Tenn. Code Ann. § 48-249-114 — TN Code / Title 48 / Chapter 249 / Section 48-249-114
Personal liability
Status: in_force

(a) Limited liability rule. (1) Except as provided in subsections (d) and (f): (A) The debts, obligations and liabilities of an LLC, whether arising in contract, tort or otherwise, are solely the debts, obligations and liabilities of the LLC; (B) A member, holder, director, manager, officer, employee or other agent of an LLC does not have any personal obligation, and is not otherwise personally liable, for the acts, debts, liabilities or obligations of the LLC; and (C) A member, holder, director, manager, officer, employee or other agent of an LLC does not have any personal obligation, and is not otherwise personally liable, for the acts or omissions of any other member, holder, manager, officer, director, employee or other agent of the LLC. (2) Notwithstanding subdivisions (a)(1)(B) and (C), a member, holder of financial rights, director, manager, officer, employee or other agent may be personally liable by reason of such person's own acts or omissions. (b) Limited liability after dissolution. The limitation on liability described in subsection (a) continues in full force, regardless of any dissolution, winding up or termination of an LLC. (c) Member not a proper party to proceeding. A member, holder, director, manager, officer, employee or other agent of an LLC is not a proper party to a proceeding by or against an LLC, except: (1) Where the object of the proceeding is to enforce such person's right against, or liability to, the LLC; (2) In a derivative proceeding brought under this chapter or the LLC documents; or (3) Where the proceeding asserts personal liability of such person, as described in subsection (a). (d) Sales tax liability. Notwithstanding any other provision of this chapter to the contrary, each member, manager, director, officer, employee, agent or other person required to collect, truthfully account for and pay over to the department of revenue any tax collected from the customers of a domestic or foreign LLC shall be personally liable for those taxes, in the same manner as responsible persons of a corporation under § 67-1-1443 . (e) Failure to follow formalities not to generate personal liability. The failure of a domestic or foreign LLC to observe the usual entity formalities or requirements relating to the exercise of its powers or management of its business is not a ground for imposing personal liability on the members, holders, managers, directors, officers, employees or other agents of the domestic or foreign LLC. (f) Voluntary unlimited liability. (1) Notwithstanding anything to the contrary in this section, the articles may provide that one (1) or more specifically identified members, as named in the articles, will be personally liable for all of the debts, obligations and liabilities of the LLC. If that provision is made, each such specifically identified member shall be liable to the same extent as a general partner in a general partnership; provided, that: (A) In order to be effective, each member so identified shall sign the articles or an amendment to the articles containing this provision; and (B) Each member identified in the articles shall continue to be personally liable for debts, obligations and liabilities of the LLC until the articles are amended to delete the member's name, but, except as provided in subdivision (f)(2), the amendment shall be signed by a person authorized to bind the LLC under § 48-249-402 , and by any remaining members who continue to be identified in the articles as being personally liable for the debts, obligations and liabilities of the LLC. (2) A member who is identified in the articles as being personally liable has the power, but not necessarily the right, to file an amendment to the articles, stating that such member will not be liable for any future debts, obligations and liabilities of the LLC, except with respect to persons that have reasonably relied upon the articles. (3) (A) An amendment to the articles filed under subdivisions (f)(1) and (2) shall be effective immediately, except that such an amendment is not effective against persons reasonably relying upon the articles naming the member as individually liable for the debts, obligations and liabilities of the LLC, until the passage of ninety (90) days from the filing of the amendment to the articles. (B) Notwithstanding subdivision (f)(3)(A), such member shall continue to be liable for all debts and obligations of the LLC incurred by the LLC during the time that the member was identified in the articles as being personally liable. Amended by 2020 Tenn. Acts, ch. 604, s 4, eff. 3/20/2020. Acts 2005, ch. 286, § 1.
(a) Limited liability rule. (1) Except as provided in subsections (d) and (f): (A) The debts, obligations and liabilities of an LLC, whether arising in contract, tort or otherwise, are solely the debts, obligations and liabilities of the LLC; (B) A member, holder, director, manager, officer, employee or other agent of an LLC does not have any personal obligation, and is not otherwise personally liable, for the acts, debts, liabilities or obligations of the LLC; and (C) A member, holder, director, manager, officer, employee or other agent of an LLC does not have any personal obligation, and is not otherwise personally liable, for the acts or omissions of any other member, holder, manager, officer, director, employee or other agent of the LLC. (2) Notwithstanding subdivisions (a)(1)(B) and (C), a member, holder of financial rights, director, manager, officer, employee or other agent may be personally liable by reason of such person's own acts or omissions.
(1) Except as provided in subsections (d) and (f): (A) The debts, obligations and liabilities of an LLC, whether arising in contract, tort or otherwise, are solely the debts, obligations and liabilities of the LLC; (B) A member, holder, director, manager, officer, employee or other agent of an LLC does not have any personal obligation, and is not otherwise personally liable, for the acts, debts, liabilities or obligations of the LLC; and (C) A member, holder, director, manager, officer, employee or other agent of an LLC does not have any personal obligation, and is not otherwise personally liable, for the acts or omissions of any other member, holder, manager, officer, director, employee or other agent of the LLC.
(A) The debts, obligations and liabilities of an LLC, whether arising in contract, tort or otherwise, are solely the debts, obligations and liabilities of the LLC;
(B) A member, holder, director, manager, officer, employee or other agent of an LLC does not have any personal obligation, and is not otherwise personally liable, for the acts, debts, liabilities or obligations of the LLC; and
(C) A member, holder, director, manager, officer, employee or other agent of an LLC does not have any personal obligation, and is not otherwise personally liable, for the acts or omissions of any other member, holder, manager, officer, director, employee or other agent of the LLC.
(2) Notwithstanding subdivisions (a)(1)(B) and (C), a member, holder of financial rights, director, manager, officer, employee or other agent may be personally liable by reason of such person's own acts or omissions.
(b) Limited liability after dissolution. The limitation on liability described in subsection (a) continues in full force, regardless of any dissolution, winding up or termination of an LLC.
(c) Member not a proper party to proceeding. A member, holder, director, manager, officer, employee or other agent of an LLC is not a proper party to a proceeding by or against an LLC, except: (1) Where the object of the proceeding is to enforce such person's right against, or liability to, the LLC; (2) In a derivative proceeding brought under this chapter or the LLC documents; or (3) Where the proceeding asserts personal liability of such person, as described in subsection (a).
(1) Where the object of the proceeding is to enforce such person's right against, or liability to, the LLC;
(2) In a derivative proceeding brought under this chapter or the LLC documents; or
(3) Where the proceeding asserts personal liability of such person, as described in subsection (a).
(d) Sales tax liability. Notwithstanding any other provision of this chapter to the contrary, each member, manager, director, officer, employee, agent or other person required to collect, truthfully account for and pay over to the department of revenue any tax collected from the customers of a domestic or foreign LLC shall be personally liable for those taxes, in the same manner as responsible persons of a corporation under § 67-1-1443 .
(e) Failure to follow formalities not to generate personal liability. The failure of a domestic or foreign LLC to observe the usual entity formalities or requirements relating to the exercise of its powers or management of its business is not a ground for imposing personal liability on the members, holders, managers, directors, officers, employees or other agents of the domestic or foreign LLC.
(f) Voluntary unlimited liability. (1) Notwithstanding anything to the contrary in this section, the articles may provide that one (1) or more specifically identified members, as named in the articles, will be personally liable for all of the debts, obligations and liabilities of the LLC. If that provision is made, each such specifically identified member shall be liable to the same extent as a general partner in a general partnership; provided, that: (A) In order to be effective, each member so identified shall sign the articles or an amendment to the articles containing this provision; and (B) Each member identified in the articles shall continue to be personally liable for debts, obligations and liabilities of the LLC until the articles are amended to delete the member's name, but, except as provided in subdivision (f)(2), the amendment shall be signed by a person authorized to bind the LLC under § 48-249-402 , and by any remaining members who continue to be identified in the articles as being personally liable for the debts, obligations and liabilities of the LLC. (2) A member who is identified in the articles as being personally liable has the power, but not necessarily the right, to file an amendment to the articles, stating that such member will not be liable for any future debts, obligations and liabilities of the LLC, except with respect to persons that have reasonably relied upon the articles. (3) (A) An amendment to the articles filed under subdivisions (f)(1) and (2) shall be effective immediately, except that such an amendment is not effective against persons reasonably relying upon the articles naming the member as individually liable for the debts, obligations and liabilities of the LLC, until the passage of ninety (90) days from the filing of the amendment to the articles. (B) Notwithstanding subdivision (f)(3)(A), such member shall continue to be liable for all debts and obligations of the LLC incurred by the LLC during the time that the member was identified in the articles as being personally liable.
(1) Notwithstanding anything to the contrary in this section, the articles may provide that one (1) or more specifically identified members, as named in the articles, will be personally liable for all of the debts, obligations and liabilities of the LLC. If that provision is made, each such specifically identified member shall be liable to the same extent as a general partner in a general partnership; provided, that: (A) In order to be effective, each member so identified shall sign the articles or an amendment to the articles containing this provision; and (B) Each member identified in the articles shall continue to be personally liable for debts, obligations and liabilities of the LLC until the articles are amended to delete the member's name, but, except as provided in subdivision (f)(2), the amendment shall be signed by a person authorized to bind the LLC under § 48-249-402 , and by any remaining members who continue to be identified in the articles as being personally liable for the debts, obligations and liabilities of the LLC.
(A) In order to be effective, each member so identified shall sign the articles or an amendment to the articles containing this provision; and
(B) Each member identified in the articles shall continue to be personally liable for debts, obligations and liabilities of the LLC until the articles are amended to delete the member's name, but, except as provided in subdivision (f)(2), the amendment shall be signed by a person authorized to bind the LLC under § 48-249-402 , and by any remaining members who continue to be identified in the articles as being personally liable for the debts, obligations and liabilities of the LLC.
(2) A member who is identified in the articles as being personally liable has the power, but not necessarily the right, to file an amendment to the articles, stating that such member will not be liable for any future debts, obligations and liabilities of the LLC, except with respect to persons that have reasonably relied upon the articles.
(3) (A) An amendment to the articles filed under subdivisions (f)(1) and (2) shall be effective immediately, except that such an amendment is not effective against persons reasonably relying upon the articles naming the member as individually liable for the debts, obligations and liabilities of the LLC, until the passage of ninety (90) days from the filing of the amendment to the articles. (B) Notwithstanding subdivision (f)(3)(A), such member shall continue to be liable for all debts and obligations of the LLC incurred by the LLC during the time that the member was identified in the articles as being personally liable.
(A) An amendment to the articles filed under subdivisions (f)(1) and (2) shall be effective immediately, except that such an amendment is not effective against persons reasonably relying upon the articles naming the member as individually liable for the debts, obligations and liabilities of the LLC, until the passage of ninety (90) days from the filing of the amendment to the articles.
(B) Notwithstanding subdivision (f)(3)(A), such member shall continue to be liable for all debts and obligations of the LLC incurred by the LLC during the time that the member was identified in the articles as being personally liable.
Amended by 2020 Tenn. Acts, ch. 604, s 4, eff. 3/20/2020.
Acts 2005, ch. 286, § 1.
Tenn. Code Ann. § 48-103-203 — TN Code / Title 48 / Chapter 103 / Section 48-103-203
Part definitions
Status: in_force

As used in this part, unless the context otherwise requires: (1) "Affiliate," when used to indicate a relationship with an interested shareholder, means a person that directly or indirectly through one (1) or more intermediaries, controls, or is controlled by, or is under common control with, or is acting in concert with, a specified person; (2) "Announcement date," when used in reference to any business combination, means the date of the first public announcement of a final definitive proposal for such business combination; (3) "Associate," when used to indicate a relationship with an interested shareholder, means: (A) Any domestic or foreign corporation, partnership, syndicate, joint venture or other unincorporated organization of which such person is an officer, director, manager or partner (either general or limited) or is, directly or indirectly, the beneficial owner of ten percent (10%) or more of any class of voting stock; (B) All members or investors in any partnership (either general or limited), syndicate or other unincorporated organization described in subdivision (3)(A); (C) Any trust or other estate in which such person has at least a ten percent (10%) beneficial interest or as to which such person serves as trustee or in a similar fiduciary capacity; or (D) Any parent, child, sibling, in-law (mother, father, sons and daughters), of such person or any relative of such person who has the same residence as such person; (4) "Beneficial owner," when used with respect to any class or series of shares or other securities, means a person that: (A) Individually, or with or through any of its affiliates or associates, beneficially owns such shares or other securities, directly or indirectly; (B) Individually, or with or through any of its affiliates or associates, has or shares with others: (i) The right to acquire or dispose of, or direct the disposition of such shares or other securities (whether such right is exercisable immediately or only after the passage of time or the satisfaction of one (1) or more other conditions), pursuant to any agreement, arrangement or understanding (whether or not in writing), or upon the exercise of conversion rights, exchange rights, warrants or options or otherwise; provided, that a person shall not be deemed the beneficial owner of any shares or other securities tendered pursuant to a tender or exchange offer made by such person or any of such person's affiliates or associates until such tendered shares or other securities are accepted for purchase or exchange; or (ii) The right to vote or direct the voting of such shares or other securities pursuant to any agreement, arrangement or understanding (whether or not in writing); provided, that a person shall not be deemed the beneficial owner of any shares or other securities under this subdivision (4)(B)(ii) if the agreement, arrangement or understanding to vote such shares or other securities: (a) Arises solely from a revocable proxy or consent given in response to a proxy or consent solicitation made in accordance with the applicable rules and regulations under the Exchange Act; and (b) Is not then reportable on a Schedule 13D or 13G under the Exchange Act (or any comparable or successor report); or (C) Has any agreement, arrangement or understanding (whether or not in writing), for the purpose of acquiring, holding, voting (except voting pursuant to a revocable proxy or consent as described in subdivision (4)(B)) or disposing of such shares or other securities with any other person that beneficially owns, or whose affiliates or associates beneficially own, directly or indirectly, such shares; (5) "Business combination," when used in reference to any resident domestic corporation and any interested shareholder of such resident domestic corporation or any affiliate or associate of such interested shareholder, means: (A) Any merger or consolidation of such resident domestic corporation or any subsidiary of such resident domestic corporation with: (i) An interested shareholder or any affiliate or associate of such interested shareholder; or (ii) Any other corporation (whether or not itself an interested shareholder of such resident domestic corporation) which is, or after such merger or consolidation would be, an affiliate or associate of such interested shareholder; (B) Any exchange of shares or securities convertible into shares of the resident domestic corporation with: (i) An interested shareholder or any affiliate or associate of such interested shareholder; or (ii) Any other domestic or foreign corporation (whether or not itself an interested shareholder of the resident domestic corporation) which is, or after the exchange would be, an affiliate or associate of the interested shareholder; (C) Any sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one (1) transaction or a series of transactions) to, with or proposed by or on behalf of an interested shareholder, or any affiliate or associate of such interested shareholder, of assets of such resident domestic corporation or any subsidiary of such resident domestic corporation: (i) Having an aggregate market value equal to ten percent (10%) or more of the aggregate market value of all the assets, determined on a consolidated basis, of such resident domestic corporation; (ii) Having an aggregate market value equal to ten percent (10%) or more of the aggregate market value of all the outstanding shares of such resident domestic corporation; or (iii) Representing ten percent (10%) or more of the net income determined on a consolidated basis of such resident domestic corporation; (D) Any transaction which results in the issuance or transfer by such resident domestic corporation or any subsidiary of such resident domestic corporation (in one (1) transaction or a series of transactions) of any shares or securities convertible into shares of such resident domestic corporation or any subsidiary of such resident domestic corporation to such interested shareholder or any affiliate or associate of such interested shareholder except pursuant to the exercise of warrants or rights to purchase shares or securities convertible into shares, or a dividend or distribution paid or made pro rata to all shareholders of such resident domestic corporation, or in connection with the exercise or conversion of securities exercisable for or convertible into shares of such resident domestic corporation (or any subsidiary of such resident domestic corporation) which securities were issued and outstanding prior to the interested shareholder's share acquisition date; (E) The adoption of any plan or proposal for the liquidation or dissolution of such resident domestic corporation, or any reincorporation of the resident domestic corporation in another state or jurisdiction, proposed by or on behalf of, or pursuant to any agreement, arrangement or understanding (whether or not in writing) with, an interested shareholder or any affiliate or associate of such interested shareholder; (F) Any transaction (whether or not with or into or otherwise involving such interested shareholder), proposed by or on behalf of, or pursuant to any agreement, arrangement or understanding (whether or not in writing) with, an interested shareholder or any affiliate or associate of such interested shareholder, which has the effect, directly or indirectly, of increasing the proportionate share of the outstanding shares of any class or series of shares or securities convertible into shares entitled to vote or securities that are exchangeable for, convertible into, or carry a right to acquire shares entitled to vote, of such resident domestic corporation or any subsidiary of such resident domestic corporation which are, directly or indirectly, owned or controlled by such interested shareholder or any affiliate or associate of such interested shareholder, except as a result of immaterial changes due to fractional share adjustments; or (G) Any loans, advances, guarantees, pledges, financial assistance, security arrangements, restrictive covenants or any tax credits or other tax advantages provided by, through or to such resident domestic corporation or any subsidiary of the resident domestic corporation as a result of which an interested shareholder or any affiliate or associate of such interested shareholder receives a benefit, directly or indirectly, except proportionately as a shareholder of such resident domestic corporation; (6) "Consummation date," with respect to any business combination, means the date of consummation of such business combination; (7) "Continuing shares" means shares held continuously of record in the name of the beneficial owner or the beneficial owner's trustee, guardian, administrator, executor, conservator or similar fiduciary on behalf of such beneficial owner, on the resident domestic corporation's stock transfer records or reported to the securities and exchange commission on a Schedule 13D or 13G or Form 3 or 4 filing pursuant to the Exchange Act for one (1) year or more prior to the date of the shareholders' meeting at which the charter or bylaw amendment is considered; (8) "Control," including the terms "controlling," "controlled by" and "under common control with," means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting stock, by contract or otherwise. A person's beneficial ownership of ten percent (10%) or more of the voting power of a corporation's outstanding voting stock shall create a presumption that such person has control of such corporation. Notwithstanding the foregoing, a person shall not be deemed to have control of a corporation if such person holds voting power, in good faith and not for the purpose of circumventing this part, as an agent, bank, broker, nominee, custodian or trustee or one (1) or more beneficial owners who do not individually or as a group have control of such corporation; (9) "Exchange" means any share exchange whether pursuant to a plan of exchange under §§ 48-21-102 , 48-21-104 , and 48-21-105 or any successor or related statute, rule or law of this state or the comparable statute, rule or law of any other state or jurisdiction; (10) "Exchange Act" means the Act of Congress known as the Securities Exchange Act of 1934 ( 15 U.S.C. § 78a et seq.), as the same has been or hereafter may be amended from time to time; (11) "Interested shareholder," when used in reference to any resident domestic corporation, means any person (other than such resident domestic corporation or any subsidiary of such resident domestic corporation) that: (A) (i) Is the beneficial owner, directly or indirectly, of ten percent (10%) or more of the voting power of any class or series of the then outstanding voting stock of such resident domestic corporation; or (ii) Is an affiliate or associate of such resident domestic corporation and at any time within the five-year period immediately prior to the date in question was the beneficial owner, directly or indirectly, of ten percent (10%) or more of the voting power of any class or series of the then outstanding stock of such resident domestic corporation; (B) For the purpose of determining whether a person is an interested shareholder, the number of shares of voting stock of such resident domestic corporation deemed to be outstanding shall include shares deemed to be beneficially owned by such person through application of subdivision (4), but shall not include any other unissued shares of voting stock of such resident domestic corporation which may be issuable pursuant to any agreement, arrangement or understanding, or upon exercise of conversion rights, warrants or options, or otherwise; (12) "Market value," when used in reference to property of any resident domestic corporation, means: (A) In the case of shares, the highest closing sale price during the thirty-day period immediately preceding the date in question of a share of such shares on the composite tape for New York Stock Exchange-listed stocks, or, if such shares are not quoted on such composite tape or if such shares are not listed on such exchange, on the principal United States securities exchange registered under the Exchange Act on which such shares are listed or, if such shares are not listed on any such exchange, the highest closing sale price (or bid quotation if no such sale price exists) with respect to such shares during the thirty-day period preceding the date in question on the National Association of Securities Dealers, Inc., Automated Quotations System or any successor system then in use, or if no such price or quotation is available, the fair market value on the date in question of a share of such resident domestic corporation's stock as determined by the board of directors of such resident domestic corporation in good faith; or (B) In the case of property other than cash or shares, the fair market value of such property on the date in question as determined by the board of directors of such resident domestic corporation in good faith; (13) "Merger" means any merger whether pursuant to a plan of merger under §§ 48-21-102 , 48-21-104 , 48-21-105 and 48-21-109 or any successor or related statute, rule or law of this state or the comparable statute, rule or law of any other state or jurisdiction respecting mergers or consolidations; (14) "Person" means any individual, domestic or foreign corporation, partnership (general or limited), syndicate, joint venture, trust estate, unincorporated association or other entity; (15) "Resident domestic corporation" means an issuer of voting stock which, as of the share acquisition date in question, is organized under the laws of Tennessee and meets two (2) or more of the following requirements: (A) (i) The corporation has more than either ten thousand (10,000) or ten percent (10%) of its shareholders resident in Tennessee or more than ten percent (10%) of its outstanding shares held by resident Tennessee shareholders; (ii) For purposes of this subdivision (15), the record date for determining the percentage, number and residency of the outstanding shares and shareholders shall be the last record date before the event requiring that the determination be made. Residence of each shareholder shall be presumed to be the address appearing in the records of the corporation. Shares held of record by brokers or nominees shall be disregarded if the address of the beneficial owner is known. Shares allocated to the account of an employee or former employee or beneficiaries of employees or former employees of a corporation and held in a plan that is qualified under § 401(a) of the federal Internal Revenue Code of 1986 ( 26 U.S.C. § 401(a) ), as amended, and is a defined contribution plan within the meaning of § 414(i) of such Code ( 26 U.S.C. § 414(i) ), shall be deemed, for purposes of this subdivision (15), to be held of record by the employee to whose account such shares are allocated. Any shares which are not allocated under any such plan and which are held by trustees, custodians, administrators or other fiduciaries under the terms of such plan shall be deemed to be held of record by the trustee, custodian, administrator or other fiduciary with residency to be determined by home address in the case of an individual, and principal place of business in the case of a corporation; (B) The corporation has its principal office or place of business located in this state; (C) The corporation has the principal office or place of business of a significant subsidiary, representing not less than twenty-five percent (25%) of the issuer's consolidated net sales, located in this state; (D) The corporation employs more than two hundred fifty (250) individuals in this state or has a combined annual payroll paid to residents of this state which is in excess of five million dollars ($5,000,000); (E) The corporation produces goods and/or services in this state which result in annual gross receipts in excess of ten million dollars ($10,000,000); or (F) The corporation has physical assets and/or deposits, including those of any subsidiary, located within this state which exceed ten million dollars ($10,000,000) in value; (16) "Share" or "shares" means: (A) Any stock or other equity interest in any class or series of stock designated in the charter of the resident domestic corporation or its subsidiaries, any certificate of interest, any participation in any profit sharing agreement, any voting trust certificate, or any certificate of deposit for stock in any class or series; and (B) Any security convertible, with or without consideration, into stock or other equity interest in any class or series, or any warrant, call or other option or privilege of buying stock without being bound to do so, or any other security carrying any right to acquire, subscribe to or purchase stock in any class or series; (17) "Share acquisition date," with respect to any person and any resident domestic corporation, means the date that such person first becomes an interested shareholder of such resident domestic corporation; (18) "Subsidiary" or "subsidiaries," with respect to any resident domestic corporation, means any other corporation which is wholly owned by the resident domestic corporation or which is organized under the laws of this state in which a majority of the shares entitled to vote are owned or controlled, directly or indirectly, by such resident or domestic corporation; and (19) "Voting stock" means all shares of the resident domestic corporation entitled to vote generally in the election of directors. Acts 1988, ch. 500, § 2; T.C.A., § 48-35-203; Acts 2012, ch. 1051, § 61.
As used in this part, unless the context otherwise requires:
(1) "Affiliate," when used to indicate a relationship with an interested shareholder, means a person that directly or indirectly through one (1) or more intermediaries, controls, or is controlled by, or is under common control with, or is acting in concert with, a specified person;
(2) "Announcement date," when used in reference to any business combination, means the date of the first public announcement of a final definitive proposal for such business combination;
(3) "Associate," when used to indicate a relationship with an interested shareholder, means: (A) Any domestic or foreign corporation, partnership, syndicate, joint venture or other unincorporated organization of which such person is an officer, director, manager or partner (either general or limited) or is, directly or indirectly, the beneficial owner of ten percent (10%) or more of any class of voting stock; (B) All members or investors in any partnership (either general or limited), syndicate or other unincorporated organization described in subdivision (3)(A); (C) Any trust or other estate in which such person has at least a ten percent (10%) beneficial interest or as to which such person serves as trustee or in a similar fiduciary capacity; or (D) Any parent, child, sibling, in-law (mother, father, sons and daughters), of such person or any relative of such person who has the same residence as such person;
(A) Any domestic or foreign corporation, partnership, syndicate, joint venture or other unincorporated organization of which such person is an officer, director, manager or partner (either general or limited) or is, directly or indirectly, the beneficial owner of ten percent (10%) or more of any class of voting stock;
(B) All members or investors in any partnership (either general or limited), syndicate or other unincorporated organization described in subdivision (3)(A);
(C) Any trust or other estate in which such person has at least a ten percent (10%) beneficial interest or as to which such person serves as trustee or in a similar fiduciary capacity; or
(D) Any parent, child, sibling, in-law (mother, father, sons and daughters), of such person or any relative of such person who has the same residence as such person;
(4) "Beneficial owner," when used with respect to any class or series of shares or other securities, means a person that: (A) Individually, or with or through any of its affiliates or associates, beneficially owns such shares or other securities, directly or indirectly; (B) Individually, or with or through any of its affiliates or associates, has or shares with others: (i) The right to acquire or dispose of, or direct the disposition of such shares or other securities (whether such right is exercisable immediately or only after the passage of time or the satisfaction of one (1) or more other conditions), pursuant to any agreement, arrangement or understanding (whether or not in writing), or upon the exercise of conversion rights, exchange rights, warrants or options or otherwise; provided, that a person shall not be deemed the beneficial owner of any shares or other securities tendered pursuant to a tender or exchange offer made by such person or any of such person's affiliates or associates until such tendered shares or other securities are accepted for purchase or exchange; or (ii) The right to vote or direct the voting of such shares or other securities pursuant to any agreement, arrangement or understanding (whether or not in writing); provided, that a person shall not be deemed the beneficial owner of any shares or other securities under this subdivision (4)(B)(ii) if the agreement, arrangement or understanding to vote such shares or other securities: (a) Arises solely from a revocable proxy or consent given in response to a proxy or consent solicitation made in accordance with the applicable rules and regulations under the Exchange Act; and (b) Is not then reportable on a Schedule 13D or 13G under the Exchange Act (or any comparable or successor report); or (C) Has any agreement, arrangement or understanding (whether or not in writing), for the purpose of acquiring, holding, voting (except voting pursuant to a revocable proxy or consent as described in subdivision (4)(B)) or disposing of such shares or other securities with any other person that beneficially owns, or whose affiliates or associates beneficially own, directly or indirectly, such shares;
(A) Individually, or with or through any of its affiliates or associates, beneficially owns such shares or other securities, directly or indirectly;
(B) Individually, or with or through any of its affiliates or associates, has or shares with others: (i) The right to acquire or dispose of, or direct the disposition of such shares or other securities (whether such right is exercisable immediately or only after the passage of time or the satisfaction of one (1) or more other conditions), pursuant to any agreement, arrangement or understanding (whether or not in writing), or upon the exercise of conversion rights, exchange rights, warrants or options or otherwise; provided, that a person shall not be deemed the beneficial owner of any shares or other securities tendered pursuant to a tender or exchange offer made by such person or any of such person's affiliates or associates until such tendered shares or other securities are accepted for purchase or exchange; or (ii) The right to vote or direct the voting of such shares or other securities pursuant to any agreement, arrangement or understanding (whether or not in writing); provided, that a person shall not be deemed the beneficial owner of any shares or other securities under this subdivision (4)(B)(ii) if the agreement, arrangement or understanding to vote such shares or other securities: (a) Arises solely from a revocable proxy or consent given in response to a proxy or consent solicitation made in accordance with the applicable rules and regulations under the Exchange Act; and (b) Is not then reportable on a Schedule 13D or 13G under the Exchange Act (or any comparable or successor report); or
(i) The right to acquire or dispose of, or direct the disposition of such shares or other securities (whether such right is exercisable immediately or only after the passage of time or the satisfaction of one (1) or more other conditions), pursuant to any agreement, arrangement or understanding (whether or not in writing), or upon the exercise of conversion rights, exchange rights, warrants or options or otherwise; provided, that a person shall not be deemed the beneficial owner of any shares or other securities tendered pursuant to a tender or exchange offer made by such person or any of such person's affiliates or associates until such tendered shares or other securities are accepted for purchase or exchange; or
(ii) The right to vote or direct the voting of such shares or other securities pursuant to any agreement, arrangement or understanding (whether or not in writing); provided, that a person shall not be deemed the beneficial owner of any shares or other securities under this subdivision (4)(B)(ii) if the agreement, arrangement or understanding to vote such shares or other securities: (a) Arises solely from a revocable proxy or consent given in response to a proxy or consent solicitation made in accordance with the applicable rules and regulations under the Exchange Act; and (b) Is not then reportable on a Schedule 13D or 13G under the Exchange Act (or any comparable or successor report); or
(a) Arises solely from a revocable proxy or consent given in response to a proxy or consent solicitation made in accordance with the applicable rules and regulations under the Exchange Act; and
(b) Is not then reportable on a Schedule 13D or 13G under the Exchange Act (or any comparable or successor report); or
(C) Has any agreement, arrangement or understanding (whether or not in writing), for the purpose of acquiring, holding, voting (except voting pursuant to a revocable proxy or consent as described in subdivision (4)(B)) or disposing of such shares or other securities with any other person that beneficially owns, or whose affiliates or associates beneficially own, directly or indirectly, such shares;
(5) "Business combination," when used in reference to any resident domestic corporation and any interested shareholder of such resident domestic corporation or any affiliate or associate of such interested shareholder, means: (A) Any merger or consolidation of such resident domestic corporation or any subsidiary of such resident domestic corporation with: (i) An interested shareholder or any affiliate or associate of such interested shareholder; or (ii) Any other corporation (whether or not itself an interested shareholder of such resident domestic corporation) which is, or after such merger or consolidation would be, an affiliate or associate of such interested shareholder; (B) Any exchange of shares or securities convertible into shares of the resident domestic corporation with: (i) An interested shareholder or any affiliate or associate of such interested shareholder; or (ii) Any other domestic or foreign corporation (whether or not itself an interested shareholder of the resident domestic corporation) which is, or after the exchange would be, an affiliate or associate of the interested shareholder; (C) Any sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one (1) transaction or a series of transactions) to, with or proposed by or on behalf of an interested shareholder, or any affiliate or associate of such interested shareholder, of assets of such resident domestic corporation or any subsidiary of such resident domestic corporation: (i) Having an aggregate market value equal to ten percent (10%) or more of the aggregate market value of all the assets, determined on a consolidated basis, of such resident domestic corporation; (ii) Having an aggregate market value equal to ten percent (10%) or more of the aggregate market value of all the outstanding shares of such resident domestic corporation; or (iii) Representing ten percent (10%) or more of the net income determined on a consolidated basis of such resident domestic corporation; (D) Any transaction which results in the issuance or transfer by such resident domestic corporation or any subsidiary of such resident domestic corporation (in one (1) transaction or a series of transactions) of any shares or securities convertible into shares of such resident domestic corporation or any subsidiary of such resident domestic corporation to such interested shareholder or any affiliate or associate of such interested shareholder except pursuant to the exercise of warrants or rights to purchase shares or securities convertible into shares, or a dividend or distribution paid or made pro rata to all shareholders of such resident domestic corporation, or in connection with the exercise or conversion of securities exercisable for or convertible into shares of such resident domestic corporation (or any subsidiary of such resident domestic corporation) which securities were issued and outstanding prior to the interested shareholder's share acquisition date; (E) The adoption of any plan or proposal for the liquidation or dissolution of such resident domestic corporation, or any reincorporation of the resident domestic corporation in another state or jurisdiction, proposed by or on behalf of, or pursuant to any agreement, arrangement or understanding (whether or not in writing) with, an interested shareholder or any affiliate or associate of such interested shareholder; (F) Any transaction (whether or not with or into or otherwise involving such interested shareholder), proposed by or on behalf of, or pursuant to any agreement, arrangement or understanding (whether or not in writing) with, an interested shareholder or any affiliate or associate of such interested shareholder, which has the effect, directly or indirectly, of increasing the proportionate share of the outstanding shares of any class or series of shares or securities convertible into shares entitled to vote or securities that are exchangeable for, convertible into, or carry a right to acquire shares entitled to vote, of such resident domestic corporation or any subsidiary of such resident domestic corporation which are, directly or indirectly, owned or controlled by such interested shareholder or any affiliate or associate of such interested shareholder, except as a result of immaterial changes due to fractional share adjustments; or (G) Any loans, advances, guarantees, pledges, financial assistance, security arrangements, restrictive covenants or any tax credits or other tax advantages provided by, through or to such resident domestic corporation or any subsidiary of the resident domestic corporation as a result of which an interested shareholder or any affiliate or associate of such interested shareholder receives a benefit, directly or indirectly, except proportionately as a shareholder of such resident domestic corporation;
(A) Any merger or consolidation of such resident domestic corporation or any subsidiary of such resident domestic corporation with: (i) An interested shareholder or any affiliate or associate of such interested shareholder; or (ii) Any other corporation (whether or not itself an interested shareholder of such resident domestic corporation) which is, or after such merger or consolidation would be, an affiliate or associate of such interested shareholder;
(i) An interested shareholder or any affiliate or associate of such interested shareholder; or
(ii) Any other corporation (whether or not itself an interested shareholder of such resident domestic corporation) which is, or after such merger or consolidation would be, an affiliate or associate of such interested shareholder;
(B) Any exchange of shares or securities convertible into shares of the resident domestic corporation with: (i) An interested shareholder or any affiliate or associate of such interested shareholder; or (ii) Any other domestic or foreign corporation (whether or not itself an interested shareholder of the resident domestic corporation) which is, or after the exchange would be, an affiliate or associate of the interested shareholder;
(i) An interested shareholder or any affiliate or associate of such interested shareholder; or
(ii) Any other domestic or foreign corporation (whether or not itself an interested shareholder of the resident domestic corporation) which is, or after the exchange would be, an affiliate or associate of the interested shareholder;
(C) Any sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one (1) transaction or a series of transactions) to, with or proposed by or on behalf of an interested shareholder, or any affiliate or associate of such interested shareholder, of assets of such resident domestic corporation or any subsidiary of such resident domestic corporation: (i) Having an aggregate market value equal to ten percent (10%) or more of the aggregate market value of all the assets, determined on a consolidated basis, of such resident domestic corporation; (ii) Having an aggregate market value equal to ten percent (10%) or more of the aggregate market value of all the outstanding shares of such resident domestic corporation; or (iii) Representing ten percent (10%) or more of the net income determined on a consolidated basis of such resident domestic corporation;
(i) Having an aggregate market value equal to ten percent (10%) or more of the aggregate market value of all the assets, determined on a consolidated basis, of such resident domestic corporation;
(ii) Having an aggregate market value equal to ten percent (10%) or more of the aggregate market value of all the outstanding shares of such resident domestic corporation; or
(iii) Representing ten percent (10%) or more of the net income determined on a consolidated basis of such resident domestic corporation;
(D) Any transaction which results in the issuance or transfer by such resident domestic corporation or any subsidiary of such resident domestic corporation (in one (1) transaction or a series of transactions) of any shares or securities convertible into shares of such resident domestic corporation or any subsidiary of such resident domestic corporation to such interested shareholder or any affiliate or associate of such interested shareholder except pursuant to the exercise of warrants or rights to purchase shares or securities convertible into shares, or a dividend or distribution paid or made pro rata to all shareholders of such resident domestic corporation, or in connection with the exercise or conversion of securities exercisable for or convertible into shares of such resident domestic corporation (or any subsidiary of such resident domestic corporation) which securities were issued and outstanding prior to the interested shareholder's share acquisition date;
(E) The adoption of any plan or proposal for the liquidation or dissolution of such resident domestic corporation, or any reincorporation of the resident domestic corporation in another state or jurisdiction, proposed by or on behalf of, or pursuant to any agreement, arrangement or understanding (whether or not in writing) with, an interested shareholder or any affiliate or associate of such interested shareholder;
(F) Any transaction (whether or not with or into or otherwise involving such interested shareholder), proposed by or on behalf of, or pursuant to any agreement, arrangement or understanding (whether or not in writing) with, an interested shareholder or any affiliate or associate of such interested shareholder, which has the effect, directly or indirectly, of increasing the proportionate share of the outstanding shares of any class or series of shares or securities convertible into shares entitled to vote or securities that are exchangeable for, convertible into, or carry a right to acquire shares entitled to vote, of such resident domestic corporation or any subsidiary of such resident domestic corporation which are, directly or indirectly, owned or controlled by such interested shareholder or any affiliate or associate of such interested shareholder, except as a result of immaterial changes due to fractional share adjustments; or
(G) Any loans, advances, guarantees, pledges, financial assistance, security arrangements, restrictive covenants or any tax credits or other tax advantages provided by, through or to such resident domestic corporation or any subsidiary of the resident domestic corporation as a result of which an interested shareholder or any affiliate or associate of such interested shareholder receives a benefit, directly or indirectly, except proportionately as a shareholder of such resident domestic corporation;
(6) "Consummation date," with respect to any business combination, means the date of consummation of such business combination;
(7) "Continuing shares" means shares held continuously of record in the name of the beneficial owner or the beneficial owner's trustee, guardian, administrator, executor, conservator or similar fiduciary on behalf of such beneficial owner, on the resident domestic corporation's stock transfer records or reported to the securities and exchange commission on a Schedule 13D or 13G or Form 3 or 4 filing pursuant to the Exchange Act for one (1) year or more prior to the date of the shareholders' meeting at which the charter or bylaw amendment is considered;
(8) "Control," including the terms "controlling," "controlled by" and "under common control with," means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting stock, by contract or otherwise. A person's beneficial ownership of ten percent (10%) or more of the voting power of a corporation's outstanding voting stock shall create a presumption that such person has control of such corporation. Notwithstanding the foregoing, a person shall not be deemed to have control of a corporation if such person holds voting power, in good faith and not for the purpose of circumventing this part, as an agent, bank, broker, nominee, custodian or trustee or one (1) or more beneficial owners who do not individually or as a group have control of such corporation;
(9) "Exchange" means any share exchange whether pursuant to a plan of exchange under §§ 48-21-102 , 48-21-104 , and 48-21-105 or any successor or related statute, rule or law of this state or the comparable statute, rule or law of any other state or jurisdiction;
(10) "Exchange Act" means the Act of Congress known as the Securities Exchange Act of 1934 ( 15 U.S.C. § 78a et seq.), as the same has been or hereafter may be amended from time to time;
(11) "Interested shareholder," when used in reference to any resident domestic corporation, means any person (other than such resident domestic corporation or any subsidiary of such resident domestic corporation) that: (A) (i) Is the beneficial owner, directly or indirectly, of ten percent (10%) or more of the voting power of any class or series of the then outstanding voting stock of such resident domestic corporation; or (ii) Is an affiliate or associate of such resident domestic corporation and at any time within the five-year period immediately prior to the date in question was the beneficial owner, directly or indirectly, of ten percent (10%) or more of the voting power of any class or series of the then outstanding stock of such resident domestic corporation; (B) For the purpose of determining whether a person is an interested shareholder, the number of shares of voting stock of such resident domestic corporation deemed to be outstanding shall include shares deemed to be beneficially owned by such person through application of subdivision (4), but shall not include any other unissued shares of voting stock of such resident domestic corporation which may be issuable pursuant to any agreement, arrangement or understanding, or upon exercise of conversion rights, warrants or options, or otherwise;
(A) (i) Is the beneficial owner, directly or indirectly, of ten percent (10%) or more of the voting power of any class or series of the then outstanding voting stock of such resident domestic corporation; or (ii) Is an affiliate or associate of such resident domestic corporation and at any time within the five-year period immediately prior to the date in question was the beneficial owner, directly or indirectly, of ten percent (10%) or more of the voting power of any class or series of the then outstanding stock of such resident domestic corporation;
(i) Is the beneficial owner, directly or indirectly, of ten percent (10%) or more of the voting power of any class or series of the then outstanding voting stock of such resident domestic corporation; or
(ii) Is an affiliate or associate of such resident domestic corporation and at any time within the five-year period immediately prior to the date in question was the beneficial owner, directly or indirectly, of ten percent (10%) or more of the voting power of any class or series of the then outstanding stock of such resident domestic corporation;
(B) For the purpose of determining whether a person is an interested shareholder, the number of shares of voting stock of such resident domestic corporation deemed to be outstanding shall include shares deemed to be beneficially owned by such person through application of subdivision (4), but shall not include any other unissued shares of voting stock of such resident domestic corporation which may be issuable pursuant to any agreement, arrangement or understanding, or upon exercise of conversion rights, warrants or options, or otherwise;
(12) "Market value," when used in reference to property of any resident domestic corporation, means: (A) In the case of shares, the highest closing sale price during the thirty-day period immediately preceding the date in question of a share of such shares on the composite tape for New York Stock Exchange-listed stocks, or, if such shares are not quoted on such composite tape or if such shares are not listed on such exchange, on the principal United States securities exchange registered under the Exchange Act on which such shares are listed or, if such shares are not listed on any such exchange, the highest closing sale price (or bid quotation if no such sale price exists) with respect to such shares during the thirty-day period preceding the date in question on the National Association of Securities Dealers, Inc., Automated Quotations System or any successor system then in use, or if no such price or quotation is available, the fair market value on the date in question of a share of such resident domestic corporation's stock as determined by the board of directors of such resident domestic corporation in good faith; or (B) In the case of property other than cash or shares, the fair market value of such property on the date in question as determined by the board of directors of such resident domestic corporation in good faith;
(A) In the case of shares, the highest closing sale price during the thirty-day period immediately preceding the date in question of a share of such shares on the composite tape for New York Stock Exchange-listed stocks, or, if such shares are not quoted on such composite tape or if such shares are not listed on such exchange, on the principal United States securities exchange registered under the Exchange Act on which such shares are listed or, if such shares are not listed on any such exchange, the highest closing sale price (or bid quotation if no such sale price exists) with respect to such shares during the thirty-day period preceding the date in question on the National Association of Securities Dealers, Inc., Automated Quotations System or any successor system then in use, or if no such price or quotation is available, the fair market value on the date in question of a share of such resident domestic corporation's stock as determined by the board of directors of such resident domestic corporation in good faith; or
(B) In the case of property other than cash or shares, the fair market value of such property on the date in question as determined by the board of directors of such resident domestic corporation in good faith;
(13) "Merger" means any merger whether pursuant to a plan of merger under §§ 48-21-102 , 48-21-104 , 48-21-105 and 48-21-109 or any successor or related statute, rule or law of this state or the comparable statute, rule or law of any other state or jurisdiction respecting mergers or consolidations;
(14) "Person" means any individual, domestic or foreign corporation, partnership (general or limited), syndicate, joint venture, trust estate, unincorporated association or other entity;
(15) "Resident domestic corporation" means an issuer of voting stock which, as of the share acquisition date in question, is organized under the laws of Tennessee and meets two (2) or more of the following requirements: (A) (i) The corporation has more than either ten thousand (10,000) or ten percent (10%) of its shareholders resident in Tennessee or more than ten percent (10%) of its outstanding shares held by resident Tennessee shareholders; (ii) For purposes of this subdivision (15), the record date for determining the percentage, number and residency of the outstanding shares and shareholders shall be the last record date before the event requiring that the determination be made. Residence of each shareholder shall be presumed to be the address appearing in the records of the corporation. Shares held of record by brokers or nominees shall be disregarded if the address of the beneficial owner is known. Shares allocated to the account of an employee or former employee or beneficiaries of employees or former employees of a corporation and held in a plan that is qualified under § 401(a) of the federal Internal Revenue Code of 1986 ( 26 U.S.C. § 401(a) ), as amended, and is a defined contribution plan within the meaning of § 414(i) of such Code ( 26 U.S.C. § 414(i) ), shall be deemed, for purposes of this subdivision (15), to be held of record by the employee to whose account such shares are allocated. Any shares which are not allocated under any such plan and which are held by trustees, custodians, administrators or other fiduciaries under the terms of such plan shall be deemed to be held of record by the trustee, custodian, administrator or other fiduciary with residency to be determined by home address in the case of an individual, and principal place of business in the case of a corporation; (B) The corporation has its principal office or place of business located in this state; (C) The corporation has the principal office or place of business of a significant subsidiary, representing not less than twenty-five percent (25%) of the issuer's consolidated net sales, located in this state; (D) The corporation employs more than two hundred fifty (250) individuals in this state or has a combined annual payroll paid to residents of this state which is in excess of five million dollars ($5,000,000); (E) The corporation produces goods and/or services in this state which result in annual gross receipts in excess of ten million dollars ($10,000,000); or (F) The corporation has physical assets and/or deposits, including those of any subsidiary, located within this state which exceed ten million dollars ($10,000,000) in value;
(A) (i) The corporation has more than either ten thousand (10,000) or ten percent (10%) of its shareholders resident in Tennessee or more than ten percent (10%) of its outstanding shares held by resident Tennessee shareholders; (ii) For purposes of this subdivision (15), the record date for determining the percentage, number and residency of the outstanding shares and shareholders shall be the last record date before the event requiring that the determination be made. Residence of each shareholder shall be presumed to be the address appearing in the records of the corporation. Shares held of record by brokers or nominees shall be disregarded if the address of the beneficial owner is known. Shares allocated to the account of an employee or former employee or beneficiaries of employees or former employees of a corporation and held in a plan that is qualified under § 401(a) of the federal Internal Revenue Code of 1986 ( 26 U.S.C. § 401(a) ), as amended, and is a defined contribution plan within the meaning of § 414(i) of such Code ( 26 U.S.C. § 414(i) ), shall be deemed, for purposes of this subdivision (15), to be held of record by the employee to whose account such shares are allocated. Any shares which are not allocated under any such plan and which are held by trustees, custodians, administrators or other fiduciaries under the terms of such plan shall be deemed to be held of record by the trustee, custodian, administrator or other fiduciary with residency to be determined by home address in the case of an individual, and principal place of business in the case of a corporation;
(i) The corporation has more than either ten thousand (10,000) or ten percent (10%) of its shareholders resident in Tennessee or more than ten percent (10%) of its outstanding shares held by resident Tennessee shareholders;
(ii) For purposes of this subdivision (15), the record date for determining the percentage, number and residency of the outstanding shares and shareholders shall be the last record date before the event requiring that the determination be made. Residence of each shareholder shall be presumed to be the address appearing in the records of the corporation. Shares held of record by brokers or nominees shall be disregarded if the address of the beneficial owner is known. Shares allocated to the account of an employee or former employee or beneficiaries of employees or former employees of a corporation and held in a plan that is qualified under § 401(a) of the federal Internal Revenue Code of 1986 ( 26 U.S.C. § 401(a) ), as amended, and is a defined contribution plan within the meaning of § 414(i) of such Code ( 26 U.S.C. § 414(i) ), shall be deemed, for purposes of this subdivision (15), to be held of record by the employee to whose account such shares are allocated. Any shares which are not allocated under any such plan and which are held by trustees, custodians, administrators or other fiduciaries under the terms of such plan shall be deemed to be held of record by the trustee, custodian, administrator or other fiduciary with residency to be determined by home address in the case of an individual, and principal place of business in the case of a corporation;
(B) The corporation has its principal office or place of business located in this state;
(C) The corporation has the principal office or place of business of a significant subsidiary, representing not less than twenty-five percent (25%) of the issuer's consolidated net sales, located in this state;
(D) The corporation employs more than two hundred fifty (250) individuals in this state or has a combined annual payroll paid to residents of this state which is in excess of five million dollars ($5,000,000);
(E) The corporation produces goods and/or services in this state which result in annual gross receipts in excess of ten million dollars ($10,000,000); or
(F) The corporation has physical assets and/or deposits, including those of any subsidiary, located within this state which exceed ten million dollars ($10,000,000) in value;
(16) "Share" or "shares" means: (A) Any stock or other equity interest in any class or series of stock designated in the charter of the resident domestic corporation or its subsidiaries, any certificate of interest, any participation in any profit sharing agreement, any voting trust certificate, or any certificate of deposit for stock in any class or series; and (B) Any security convertible, with or without consideration, into stock or other equity interest in any class or series, or any warrant, call or other option or privilege of buying stock without being bound to do so, or any other security carrying any right to acquire, subscribe to or purchase stock in any class or series;
(A) Any stock or other equity interest in any class or series of stock designated in the charter of the resident domestic corporation or its subsidiaries, any certificate of interest, any participation in any profit sharing agreement, any voting trust certificate, or any certificate of deposit for stock in any class or series; and
(B) Any security convertible, with or without consideration, into stock or other equity interest in any class or series, or any warrant, call or other option or privilege of buying stock without being bound to do so, or any other security carrying any right to acquire, subscribe to or purchase stock in any class or series;
(17) "Share acquisition date," with respect to any person and any resident domestic corporation, means the date that such person first becomes an interested shareholder of such resident domestic corporation;
(18) "Subsidiary" or "subsidiaries," with respect to any resident domestic corporation, means any other corporation which is wholly owned by the resident domestic corporation or which is organized under the laws of this state in which a majority of the shares entitled to vote are owned or controlled, directly or indirectly, by such resident or domestic corporation; and
(19) "Voting stock" means all shares of the resident domestic corporation entitled to vote generally in the election of directors.
Acts 1988, ch. 500, § 2; T.C.A., § 48-35-203; Acts 2012, ch. 1051, § 61.
Tenn. Code Ann. § 48-242-101 — TN Code / Title 48 / Chapter 242 / Section 48-242-101
Loans, guarantees and suretyship
Status: in_force

(a) Prerequisites. Unless otherwise provided in chapters 201-248 of this title or the articles or operating agreement, an LLC may lend money to, guarantee an obligation of, become a surety for, or otherwise financially assist a person: (1) In the usual and regular course of business of the LLC; (2) With, or for the benefit of, a related LLC, an organization in which the LLC has a financial interest, an organization with which the LLC has a business relationship, or an organization to which the LLC has the power to make donations; or (3) With, or for the benefit of, a manager or other employee of the LLC or a subsidiary, including a manager or employee who is a member but not a governor of the LLC or a subsidiary, and may reasonably be expected, in the judgment of the body giving the requisite approval, to benefit the LLC. In the case of a loan or guarantee which is with, or for the benefit of, a person who is a governor, approval by a majority of the membership interests of disinterested members entitled to vote is required. (b) Interest and Security. A loan, guaranty, surety contract, or other financial assistance under subsection (a) may be with or without interest and may be unsecured or may be secured in any manner, including, without limitation, a grant of a security interest in a member's financial rights in the LLC. (c) Banking Authority not Granted. This section does not grant any authority to act as a bank or to carry on the business of banking. (d) Requisite Approval. (1) Except as otherwise provided in this section, for purposes of this section, "requisite approval" means: (A) If the LLC is board-managed, an action taken at a duly held meeting and approved by a majority of the disinterested governors or by a majority of the disinterested members at a duly held meeting of the members; or (B) If the LLC is member-managed, an action taken at a duly held meeting and approved by a majority of the voting interest of members entitled to vote which are held by disinterested persons. (2) For purposes of this section, a "disinterested person" is a person other than: (A) A person who receives a direct or indirect benefit from receipt of the loan or guarantee; (B) The spouse, parents, children and spouses of children, brothers and sisters, other lineal descendants and spouses of brothers and sisters of such person; or (C) Any entity in which any of the people, or any combination of the people, in subdivisions (d)(2)(A) and (B) have a material financial interest. (e) Validity of Obligation of Borrower. The fact that a loan or guarantee is made in violation of this section does not affect the borrower's liability on the loan. (f) Exception for Sales on Credit. A sale on credit in the ordinary course of business shall not be subject to the restrictions of this section. Acts 1994, ch. 868, § 1; 1995, ch. 403, §§ 66, 67.
(a) Prerequisites. Unless otherwise provided in chapters 201-248 of this title or the articles or operating agreement, an LLC may lend money to, guarantee an obligation of, become a surety for, or otherwise financially assist a person: (1) In the usual and regular course of business of the LLC; (2) With, or for the benefit of, a related LLC, an organization in which the LLC has a financial interest, an organization with which the LLC has a business relationship, or an organization to which the LLC has the power to make donations; or (3) With, or for the benefit of, a manager or other employee of the LLC or a subsidiary, including a manager or employee who is a member but not a governor of the LLC or a subsidiary, and may reasonably be expected, in the judgment of the body giving the requisite approval, to benefit the LLC. In the case of a loan or guarantee which is with, or for the benefit of, a person who is a governor, approval by a majority of the membership interests of disinterested members entitled to vote is required.
(1) In the usual and regular course of business of the LLC;
(2) With, or for the benefit of, a related LLC, an organization in which the LLC has a financial interest, an organization with which the LLC has a business relationship, or an organization to which the LLC has the power to make donations; or
(3) With, or for the benefit of, a manager or other employee of the LLC or a subsidiary, including a manager or employee who is a member but not a governor of the LLC or a subsidiary, and may reasonably be expected, in the judgment of the body giving the requisite approval, to benefit the LLC. In the case of a loan or guarantee which is with, or for the benefit of, a person who is a governor, approval by a majority of the membership interests of disinterested members entitled to vote is required.
(b) Interest and Security. A loan, guaranty, surety contract, or other financial assistance under subsection (a) may be with or without interest and may be unsecured or may be secured in any manner, including, without limitation, a grant of a security interest in a member's financial rights in the LLC.
(c) Banking Authority not Granted. This section does not grant any authority to act as a bank or to carry on the business of banking.
(d) Requisite Approval. (1) Except as otherwise provided in this section, for purposes of this section, "requisite approval" means: (A) If the LLC is board-managed, an action taken at a duly held meeting and approved by a majority of the disinterested governors or by a majority of the disinterested members at a duly held meeting of the members; or (B) If the LLC is member-managed, an action taken at a duly held meeting and approved by a majority of the voting interest of members entitled to vote which are held by disinterested persons. (2) For purposes of this section, a "disinterested person" is a person other than: (A) A person who receives a direct or indirect benefit from receipt of the loan or guarantee; (B) The spouse, parents, children and spouses of children, brothers and sisters, other lineal descendants and spouses of brothers and sisters of such person; or (C) Any entity in which any of the people, or any combination of the people, in subdivisions (d)(2)(A) and (B) have a material financial interest.
(1) Except as otherwise provided in this section, for purposes of this section, "requisite approval" means: (A) If the LLC is board-managed, an action taken at a duly held meeting and approved by a majority of the disinterested governors or by a majority of the disinterested members at a duly held meeting of the members; or (B) If the LLC is member-managed, an action taken at a duly held meeting and approved by a majority of the voting interest of members entitled to vote which are held by disinterested persons.
(A) If the LLC is board-managed, an action taken at a duly held meeting and approved by a majority of the disinterested governors or by a majority of the disinterested members at a duly held meeting of the members; or
(B) If the LLC is member-managed, an action taken at a duly held meeting and approved by a majority of the voting interest of members entitled to vote which are held by disinterested persons.
(2) For purposes of this section, a "disinterested person" is a person other than: (A) A person who receives a direct or indirect benefit from receipt of the loan or guarantee; (B) The spouse, parents, children and spouses of children, brothers and sisters, other lineal descendants and spouses of brothers and sisters of such person; or (C) Any entity in which any of the people, or any combination of the people, in subdivisions (d)(2)(A) and (B) have a material financial interest.
(A) A person who receives a direct or indirect benefit from receipt of the loan or guarantee;
(B) The spouse, parents, children and spouses of children, brothers and sisters, other lineal descendants and spouses of brothers and sisters of such person; or
(C) Any entity in which any of the people, or any combination of the people, in subdivisions (d)(2)(A) and (B) have a material financial interest.
(e) Validity of Obligation of Borrower. The fact that a loan or guarantee is made in violation of this section does not affect the borrower's liability on the loan.
(f) Exception for Sales on Credit. A sale on credit in the ordinary course of business shall not be subject to the restrictions of this section.
Acts 1994, ch. 868, § 1; 1995, ch. 403, §§ 66, 67.
Tenn. Code Ann. § 48-11-201 — TN Code / Title 48 / Chapter 11 / Section 48-11-201
Definitions for chapters 11 through 27
Status: in_force

As used in chapters 11-27 of this title, unless the context otherwise requires (or the term is otherwise defined in another chapter of the Tennessee Business Corporation Act, in which event the term shall have such other meaning for that chapter): (1) "Affiliate" of a specific person means a person that directly, or indirectly through one (1) or more intermediaries, controls, or is controlled by, or is under common control with, the person specified; (2) "Authorized shares" means the shares of all classes a domestic or foreign corporation is authorized to issue; (3) "Business" means any activity or function; (4) "Charter" includes amended and restated charters and articles of merger; (5) "Confirmation of good standing" means confirmation by the commissioner of revenue issued through electronic communication to the secretary of state or a certificate of tax clearance that at the time such confirmation is issued a domestic or foreign corporation is current on all taxes and penalties to the satisfaction of the commissioner; (6) "Conspicuous" means so written that a reasonable person against whom the writing is to operate should have noticed it. For example, printing in italics or boldface or contrasting color, or typing in capitals or underlined, is conspicuous; (7) "Corporation," "domestic corporation" or "domestic business corporation" means a corporation for profit, which is not a foreign corporation, incorporated under or subject to chapters 11-27 of this title; (8) "Deliver" or "delivery" means any method of delivery used in conventional commercial practice, including delivery by hand, mail, commercial delivery, and, if authorized in accordance with § 48-11-202 , by electronic transmission; (9) "Distribution" means a direct or indirect transfer of money or other property (except its own shares) or incurrence of indebtedness (whether directly or indirectly, including through a guaranty) by a corporation to or for the benefit of its shareholders in respect of any of its shares. A distribution may be in the form of a declaration or payment of a dividend; a purchase, redemption, or other acquisition of shares; a distribution of indebtedness (which includes the incurrence of indebtedness for the benefit of the shareholders); or otherwise; (10) "Document" means: (A) Any tangible medium on which information is inscribed, and includes any writing or written instrument; or (B) An electronic record; (11) "Effective date of notice," as defined in § 48-11-202(i) ; (12) "Electronic" means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities; (13) "Electronic record" means information that is stored in an electronic or other medium and is retrievable in paper form through an automated process used in conventional commercial practice, unless otherwise authorized in accordance with § 48-11-202 ; (14) "Electronic transmission" or "electronically transmitted" means any form or process of communication not directly involving the physical transfer of paper or another tangible medium, which is: (A) Suitable for the retention, retrieval, and reproduction of information by the recipient; and (B) Is retrievable in paper form by the recipient through an automated process used in conventional commercial practice, unless otherwise authorized in accordance with § 48-11-202(j) ; (15) "Emergency" exists when a quorum of the corporate directors cannot readily be assembled because of some catastrophic event; (16) "Employee" includes an officer but not a director. A director may accept duties that make the director also an employee; (17) "Entity" includes domestic and foreign business corporation; domestic and foreign nonprofit corporation; estate; trust; domestic and foreign unincorporated entity and state, United States, and foreign government. The term includes two (2) or more persons having a joint or common economic interest; (18) "Filing entity" means an unincorporated entity that is of a type that is created by filing a public organic document; (19) "Foreign corporation" means a corporation for profit incorporated under a law other than the laws of this state; (20) "Foreign nonprofit corporation" means a corporation incorporated under a law other than the law of this state, which would be a nonprofit corporation if incorporated under the laws of this state; (21) "Foreign unincorporated entity" means an unincorporated entity whose internal affairs are governed by an organic law of a jurisdiction other than this state; (22) "Governmental subdivision" includes authority, county, district, and municipality; (23) "Includes" denotes a partial definition; (24) "Individual" includes the estate of an incompetent or deceased individual; (25) "Interest" means either or both of the following rights under the organic law of an unincorporated entity: (A) The right to receive distributions from the entity either in the ordinary course or upon liquidation; or (B) The right to receive notice or vote on issues involving its internal affairs, other than as an agent, assignee, proxy, or person responsible for managing its business and affairs; (26) "Means" denotes an exhaustive definition; (27) "Month" means the time from any day of any month to the corresponding day of the succeeding month, if any, and if none, the last day of the succeeding month. "A period of two (2) or more months" means the time from any day of the first month in such period to the corresponding day of the last month in such period, if any, and if none, the last day of the last month in such period; (28) "Nonfiling entity" means an unincorporated entity that is of a type that is not created by filing a public organic document; (29) "Nonprofit corporation" or "domestic nonprofit corporation" means a corporation incorporated under the laws of this state and subject to the Tennessee Nonprofit Corporation Act, compiled in chapters 51-68 of this title; (30) "Notice," as defined in § 48-11-202 ; (31) "Organic document" means a public organic document or a private organic document; (32) "Organic law" means the statute governing the internal affairs of a domestic or foreign business or nonprofit corporation or unincorporated entity; (33) "Person" includes individual and entity; (34) "Principal office" means the office (in or out of this state) so designated in the annual report where the principal executive offices of a domestic or foreign corporation are located; (35) "Private organic document" means any document (other than the public organic document, if any) that determines the internal governance of an unincorporated entity. Where a private organic document has been amended or restated, the term means the private organic document as last amended or restated; (36) "Proceeding" includes civil suit and criminal, administrative, and investigatory action; (37) "Public organic document" means the document, if any, that is filed of public record to create an unincorporated entity. Where a public organic document has been amended or restated, the term means the public organic document as last amended or restated; (38) "Record date" means the date established under chapter 16 or 17 on which a corporation determines the identity of its shareholders for purposes of chapters 11-27 of this title; (39) "Secretary" means the corporate officer to whom the bylaws or the board of directors has delegated responsibility under § 48-18-401(c) for custody of the minutes of the meetings of the board of directors and of the shareholders and for authenticating records of the corporation; (40) "Share" means the unit into which the proprietary interests in a corporation are divided; (41) "Shareholder" means the person in whose name shares are registered in the records of a corporation or the beneficial owner of shares to the extent of the rights granted by a nominee certificate on file with a corporation; (42) "Sign" or "signature" means, with present intent to authenticate or adopt a document: (A) To execute or adopt a tangible symbol to a document, and includes any manual, facsimile, or conformed signature; or (B) To attach to or logically associate with an electronic transmission an electronic sound, symbol, or process, and includes an electronic signature in an electronic transmission; (43) "State," when referring to a part of the United States, includes a state and commonwealth (and their agencies and governmental subdivisions) and a territory and insular possession (and their agencies and governmental subdivisions) of the United States; (44) "Subscriber" means a person who subscribes for shares in a corporation, whether before or after incorporation; (45) "Subsidiary" means a corporation more than fifty percent (50%) of whose outstanding voting shares are owned by its parent and/or the parent's other wholly-owned subsidiaries; (46) "Tax clearance for termination or withdrawal" means confirmation by the commissioner of revenue issued through electronic communication to the secretary of state or a certificate of tax clearance that a domestic or foreign corporation has filed all applicable reports, including, but not limited to, a final report, and has paid all fees, penalties and taxes as required by the revenue laws of this state; (47) "Unincorporated entity" means an organization or artificial legal person that either has a separate legal existence or has the power to acquire an estate in real property in its own name and that is not any of the following: a domestic or foreign business or nonprofit corporation, an estate, a trust, a state, the United States, or a foreign government. The term includes a general partnership, limited liability company, limited partnership, business trust, joint stock association, and unincorporated nonprofit association; (48) "United States" includes district, authority, bureau, commission, department, and any other agency of the United States; (49) "Voting group" means all shares of one (1) or more classes or series that under the charter or chapters 11-27 of this title are entitled to vote and be counted together collectively on a matter at a meeting of shareholders. All shares entitled by the charter or chapters 11-27 of this title to vote generally on the matter are for that purpose a single voting group; and (50) "Writing" or "written" means any information in the form of a document. Acts 1986, ch. 887, § 1.20; 1987, ch. 273, §§ 3, 4; 1989, ch. 451, § 1; 1994, ch. 776, §§ 1, 2; 2010, ch. 741, § 1; 2012, ch. 1051, §§ 1 - 6.
As used in chapters 11-27 of this title, unless the context otherwise requires (or the term is otherwise defined in another chapter of the Tennessee Business Corporation Act, in which event the term shall have such other meaning for that chapter):
(1) "Affiliate" of a specific person means a person that directly, or indirectly through one (1) or more intermediaries, controls, or is controlled by, or is under common control with, the person specified;
(2) "Authorized shares" means the shares of all classes a domestic or foreign corporation is authorized to issue;
(3) "Business" means any activity or function;
(4) "Charter" includes amended and restated charters and articles of merger;
(5) "Confirmation of good standing" means confirmation by the commissioner of revenue issued through electronic communication to the secretary of state or a certificate of tax clearance that at the time such confirmation is issued a domestic or foreign corporation is current on all taxes and penalties to the satisfaction of the commissioner;
(6) "Conspicuous" means so written that a reasonable person against whom the writing is to operate should have noticed it. For example, printing in italics or boldface or contrasting color, or typing in capitals or underlined, is conspicuous;
(7) "Corporation," "domestic corporation" or "domestic business corporation" means a corporation for profit, which is not a foreign corporation, incorporated under or subject to chapters 11-27 of this title;
(8) "Deliver" or "delivery" means any method of delivery used in conventional commercial practice, including delivery by hand, mail, commercial delivery, and, if authorized in accordance with § 48-11-202 , by electronic transmission;
(9) "Distribution" means a direct or indirect transfer of money or other property (except its own shares) or incurrence of indebtedness (whether directly or indirectly, including through a guaranty) by a corporation to or for the benefit of its shareholders in respect of any of its shares. A distribution may be in the form of a declaration or payment of a dividend; a purchase, redemption, or other acquisition of shares; a distribution of indebtedness (which includes the incurrence of indebtedness for the benefit of the shareholders); or otherwise;
(10) "Document" means: (A) Any tangible medium on which information is inscribed, and includes any writing or written instrument; or (B) An electronic record;
(A) Any tangible medium on which information is inscribed, and includes any writing or written instrument; or
(B) An electronic record;
(11) "Effective date of notice," as defined in § 48-11-202(i) ;
(12) "Electronic" means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities;
(13) "Electronic record" means information that is stored in an electronic or other medium and is retrievable in paper form through an automated process used in conventional commercial practice, unless otherwise authorized in accordance with § 48-11-202 ;
(14) "Electronic transmission" or "electronically transmitted" means any form or process of communication not directly involving the physical transfer of paper or another tangible medium, which is: (A) Suitable for the retention, retrieval, and reproduction of information by the recipient; and (B) Is retrievable in paper form by the recipient through an automated process used in conventional commercial practice, unless otherwise authorized in accordance with § 48-11-202(j) ;
(A) Suitable for the retention, retrieval, and reproduction of information by the recipient; and
(B) Is retrievable in paper form by the recipient through an automated process used in conventional commercial practice, unless otherwise authorized in accordance with § 48-11-202(j) ;
(15) "Emergency" exists when a quorum of the corporate directors cannot readily be assembled because of some catastrophic event;
(16) "Employee" includes an officer but not a director. A director may accept duties that make the director also an employee;
(17) "Entity" includes domestic and foreign business corporation; domestic and foreign nonprofit corporation; estate; trust; domestic and foreign unincorporated entity and state, United States, and foreign government. The term includes two (2) or more persons having a joint or common economic interest;
(18) "Filing entity" means an unincorporated entity that is of a type that is created by filing a public organic document;
(19) "Foreign corporation" means a corporation for profit incorporated under a law other than the laws of this state;
(20) "Foreign nonprofit corporation" means a corporation incorporated under a law other than the law of this state, which would be a nonprofit corporation if incorporated under the laws of this state;
(21) "Foreign unincorporated entity" means an unincorporated entity whose internal affairs are governed by an organic law of a jurisdiction other than this state;
(22) "Governmental subdivision" includes authority, county, district, and municipality;
(23) "Includes" denotes a partial definition;
(24) "Individual" includes the estate of an incompetent or deceased individual;
(25) "Interest" means either or both of the following rights under the organic law of an unincorporated entity: (A) The right to receive distributions from the entity either in the ordinary course or upon liquidation; or (B) The right to receive notice or vote on issues involving its internal affairs, other than as an agent, assignee, proxy, or person responsible for managing its business and affairs;
(A) The right to receive distributions from the entity either in the ordinary course or upon liquidation; or
(B) The right to receive notice or vote on issues involving its internal affairs, other than as an agent, assignee, proxy, or person responsible for managing its business and affairs;
(26) "Means" denotes an exhaustive definition;
(27) "Month" means the time from any day of any month to the corresponding day of the succeeding month, if any, and if none, the last day of the succeeding month. "A period of two (2) or more months" means the time from any day of the first month in such period to the corresponding day of the last month in such period, if any, and if none, the last day of the last month in such period;
(28) "Nonfiling entity" means an unincorporated entity that is of a type that is not created by filing a public organic document;
(29) "Nonprofit corporation" or "domestic nonprofit corporation" means a corporation incorporated under the laws of this state and subject to the Tennessee Nonprofit Corporation Act, compiled in chapters 51-68 of this title;
(30) "Notice," as defined in § 48-11-202 ;
(31) "Organic document" means a public organic document or a private organic document;
(32) "Organic law" means the statute governing the internal affairs of a domestic or foreign business or nonprofit corporation or unincorporated entity;
(33) "Person" includes individual and entity;
(34) "Principal office" means the office (in or out of this state) so designated in the annual report where the principal executive offices of a domestic or foreign corporation are located;
(35) "Private organic document" means any document (other than the public organic document, if any) that determines the internal governance of an unincorporated entity. Where a private organic document has been amended or restated, the term means the private organic document as last amended or restated;
(36) "Proceeding" includes civil suit and criminal, administrative, and investigatory action;
(37) "Public organic document" means the document, if any, that is filed of public record to create an unincorporated entity. Where a public organic document has been amended or restated, the term means the public organic document as last amended or restated;
(38) "Record date" means the date established under chapter 16 or 17 on which a corporation determines the identity of its shareholders for purposes of chapters 11-27 of this title;
(39) "Secretary" means the corporate officer to whom the bylaws or the board of directors has delegated responsibility under § 48-18-401(c) for custody of the minutes of the meetings of the board of directors and of the shareholders and for authenticating records of the corporation;
(40) "Share" means the unit into which the proprietary interests in a corporation are divided;
(41) "Shareholder" means the person in whose name shares are registered in the records of a corporation or the beneficial owner of shares to the extent of the rights granted by a nominee certificate on file with a corporation;
(42) "Sign" or "signature" means, with present intent to authenticate or adopt a document: (A) To execute or adopt a tangible symbol to a document, and includes any manual, facsimile, or conformed signature; or (B) To attach to or logically associate with an electronic transmission an electronic sound, symbol, or process, and includes an electronic signature in an electronic transmission;
(A) To execute or adopt a tangible symbol to a document, and includes any manual, facsimile, or conformed signature; or
(B) To attach to or logically associate with an electronic transmission an electronic sound, symbol, or process, and includes an electronic signature in an electronic transmission;
(43) "State," when referring to a part of the United States, includes a state and commonwealth (and their agencies and governmental subdivisions) and a territory and insular possession (and their agencies and governmental subdivisions) of the United States;
(44) "Subscriber" means a person who subscribes for shares in a corporation, whether before or after incorporation;
(45) "Subsidiary" means a corporation more than fifty percent (50%) of whose outstanding voting shares are owned by its parent and/or the parent's other wholly-owned subsidiaries;
(46) "Tax clearance for termination or withdrawal" means confirmation by the commissioner of revenue issued through electronic communication to the secretary of state or a certificate of tax clearance that a domestic or foreign corporation has filed all applicable reports, including, but not limited to, a final report, and has paid all fees, penalties and taxes as required by the revenue laws of this state;
(47) "Unincorporated entity" means an organization or artificial legal person that either has a separate legal existence or has the power to acquire an estate in real property in its own name and that is not any of the following: a domestic or foreign business or nonprofit corporation, an estate, a trust, a state, the United States, or a foreign government. The term includes a general partnership, limited liability company, limited partnership, business trust, joint stock association, and unincorporated nonprofit association;
(48) "United States" includes district, authority, bureau, commission, department, and any other agency of the United States;
(49) "Voting group" means all shares of one (1) or more classes or series that under the charter or chapters 11-27 of this title are entitled to vote and be counted together collectively on a matter at a meeting of shareholders. All shares entitled by the charter or chapters 11-27 of this title to vote generally on the matter are for that purpose a single voting group; and
(50) "Writing" or "written" means any information in the form of a document.
Acts 1986, ch. 887, § 1.20; 1987, ch. 273, §§ 3, 4; 1989, ch. 451, § 1; 1994, ch. 776, §§ 1, 2; 2010, ch. 741, § 1; 2012, ch. 1051, §§ 1 - 6.
Tenn. Code Ann. § 48-249-503 — TN Code / Title 48 / Chapter 249 / Section 48-249-503
Termination of membership interest
Status: in_force

(a) Events constituting termination. A member's membership interest in an LLC is terminated upon the occurrence of any of the following events: (1) The LLC receives written notice from the member of the member's express will to withdraw upon the date of the notice, or on a later date specified by the member in the notice; (2) An event specified in the LLC documents as causing the member's membership interest to terminate; (3) The transfer of all of the member's financial rights, unless the transfer is for security purposes, and has not been foreclosed or is under a court order charging the member's financial rights; (4) The member is expelled under the LLC documents; (5) The member is expelled by unanimous vote of the other members entitled to vote, if: (A) It is unlawful to carry on the business of the LLC with the member; (B) (i) The member is a corporation or an LLC; (ii) Within ninety (90) days after the LLC notifies the member that it will be expelled, because it has filed a certificate of dissolution, or the equivalent, its charter or articles of organization, or the equivalent, have been revoked, or its right to conduct business has been suspended by the jurisdiction of its formation; and (iii) The member fails to obtain a revocation of the certificate of dissolution or a reinstatement of its charter or articles of organization, or the equivalent, or its right to conduct business within such ninety-day period; or (C) The member is a general or limited partnership and has been dissolved and its business is being wound up; (6) On application by the LLC or another member, the member is expelled by judicial determination, because the member: (A) Engaged in wrongful conduct that adversely and materially affected the LLC's business; (B) Willfully or persistently committed a material breach of the LLC documents, or of a duty owed under § 48-249-403 to the LLC or to other members or to holders; or (C) Engaged in conduct relating to the LLC's business that makes it not reasonably practicable to carry on the business with the member; (7) The member: (A) Files a petition as a debtor in bankruptcy; (B) Executes an assignment for the benefit of creditors; (C) Seeks, consents to, or acquiesces in the appointment of a trustee, receiver or liquidator for or of the member, or for or of all or substantially all of the member's property; or (D) Fails, within ninety (90) days after the filing or appointment, to have dismissed the filing against the member of an involuntary petition in bankruptcy, or to have vacated or stayed the appointment of a trustee, receiver or liquidator for or of the member, or for or of all or substantially all of the member's property obtained without the member's consent or acquiescence, or fails within ninety (90) days after the expiration of a stay, to have the appointment vacated; (8) In the case of a member who is an individual: (A) The member dies; (B) A personal representative is appointed for the member; or (C) A judicial determination that the member has become incapable of performing the member's duties under the LLC documents; (9) In the case of a member that is a trust or is acting as a member by virtue of being a trustee of a trust, the distribution of all of the trust's financial rights, but not merely by reason of the substitution of a successor trustee; provided, however, that a distribution to a beneficiary of a trust established under § 2503(c) of the Code ( 26 U.S.C. § 2503(c) ), or a trust that is treated under § 676 of the Code ( 26 U.S.C. § 676 ), as owned by the settlor of the trust, shall not be considered to be a distribution of financial rights under this subdivision (a)(9); (10) In the case of a member that is an estate, or is acting as a member by virtue of being a personal representative of an estate, distribution of all of the estate's financial rights, but not merely the substitution of a successor personal representative or beneficiary; (11) In the case of a custodianship under the Uniform Transfers to Minors Act, compiled in title 35, chapter 7, or the equivalent law of any foreign jurisdiction, a transfer of the financial rights held by the custodian, but not a transfer to the beneficiary for whom the custodian is holding the financial rights; or (12) Termination of the existence of a member, if the member is an entity other than an estate, or trust, other than a business trust. (b) Power to terminate. (1) Except as otherwise provided in subdivision (b)(2), and subject to § 48-249-504 , a member has the power and right to terminate such member's membership interest at any time, including, without limitation, upon withdrawal by express will under subdivision (a)(1). A provision in the LLC documents that negates any right of a member to terminate the member's membership interest shall also automatically negate the corresponding power of the member to terminate the member's membership interest, unless the corresponding power of the member to terminate the member's membership interest is expressly reserved. Any attempted termination of a member's membership interest as to which the power to terminate has been negated shall be null and void. (2) No member of a family LLC has either the power or the right to terminate the membership interest or financial rights of such member in such family LLC. No event specified in subdivisions (a)(1), (a)(3), (a)(7), (a)(8), (a)(9), (a)(10), (a)(11) or (a)(12) shall result in the termination of the membership interest or financial rights of a member of a family LLC. In the event that a member of a family LLC attempts to terminate the member's membership interest or financial rights by withdrawal by express will under subdivision (a)(1), such attempted termination shall be null and void. Acts 2005, ch. 286, § 1; 2006, ch. 620, §§ 30, 31.
(a) Events constituting termination. A member's membership interest in an LLC is terminated upon the occurrence of any of the following events: (1) The LLC receives written notice from the member of the member's express will to withdraw upon the date of the notice, or on a later date specified by the member in the notice; (2) An event specified in the LLC documents as causing the member's membership interest to terminate; (3) The transfer of all of the member's financial rights, unless the transfer is for security purposes, and has not been foreclosed or is under a court order charging the member's financial rights; (4) The member is expelled under the LLC documents; (5) The member is expelled by unanimous vote of the other members entitled to vote, if: (A) It is unlawful to carry on the business of the LLC with the member; (B) (i) The member is a corporation or an LLC; (ii) Within ninety (90) days after the LLC notifies the member that it will be expelled, because it has filed a certificate of dissolution, or the equivalent, its charter or articles of organization, or the equivalent, have been revoked, or its right to conduct business has been suspended by the jurisdiction of its formation; and (iii) The member fails to obtain a revocation of the certificate of dissolution or a reinstatement of its charter or articles of organization, or the equivalent, or its right to conduct business within such ninety-day period; or (C) The member is a general or limited partnership and has been dissolved and its business is being wound up; (6) On application by the LLC or another member, the member is expelled by judicial determination, because the member: (A) Engaged in wrongful conduct that adversely and materially affected the LLC's business; (B) Willfully or persistently committed a material breach of the LLC documents, or of a duty owed under § 48-249-403 to the LLC or to other members or to holders; or (C) Engaged in conduct relating to the LLC's business that makes it not reasonably practicable to carry on the business with the member; (7) The member: (A) Files a petition as a debtor in bankruptcy; (B) Executes an assignment for the benefit of creditors; (C) Seeks, consents to, or acquiesces in the appointment of a trustee, receiver or liquidator for or of the member, or for or of all or substantially all of the member's property; or (D) Fails, within ninety (90) days after the filing or appointment, to have dismissed the filing against the member of an involuntary petition in bankruptcy, or to have vacated or stayed the appointment of a trustee, receiver or liquidator for or of the member, or for or of all or substantially all of the member's property obtained without the member's consent or acquiescence, or fails within ninety (90) days after the expiration of a stay, to have the appointment vacated; (8) In the case of a member who is an individual: (A) The member dies; (B) A personal representative is appointed for the member; or (C) A judicial determination that the member has become incapable of performing the member's duties under the LLC documents; (9) In the case of a member that is a trust or is acting as a member by virtue of being a trustee of a trust, the distribution of all of the trust's financial rights, but not merely by reason of the substitution of a successor trustee; provided, however, that a distribution to a beneficiary of a trust established under § 2503(c) of the Code ( 26 U.S.C. § 2503(c) ), or a trust that is treated under § 676 of the Code ( 26 U.S.C. § 676 ), as owned by the settlor of the trust, shall not be considered to be a distribution of financial rights under this subdivision (a)(9); (10) In the case of a member that is an estate, or is acting as a member by virtue of being a personal representative of an estate, distribution of all of the estate's financial rights, but not merely the substitution of a successor personal representative or beneficiary; (11) In the case of a custodianship under the Uniform Transfers to Minors Act, compiled in title 35, chapter 7, or the equivalent law of any foreign jurisdiction, a transfer of the financial rights held by the custodian, but not a transfer to the beneficiary for whom the custodian is holding the financial rights; or (12) Termination of the existence of a member, if the member is an entity other than an estate, or trust, other than a business trust.
(1) The LLC receives written notice from the member of the member's express will to withdraw upon the date of the notice, or on a later date specified by the member in the notice;
(2) An event specified in the LLC documents as causing the member's membership interest to terminate;
(3) The transfer of all of the member's financial rights, unless the transfer is for security purposes, and has not been foreclosed or is under a court order charging the member's financial rights;
(4) The member is expelled under the LLC documents;
(5) The member is expelled by unanimous vote of the other members entitled to vote, if: (A) It is unlawful to carry on the business of the LLC with the member; (B) (i) The member is a corporation or an LLC; (ii) Within ninety (90) days after the LLC notifies the member that it will be expelled, because it has filed a certificate of dissolution, or the equivalent, its charter or articles of organization, or the equivalent, have been revoked, or its right to conduct business has been suspended by the jurisdiction of its formation; and (iii) The member fails to obtain a revocation of the certificate of dissolution or a reinstatement of its charter or articles of organization, or the equivalent, or its right to conduct business within such ninety-day period; or (C) The member is a general or limited partnership and has been dissolved and its business is being wound up;
(A) It is unlawful to carry on the business of the LLC with the member;
(B) (i) The member is a corporation or an LLC; (ii) Within ninety (90) days after the LLC notifies the member that it will be expelled, because it has filed a certificate of dissolution, or the equivalent, its charter or articles of organization, or the equivalent, have been revoked, or its right to conduct business has been suspended by the jurisdiction of its formation; and (iii) The member fails to obtain a revocation of the certificate of dissolution or a reinstatement of its charter or articles of organization, or the equivalent, or its right to conduct business within such ninety-day period; or
(i) The member is a corporation or an LLC;
(ii) Within ninety (90) days after the LLC notifies the member that it will be expelled, because it has filed a certificate of dissolution, or the equivalent, its charter or articles of organization, or the equivalent, have been revoked, or its right to conduct business has been suspended by the jurisdiction of its formation; and
(iii) The member fails to obtain a revocation of the certificate of dissolution or a reinstatement of its charter or articles of organization, or the equivalent, or its right to conduct business within such ninety-day period; or
(C) The member is a general or limited partnership and has been dissolved and its business is being wound up;
(6) On application by the LLC or another member, the member is expelled by judicial determination, because the member: (A) Engaged in wrongful conduct that adversely and materially affected the LLC's business; (B) Willfully or persistently committed a material breach of the LLC documents, or of a duty owed under § 48-249-403 to the LLC or to other members or to holders; or (C) Engaged in conduct relating to the LLC's business that makes it not reasonably practicable to carry on the business with the member;
(A) Engaged in wrongful conduct that adversely and materially affected the LLC's business;
(B) Willfully or persistently committed a material breach of the LLC documents, or of a duty owed under § 48-249-403 to the LLC or to other members or to holders; or
(C) Engaged in conduct relating to the LLC's business that makes it not reasonably practicable to carry on the business with the member;
(7) The member: (A) Files a petition as a debtor in bankruptcy; (B) Executes an assignment for the benefit of creditors; (C) Seeks, consents to, or acquiesces in the appointment of a trustee, receiver or liquidator for or of the member, or for or of all or substantially all of the member's property; or (D) Fails, within ninety (90) days after the filing or appointment, to have dismissed the filing against the member of an involuntary petition in bankruptcy, or to have vacated or stayed the appointment of a trustee, receiver or liquidator for or of the member, or for or of all or substantially all of the member's property obtained without the member's consent or acquiescence, or fails within ninety (90) days after the expiration of a stay, to have the appointment vacated;
(A) Files a petition as a debtor in bankruptcy;
(B) Executes an assignment for the benefit of creditors;
(C) Seeks, consents to, or acquiesces in the appointment of a trustee, receiver or liquidator for or of the member, or for or of all or substantially all of the member's property; or
(D) Fails, within ninety (90) days after the filing or appointment, to have dismissed the filing against the member of an involuntary petition in bankruptcy, or to have vacated or stayed the appointment of a trustee, receiver or liquidator for or of the member, or for or of all or substantially all of the member's property obtained without the member's consent or acquiescence, or fails within ninety (90) days after the expiration of a stay, to have the appointment vacated;
(8) In the case of a member who is an individual: (A) The member dies; (B) A personal representative is appointed for the member; or (C) A judicial determination that the member has become incapable of performing the member's duties under the LLC documents;
(A) The member dies;
(B) A personal representative is appointed for the member; or
(C) A judicial determination that the member has become incapable of performing the member's duties under the LLC documents;
(9) In the case of a member that is a trust or is acting as a member by virtue of being a trustee of a trust, the distribution of all of the trust's financial rights, but not merely by reason of the substitution of a successor trustee; provided, however, that a distribution to a beneficiary of a trust established under § 2503(c) of the Code ( 26 U.S.C. § 2503(c) ), or a trust that is treated under § 676 of the Code ( 26 U.S.C. § 676 ), as owned by the settlor of the trust, shall not be considered to be a distribution of financial rights under this subdivision (a)(9);
(10) In the case of a member that is an estate, or is acting as a member by virtue of being a personal representative of an estate, distribution of all of the estate's financial rights, but not merely the substitution of a successor personal representative or beneficiary;
(11) In the case of a custodianship under the Uniform Transfers to Minors Act, compiled in title 35, chapter 7, or the equivalent law of any foreign jurisdiction, a transfer of the financial rights held by the custodian, but not a transfer to the beneficiary for whom the custodian is holding the financial rights; or
(12) Termination of the existence of a member, if the member is an entity other than an estate, or trust, other than a business trust.
(b) Power to terminate. (1) Except as otherwise provided in subdivision (b)(2), and subject to § 48-249-504 , a member has the power and right to terminate such member's membership interest at any time, including, without limitation, upon withdrawal by express will under subdivision (a)(1). A provision in the LLC documents that negates any right of a member to terminate the member's membership interest shall also automatically negate the corresponding power of the member to terminate the member's membership interest, unless the corresponding power of the member to terminate the member's membership interest is expressly reserved. Any attempted termination of a member's membership interest as to which the power to terminate has been negated shall be null and void. (2) No member of a family LLC has either the power or the right to terminate the membership interest or financial rights of such member in such family LLC. No event specified in subdivisions (a)(1), (a)(3), (a)(7), (a)(8), (a)(9), (a)(10), (a)(11) or (a)(12) shall result in the termination of the membership interest or financial rights of a member of a family LLC. In the event that a member of a family LLC attempts to terminate the member's membership interest or financial rights by withdrawal by express will under subdivision (a)(1), such attempted termination shall be null and void.
(1) Except as otherwise provided in subdivision (b)(2), and subject to § 48-249-504 , a member has the power and right to terminate such member's membership interest at any time, including, without limitation, upon withdrawal by express will under subdivision (a)(1). A provision in the LLC documents that negates any right of a member to terminate the member's membership interest shall also automatically negate the corresponding power of the member to terminate the member's membership interest, unless the corresponding power of the member to terminate the member's membership interest is expressly reserved. Any attempted termination of a member's membership interest as to which the power to terminate has been negated shall be null and void.
(2) No member of a family LLC has either the power or the right to terminate the membership interest or financial rights of such member in such family LLC. No event specified in subdivisions (a)(1), (a)(3), (a)(7), (a)(8), (a)(9), (a)(10), (a)(11) or (a)(12) shall result in the termination of the membership interest or financial rights of a member of a family LLC. In the event that a member of a family LLC attempts to terminate the member's membership interest or financial rights by withdrawal by express will under subdivision (a)(1), such attempted termination shall be null and void.
Acts 2005, ch. 286, § 1; 2006, ch. 620, §§ 30, 31.
Tenn. Code Ann. § 48-21-115 — TN Code / Title 48 / Chapter 21 / Section 48-21-115
Abandonment of entity conversion
Status: in_force

(a) Unless otherwise provided in a plan of entity conversion of a domestic business corporation, after the plan has been adopted and approved as required by § 48-21-111 , and at any time before the entity conversion has become effective, it may be abandoned by the board of directors without action by the shareholders. (b) If an entity conversion is abandoned after articles of entity conversion or articles of charter surrender have been filed with the secretary of state but before the entity conversion has become effective, a statement that the entity conversion has been abandoned in accordance with this section, executed by an officer or other duly authorized representative, shall be delivered to the secretary of state for filing, together with the required filing fee, prior to the effective date of the entity conversion. Upon filing, the statement shall take effect and the entity conversion shall be deemed abandoned and shall not become effective. Acts 2012, ch. 1051, § 39.
(a) Unless otherwise provided in a plan of entity conversion of a domestic business corporation, after the plan has been adopted and approved as required by § 48-21-111 , and at any time before the entity conversion has become effective, it may be abandoned by the board of directors without action by the shareholders.
(b) If an entity conversion is abandoned after articles of entity conversion or articles of charter surrender have been filed with the secretary of state but before the entity conversion has become effective, a statement that the entity conversion has been abandoned in accordance with this section, executed by an officer or other duly authorized representative, shall be delivered to the secretary of state for filing, together with the required filing fee, prior to the effective date of the entity conversion. Upon filing, the statement shall take effect and the entity conversion shall be deemed abandoned and shall not become effective.
Acts 2012, ch. 1051, § 39.
Tenn. Code Ann. § 48-249-115 — TN Code / Title 48 / Chapter 249 / Section 48-249-115
Indemnification
Status: in_force

(a) Definitions. As used in this section, unless the context otherwise requires: (1) "Expenses" means, without limitation, counsel fees; (2) "Liability" means the obligation to pay a judgment, settlement, penalty, fine, including an excise tax assessed with respect to an employee benefit plan, or reasonable expenses incurred with respect to a proceeding; (3) "LLC" includes any domestic LLC and any domestic or foreign predecessor of an LLC in a merger or other transaction in which the predecessor's existence ceased upon consummation of the transaction; (4) (A) "Official capacity" means: (i) With respect to a director in a director-managed LLC, the position of director; (ii) With respect to a manager in a manager-managed LLC, the position of manager; (iii) With respect to a member in a member-managed LLC, a member who took an action of management as a member; and (iv) With respect to a person in a capacity not described in subdivision (a)(4)(A)(i), (a)(4)(A)(ii) or (a)(4)(A)(iii), the elective or appointive office or position held by an officer, member of a committee of the board of directors or member of a committee of the managers or members or the employment or agency relationship undertaken by an employee or agent on behalf of the LLC; and (B) "Official capacity" does not mean service for any other foreign or domestic entity; (5) "Party" means an individual who was, is or is threatened to be made a named defendant or respondent in a proceeding; (6) "Responsible person" means an individual who is or was a director of a director-managed LLC, a manager of a manager-managed LLC or a member of a member-managed LLC, or an individual who, while a director of a director-managed LLC, a manager of a manager-managed LLC, or a member of a member-managed LLC, is or was serving at the LLC's request as a director, manager, officer, partner, trustee, employee or agent of an employee benefit plan or any other foreign or domestic entity. For purposes of this subdivision (a)(6), a director of a director-managed LLC, a manager of a manager-managed LLC or a member of a member-managed LLC is considered to be serving an employee benefit plan at the LLC's request, if the director's, manager's or member's duties to the LLC also impose duties on, or otherwise involve services by, the director, manager or member to the plan or to participants in or beneficiaries of the plan. "Responsible person" includes, unless the context requires otherwise, the estate or personal representative of a responsible person; and (7) "Special legal counsel" means counsel who has not represented the LLC or a related LLC, or a member, director, manager, member of a committee of the board of directors, member of a committee of the managers, member of a committee of the members, officer, agent or employee, whose indemnification is in issue. (b) Authority to indemnify. (1) Except as provided in subsection (d), an LLC may indemnify an individual made a party to a proceeding, because such individual is or was a responsible person against liability incurred in the proceeding, if the individual: (A) Acted in good faith; (B) Reasonably believed: (i) In the case of conduct in such individual's official capacity with the LLC, that such individual's conduct was in the LLC's best interest; and (ii) In all other cases, that such individual's conduct was at least not opposed to the LLC's best interests; and (C) In the case of any criminal proceeding, had no reasonable cause to believe such individual's conduct was unlawful. (2) A responsible person's conduct, with respect to an employee benefit plan for a purpose such person reasonably believed to be in the best interests of the participants in and beneficiaries of the plan, is conduct that satisfies the requirement of subdivision (b)(1)(B). (3) The termination of a proceeding by judgment, order, settlement or conviction or upon a plea of nolo contendere, or its equivalent, is not, of itself, determinative that the responsible person did not meet the standard of conduct described in this section. (4) Except as provided in subsection (e), an LLC may not indemnify a responsible person under this section: (A) In connection with a proceeding by, or in the right of, the LLC in which the responsible person was adjudged liable to the LLC; or (B) In connection with any other proceeding charging improper personal benefit to such responsible person, whether or not involving action in such person's official capacity, in which such person was adjudged liable on the basis that personal benefit was improperly received by such person. (c) Mandatory indemnification. An LLC shall indemnify a responsible person who was wholly successful, on the merits or otherwise, in the defense of any proceeding to which the person was a party, because the person is or was a responsible person, against reasonable expenses incurred by the person in connection with the proceeding. (d) Advances for expenses. (1) An LLC may pay for or reimburse the reasonable expenses incurred by a responsible person who is a party to a proceeding, in advance of final disposition of the proceeding, if: (A) The responsible person furnishes the LLC a written affirmation of good faith belief that such responsible person has met the standard of conduct described in subsection (b); (B) The responsible person furnishes the LLC a written undertaking, executed personally or on such responsible person's behalf, to repay the advance, if it is ultimately determined that the responsible person is not entitled to indemnification; and (C) A determination is made that the facts then known to those making the determination would not preclude indemnification under this section. (2) The undertaking required by subdivision (d)(1)(B) shall be an unlimited general obligation of the responsible person, but need not be secured, and may be accepted without reference to financial ability to make repayment. (3) Determinations and authorizations of payments under this section shall be made in the manner specified in subsection (f). (e) Court ordered indemnification. A responsible person who is a party to a proceeding may apply for indemnification to the court conducting the proceeding, or to another court of competent jurisdiction. On receipt of an application, the court, after giving any notice the court considers necessary, may order indemnification, if it determines: (1) The responsible person is entitled to mandatory indemnification under subsection (c), in which case the court shall also order the LLC to pay the responsible person's reasonable expenses incurred to obtain court ordered indemnification; or (2) The responsible person is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, whether or not the responsible person met the standard of conduct set forth in subdivision (b)(1), or was adjudged liable as described in subdivision (b)(4). If the responsible person was adjudged so liable, the responsible person's indemnification is limited to reasonable expenses incurred. (f) Determination and authorization of indemnification. (1) Except as provided in subsection (e), an LLC may not indemnify a responsible person under subsection (b), unless authorized in the specific case, after a determination has been made that indemnification of the responsible person is permissible in the circumstances, because the responsible person has met the standard of conduct set forth in subdivision (b)(1). (2) Such determination shall be made: (A) By the board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, by majority vote of a quorum consisting of directors, managers or members, as applicable, not at the time parties to the proceeding; (B) If a quorum cannot be obtained under subdivision (f)(2)(A), by majority vote of a committee duly designated by the board of directors of a board-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, in which designation directors, managers or members, as applicable, who are parties may participate, consisting solely of two (2) or more directors, managers or members, as applicable, who are not at the time parties to the proceeding; (C) By special legal counsel: (i) Selected by the board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, or by a committee in the manner prescribed in subdivision (f)(2)(A) or (f)(2)(B); or (ii) If a quorum of the board of directors of a director-managed LLC, the managers of a manager-managed LLC, or the members of a member-managed LLC, as applicable, cannot be obtained under subdivision (f)(2)(A) and a committee cannot be designated under subdivision (f)(2)(B), selected by majority vote of the full board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, in which selection directors, managers or members, as applicable, who are parties to the proceeding may participate; or (D) By a majority vote of the members of a director-managed LLC or a manager-managed LLC, but voting rights owned or controlled by members who are at the time parties to the proceeding may not be voted on the determination. (3) Authorization of indemnification, and evaluation as to reasonableness of expenses, shall be made in the same manner as the determination that indemnification is permissible, except that, if the determination is made by special legal counsel, authorization of indemnification and evaluation as to reasonableness of expenses shall be made by those entitled under subdivision (f)(2)(C) to select counsel. (g) Indemnification of officers, employees and agents. (1) An officer of the LLC who is not a responsible person is entitled to mandatory indemnification under subsection (c), and is entitled to apply for court-ordered indemnification under subsection (e), in each case, to the same extent as a responsible person. (2) The LLC may indemnify and advance expenses to an officer, employee, independent contractor or agent of the LLC who is not a responsible person, to the same extent as a responsible person. (3) An LLC may also indemnify and advance expenses to an officer, employee, independent contractor or agent who is not a responsible person, to the extent, consistent with public policy, that may be provided by its LLC documents, by general or specific action of the board of directors of a director-managed LLC, by the managers of a manager-managed LLC, by the members of a member-managed LLC, or by contract. (h) Insurance. An LLC may purchase and maintain insurance on behalf of a person who is or was a responsible person, officer, employee, independent contractor or agent of the LLC, or who, while a responsible person, officer, employee, independent contractor or agent of the LLC, is or was serving at the request of the LLC as a responsible person, officer, partner, trustee, employee, independent contractor or agent of an employee benefit plan or any other domestic or foreign entity, against liability asserted against or incurred by such person acting in that capacity, or arising from the person's status as a responsible person, officer, employee, independent contractor or agent, whether or not the LLC would have power to indemnify the person against the same liability under subsection (b), (c) or (g). (i) Nonexclusivity. (1) The indemnification and advancement of expenses, granted under or provided by this section, shall not be deemed exclusive of any other rights to which a responsible person seeking indemnification or advancement of expenses may be entitled, whether contained in this section, the LLC documents, or, when authorized by such LLC documents, action of the members, directors or managers or an agreement providing for such indemnification; provided, that no indemnification may be made to or on behalf of any responsible person, if a judgment, or other final adjudication adverse to the responsible person or officer, establishes such person's liability: (A) For any breach of the duty of loyalty to the LLC or its members; (B) For acts or omissions not in good faith, or that involve intentional misconduct or a knowing violation of law; or (C) Under § 48-249-307 . (2) Nothing contained in this section shall affect any rights to indemnification to which the LLC's personnel, other than responsible persons, may be entitled by contract or otherwise under law. If the LLC documents limit indemnification or advances for expenses, indemnification and advances for expenses are valid only to the extent consistent with the LLC documents. (3) This section does not limit an LLC's power to pay or reimburse expenses incurred by a responsible person, officer, employee, independent contractor or agent, in connection with such person's appearance as a witness in a proceeding, at a time when such person has not been made a named defendant or respondent to the proceeding. Acts 2005, ch. 286, § 1.
(a) Definitions. As used in this section, unless the context otherwise requires: (1) "Expenses" means, without limitation, counsel fees; (2) "Liability" means the obligation to pay a judgment, settlement, penalty, fine, including an excise tax assessed with respect to an employee benefit plan, or reasonable expenses incurred with respect to a proceeding; (3) "LLC" includes any domestic LLC and any domestic or foreign predecessor of an LLC in a merger or other transaction in which the predecessor's existence ceased upon consummation of the transaction; (4) (A) "Official capacity" means: (i) With respect to a director in a director-managed LLC, the position of director; (ii) With respect to a manager in a manager-managed LLC, the position of manager; (iii) With respect to a member in a member-managed LLC, a member who took an action of management as a member; and (iv) With respect to a person in a capacity not described in subdivision (a)(4)(A)(i), (a)(4)(A)(ii) or (a)(4)(A)(iii), the elective or appointive office or position held by an officer, member of a committee of the board of directors or member of a committee of the managers or members or the employment or agency relationship undertaken by an employee or agent on behalf of the LLC; and (B) "Official capacity" does not mean service for any other foreign or domestic entity; (5) "Party" means an individual who was, is or is threatened to be made a named defendant or respondent in a proceeding; (6) "Responsible person" means an individual who is or was a director of a director-managed LLC, a manager of a manager-managed LLC or a member of a member-managed LLC, or an individual who, while a director of a director-managed LLC, a manager of a manager-managed LLC, or a member of a member-managed LLC, is or was serving at the LLC's request as a director, manager, officer, partner, trustee, employee or agent of an employee benefit plan or any other foreign or domestic entity. For purposes of this subdivision (a)(6), a director of a director-managed LLC, a manager of a manager-managed LLC or a member of a member-managed LLC is considered to be serving an employee benefit plan at the LLC's request, if the director's, manager's or member's duties to the LLC also impose duties on, or otherwise involve services by, the director, manager or member to the plan or to participants in or beneficiaries of the plan. "Responsible person" includes, unless the context requires otherwise, the estate or personal representative of a responsible person; and (7) "Special legal counsel" means counsel who has not represented the LLC or a related LLC, or a member, director, manager, member of a committee of the board of directors, member of a committee of the managers, member of a committee of the members, officer, agent or employee, whose indemnification is in issue.
(1) "Expenses" means, without limitation, counsel fees;
(2) "Liability" means the obligation to pay a judgment, settlement, penalty, fine, including an excise tax assessed with respect to an employee benefit plan, or reasonable expenses incurred with respect to a proceeding;
(3) "LLC" includes any domestic LLC and any domestic or foreign predecessor of an LLC in a merger or other transaction in which the predecessor's existence ceased upon consummation of the transaction;
(4) (A) "Official capacity" means: (i) With respect to a director in a director-managed LLC, the position of director; (ii) With respect to a manager in a manager-managed LLC, the position of manager; (iii) With respect to a member in a member-managed LLC, a member who took an action of management as a member; and (iv) With respect to a person in a capacity not described in subdivision (a)(4)(A)(i), (a)(4)(A)(ii) or (a)(4)(A)(iii), the elective or appointive office or position held by an officer, member of a committee of the board of directors or member of a committee of the managers or members or the employment or agency relationship undertaken by an employee or agent on behalf of the LLC; and (B) "Official capacity" does not mean service for any other foreign or domestic entity;
(A) "Official capacity" means: (i) With respect to a director in a director-managed LLC, the position of director; (ii) With respect to a manager in a manager-managed LLC, the position of manager; (iii) With respect to a member in a member-managed LLC, a member who took an action of management as a member; and (iv) With respect to a person in a capacity not described in subdivision (a)(4)(A)(i), (a)(4)(A)(ii) or (a)(4)(A)(iii), the elective or appointive office or position held by an officer, member of a committee of the board of directors or member of a committee of the managers or members or the employment or agency relationship undertaken by an employee or agent on behalf of the LLC; and
(i) With respect to a director in a director-managed LLC, the position of director;
(ii) With respect to a manager in a manager-managed LLC, the position of manager;
(iii) With respect to a member in a member-managed LLC, a member who took an action of management as a member; and
(iv) With respect to a person in a capacity not described in subdivision (a)(4)(A)(i), (a)(4)(A)(ii) or (a)(4)(A)(iii), the elective or appointive office or position held by an officer, member of a committee of the board of directors or member of a committee of the managers or members or the employment or agency relationship undertaken by an employee or agent on behalf of the LLC; and
(B) "Official capacity" does not mean service for any other foreign or domestic entity;
(5) "Party" means an individual who was, is or is threatened to be made a named defendant or respondent in a proceeding;
(6) "Responsible person" means an individual who is or was a director of a director-managed LLC, a manager of a manager-managed LLC or a member of a member-managed LLC, or an individual who, while a director of a director-managed LLC, a manager of a manager-managed LLC, or a member of a member-managed LLC, is or was serving at the LLC's request as a director, manager, officer, partner, trustee, employee or agent of an employee benefit plan or any other foreign or domestic entity. For purposes of this subdivision (a)(6), a director of a director-managed LLC, a manager of a manager-managed LLC or a member of a member-managed LLC is considered to be serving an employee benefit plan at the LLC's request, if the director's, manager's or member's duties to the LLC also impose duties on, or otherwise involve services by, the director, manager or member to the plan or to participants in or beneficiaries of the plan. "Responsible person" includes, unless the context requires otherwise, the estate or personal representative of a responsible person; and
(7) "Special legal counsel" means counsel who has not represented the LLC or a related LLC, or a member, director, manager, member of a committee of the board of directors, member of a committee of the managers, member of a committee of the members, officer, agent or employee, whose indemnification is in issue.
(b) Authority to indemnify. (1) Except as provided in subsection (d), an LLC may indemnify an individual made a party to a proceeding, because such individual is or was a responsible person against liability incurred in the proceeding, if the individual: (A) Acted in good faith; (B) Reasonably believed: (i) In the case of conduct in such individual's official capacity with the LLC, that such individual's conduct was in the LLC's best interest; and (ii) In all other cases, that such individual's conduct was at least not opposed to the LLC's best interests; and (C) In the case of any criminal proceeding, had no reasonable cause to believe such individual's conduct was unlawful. (2) A responsible person's conduct, with respect to an employee benefit plan for a purpose such person reasonably believed to be in the best interests of the participants in and beneficiaries of the plan, is conduct that satisfies the requirement of subdivision (b)(1)(B). (3) The termination of a proceeding by judgment, order, settlement or conviction or upon a plea of nolo contendere, or its equivalent, is not, of itself, determinative that the responsible person did not meet the standard of conduct described in this section. (4) Except as provided in subsection (e), an LLC may not indemnify a responsible person under this section: (A) In connection with a proceeding by, or in the right of, the LLC in which the responsible person was adjudged liable to the LLC; or (B) In connection with any other proceeding charging improper personal benefit to such responsible person, whether or not involving action in such person's official capacity, in which such person was adjudged liable on the basis that personal benefit was improperly received by such person.
(1) Except as provided in subsection (d), an LLC may indemnify an individual made a party to a proceeding, because such individual is or was a responsible person against liability incurred in the proceeding, if the individual: (A) Acted in good faith; (B) Reasonably believed: (i) In the case of conduct in such individual's official capacity with the LLC, that such individual's conduct was in the LLC's best interest; and (ii) In all other cases, that such individual's conduct was at least not opposed to the LLC's best interests; and (C) In the case of any criminal proceeding, had no reasonable cause to believe such individual's conduct was unlawful.
(A) Acted in good faith;
(B) Reasonably believed: (i) In the case of conduct in such individual's official capacity with the LLC, that such individual's conduct was in the LLC's best interest; and (ii) In all other cases, that such individual's conduct was at least not opposed to the LLC's best interests; and
(i) In the case of conduct in such individual's official capacity with the LLC, that such individual's conduct was in the LLC's best interest; and
(ii) In all other cases, that such individual's conduct was at least not opposed to the LLC's best interests; and
(C) In the case of any criminal proceeding, had no reasonable cause to believe such individual's conduct was unlawful.
(2) A responsible person's conduct, with respect to an employee benefit plan for a purpose such person reasonably believed to be in the best interests of the participants in and beneficiaries of the plan, is conduct that satisfies the requirement of subdivision (b)(1)(B).
(3) The termination of a proceeding by judgment, order, settlement or conviction or upon a plea of nolo contendere, or its equivalent, is not, of itself, determinative that the responsible person did not meet the standard of conduct described in this section.
(4) Except as provided in subsection (e), an LLC may not indemnify a responsible person under this section: (A) In connection with a proceeding by, or in the right of, the LLC in which the responsible person was adjudged liable to the LLC; or (B) In connection with any other proceeding charging improper personal benefit to such responsible person, whether or not involving action in such person's official capacity, in which such person was adjudged liable on the basis that personal benefit was improperly received by such person.
(A) In connection with a proceeding by, or in the right of, the LLC in which the responsible person was adjudged liable to the LLC; or
(B) In connection with any other proceeding charging improper personal benefit to such responsible person, whether or not involving action in such person's official capacity, in which such person was adjudged liable on the basis that personal benefit was improperly received by such person.
(c) Mandatory indemnification. An LLC shall indemnify a responsible person who was wholly successful, on the merits or otherwise, in the defense of any proceeding to which the person was a party, because the person is or was a responsible person, against reasonable expenses incurred by the person in connection with the proceeding.
(d) Advances for expenses. (1) An LLC may pay for or reimburse the reasonable expenses incurred by a responsible person who is a party to a proceeding, in advance of final disposition of the proceeding, if: (A) The responsible person furnishes the LLC a written affirmation of good faith belief that such responsible person has met the standard of conduct described in subsection (b); (B) The responsible person furnishes the LLC a written undertaking, executed personally or on such responsible person's behalf, to repay the advance, if it is ultimately determined that the responsible person is not entitled to indemnification; and (C) A determination is made that the facts then known to those making the determination would not preclude indemnification under this section. (2) The undertaking required by subdivision (d)(1)(B) shall be an unlimited general obligation of the responsible person, but need not be secured, and may be accepted without reference to financial ability to make repayment. (3) Determinations and authorizations of payments under this section shall be made in the manner specified in subsection (f).
(1) An LLC may pay for or reimburse the reasonable expenses incurred by a responsible person who is a party to a proceeding, in advance of final disposition of the proceeding, if: (A) The responsible person furnishes the LLC a written affirmation of good faith belief that such responsible person has met the standard of conduct described in subsection (b); (B) The responsible person furnishes the LLC a written undertaking, executed personally or on such responsible person's behalf, to repay the advance, if it is ultimately determined that the responsible person is not entitled to indemnification; and (C) A determination is made that the facts then known to those making the determination would not preclude indemnification under this section.
(A) The responsible person furnishes the LLC a written affirmation of good faith belief that such responsible person has met the standard of conduct described in subsection (b);
(B) The responsible person furnishes the LLC a written undertaking, executed personally or on such responsible person's behalf, to repay the advance, if it is ultimately determined that the responsible person is not entitled to indemnification; and
(C) A determination is made that the facts then known to those making the determination would not preclude indemnification under this section.
(2) The undertaking required by subdivision (d)(1)(B) shall be an unlimited general obligation of the responsible person, but need not be secured, and may be accepted without reference to financial ability to make repayment.
(3) Determinations and authorizations of payments under this section shall be made in the manner specified in subsection (f).
(e) Court ordered indemnification. A responsible person who is a party to a proceeding may apply for indemnification to the court conducting the proceeding, or to another court of competent jurisdiction. On receipt of an application, the court, after giving any notice the court considers necessary, may order indemnification, if it determines: (1) The responsible person is entitled to mandatory indemnification under subsection (c), in which case the court shall also order the LLC to pay the responsible person's reasonable expenses incurred to obtain court ordered indemnification; or (2) The responsible person is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, whether or not the responsible person met the standard of conduct set forth in subdivision (b)(1), or was adjudged liable as described in subdivision (b)(4). If the responsible person was adjudged so liable, the responsible person's indemnification is limited to reasonable expenses incurred.
(1) The responsible person is entitled to mandatory indemnification under subsection (c), in which case the court shall also order the LLC to pay the responsible person's reasonable expenses incurred to obtain court ordered indemnification; or
(2) The responsible person is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, whether or not the responsible person met the standard of conduct set forth in subdivision (b)(1), or was adjudged liable as described in subdivision (b)(4). If the responsible person was adjudged so liable, the responsible person's indemnification is limited to reasonable expenses incurred.
(f) Determination and authorization of indemnification. (1) Except as provided in subsection (e), an LLC may not indemnify a responsible person under subsection (b), unless authorized in the specific case, after a determination has been made that indemnification of the responsible person is permissible in the circumstances, because the responsible person has met the standard of conduct set forth in subdivision (b)(1). (2) Such determination shall be made: (A) By the board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, by majority vote of a quorum consisting of directors, managers or members, as applicable, not at the time parties to the proceeding; (B) If a quorum cannot be obtained under subdivision (f)(2)(A), by majority vote of a committee duly designated by the board of directors of a board-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, in which designation directors, managers or members, as applicable, who are parties may participate, consisting solely of two (2) or more directors, managers or members, as applicable, who are not at the time parties to the proceeding; (C) By special legal counsel: (i) Selected by the board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, or by a committee in the manner prescribed in subdivision (f)(2)(A) or (f)(2)(B); or (ii) If a quorum of the board of directors of a director-managed LLC, the managers of a manager-managed LLC, or the members of a member-managed LLC, as applicable, cannot be obtained under subdivision (f)(2)(A) and a committee cannot be designated under subdivision (f)(2)(B), selected by majority vote of the full board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, in which selection directors, managers or members, as applicable, who are parties to the proceeding may participate; or (D) By a majority vote of the members of a director-managed LLC or a manager-managed LLC, but voting rights owned or controlled by members who are at the time parties to the proceeding may not be voted on the determination. (3) Authorization of indemnification, and evaluation as to reasonableness of expenses, shall be made in the same manner as the determination that indemnification is permissible, except that, if the determination is made by special legal counsel, authorization of indemnification and evaluation as to reasonableness of expenses shall be made by those entitled under subdivision (f)(2)(C) to select counsel.
(1) Except as provided in subsection (e), an LLC may not indemnify a responsible person under subsection (b), unless authorized in the specific case, after a determination has been made that indemnification of the responsible person is permissible in the circumstances, because the responsible person has met the standard of conduct set forth in subdivision (b)(1).
(2) Such determination shall be made: (A) By the board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, by majority vote of a quorum consisting of directors, managers or members, as applicable, not at the time parties to the proceeding; (B) If a quorum cannot be obtained under subdivision (f)(2)(A), by majority vote of a committee duly designated by the board of directors of a board-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, in which designation directors, managers or members, as applicable, who are parties may participate, consisting solely of two (2) or more directors, managers or members, as applicable, who are not at the time parties to the proceeding; (C) By special legal counsel: (i) Selected by the board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, or by a committee in the manner prescribed in subdivision (f)(2)(A) or (f)(2)(B); or (ii) If a quorum of the board of directors of a director-managed LLC, the managers of a manager-managed LLC, or the members of a member-managed LLC, as applicable, cannot be obtained under subdivision (f)(2)(A) and a committee cannot be designated under subdivision (f)(2)(B), selected by majority vote of the full board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, in which selection directors, managers or members, as applicable, who are parties to the proceeding may participate; or (D) By a majority vote of the members of a director-managed LLC or a manager-managed LLC, but voting rights owned or controlled by members who are at the time parties to the proceeding may not be voted on the determination.
(A) By the board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, by majority vote of a quorum consisting of directors, managers or members, as applicable, not at the time parties to the proceeding;
(B) If a quorum cannot be obtained under subdivision (f)(2)(A), by majority vote of a committee duly designated by the board of directors of a board-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, in which designation directors, managers or members, as applicable, who are parties may participate, consisting solely of two (2) or more directors, managers or members, as applicable, who are not at the time parties to the proceeding;
(C) By special legal counsel: (i) Selected by the board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, or by a committee in the manner prescribed in subdivision (f)(2)(A) or (f)(2)(B); or (ii) If a quorum of the board of directors of a director-managed LLC, the managers of a manager-managed LLC, or the members of a member-managed LLC, as applicable, cannot be obtained under subdivision (f)(2)(A) and a committee cannot be designated under subdivision (f)(2)(B), selected by majority vote of the full board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, in which selection directors, managers or members, as applicable, who are parties to the proceeding may participate; or
(i) Selected by the board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, as applicable, or by a committee in the manner prescribed in subdivision (f)(2)(A) or (f)(2)(B); or
(ii) If a quorum of the board of directors of a director-managed LLC, the managers of a manager-managed LLC, or the members of a member-managed LLC, as applicable, cannot be obtained under subdivision (f)(2)(A) and a committee cannot be designated under subdivision (f)(2)(B), selected by majority vote of the full board of directors of a director-managed LLC, by the managers of a manager-managed LLC, or by the members of a member-managed LLC, in which selection directors, managers or members, as applicable, who are parties to the proceeding may participate; or
(D) By a majority vote of the members of a director-managed LLC or a manager-managed LLC, but voting rights owned or controlled by members who are at the time parties to the proceeding may not be voted on the determination.
(3) Authorization of indemnification, and evaluation as to reasonableness of expenses, shall be made in the same manner as the determination that indemnification is permissible, except that, if the determination is made by special legal counsel, authorization of indemnification and evaluation as to reasonableness of expenses shall be made by those entitled under subdivision (f)(2)(C) to select counsel.
(g) Indemnification of officers, employees and agents. (1) An officer of the LLC who is not a responsible person is entitled to mandatory indemnification under subsection (c), and is entitled to apply for court-ordered indemnification under subsection (e), in each case, to the same extent as a responsible person. (2) The LLC may indemnify and advance expenses to an officer, employee, independent contractor or agent of the LLC who is not a responsible person, to the same extent as a responsible person. (3) An LLC may also indemnify and advance expenses to an officer, employee, independent contractor or agent who is not a responsible person, to the extent, consistent with public policy, that may be provided by its LLC documents, by general or specific action of the board of directors of a director-managed LLC, by the managers of a manager-managed LLC, by the members of a member-managed LLC, or by contract.
(1) An officer of the LLC who is not a responsible person is entitled to mandatory indemnification under subsection (c), and is entitled to apply for court-ordered indemnification under subsection (e), in each case, to the same extent as a responsible person.
(2) The LLC may indemnify and advance expenses to an officer, employee, independent contractor or agent of the LLC who is not a responsible person, to the same extent as a responsible person.
(3) An LLC may also indemnify and advance expenses to an officer, employee, independent contractor or agent who is not a responsible person, to the extent, consistent with public policy, that may be provided by its LLC documents, by general or specific action of the board of directors of a director-managed LLC, by the managers of a manager-managed LLC, by the members of a member-managed LLC, or by contract.
(h) Insurance. An LLC may purchase and maintain insurance on behalf of a person who is or was a responsible person, officer, employee, independent contractor or agent of the LLC, or who, while a responsible person, officer, employee, independent contractor or agent of the LLC, is or was serving at the request of the LLC as a responsible person, officer, partner, trustee, employee, independent contractor or agent of an employee benefit plan or any other domestic or foreign entity, against liability asserted against or incurred by such person acting in that capacity, or arising from the person's status as a responsible person, officer, employee, independent contractor or agent, whether or not the LLC would have power to indemnify the person against the same liability under subsection (b), (c) or (g).
(i) Nonexclusivity. (1) The indemnification and advancement of expenses, granted under or provided by this section, shall not be deemed exclusive of any other rights to which a responsible person seeking indemnification or advancement of expenses may be entitled, whether contained in this section, the LLC documents, or, when authorized by such LLC documents, action of the members, directors or managers or an agreement providing for such indemnification; provided, that no indemnification may be made to or on behalf of any responsible person, if a judgment, or other final adjudication adverse to the responsible person or officer, establishes such person's liability: (A) For any breach of the duty of loyalty to the LLC or its members; (B) For acts or omissions not in good faith, or that involve intentional misconduct or a knowing violation of law; or (C) Under § 48-249-307 . (2) Nothing contained in this section shall affect any rights to indemnification to which the LLC's personnel, other than responsible persons, may be entitled by contract or otherwise under law. If the LLC documents limit indemnification or advances for expenses, indemnification and advances for expenses are valid only to the extent consistent with the LLC documents. (3) This section does not limit an LLC's power to pay or reimburse expenses incurred by a responsible person, officer, employee, independent contractor or agent, in connection with such person's appearance as a witness in a proceeding, at a time when such person has not been made a named defendant or respondent to the proceeding.
(1) The indemnification and advancement of expenses, granted under or provided by this section, shall not be deemed exclusive of any other rights to which a responsible person seeking indemnification or advancement of expenses may be entitled, whether contained in this section, the LLC documents, or, when authorized by such LLC documents, action of the members, directors or managers or an agreement providing for such indemnification; provided, that no indemnification may be made to or on behalf of any responsible person, if a judgment, or other final adjudication adverse to the responsible person or officer, establishes such person's liability: (A) For any breach of the duty of loyalty to the LLC or its members; (B) For acts or omissions not in good faith, or that involve intentional misconduct or a knowing violation of law; or (C) Under § 48-249-307 .
(A) For any breach of the duty of loyalty to the LLC or its members;
(B) For acts or omissions not in good faith, or that involve intentional misconduct or a knowing violation of law; or
(C) Under § 48-249-307 .
(2) Nothing contained in this section shall affect any rights to indemnification to which the LLC's personnel, other than responsible persons, may be entitled by contract or otherwise under law. If the LLC documents limit indemnification or advances for expenses, indemnification and advances for expenses are valid only to the extent consistent with the LLC documents.
(3) This section does not limit an LLC's power to pay or reimburse expenses incurred by a responsible person, officer, employee, independent contractor or agent, in connection with such person's appearance as a witness in a proceeding, at a time when such person has not been made a named defendant or respondent to the proceeding.
Acts 2005, ch. 286, § 1.
Tenn. Code Ann. § 48-248-604 — TN Code / Title 48 / Chapter 248 / Section 48-248-604
Jurisdiction of licensing authority
Status: in_force

This chapter does not restrict the jurisdiction of a licensing authority over individuals rendering a professional service within the jurisdiction of the licensing authority, nor does it affect the interpretation or application of any law pertaining to standards of professional conduct except, notwithstanding any other provision of chapters 201-248 of this title, this chapter expressly provides that persons engaged in a professional service are expressly authorized to form a PLLC in which to conduct their business and limit their liability for the acts of others. Acts 1994, ch. 868, § 1.
This chapter does not restrict the jurisdiction of a licensing authority over individuals rendering a professional service within the jurisdiction of the licensing authority, nor does it affect the interpretation or application of any law pertaining to standards of professional conduct except, notwithstanding any other provision of chapters 201-248 of this title, this chapter expressly provides that persons engaged in a professional service are expressly authorized to form a PLLC in which to conduct their business and limit their liability for the acts of others.
Acts 1994, ch. 868, § 1.
Tenn. Code Ann. § 48-241-102 — TN Code / Title 48 / Chapter 241 / Section 48-241-102
Duties of required managers
Status: in_force

(a) Presumption and Modification. Unless: (1) The articles or the operating agreement provide otherwise; (2) If the LLC is board-managed, a resolution of the board of governors providing otherwise; or (3) If the LLC is member-managed, a written resolution of the members providing otherwise; the chief manager and secretary have the duties specified in this section. (b) Chief Manager. The chief manager shall: (1) See that all orders and resolutions of the board of governors or members are carried into effect; (2) Sign and deliver in the name of the LLC any deeds, mortgages, bonds, contracts or other instruments pertaining to the business of the LLC, except in cases in which the authority to sign and deliver is required by law to be exercised by another person or is expressly delegated: (A) By the articles or operating agreement; (B) The board of governors if the LLC is board-managed; or (C) Members if the LLC is member-managed to some other manager or agent of the LLC; (3) Perform other duties prescribed by the board of governors or the members; and (4) In the event the LLC has a vacancy in the office of secretary, any notices, documents or other matters that otherwise are required to go to the secretary may be delivered to the chief manager. (c) Secretary. The secretary shall: (1) Keep accurate membership records for the LLC; (2) Maintain records of and, whenever necessary, certify all proceedings of the board of governors, members or committees of the LLC; (3) Receive notices required to be sent to the secretary and to keep a record of such notices in the records of the LLC; and (4) Perform other duties prescribed by the board of governors, the members or by the chief manager. Acts 1994, ch. 868, § 1.
(a) Presumption and Modification. Unless: (1) The articles or the operating agreement provide otherwise; (2) If the LLC is board-managed, a resolution of the board of governors providing otherwise; or (3) If the LLC is member-managed, a written resolution of the members providing otherwise; the chief manager and secretary have the duties specified in this section.
(1) The articles or the operating agreement provide otherwise;
(2) If the LLC is board-managed, a resolution of the board of governors providing otherwise; or
(3) If the LLC is member-managed, a written resolution of the members providing otherwise; the chief manager and secretary have the duties specified in this section.
the chief manager and secretary have the duties specified in this section.
(b) Chief Manager. The chief manager shall: (1) See that all orders and resolutions of the board of governors or members are carried into effect; (2) Sign and deliver in the name of the LLC any deeds, mortgages, bonds, contracts or other instruments pertaining to the business of the LLC, except in cases in which the authority to sign and deliver is required by law to be exercised by another person or is expressly delegated: (A) By the articles or operating agreement; (B) The board of governors if the LLC is board-managed; or (C) Members if the LLC is member-managed to some other manager or agent of the LLC; (3) Perform other duties prescribed by the board of governors or the members; and (4) In the event the LLC has a vacancy in the office of secretary, any notices, documents or other matters that otherwise are required to go to the secretary may be delivered to the chief manager.
(1) See that all orders and resolutions of the board of governors or members are carried into effect;
(2) Sign and deliver in the name of the LLC any deeds, mortgages, bonds, contracts or other instruments pertaining to the business of the LLC, except in cases in which the authority to sign and deliver is required by law to be exercised by another person or is expressly delegated: (A) By the articles or operating agreement; (B) The board of governors if the LLC is board-managed; or (C) Members if the LLC is member-managed to some other manager or agent of the LLC;
(A) By the articles or operating agreement;
(B) The board of governors if the LLC is board-managed; or
(C) Members if the LLC is member-managed to some other manager or agent of the LLC;
(3) Perform other duties prescribed by the board of governors or the members; and
(4) In the event the LLC has a vacancy in the office of secretary, any notices, documents or other matters that otherwise are required to go to the secretary may be delivered to the chief manager.
(c) Secretary. The secretary shall: (1) Keep accurate membership records for the LLC; (2) Maintain records of and, whenever necessary, certify all proceedings of the board of governors, members or committees of the LLC; (3) Receive notices required to be sent to the secretary and to keep a record of such notices in the records of the LLC; and (4) Perform other duties prescribed by the board of governors, the members or by the chief manager.
(1) Keep accurate membership records for the LLC;
(2) Maintain records of and, whenever necessary, certify all proceedings of the board of governors, members or committees of the LLC;
(3) Receive notices required to be sent to the secretary and to keep a record of such notices in the records of the LLC; and
(4) Perform other duties prescribed by the board of governors, the members or by the chief manager.
Acts 1994, ch. 868, § 1.
Tenn. Code Ann. § 48-18-503 — TN Code / Title 48 / Chapter 18 / Section 48-18-503
Mandatory indemnification
Status: in_force

Unless limited by its charter, a corporation shall indemnify a director who was wholly successful, on the merits or otherwise, in the defense of any proceeding to which the director was a party because the director is or was a director of the corporation against reasonable expenses incurred by the director in connection with the proceeding. Acts 1986, ch. 887, § 8.52.
Unless limited by its charter, a corporation shall indemnify a director who was wholly successful, on the merits or otherwise, in the defense of any proceeding to which the director was a party because the director is or was a director of the corporation against reasonable expenses incurred by the director in connection with the proceeding.
Acts 1986, ch. 887, § 8.52.
Tenn. Code Ann. § 48-249-902 — TN Code / Title 48 / Chapter 249 / Section 48-249-902
Transactions not constituting transacting business
Status: in_force

(a) General. The following activities of a foreign LLC, among others, do not constitute transacting business within the meaning of this part: (1) Maintaining, defending or settling any proceeding, claim or dispute; (2) Holding meetings of its members or representatives, or carrying on any other activities concerning its internal affairs; (3) Maintaining bank accounts; (4) Maintaining offices or agencies for the transfer, exchange and registration of the foreign LLC's own securities, or appointing and maintaining trustees or depositories with respect to those securities; (5) Selling through independent contractors; (6) Soliciting or obtaining orders, whether by mail or through representatives or otherwise, if the orders require acceptance outside this state before they become contracts; (7) Creating or acquiring indebtedness, deeds of trust, mortgages and security interests in real or personal property; (8) Securing or collecting debts or enforcing mortgages, deeds of trust and security interests in property securing the debts; (9) Owning, without more, real or personal property; provided, that, for a reasonable time, the management and rental of real property acquired in connection with enforcing a mortgage or deed of trust shall also not be considered transacting business, if the owner is attempting to liquidate the investment, and if no office or other agency therefor, other than an independent agency, is maintained in this state; (10) Conducting an isolated transaction that is completed within one (1) month and that is not a transaction in the course of repeated transactions of a like nature; or (11) Transacting business in interstate commerce. (b) Entity not transacting business. An entity formed under the laws of any jurisdiction other than this state shall not be deemed to be transacting business in this state for purposes of obtaining a certificate of authority to transact business, solely by reason of its being or acting in its capacity as a member or manager of a domestic or foreign LLC. (c) Nonexhaustive enumeration. The enumeration of activities in subsections (a) and (b) is not exhaustive, and is applicable solely to determine whether a foreign LLC is required to procure a certificate of authority and for no other purpose. This section does not apply in determining the contacts or activities that may subject a foreign LLC or its members to service of process or taxation in this state, or to regulation under any other law of this state. Acts 2005, ch. 286, § 1.
(a) General. The following activities of a foreign LLC, among others, do not constitute transacting business within the meaning of this part: (1) Maintaining, defending or settling any proceeding, claim or dispute; (2) Holding meetings of its members or representatives, or carrying on any other activities concerning its internal affairs; (3) Maintaining bank accounts; (4) Maintaining offices or agencies for the transfer, exchange and registration of the foreign LLC's own securities, or appointing and maintaining trustees or depositories with respect to those securities; (5) Selling through independent contractors; (6) Soliciting or obtaining orders, whether by mail or through representatives or otherwise, if the orders require acceptance outside this state before they become contracts; (7) Creating or acquiring indebtedness, deeds of trust, mortgages and security interests in real or personal property; (8) Securing or collecting debts or enforcing mortgages, deeds of trust and security interests in property securing the debts; (9) Owning, without more, real or personal property; provided, that, for a reasonable time, the management and rental of real property acquired in connection with enforcing a mortgage or deed of trust shall also not be considered transacting business, if the owner is attempting to liquidate the investment, and if no office or other agency therefor, other than an independent agency, is maintained in this state; (10) Conducting an isolated transaction that is completed within one (1) month and that is not a transaction in the course of repeated transactions of a like nature; or (11) Transacting business in interstate commerce.
(1) Maintaining, defending or settling any proceeding, claim or dispute;
(2) Holding meetings of its members or representatives, or carrying on any other activities concerning its internal affairs;
(3) Maintaining bank accounts;
(4) Maintaining offices or agencies for the transfer, exchange and registration of the foreign LLC's own securities, or appointing and maintaining trustees or depositories with respect to those securities;
(5) Selling through independent contractors;
(6) Soliciting or obtaining orders, whether by mail or through representatives or otherwise, if the orders require acceptance outside this state before they become contracts;
(7) Creating or acquiring indebtedness, deeds of trust, mortgages and security interests in real or personal property;
(8) Securing or collecting debts or enforcing mortgages, deeds of trust and security interests in property securing the debts;
(9) Owning, without more, real or personal property; provided, that, for a reasonable time, the management and rental of real property acquired in connection with enforcing a mortgage or deed of trust shall also not be considered transacting business, if the owner is attempting to liquidate the investment, and if no office or other agency therefor, other than an independent agency, is maintained in this state;
(10) Conducting an isolated transaction that is completed within one (1) month and that is not a transaction in the course of repeated transactions of a like nature; or
(11) Transacting business in interstate commerce.
(b) Entity not transacting business. An entity formed under the laws of any jurisdiction other than this state shall not be deemed to be transacting business in this state for purposes of obtaining a certificate of authority to transact business, solely by reason of its being or acting in its capacity as a member or manager of a domestic or foreign LLC.
(c) Nonexhaustive enumeration. The enumeration of activities in subsections (a) and (b) is not exhaustive, and is applicable solely to determine whether a foreign LLC is required to procure a certificate of authority and for no other purpose. This section does not apply in determining the contacts or activities that may subject a foreign LLC or its members to service of process or taxation in this state, or to regulation under any other law of this state.
Acts 2005, ch. 286, § 1.
Tenn. Code Ann. § 48-21-120 — TN Code / Title 48 / Chapter 21 / Section 48-21-120
Effect of nonprofit conversion
Status: in_force

(a) When a conversion of a domestic business corporation to a domestic nonprofit corporation becomes effective: (1) The title to all real and personal property, both tangible and intangible, of the corporation remains in the corporation without reversion or impairment; (2) The liabilities of the corporation remain the liabilities of the corporation; (3) An action or proceeding pending against the corporation continues against the corporation as if the conversion had not occurred; (4) The charter of the domestic nonprofit corporation becomes effective; (5) The shares of the corporation are reclassified into memberships, securities, obligations, rights to acquire memberships, or securities, or into cash or other property in accordance with the plan of conversion, and the shareholders are entitled only to the rights provided in the plan of nonprofit conversion or to any rights they may have under chapter 23 of this title; and (6) The corporation is deemed to: (A) Be a domestic nonprofit corporation for all purposes; (B) Be the same corporation without interruption as the corporation that existed prior to the conversion; and (C) Have been incorporated on the date it was originally incorporated as a domestic business corporation. (b) When a conversion of a domestic business corporation to a foreign nonprofit corporation becomes effective, the foreign nonprofit corporation is deemed to: (1) Appoint the secretary of state as its agent for service of process in a proceeding to enforce the rights of shareholders who exercise dissenters' rights in connection with the conversion; and (2) Agree that it will promptly pay the amount, if any, to which such shareholders are entitled under chapter 23 of this title. (c) The owner liability of a shareholder in a domestic business corporation that converts to a domestic nonprofit corporation shall be as follows: (1) The conversion does not discharge any owner liability of the shareholder as a shareholder of the business corporation to the extent any such owner liability arose before the effective time of the articles of nonprofit conversion; (2) The shareholder shall not have owner liability for any debt, obligation, or liability of the nonprofit corporation that arises after the effective time of the articles of nonprofit conversion; (3) The laws of this state shall continue to apply to the collection or discharge of any owner liability preserved by subdivision (c)(1), as if the conversion had not occurred and the nonprofit corporation was still a business corporation; and (4) The shareholder shall have whatever rights of contribution from other shareholders are provided by the laws of this state with respect to any owner liability preserved by subdivision (c)(1), as if the conversion had not occurred and the nonprofit corporation was still a business corporation. (d) A shareholder who becomes subject to owner liability for some or all of the debts, obligations, or liabilities of the nonprofit corporation shall have owner liability only for those debts, obligations, or liabilities of the nonprofit corporation that arise after the effective time of the articles of nonprofit conversion. Acts 2012, ch. 1051, § 39.
(a) When a conversion of a domestic business corporation to a domestic nonprofit corporation becomes effective: (1) The title to all real and personal property, both tangible and intangible, of the corporation remains in the corporation without reversion or impairment; (2) The liabilities of the corporation remain the liabilities of the corporation; (3) An action or proceeding pending against the corporation continues against the corporation as if the conversion had not occurred; (4) The charter of the domestic nonprofit corporation becomes effective; (5) The shares of the corporation are reclassified into memberships, securities, obligations, rights to acquire memberships, or securities, or into cash or other property in accordance with the plan of conversion, and the shareholders are entitled only to the rights provided in the plan of nonprofit conversion or to any rights they may have under chapter 23 of this title; and (6) The corporation is deemed to: (A) Be a domestic nonprofit corporation for all purposes; (B) Be the same corporation without interruption as the corporation that existed prior to the conversion; and (C) Have been incorporated on the date it was originally incorporated as a domestic business corporation.
(1) The title to all real and personal property, both tangible and intangible, of the corporation remains in the corporation without reversion or impairment;
(2) The liabilities of the corporation remain the liabilities of the corporation;
(3) An action or proceeding pending against the corporation continues against the corporation as if the conversion had not occurred;
(4) The charter of the domestic nonprofit corporation becomes effective;
(5) The shares of the corporation are reclassified into memberships, securities, obligations, rights to acquire memberships, or securities, or into cash or other property in accordance with the plan of conversion, and the shareholders are entitled only to the rights provided in the plan of nonprofit conversion or to any rights they may have under chapter 23 of this title; and
(6) The corporation is deemed to: (A) Be a domestic nonprofit corporation for all purposes; (B) Be the same corporation without interruption as the corporation that existed prior to the conversion; and (C) Have been incorporated on the date it was originally incorporated as a domestic business corporation.
(A) Be a domestic nonprofit corporation for all purposes;
(B) Be the same corporation without interruption as the corporation that existed prior to the conversion; and
(C) Have been incorporated on the date it was originally incorporated as a domestic business corporation.
(b) When a conversion of a domestic business corporation to a foreign nonprofit corporation becomes effective, the foreign nonprofit corporation is deemed to: (1) Appoint the secretary of state as its agent for service of process in a proceeding to enforce the rights of shareholders who exercise dissenters' rights in connection with the conversion; and (2) Agree that it will promptly pay the amount, if any, to which such shareholders are entitled under chapter 23 of this title.
(1) Appoint the secretary of state as its agent for service of process in a proceeding to enforce the rights of shareholders who exercise dissenters' rights in connection with the conversion; and
(2) Agree that it will promptly pay the amount, if any, to which such shareholders are entitled under chapter 23 of this title.
(c) The owner liability of a shareholder in a domestic business corporation that converts to a domestic nonprofit corporation shall be as follows: (1) The conversion does not discharge any owner liability of the shareholder as a shareholder of the business corporation to the extent any such owner liability arose before the effective time of the articles of nonprofit conversion; (2) The shareholder shall not have owner liability for any debt, obligation, or liability of the nonprofit corporation that arises after the effective time of the articles of nonprofit conversion; (3) The laws of this state shall continue to apply to the collection or discharge of any owner liability preserved by subdivision (c)(1), as if the conversion had not occurred and the nonprofit corporation was still a business corporation; and (4) The shareholder shall have whatever rights of contribution from other shareholders are provided by the laws of this state with respect to any owner liability preserved by subdivision (c)(1), as if the conversion had not occurred and the nonprofit corporation was still a business corporation.
(1) The conversion does not discharge any owner liability of the shareholder as a shareholder of the business corporation to the extent any such owner liability arose before the effective time of the articles of nonprofit conversion;
(2) The shareholder shall not have owner liability for any debt, obligation, or liability of the nonprofit corporation that arises after the effective time of the articles of nonprofit conversion;
(3) The laws of this state shall continue to apply to the collection or discharge of any owner liability preserved by subdivision (c)(1), as if the conversion had not occurred and the nonprofit corporation was still a business corporation; and
(4) The shareholder shall have whatever rights of contribution from other shareholders are provided by the laws of this state with respect to any owner liability preserved by subdivision (c)(1), as if the conversion had not occurred and the nonprofit corporation was still a business corporation.
(d) A shareholder who becomes subject to owner liability for some or all of the debts, obligations, or liabilities of the nonprofit corporation shall have owner liability only for those debts, obligations, or liabilities of the nonprofit corporation that arise after the effective time of the articles of nonprofit conversion.
Acts 2012, ch. 1051, § 39.
Tenn. Code Ann. § 48-247-101 — TN Code / Title 48 / Chapter 247 / Section 48-247-101
Filing requirements
Status: in_force

(a) The form and filing of a document must satisfy the requirements of this section, and of all other applicable sections or rules that add to these requirements, to be entitled to filing by the secretary of state. (b) Chapters 201-248 of this title must require or permit filing the document in the office of the secretary of state. (c) The document must contain the information required by chapters 201-248 of this title or required by rule. It may contain other information as well. (d) The document must be capable of being printed in ink in a clear and legible fashion on one (1) side of letter size paper. (e) The document must be in the English language. An LLC's or other business entity's name need not be in English if written in English letters, or Arabic or Roman numerals, and the certificate of existence or equivalent required of foreign business entities need not be in English, if accompanied by a reasonably authenticated English translation. (f) The document must be executed: (1) By the chair of the board of directors of a domestic or foreign corporation, by its president, or by another of its authorized officers if a corporate action is taken, by the chief manager, a governor, or another authorized manager if an LLC action is taken, by a general partner if a partnership action is taken or by the equivalent person of another business entity; (2) If directors of a corporation or governors of a board-governed LLC have not been selected or the corporation or LLC has not been formed, by an incorporator or organizer; or (3) If the business entity is in the hands of a receiver, trustee, or other court-appointed fiduciary, by that fiduciary. (g) The person executing the document must sign it and state beneath or opposite the signature the person's name and the capacity in which the person signs. The document may, but need not, contain: (1) An attestation by the secretary or an assistant secretary; (2) An acknowledgment, verification, or proof; or (3) The date the document is signed, except that the date is required for the annual report for the secretary of state. (h) If the secretary of state, pursuant to statutory authority or rule, has prescribed a mandatory form for the document, then the document must be in or on the prescribed form. (i) The document must be delivered to the office of the secretary of state for filing in the form and manner prescribed by the secretary of state and must be accompanied by the current filing fee, and any tax, license fee, interest, or penalty required by chapters 201-248 of this title. (j) The document must contain a statement that makes it clear that the document is being filed pursuant to the Tennessee Limited Liability Company Act, compiled in chapter 249, of this title. (k) The secretary of state may promulgate appropriate rules establishing acceptable methods for execution of any document to be filed with the secretary of state. (l) Notwithstanding any other law to the contrary, whenever this title requires that an application or other document submitted to the secretary of state for filing be accompanied by a confirmation of good standing, tax clearance for termination, or withdrawal, or other similar communication of taxpayer status by the commissioner of revenue, then that requirement is met, and a paper certificate need not accompany the application or other document, if the commissioner provides to the secretary of state electronic verification of the required information. Upon request of the person seeking certificate information, the commissioner shall provide to the secretary of state electronic verification in lieu of a paper certificate. (m) Any Tennessee LLC that has not timely filed with the department of revenue such information as required by the commissioner of revenue under prior law, chapter 421, § 1 of the Public Acts of 1997, is subject to administrative dissolution in accordance with the procedures specified in § 48-245-302 . The certificate of authority of any foreign LLC that has not timely filed such information with the department is subject to revocation as provided in § 48-246-502 . Upon certification by the commissioner that it has complied with the information reporting requirements that were required under prior law, an LLC that has been administratively dissolved or that has had its certificate of authority revoked for failure to timely file such information may be reinstated. Amended by 2020 Tenn. Acts, ch. 719, s 15, eff. 6/22/2020. Acts 1994, ch. 868, § 1; 1997 , ch. 421, § 1; 1999, ch. 80, § 3; 1999, ch. 159, §§ 1, 2; 2010 , ch. 741, § 36; 2011 , ch. 99, § 27.
(a) The form and filing of a document must satisfy the requirements of this section, and of all other applicable sections or rules that add to these requirements, to be entitled to filing by the secretary of state.
(b) Chapters 201-248 of this title must require or permit filing the document in the office of the secretary of state.
(c) The document must contain the information required by chapters 201-248 of this title or required by rule. It may contain other information as well.
(d) The document must be capable of being printed in ink in a clear and legible fashion on one (1) side of letter size paper.
(e) The document must be in the English language. An LLC's or other business entity's name need not be in English if written in English letters, or Arabic or Roman numerals, and the certificate of existence or equivalent required of foreign business entities need not be in English, if accompanied by a reasonably authenticated English translation.
(f) The document must be executed: (1) By the chair of the board of directors of a domestic or foreign corporation, by its president, or by another of its authorized officers if a corporate action is taken, by the chief manager, a governor, or another authorized manager if an LLC action is taken, by a general partner if a partnership action is taken or by the equivalent person of another business entity; (2) If directors of a corporation or governors of a board-governed LLC have not been selected or the corporation or LLC has not been formed, by an incorporator or organizer; or (3) If the business entity is in the hands of a receiver, trustee, or other court-appointed fiduciary, by that fiduciary.
(1) By the chair of the board of directors of a domestic or foreign corporation, by its president, or by another of its authorized officers if a corporate action is taken, by the chief manager, a governor, or another authorized manager if an LLC action is taken, by a general partner if a partnership action is taken or by the equivalent person of another business entity;
(2) If directors of a corporation or governors of a board-governed LLC have not been selected or the corporation or LLC has not been formed, by an incorporator or organizer; or
(3) If the business entity is in the hands of a receiver, trustee, or other court-appointed fiduciary, by that fiduciary.
(g) The person executing the document must sign it and state beneath or opposite the signature the person's name and the capacity in which the person signs. The document may, but need not, contain: (1) An attestation by the secretary or an assistant secretary; (2) An acknowledgment, verification, or proof; or (3) The date the document is signed, except that the date is required for the annual report for the secretary of state.
(1) An attestation by the secretary or an assistant secretary;
(2) An acknowledgment, verification, or proof; or
(3) The date the document is signed, except that the date is required for the annual report for the secretary of state.
(h) If the secretary of state, pursuant to statutory authority or rule, has prescribed a mandatory form for the document, then the document must be in or on the prescribed form.
(i) The document must be delivered to the office of the secretary of state for filing in the form and manner prescribed by the secretary of state and must be accompanied by the current filing fee, and any tax, license fee, interest, or penalty required by chapters 201-248 of this title.
(j) The document must contain a statement that makes it clear that the document is being filed pursuant to the Tennessee Limited Liability Company Act, compiled in chapter 249, of this title.
(k) The secretary of state may promulgate appropriate rules establishing acceptable methods for execution of any document to be filed with the secretary of state.
(l) Notwithstanding any other law to the contrary, whenever this title requires that an application or other document submitted to the secretary of state for filing be accompanied by a confirmation of good standing, tax clearance for termination, or withdrawal, or other similar communication of taxpayer status by the commissioner of revenue, then that requirement is met, and a paper certificate need not accompany the application or other document, if the commissioner provides to the secretary of state electronic verification of the required information. Upon request of the person seeking certificate information, the commissioner shall provide to the secretary of state electronic verification in lieu of a paper certificate.
(m) Any Tennessee LLC that has not timely filed with the department of revenue such information as required by the commissioner of revenue under prior law, chapter 421, § 1 of the Public Acts of 1997, is subject to administrative dissolution in accordance with the procedures specified in § 48-245-302 . The certificate of authority of any foreign LLC that has not timely filed such information with the department is subject to revocation as provided in § 48-246-502 . Upon certification by the commissioner that it has complied with the information reporting requirements that were required under prior law, an LLC that has been administratively dissolved or that has had its certificate of authority revoked for failure to timely file such information may be reinstated.
Amended by 2020 Tenn. Acts, ch. 719, s 15, eff. 6/22/2020.
Acts 1994, ch. 868, § 1; 1997 , ch. 421, § 1; 1999, ch. 80, § 3; 1999, ch. 159, §§ 1, 2; 2010 , ch. 741, § 36; 2011 , ch. 99, § 27.