SB 95 — Revises provisions relating to business entities. (BDR 7-493)

Service of process must be effected by serving the registered agent with a true copy in the manner provided by law for service of process.or proceeding is pending] party serving the registered agent shall,tion within 7 days after such service, send by registered or certified mail, postage prepaid, [true and attested] copies of the [process,] documents served upon the registered agent, together with a statement that service is being made pursuant to this section, addressed to the management person at the address as it appears on the records of the Secretary of State, or if no such address appears, at the address last known to the serving party .

In addition, the [clerk of the court in which the civil action or proceeding is pending] party serving the registered agent shall, within 7 days after such service, send by registered or certified mail, postage prepaid, [true and attested] copies of the [process,] documents served upon the registered agent, together with a statement that service is being made pursuant to this section, the records of the Secretary of State, or if no such address appears, at the address last known to the serving party .

If any entity or management person fails to appoint a registered agent, or fails to file a statement of change of registered agent pursuant to NRS 77.340 before the effective date of a vacancy in the agency pursuant to NRS 77.330 or 77.370, on the production of a certificate of the Secretary of State showing either fact, which is conclusive evidence of the fact so certified to be made a part of the return of service, or if the street address of the registered agent of the entity is not staffed as required pursuant to NRS 14.020, which fact is to be made part of the return of service, the management person may be - *SB95_R1* – 5 – served with any and all legal process, or a demand or notice described in NRS 14.020, by delivering a copy to the Secretary of State or, in the absence of the Secretary of State, to any deputy secretary of state, and such service is valid to all intents and purposes.

- 81st Session (2021) – 5 – (a) Include a specific citation to the provisions of this section.

 The Secretary of State shall keep a copy of the legal process received pursuant to this section in the Office of the Secretary of State for at least 1 year after receipt thereof and shall make those records available for public inspection during normal business hours.

7.served with process pursuant to subsection 2, the time in which a defendant is required to appear and file a responsive pleading must be computed from the date of mailing by the [clerk of the court.] serving party.

In any action in which any management person has been served with process pursuant to subsection 2, the time in which a defendant is required to appear and file a responsive pleading must be computed from the date of mailing by the [clerk of the court.] serving party.

In a charter or other writing, a management person or owner of any entity may consent to be subject to the nonexclusive jurisdiction of the courts of, or arbitration in, a specified jurisdiction, or the exclusive jurisdiction of the courts of this State, or the exclusivity of arbitration in a specified jurisdiction or this State, and to be served with process in the manner prescribed in the charter or - *SB95_R1* – 6 – other writing.

Notwithstanding any other provision of this subsection, except by agreeing to arbitrate any arbitrable matter in a specified jurisdiction or in this State, an owner of an entity who is not- a81st managementSession person(2021) may– not6 waive– its right to maintain a legal action or proceeding in the courts of this State with respect totogal matters relating to the organization or internal affairs of an entity.

(1)(2) Corporation,Limited-liability whethercompany;t or not for profit;

(2) Limited-liability company;

(b) “Articles,” “articles of incorporation” and “certificate of incorporation” are synonymous terms and, unless the contextcontextcate of otherwise requires, include all certificates filed pursuant to NRS 78.030, 78.180, 78.185, 78.1955, 78.209, 78.380, 78.385, 78.390, 78.725 and 78.730 and any articles of merger, conversion, exchange or domestication filed pursuant to NRS 92A.200 to 92A.240, inclusive, or 92A.270.

- *SB95_R1* – 7 – (d) “Entity” means a foreign or domestic:

- 81st Session (2021) – 7 – (1) Corporation, whether or not for profit;

(e)corporation “Marketthat value”has whena usedclass inor referenceseries toof thevoting shares which is:ic (1) A covered security under section 18(b)(1)(A) or property(B) of anythe residentSecurities domesticAct corporation,of means:1933, 15 U.S.C.

(1) In the case of shares, the highest closing sale price of a share during the 30 calendar days immediately preceding the date in question on the principal United States securities exchange registered under the Securities Exchange Act on which the shares are listed, or, if the shares are not listed on any such exchange, the fair market value on the date in question of a share as determined by the board of directors of the resident domestic corporation in good faith.

(2) In the case of property other than cash or shares, the fair market value of the property on the date in question as determined by the board of directors of the resident domestic corporation in good faith.

(f) “Publicly traded corporation” means a domestic corporation that has a class or series of voting shares which is:

(1) A covered security under section 18(b)(1)(A) or (B) of the Securities Act of 1933, 15 U.S.C.

(g)(f) “Principal office” means the office, in or out of this State, where the principal executive offices of a domestic or foreign corporation are located.

[(f)] (h)(g) “Receiver” includes receivers and trustees appointed by a court as provided in this chapter or in chapter 32 of NRS.

[(g)] (i)(h) “Registered agent” has the meaning ascribed to it in NRS 77.230.

[(h)] (j)(i) “Registered office” means the office maintained at the street address of the registered agent.

[(i)] (k)(j) “Resident“Securities domesticExchange corporation”Act” means athe domesticAct corporationof thatCongress hasknown 200as orthe moreSecurities stockholdersExchange Act of record.1934, as amended, 15 U.S.C.

A resident domestic corporation does not cease to be a resident domestic corporation by reason of events occurring or actions taken while the resident domestic corporation is subject to NRS 78.411 to 78.444, inclusive.

- *SB95_R1* – 8 – (l) “Securities Exchange Act” means the Act of Congress known as the Securities Exchange Act of 1934, as amended, 15 U.S.C.

(m)(k) “Stockholder of record” means a person whose name appears on the stock ledger of the corporation as the owner of record of shares of any class or series of the stock of the corporation.

(l) “Voting shares” means shares of stock of a corporation entitled to vote generally in the election of directors.

3.

As used in this section:

(a) “Share” has the meaning ascribed to it in NRS 78.429.

(b) “Subsidiary” has the meaning ascribed to it in NRS 78.431.

(c) “Voting shares” has the meaning ascribed to it in NRS 78.432.

(a)- It81st appearsSession from(2021) the– articles8 or– the certificate of amendment that the corporation proposes to carry on business as a banking orort trust company, exclusively or in connection with its business as a bank, savings and loan association, savings bank or thrift company;

Except as otherwise provided in subsection 7, the Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of anyanyon or corporation formed pursuant to the laws of this State if the name of the corporation contains the words “engineer,” “engineered,” - *SB95_R1* – 9 – “engineering,” “professional engineer,” “registered engineer” or “licensed engineer” unless:

Except as otherwise provided in subsection 7, the Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed pursuant to the laws of this State if the name of the corporation contains the words “architect,” “architecture,” “registered architect,” “licensed architect,” “registered interior designer,” “registered interior design,” “residential designer,” “registered residential designer,” “licensed residential designer” or “residential design” unless the State Board of Architecture, Interior Design and Residential Design certifies that:

or (b)- The81st corporationSession is(2021) – 9 – pursuant to NRS 623.349.s qualified to do business in this State pursuant5. to NRS 623.349.

5.

The Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed or existing pursuant to the laws of this State which provides that the name of the corporationcorporatione contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the articles of incorporation or certificate of amendment that the purpose of the - *SB95_R1* – 10 – corporation is to operate as a unit-owners’ association pursuant to chapter 116 or 116B of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the corporation has:

The provisions of subsections 3 and 4 do not apply to any corporation, whose securities are publicly traded and regulated by the Securities Exchange Act , [of 1934,] which does not engage ininy the practice of professional engineering, architecture or residential design or interior design, as applicable.

Sec.- 81st Session (2021) – 10 – 78.046.

4.1.

NRSThe 78.046articles isof herebyincorporation amendedor tobylaws readof asa: follows:

78.046corporation 1.may require, to the extent not inconsistent with any applicable jurisdictional requirements [,] and the laws of the United States, that any, all or certain [internal] :

The articles of incorporation or bylaws of a corporation may require, to the extent not inconsistent with any applicable jurisdictional requirements [,] and the laws of the United States, that any, all or certain [internal] :

[3.] 4.

As used in this section:

- *SB95_R1* – 11 – (II) Any stockholder of the corporation;

(1) This State, including, without limitation, those courts in any county having a business court, as that term is defined in NRS 13.050;13.(2) A state other than this State;

(2) A state other than this State;

or - 81st Session (2021) – 11 – (3) Arising pursuant to, or to interpret, apply, enforce or determine the validity of, any provision of this title, the articles of incorporation, the bylaws or any agreement entered into pursuant to NRS 78.365 to which the corporation is a party or a stated beneficiarybenSec. thereof.

Sec.5.y tNRS 78.138 is hereby amended to read as follows:

5.

NRS 78.138 is hereby amended to read as follows:

or (c) A committee on which the director or officer relying thereon does not serve, established in accordance with NRS 78.125, as to matters within the committee’s designated authority and matters on which the committee is reasonably believed to merit confidence,  but a director or officer is not entitled to rely on such information, opinions, reports, books of account or statements if the director or officer has knowledge concerning the matter in question thattha3.wouExcept wouldas causeotherwise relianceprovided thereonin subsection 1 of NRS 78.139, directors and officers, in deciding upon matters of business, are presumed to beact unwarranted.in good faith, on an informed basis and with a view to the interests of the corporation.

- *SB95_R1* – 12 – 3.

Except as otherwise provided in subsection 1 of NRS 78.139, directors and officers, in deciding upon matters of business, are presumed to act in good faith, on an informed basis and with a view to the interests of the corporation.

- 81st Session (2021) – 12 – (3) The interests of the community or of society;

or (5) The long-term or short-term interests of the corporation’s stockholders, including the possibility that these interests may bebe’s best served by the continued independence of the corporation.

(1) The director’s or officer’s act or failure to act constituted a breach of his or her fiduciary duties as a director or officer;

andandted - *SB95_R1* – 13 – (2) Such breach involved intentional misconduct, fraud or a knowing violation of law.

A distribution may be in the form - 81st Session (2021) – 13 – of a declaration or payment of a dividend, a purchase, redemption or other acquisition of shares, a distribution of indebtedness, or otherwise.

78.257of 1.any corporation and owns not less than 15 percent of all of the issued and outstanding shares of the stock of such corporation or has been authorized in writing by the holders of at least 15 percent of all its issued and outstanding shares, upon at least 5 days’ written demand, including the affidavit required pursuant to subsection 2, is entitled to inspect in person or by agent or attorney, during normal business hours, the books of account and all financial records of the corporation, to make copies of records, and to conduct an audit of such records.

Any person who has been a stockholder of record of any corporation and owns not less than 15 percent of all of the issued and outstanding shares of the stock of such corporation or has been authorized in writing by the holders of at least 15 percent of all its issued and outstanding shares, upon at least 5 days’ written demand, including the affidavit required pursuant to subsection 2, is entitled to inspect in person or by agent or attorney, during normal business hours, the books of account and all financial records of the corporation, to make copies of records, and to conduct an audit of such records.

The rights authorized by subsection 1 may be denied to any stockholder upon the stockholder’s refusal to furnish the corporation an affidavit required pursuant to subsection 2.

Any stockholder ororion other person, exercising rights set forth in subsection 1, who uses or attempts to use information, records or other data obtained from the - *SB95_R1* – 14 – corporation, for any purpose not related to the stockholder’s interest in the corporation as a stockholder, is guilty of a gross misdemeanor.

- 81st Session (2021) – 14 – 6.

(a) Is entitled to costs and reasonable attorney’s fees, if the sto(b) Is liable for such costs and fees, if the stockholder prevails;does not prevail,  in the action or proceeding.

or (b) Is liable for such costs and fees, if the stockholder does not prevail,  in the action or proceeding.

Except to the extent limited or denied by this section or the articles of incorporation, shareholders have a preemptive right to acquireinto unissuedsuch shares,shares.shares, treasury shares or securities convertible into3. such shares.

3.

(1) To acquire any shares issued to directors, officers or employees pursuant to approval by the affirmative vote of the - *SB95_R1* – 15 – holders of a majority of the shares entitled to vote or when authorized by a plan approved by such a vote of shareholders;

or (5)- To81st acquireSession any(2021) shares,– treasury15 shares– or securities convertible into such shares, if the shares or the shares into which the convertible securities may be converted are upon issuance registered pursuant to section 12 of the Securities Exchange Act , [of 1934,] 15 U.S.C.

(e) The preemptive right is only an opportunity to acquire shares or other securities upon such terms as the board of directors fixes for the purpose of providing a fair and reasonable opportunity for the exerciseexeSec. of such right.

Sec.9.f sNRS 78.288 is hereby amended to read as follows:

9.

NRS 78.288 is hereby amended to read as follows:

or (b) Except as otherwise specifically allowed by the articles of incorporation, the corporation’s total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the corporation were to be dissolved immediately after the time of the distribution, to satisfy the preferential rights upon such dissolution of [stockholders] holders of shares of any class or series of the capital stock of the corporation [whose] having preferential rights [are] superior to those receiving the distribution.

- *SB95_R1* – 16 – 3.

4.- 81st Session (2021) – 16 – measured:

The effect of a distribution pursuant to subsection 2 must be measured:(a) In the case of a distribution by purchase, redemption or other acquisition of shares of the [corporation’s shares,] capital stock of the corporation, as of the earlier of:

(a) In the case of a distribution by purchase, redemption or other acquisition of shares of the [corporation’s shares,] capital stock of the corporation, as of the earlier of:

5.shares of one or more classes or series of the capital stock of the corporation incurred by reason of a distribution made in accordance with this section is at parity with the corporation’s indebtedness to its general unsecured creditors except to the extent subordinated by agreement.

A corporation’s indebtedness to a [stockholder] holder of shares of one or more classes or series of the capital stock of the corporation incurred by reason of a distribution made in accordance with this section is at parity with the corporation’s indebtedness to its general unsecured creditors except to the extent subordinated by agreement.

The board of directors may fix a record date for determining [stockholders] holders of shares of one or more classes or series of the capital stock of the corporation entitled to a distributiondistributiones of authorized by the board of directors pursuant to this section, which record date must not precede the date upon which the resolution fixing the record date is adopted.

- *SB95_R1* – 17 – 8.

- 81st Session (2021) – 17 – Sec.

Except as otherwise provided in subsection 3 and NRS 78.138, in case of any violation of the provisions of this section, the directors under whose administration the violation occurred areareion, the jointly and severally liable, at any time within 3 years after each violation, to the corporation, and, in the event of its dissolution or insolvency, to its creditors at the time of the violation, or any of them, to the lesser of the full amount of the distribution made or of any loss sustained by the corporation by reason of the distribution .

and (b) Action by the stockholders on a matter other than the election of directors is approved if the number of votes cast in favor of the action exceeds the number of votes cast in opposition to the action.act2.n.

2.

Unless otherwise restricted by the articles of incorporation or bylaws, stockholders and certain other persons permitted by the corporation to attend a meeting of stockholders may participate in [a] the meeting [of stockholders] through remote communication, - *SB95_R1* – 18 – including, without limitation, electronic communications, - 81st Session (2021) – 18 – videoconferencing, teleconferencing or other available technology , if the corporation has implemented reasonable measures to:

and (b) Provide the stockholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the stockholders, including an opportunity to communicate, and to read or hear the proceedings of the meetings in a substantially concurrent manner with such proceedings.

8.the bylaws, once a share is represented in person or by proxy for any purpose at a meeting, the share shall be deemed present for purposes of determining a quorum for the remainder of the meeting and for any adjournment of the meeting unless a new record date is or must be fixed for the adjourned meeting.

Unless otherwise provided in the articles of incorporation or the bylaws, once a share is represented in person or by proxy for any purpose at a meeting, the share shall be deemed present for purposes of determining a quorum for the remainder of the meeting and for any adjournment of the meeting unless a new record date is or must be fixed for the adjourned meeting.

If the articles of incorporation, or the certificate of designation establishing the class or series of stock provides for more or less than one vote per share for any class or series of shares on any matter, every reference in this chapter to a majority or other - 81st Session (2021) – 19 – proportion of stock shall be deemed to refer to a majority or other - *SB95_R1* – 19 – proportion of the voting power of all of the shares or those classes or series of shares, as may be required by the articles of incorporation, or in the certificate of designation establishing the class or series of stocksto2. or the provisions of this chapter.

2.orUnless a period of more than 60 days or a period of less than days is prescribed or fixed in the articles of incorporation, the board of directors may prescribe a period not exceeding 60 days before any meeting of the stockholders during which no transfer of stock on the books of the corporation may be made, or may fix [, in advance,] a record date not more than 60 or less than 10 days before the date of any such meeting as the date as of which stockholders entitled to notice of and to vote at such meetings must be determined.

Unless a period of more than 60 days or a period of less than 10 days is prescribed or fixed in the articles of incorporation, the board of directors may prescribe a period not exceeding 60 days before any meeting of the stockholders during which no transfer of stock on the books of the corporation may be made, or may fix [, in advance,] a record date not more than 60 or less than 10 days before the date of any such meeting as the date as of which stockholders entitled to notice of and to vote at such meetings must be determined.

If a record date for a meeting of stockholders is not fixed [,] by the board of directors, the record date is at the close of business on the day before the day on which the first notice is given or, if noticemeeting is waived,held., at the close of business on the day before the meeting5. is held.

5.

7.- 81st Session (2021) – 20 – prescribing a date upon which the stockholders of record entitled to give written consent pursuant to NRS 78.320 must be determined and:

If the board of directors does not adopt a resolution prescribing a date upon which the stockholders of record entitled to - *SB95_R1* – 20 – give written consent pursuant to NRS 78.320 must be determined and:

The provisions of this section do not restrict the directors from taking action to protect the interests of the corporation and its stockholders, including, but not limited to, adopting or signing plans, arrangements or instruments that grant or deny rights, privileges, power or authority to a holder or holders of a specified number of shares or percentage of share ownership ororders of a voting power.

A duplicate of every such agreement must be filed in the registered office of the corporation and at all times during its terms be open2.en At any time within the 2 years next preceding the expiration of an agreement entered into pursuant to inspectionthe byprovisions of subsection 1, or the expiration of an extension of that agreement, any stockholderbeneficiary of the trust may, by written agreement with the trustee or histrustees, extend the duration of the trust for a time not to exceed 15 years after the scheduled expiration date of the original agreement or herthe attorney.latest extension.

2.An extension is not effective unless the trustee, before the expiration date of the original agreement or the latest extension, files a duplicate of the agreement - 81st Session (2021) – 21 – corporation.

At any time within the 2 years next preceding the expiration of an agreement entered into pursuant to the provisions of subsection 1, or the expiration of an extension of that agreement, any beneficiary of the trust may, by written agreement with the trustee or trustees, extend the duration of the trust for a time not to exceed 15 years after the scheduled expiration date of the original agreement or the latest extension.

An extension is not effective unless the trustee, before the expiration date of the original agreement or the latest extension, files a duplicate of the agreement providing for the extension in the registered office of the corporation.

An agreement entered into pursuant to the provisions - *SB95_R1* – 21 – of subsection 1 is not invalidated by the fact that, by its terms, its duration is more than 15 years, but its duration shall be deemed amended to conform with the provisions of this section.

(a) If and to the extent that the transferee agrees in writing to be bound by the agreement;

ororhat the transferee agrees in writing to (b) If the agreement expressly provides that it is enforceable against the transferee of a stockholder party to the agreement and:

(a) Effective for a term of more than 15 years, but at any time within the 2 years next preceding the expiration of the agreement the parties thereto may extend its duration for [as many additional periods,per5.ds,An] eachsuch notperiod as is stated in the extension [agreement entered into pursuant to exceedthe 15provisions years,of assubsection they1 wish.or 3 is not invalidated] ;

5.

An] such period as is stated in the extension [agreement entered into pursuant to the provisions of subsection 1 or 3 is not invalidated] ;

- 81st Session (2021) – 22 – Sec.

2.state the purpose or purposes for which the meeting is called.

Except in the case of the annual meeting, the notice must state the purpose or purposes for which the meeting is called.

- *SB95_R1* – 22 – (a) The date and time [when, and the place, which may be within or without this State, where] of the meeting [is to be held, and the] ;

Personal delivery of any such notice to any officer of a corporation or association, to any member of a limited-liability company managed by its members, to any manager of a limited-liability company managed by managers, to any general partner of a partnership or to any trustee of a trust constitutes deliveryliability ofcompany, thepartnership noticeor totrust.n, the corporation, association, limited- liability4. company, partnership or trust.

4.

6.- 81st Session (2021) – 23 – the bylaws, if notice is required to be delivered, under any provision of this chapter or the articles of incorporation or bylaws of any corporation, to any stockholder to whom:

Unless otherwise provided in the articles of incorporation or the bylaws, if notice is required to be delivered, under any provision of this chapter or the articles of incorporation or bylaws of any corporation, to any stockholder to whom:

or (b) All, and at least two, payments sent by first-class mail of dividends or interest on securities during a 12-month period, - *SB95_R1* – 23 –  have been mailed addressed to the stockholder at his or her address as shown on the records of the corporation and have been returned undeliverable, the delivery of further notices to the stockholder is not required.

If any such stockholder delivers to the corporation a written notice setting forth his or her current address, the requirement that notice be delivered to the stockholder is reinstated.

(a) The date [,] and time [or place] of the adjourned meeting [if they are announced at the meeting at which the adjournment is taken.]tak(b) ;The means of remote communication, if any, by which stockholders and proxies shall be deemed to be present in person and vote at the adjourned meeting;

(b) The means of remote communication, if any, by which stockholders and proxies shall be deemed to be present in person and vote at the adjourned meeting;

- 81st Session (2021) – 24 – 8.

The requirements for notice pursuant to this section are satisfied by a corporation if the corporation is a publicly traded corporation on the record date for the meeting and the corporation timely files, pursuant to section 14(a) of the Securities Exchange Act, 15 U.S.C.

- *SB95_R1* – 24 – 10.

14.2.

NRS 78.411 is hereby amended to read as follows:

78.411 As used in NRS 78.411 to 78.444, inclusive, unless the context otherwise requires, the words and terms defined in NRS 78.412 to [78.432,] 78.431, inclusive, have the meanings ascribed to them in those sections.

Sec.

Whenever any corporation becomes insolvent or suspends its ordinary business for want of money to carry on the business, or if its business has been and is being conducted at a great loss and greatly prejudicial to the interest of its creditors or stockholders, any creditors holding at least 10 percent of the outstanding indebtedness, or stockholders owning at least 1010he percent of the outstanding stock entitled to vote, may, by petition setting forth the facts and circumstances of the case, apply to the district court of the county in which the principal office of the corporation is located or, if the principal office is not located in this State, to the district court in the county in which the corporation’s registered office is located for a writ of injunction and the appointment of a receiver or receivers or trustee or trustees.

3.- 81st Session (2021) – 25 – corporation has become insolvent and is not about to resume its business in a short time thereafter, or that its business has been and is being conducted at a great loss and greatly prejudicial to the interests of its creditors or stockholders, so that its business cannot be conducted with safety to the public, it may issue an injunction to restrain the corporation and its officers and agents from exercising any of its privileges or franchises and from collecting or receiving any debts or paying out, selling, assigning or transferring any of its estate, money, lands, tenements or effects, except to a receiver appointed by the court, until the court otherwise orders.

If upon such inquiry it appears to the court that the corporation has become insolvent and is not about to resume its business in a short time thereafter, or that its business has been and is being conducted at a great loss and greatly prejudicial to the interests of its creditors or stockholders, so that its business cannot be conducted with safety to the public, it may issue an injunction to restrain the corporation and its officers and agents from exercising any of its privileges or franchises and from collecting or receiving any debts or paying out, selling, assigning or transferring any of its estate, money, lands, tenements or effects, except to a receiver appointed by the court, until the court otherwise orders.

A corporation may indemnify pursuant to this subsection any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, except an action by or in the right of the corporation, by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise [,] or as a manager of a limited-liability company, against expenses, - *SB95_R1* – 25 – including attorneys’ fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with the action, suit or proceeding if the person:

 The termination of any action, suit or proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent, does not, of itself, create a presumption that the person is liable pursuant to NRS 78.138 or did not act in good faith and in aaon is manner which he or she reasonably believed to be in or not opposed to the best interests of the corporation, or that, with respect to any criminal action or proceeding, he or she had reasonable cause to believe that the conduct was unlawful.

A corporation may indemnify pursuant to this subsection any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of- the81st factSession that(2021) the– person26 is– or was a director, officer, employee or agent of the corporation, or is or was serving at the request of thetheor corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise or as a manager of a limited-liability company, against expenses, including amounts paid in settlement and attorneys’ fees actually and reasonably incurred by the person in connection with the defense or settlement of the action or suit if the person:

 Indemnification pursuant to this section may not be made for any claim, issue or matter as to which such a person has been adjudged by a court of competent jurisdiction, after exhaustion of any appeals taken therefrom, to be liable to the corporation or for amounts paid in settlement to the corporation, unless and only to the extent that the court in which the action or suit was brought or other court of competent jurisdiction determines upon application that in view ofoff all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for such expenses as the court deems proper.

Any discretionary indemnification pursuant to this section, unless ordered by a court or advanced pursuant to subsection 2 of NRS 78.751, may be made by the corporation only as authorized in - *SB95_R1* – 26 – each specific case upon a determination that the indemnification of a director, officer, employee or agent of a corporation is proper under the circumstances.

(1) A majority vote of a quorum consisting of directors who were no(2) A quorum consisting of directors who were not parties to the action, suit or proceeding socannot orders;be obtained.

or (2) A quorum consisting of directors who were not parties to the action, suit or proceeding cannot be obtained.

2.- 81st Session (2021) – 27 – owners’ association, each term as defined in NRS 116.011, theit- corporation shall issue a certificate of membership to each member, but the membership or the certificate thereof shall not, except as provided in NRS 81.410 to 81.540, inclusive, be assigned by any member to any other person, nor shall the assigns thereof be entitled to membership in the corporation, or to any property rights or interest therein.

[The] Unless the corporation is an association or a unit- owners’ association, each term as defined in NRS 116.011, the corporation shall issue a certificate of membership to each member, but the membership or the certificate thereof shall not, except as provided in NRS 81.410 to 81.540, inclusive, be assigned by any member to any other person, nor shall the assigns thereof be entitled to membership in the corporation, or to any property rights or interest therein.

thereto the provisions set forth as sections 18 and 19 of this act.

17.

Chapter 86 of NRS is hereby amended by adding thereto the provisions set forth as sections 18 and 19 of this act.

Sec.

- *SB95_R1* – 27 – 2.

As used in NRS 86.281 to 86.351, inclusive, unless the context otherwise requires, “distribution” means a direct or indirect transfer of money or property, other than its own member’s interests, or the incurrence of indebtedness, by a limited-liability company to or for the benefit of all holders of any one or more classes or series of its members’ interests with respect to such interests or as otherwise provided in the articles of organization or operating agreement.

86.011 As used in this chapter, unless the context otherwise requires, the words and terms defined in NRS 86.022 to 86.1255, - 81st Session (2021) – 28 – inclusive, and section 18 of this act have the meanings ascribed to them in those sections.

“Noneconomic member” means a member of a limited-liabilitylim[1.] company(a) who:Does not own a member’s interest in the company;

[1.] (a) Does not own a member’s interest in the company;

Unless otherwise provided in the articles of organization or operating agreement, the management of a series is vested in the members associated with the series [in proportion to their contribution to the capital of the series, as adjusted from time to time to reflect properly any additional contributions or withdrawals - *SB95_R1* – 28 – from the assets or income of the series by the members associatedassociatedals with the series.] proportionally in interest thereof.

86.321 [The] For purposes of this chapter, the[contributions] contributionsa contribution to capital of a member to a limited-liability company or series may be[be in cash,cash,] consist of tangible or intangible property or servicesany rendered,other benefit to the limited-liability company or aseries, promissoryincluding, notewithout limitation, money, real or otherpersonal property, - 81st Session (2021) – 29 – binding obligation to contribute cash or property or to perform services.

(a) The company would not be able to pay its debts as they become due in the usual course of business;

orors debts as they (b) Except as otherwise specifically permitted by the articles of organization, the total assets of the company would be less than the sum of its total liabilities.

The manager or managers or, if management of the company is not vested in a manager or managers, the members , - *SB95_R1* – 29 – may base a determination that a distribution is not prohibited pursuantpur(a) toFinancial thisstatements sectionprepared on:on the basis of accounting practices that are reasonable in the circumstances;

(a) Financial statements prepared on the basis of accounting practices that are reasonable in the circumstances;

(a)- In81st theSession case(2021) of– a30 distribution– by purchase, redemption or other acquisition by the company of member’s interests, as of the earlierearlierer of:

Indebtedness of the company, or a series of the company, including indebtedness issued as a distribution, is not considered a liability for purposes of determinations pursuant to this section if its terms provide that payment of principal and interest are to be made only if and to the extent that payment of a distribution to thethemade members could then be made pursuant to this section.

A member who receives a distribution from a limited- liability company or the series, as applicable, in violation of this section is not liable to the limited-liability company or such series, as applicable, and, in the event of its dissolution or insolvency, to its creditors, or any of them, for the amount of the distribution after the expiration of 3 years after the date of the distribution unless ananr - *SB95_R1* – 30 – action to recover the distribution from the member is commenced before the expiration of the 3-year period following the distribution.

Except as otherwise provided in the articles of organization or operating agreement, the manager or managers or, if the management of the company is not vested in a manager or managers, the members, may fix a record date for determining the members entitled to a distribution authorized pursuant to this section.- 81st Session (2021) – 31 – fixed.n.

The record date must not precede the day on which it is fixed.Sec.

Sec.

Whenever any limited-liability company becomes insolvent or suspends its ordinary business for want of money to carry on the business, or if its business has been and is being conducted at a great loss and greatly prejudicial to the interest of its creditors or members, any creditors holding at least 10 percent of the outstanding indebtedness [, or members owning either 10 percent of the outstanding member’s interests or 10 percent of the voting power] of the company [,] or at least 10 percent in interest of the members, may, by petition setting forth the facts and circumstances of the case, apply to the district court of the county in which the principal office of the company is located or, if the principal office is not located in this State, to the district court in the county in which the company’s registered office is located for a writ of injunction and the appointment of a receiver or receivers or trusteetru2. or trustees.

2.

If, upon such inquiry it appears to the court that the company has become insolvent and is not about to resume its business in a short time thereafter, or that its business has been and is being conducted at a great loss and greatly prejudicial to the interests of its creditors or members so that its business cannot be conducted with safety to the public, it may issue an injunction to restrain the company and its managers, managing members, officers and agents from exercising any of its privileges or franchises and from collecting or receiving any debts or paying out, selling, assigning or transferring any of its estate, money, lands, tenements or effects, except to a receiver appointed by the court, until the court otherwise orders.

- *SB95_R1* – 31 – 4.

[Any member owning either 10 percent of the outstanding member’s interests or] Members holding not less than 10 percent [of the voting power] in interest of the limited-liability company- may81st applySession to(2021) the– district32 court– in the county in which the company has its principal place of business or, if the principal place of business is not located in this State, to the district court in the county in which the company’s registered office is located, for an order appointing a receiver, and by injunction restrain the company from exercising any of its powers or doing business whatsoever, except by and through a receiver appointed by the court, whenever irreparable injury to the company is threatened or being suffered and:

or (d) The company has dissolved, but has not proceeded diligently to wind2. up its affairs, or to distribute its assets in a reasonable time.

2.The application may be for the appointment of a receiver,able time.

The application may be for the appointment of a receiver, without at the same time applying for the dissolution of the company, and notwithstanding the absence, if any there be, of any action or other proceeding in the premises pending in such court.

The court may at any time for sufficient cause make a decree terminating the receivership, or dissolving the company and terminating its existence, or both, as may be proper.proper.ny and 5.

5.Receivers so appointed have, among the usual powers, all the functions, powers, tenure and duties to be exercised under the direction of the court as are conferred on receivers and as provided pursuant to NRS 86.5412, 86.5413 and 86.5414, whether the company is insolvent or not.

Receivers so appointed have, among the usual powers, all the functions, powers, tenure and duties to be exercised under the direction of the court as are conferred on receivers and as provided - *SB95_R1* – 32 – pursuant to NRS 86.5412, 86.5413 and 86.5414, whether the company is insolvent or not.

The requirement [as to ownership or voting] to hold not less than 10 percent in interest set forth in subsection 1 shall be - 81st Session (2021) – 33 – maintained from the date of and throughout the pendency of the application for the appointment of a receiver of the company.

The rights of a member set forth in this section may be exercised by a noneconomic member if specifically set forth in the articlesartSec. of organization or the operating agreement.

Sec.

“Advance notice statement” when used in reference to a proposed corporate action creating dissenter’s rights that is taken or submitted for approval pursuant to a written consent of the stockholders or taken without a vote of the stockholders, means written notice of the proposed corporate action sent by the subject corporation to all stockholders of record entitled to assert dissenter’s rights if the corporate action is effectuated.

Provide that a stockholder who wishes to assert dissenter’s rights with respect to any class or series of shares must deliver a statement of intent to the subject corporation and set a date by which the subject corporation must receive the statement of intent, which may not be less than 15 days after the date the notice is sent, and state that the stockholder shall be deemed to have waived the right to assert dissenter’s rights with respect to the shares - *SB95_R1* – 33 – unless the statement of intent is received by the subject corporation by such specified date;

and 4.- 81st Session (2021) – 34 – inclusive.

Be accompanied by a copy of NRS 92A.300 to 92A.500, inclusive.Sec.

Sec.

Unless otherwise expressly required by the articles of incorporation, no vote of the stockholders of a [publicly traded] domestic corporation is necessary to authorize a merger in which the [publicly traded] domestic corporation is a constituent entity if the plan of merger expressly permits or requires the merger to be effected under this section and:

permits or requires the merger (a) The ownership threshold requirement is satisfied without any offer, subject to the provisions of subsection 2;

and [(2)] (II) Each outstanding share of each class or series of stock of the [publicly traded] domestic corporation that is thethes of subject of, and not irrevocably accepted for purchase or exchange in, the offer must be converted in such merger into, or into the right to receive, the same amount and kind of cash, property, rights or securities to be paid for shares of such class or series of stock of the [publicly traded] domestic corporation irrevocably accepted for purchase or exchange in the offer.

The plan of merger may expressly provide that the requirements of this [subparagraph] - *SB95_R1*81st –Session 34(2021) – sub-subparagraph35 must– not apply to specified categories of excluded shares.

must not apply to specified categories of 2.

and (c) The domestic corporation must have been a publicly traded corporation at all times during the period between the date of the adoption of the plan of merger by the board of directors of the domesticdom3. corporation and the effective date of the merger.

3.

(III) Any person who owns, directly or indirectly, all of the outstanding equity interests of the constituent entity making the offer;

(e) “Offer” means an offer made by the other constituent entity in the merger for all of the outstanding shares of each class or series of stock of the [publicly traded] domestic corporation listed on a national securities exchange, on the terms provided in the plan of merger that, absent this section, would be entitled to vote on the [adoption]- approval81st Session (2021) – 36 – entity in the merger may, but is not required to, engage in thet consummation of separate offers for separate classes or series of the planstock of merger.the [publicly traded] domestic corporation.

The other constituent entity in the merger may, but is not required to, engage in the - *SB95_R1* – 35 – consummation of separate offers for separate classes or series of the stock of the [publicly traded] domestic corporation.

(g) “Ownership threshold requirement” means that the voting power of the stock of the [publicly traded] domestic corporation otherwise owned beneficially or of record by the other constituent entity in the merger or any of the owned affiliates of the other constituent entity, together with the voting power of any rollover shares and any shares irrevocably accepted for purchase or exchange pursuant to any offer and received before the expiration of the offer by the agent or depositary appointed to facilitate the consummation of the offer, equals at least that proportion of the voting power of the stock, and of each class or series thereof, of the [publicly traded] domestic corporation that, absent this section, would be required to approve the plan of merger under this chapter and the articles of incorporation and bylaws of the [publicly traded] domestic corporation.

(2) If the shares are uncertificated shares held of record by a clearing corporation as nominee, upon transfer into the account of the age(3) If the shares are uncertificated shares held of record by a person other than a clearing corporation as nominee, upon physical receipt by the agent or depositary byof wayan executed letter of antransmittal agent’sor message;other instrument of transfer.

and (3) If the shares are uncertificated shares held of record by a person other than a clearing corporation as nominee, upon physical receipt by the agent or depositary of an executed letter of transmittal or other instrument of transfer.

(i)- “Rollover81st shares”Session means(2021) any– shares37 of– any class or series of the capital stock of the [publicly traded] domestic corporation that are the subject of a written agreement requiring such shares to be contributed or otherwise transferred to the other constituent entity in the merger or any of the owned affiliates of the other constituent - *SB95_R1* – 36 – entity in exchange for shares or other equity interest in the other constituent entity or any of its owned affiliates.

If the partnership has more than one class of limited partners, the plan of merger, conversion or exchange must be approved by those limited partners who own a majority inine must interest of the partnership then owned by the limited partners in each class.

3.] If any partner of a domestic limited partnership, which will be the constituent entity in a conversion, will have any liability for the obligations of the resulting entity after the conversion becausebecauseor the partner will be the owner of an owner’s interest in the resulting entity, then that partner must also approve the plan of conversion.

Sec.- 81st Session (2021) – 38 – 92A.150.

34.NR1.

NRS 92A.150 is hereby amended to read as follows:

92A.150 1.

and - *SB95_R1* – 37 – (b) If the company has more than one class of members, the plan of merger, conversion or exchange must be approved by [those members who own] a majority [of the interests in the current profits] in interest of the [company then owned by the] members in each class.

If any manager or member of a domestic limited-liability company, which will be the constituent entity in a conversion, will have any liability for the obligations of the resulting entity after the conversion because the manager or member will be the owner of an owner’s interest in the resulting entity, then that manager or member mustmus3.alsAs alsoused approvein this section, “in interest” has the planmeaning ascribed to it in section 18 of conversion.this act.

3.

As used in this section, “in interest” has the meaning ascribed to it in section 18 of this act.

or (c) Issued by an open end management investment company registered with the Securities and Exchange Commission under the Investment Company Act of 1940, 15 U.S.C.

§§ 80a-1 et seq., asashe amended, and which may be redeemed at the option of the holder at net asset value,  unless the articles of incorporation of the corporation issuing the class or series or the resolution of the board of directors approving the plan of merger, conversion or exchange expressly provide otherwise.

- 81st Session (2021) – 39 – (a) The record date fixed to determine the stockholders entitled to receive notice of and to vote at the meeting of stockholders to act upon the corporate action otherwise requiring dissenter’s rights;

or (b) The day before the effective date of such corporate action if [there][there](1) :There is no meeting of stockholders [.] to act upon the corporate action otherwise requiring dissenter’s rights;

(1) There is no meeting of stockholders [.] to act upon the corporate action otherwise requiring dissenter’s rights;

- *SB95_R1* – 38 – 3.

6.that was not issued and outstanding on the date of the first of stock announcement to the news media or to the stockholders of the terms of the proposed action requiring dissenter’s rights.

There is no right of dissent with respect to any share of stock that was not issued and outstanding on the date of the first announcement to the news media or to the stockholders of the terms of the proposed action requiring dissenter’s rights.

If [the] a corporate action creating dissenter’s rights is [taken] submitted for approval [by] pursuant to a written consent - 81st Session (2021) – 40 – of the stockholders or taken without a vote of the stockholders, the domestic corporation :

If a proposed corporate action creating dissenter’s rights is submitted to a vote at a stockholders’ meeting, a -any *SB95_R1*class –or 39series –of stockholdershares:rt whodissenter’s wishesrights with respect to assert(a) dissenter’sMust rightsdeliver to the subject corporation, before the vote is taken, [written notice of the stockholder’s] a statement of intent [to demand payment for his or her shares if] with respect to anythe classproposed orcorporate seriesaction of; shares:

(a) Must deliver to the subject corporation, before the vote is taken, [written notice of the stockholder’s] a statement of intent [to demand payment for his or her shares if] with respect to the proposed corporate action ;

If a proposed corporate action creating dissenter’s rights is taken without a vote of the stockholders or submitted for approval [by] pursuant to a written consent of the stockholders, a stockholder who wishes to assert dissenter’s rights with respect to any class or series of shares [must] :

NRS 78.424, 78.4265, 78.427,78.428, 78.42878.432 and 86.065 are hereby repealed.

LEADLINES~~~~~ OF21 REPEALED- SECTIONS81st 78.424Session “Market(2021) value” defined.

78.4265 “Publicly traded corporation” defined.

78.427 “Resident domestic corporation” defined.

78.428 “Securities Exchange Act” defined.

86.065 “Majority in interest” defined.

H - *SB95_R1*