Illinois recently amended several of its business statutes impacting both for profit and not-for-profit entities. Please take note of the major changes highlighted below, which may affect how you do business in Illinois.
1. Public Act 095-0342, effective January 1, 2008, changes the General Not For Profit Corporation Act by extending liability protection to board members serving without compensation. Board members will be shielded from liability when legal action arises because an executive director falsely reports or tampers with the financial records of the organization. The limited liability exemption does not apply if there is willful and wanton conduct on behalf of a board member or when action is taken by the attorney general to protect charitable assets in exercise of powers that apply to the trustees of a charity.
2. Public Act 095-0368, effective August 23, 2007, amends the Business Corporation Act, the Professional Service Corporation Act, the General Not For Profi t Corporation Act, the Limited Liability Company Act, the Uniform Partnership Act and the Uniform Limited Partnership Act. The most important changes are:
- Section 1103 of the Uniform Partnership Act clarifi es the need for qualifi cations to do business for registered limited liability partnerships.
- Section 108 of the Uniform Limited Partnership Act clarifi es the use of names for limited partnerships.
- Section 109 of the Uniform Limited Partnership Act limits the reservation of reserved names for limited partnerships.
- Section 114 of the Uniform Limited Partnership Act grants the state authority to dissolve a limited partnership if there is no agent maintained for service of process.
- Section 201 of the Uniform Limited Partnership Act allows for a general purposes clause in the certifi cate of limited partnership.
- Section 1305 of the Uniform Limited Partnership Act grants the state authority to dissolve any limited partnership that fails to provide a federal Employer Identification Number. 3. Public Act 095-0515, effective August 28, 2007, amends the Business Corporation Act and the Limited Liability Company Act by granting the state power to stop a foreign business from transacting business in Illinois if it fails to pay a judgment to a local government or school district.
4. Public Act 095-0507, effective August 28, 2007, amends the Business Corporation Act and the General Not For Profi t Corporation Act. It prevents the use of a corporation’s name until three years after that corporation’s administrative dissolution.
We are happy to discuss these and other recent corporate law changes and how they might impact your business.