter 4723. of the Revised Code, pharmacists authorized under Chapter 4729. of the Revised Code, physical therapists authorized under sections 4755.40 to 4755.56 of the Revised Code, occupational therapists authorized under sections 4755.04 to 4755.13 of the Revised Code, mechanotherapists authorized under section 4731.151 of the Revised Code, and doctors of medicine and surgery, osteopathic medicine and surgery, or podiatric medicine and surgery authorized under Chapter 4731. of the Revised Code are to be rendered.

Effective Date: 03-22-1999; 04-06-2007; 2007 SB33 08-22-2007

1705.54 Application for registration.

(A) Before transacting business in this state, a foreign limited liability company shall register with the secretary of state. The company shall register by submitting to the secretary of state an application for registration as a foreign limited liability company. The application shall be on a form that is prescribed by the secretary of state, be signed by an authorized representative of the company, and set forth all of the following:

(1) The name of the company and, if different, the name under which it is registered or organized in the state of its organization;

(2) The state in which it was organized and the date of its formation;

(3) The name and address of an agent for service of any process, notice, or demand on the company. The agent shall be one of the following:

(a) A natural person who is a resident of this state ;

(b) A domestic or foreign corporation, nonprofit corporation, limited liability company, partnership, limited partnership, limited liability partnership, limited partnership association, professional association, business trust, or unincorporated nonprofit association that has a business address in this state. If the agent is an entity other than a domestic corporation, the agent shall meet the requirements of Title XVII of the Revised Code for an entity of the agent's type to transact business or exercise privileges in this state.

(4) A statement that the secretary of state is appointed the agent of the company for service of any process, notice, or demand on the company if an agent is not appointed as described in division (A)(3) of this section or if an agent is appointed pursuant to that division but the authority of that agent has been revoked or the agent cannot be found or served after the exercise of reasonable diligence;

(5) An address to which interested persons may direct requests for copies of the articles of organization, operating agreement, bylaws, or other charter documents of the company.

(B) Upon receipt of an application for registration as a foreign limited liability company and the filing fee required by law, the secretary of state shall accept the application for filing and shall make a copy of the application for the secretary of state's records by microfilm or by any authorized photostatic or digitized process. Evidence of the filing shall be returned to the company or its representative.

(C) Upon being filed in accordance with division (B) of this section, an application for registration as a foreign limited liability company shall be deemed to be the certificate of registration of the applicant as a foreign limited liability company authorized to transact business in this state.

Amended by 130th General Assembly File No. 62, SB 98, §1, eff. 2/18/2014.

Effective Date: 07-29-1998

1705.55 Certificate of correction of registration application.

(A) If any statement in an application for registration as a foreign limited liability company is materially false when made or if any facts described in the application have changed making it inaccurate in any material respect, the foreign limited liability company shall file promptly with the secretary of state a certificate correcting the application that shall be on a form that is prescribed by the secretary of state and be signed by an authorized representative of the company.

(B) If the application for registration or a subsequent certificate of correction becomes inaccurate because the designated agent resigns or changes the agent's address from that appearing in the registration application or any subsequent certificate of correction of the registration application, the foreign limited liability company, or the designated agent on its behalf, shall file a notice of that resignation or change promptly with the secretary of state.

(C) A foreign limited liability company may revoke the appointment of its designated agent described in division (A) of section 1705.54 of the Revised Code by filing with the secretary of state, on a form prescribed by the secretary of state, a written appointment of another agent and an acceptance of appointment in the manner described in division (B)(2) of section 1705.06 of the Revised Code and a statement indicating that the appointment of the former agent is revoked.

(D) The fee specified in division (R) of section 111.16 of the Revised Code shall accompany a filing under division (B) or (C) of this section.

Effective Date: 06-06-2001

1705.56 Name.

A foreign limited liability company may register with the secretary of state under any name that could be registered by a domestic limited liability company pursuant to section 1705.05 of the Revised Code, whether or not the name is the name under which it is organized in the state of its organization.

Effective Date: 07-01-1994

1705.57 Cancellation of registration.

A foreign limited liability company may cancel its registration to transact business in this state by filing with the secretary of state a certificate of cancellation that shall be on a form that is prescribed by the secretary of state and signed by an authorized representative of the company, and that sets forth all of the following:

(A) The name under which the company is registered in this state and, if different, the name under which it is registered or organized in the state of its organization;

(B) A statement that the company is not transacting business in this state;

(C) A statement whether the authority of its statutory agent in this state to accept service of process, notices, and demands is revoked and, if it is revoked, an address to which a person may mail a copy of any process, notice, or demand against the company and a commitment to notify the secretary of state in the future of any change in that mailing address.

Effective Date: 07-01-1994

1705.58 Transacting business in Ohio without registration.

(A) A foreign limited liability company transacting business in this state may not maintain any action or proceeding in any court of this state until it has registered in this state in accordance with sections 1705.53 to 1705.58 of the Revised Code.

(B) The failure of a foreign limited liability company to register in this state in accordance with sections 1705.53 to 1705.58 of the Revised Code does not impair the validity of any contract or act of the company or prevent it from defending any action or proceeding in any court of this state.

(C) A foreign limited liability company that transacts business in this state without registration in accordance with sections 1705.53 to 1705.58 of the Revised Code or that cancels its registration as a foreign limited liability company under those sections appoints the secretary of state as its agent for service of process, notices, and demands for causes of action arising out of its transaction of business in this state.

(D) A member of a foreign limited liability company is not personally liable for the obligations of the company solely because the company transacts business in this state without being registered in accordance with sections 1705.53 to 1705.58 of the Revised Code.

Effective Date: 07-01-1994

1705.61 Persons performing services to company or members.

(A) Absent an express agreement to the contrary, a person providing goods to or performing services for a limited liability company owes no duty to, incurs no liability or obligation to, and is not in privity with the members or creditors of the limited liability company by reason of providing goods to or performing services for the limited liability company.

(B) Absent an express agreement to the contrary, a person providing goods to or performing services for a member or group of members of a limited liability company owes no duty to, incurs no liability or obligation to, and is not in privity with the limited liability company, any other members of the limited liability company, or the creditors of the limited liability company by reason of providing goods to or performing services for the member or group of members of the limited liability company.

Amended by 129th General AssemblyFile No.72, HB 48, §1, eff. 5/4/2012.

Effective Date: 10-12-2006