Corporation and limited liability company powers related to election activity prohibited.

A bill for an act

relating to civil law; prohibiting corporation and limited liability company powers

related to election activity; amending Minnesota Statutes 2024, sections 302A.011,

by adding a subdivision; 302A.161, subdivision 24; 302A.165; 317A.011, by

adding a subdivision; 317A.161, subdivision 28; 317A.165, subdivision 1;

322C.0102, by adding a subdivision; 322C.0105, subdivision 1; Minnesota Statutes

2025 Supplement, section 302A.166, subdivision 1.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2024, section 302A.011, is amended by adding a subdivision

to read:

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Subd. 10a.

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Election activity.

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Election activity means:

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(1) paying, contributing, or expending anything of value, either monetarily or in-kind,

to (i) aid, promote, or defeat the nomination or election of a candidate, or (ii) aid or promote

the interests, success, or defeat of any political party or political organization; or

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(2) paying, contributing, or expending anything of value, either monetarily or in-kind,

to aid, promote, or defeat the passage of a ballot question.

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Sec. 2.

Minnesota Statutes 2024, section 302A.161, subdivision 24, is amended to read:

Subd. 24.

Other powers
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; limitation
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.

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(a)
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A corporation may have and exercise all other

powers necessary or convenient to effect any or all of the business purposes for which the

corporation is incorporated.

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(b) Nothing in this chapter, in any other statute or regulation of this state, or in any

corporation's articles of incorporation or, if a foreign corporation in any certificate of

authority to transact business in this state, shall be deemed or interpreted as a grant of power

to participate in, conduct, or otherwise influence, directly or indirectly, any election activity.

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Sec. 3.

Minnesota Statutes 2024, section 302A.165, is amended to read:

302A.165 EFFECT OF LACK OF POWER; ULTRA VIRES.

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Except as otherwise provided under section 302A.161, subdivision 24,
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the doing,

continuing, or performing by a corporation of an act, or an executed or wholly or partially

executory contract, conveyance or transfer to or by the corporation, if otherwise lawful, is

not invalid because the corporation was without the power to do, continue, or perform the

act, contract, conveyance, or transfer, unless the lack of power is established in a court in

this state:

(a) In a proceeding by a shareholder against the corporation to enjoin the doing,

continuing, or performing of the act, contract, conveyance, or transfer. If the unauthorized

act, continuation, or performance sought to be enjoined is being, or to be, performed or

made pursuant to a contract to which the corporation is a party, the court may, if just and

reasonable in the circumstances, set aside and enjoin the performance of the contract and

in so doing may allow to the corporation or to the other parties to the contract compensation

for the loss or damage sustained as a result of the action of the court in setting aside and

enjoining the performance of the contract;

(b) In a proceeding by or in the name of the corporation, whether acting directly or

through a legal representative, or through shareholders in a representative or derivative suit,

against the incumbent or former officers or directors of the corporation for exceeding or

otherwise violating their authority, or against a person having actual knowledge of the lack

of power; or

(c) In a proceeding by the attorney general, as provided in section
302A.757
, to dissolve

the corporation, or in a proceeding by the attorney general to enjoin the corporation from

the transaction of unauthorized business.

Sec. 4.

Minnesota Statutes 2025 Supplement, section 302A.166, subdivision 1, is amended

to read:

Subdivision 1.

Effect of ratification or validation.

Subject to subdivision 7,
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and except

as otherwise provided under section 302A.161, subdivision 24,
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a defective corporate act or

putative share is not void or voidable solely as a result of a failure of authorization if the

defective corporate act or putative share is ratified under this section or validated by a court

in a proceeding brought under section
302A.167
.

Sec. 5.

Minnesota Statutes 2024, section 317A.011, is amended by adding a subdivision

to read:

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Subd. 7b.

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Election activity.

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Election activity means:

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(1) paying, contributing, or expending anything of value, either monetarily or in-kind,

to (i) aid, promote, or defeat the nomination or election of a candidate, or (ii) aid or promote

the interests, success, or defeat of any political party or organization; or

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(2) paying, contributing, or expending anything of value, either monetarily or in-kind,

to aid, promote, or defeat the passage of a ballot question.

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Sec. 6.

Minnesota Statutes 2024, section 317A.161, subdivision 28, is amended to read:

Subd. 28.

Other powers
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; limitation
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.

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(a)
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A corporation has other powers necessary or

convenient to effect a lawful purpose for which the corporation is incorporated.

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(b) Nothing in this chapter, in any other statute or regulation of this state, or in any

corporation's articles of incorporation or, if a foreign corporation in any certificate of

authority to transact business in this state, shall be deemed or interpreted as a grant of power

to participate in, conduct, or otherwise influence, directly or indirectly, any election activity.

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Sec. 7.

Minnesota Statutes 2024, section 317A.165, subdivision 1, is amended to read:

Subdivision 1.

General.

Except as provided in this section,
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and except as otherwise

provided under section 317A.161, subdivision 28,
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the doing, continuing, or performing by

a corporation of an act, or an executed or wholly or partially executory contract, conveyance,

or transfer to or by the corporation, if otherwise lawful, is not invalid because the corporation

was without the power under this chapter or its articles or bylaws to do, continue, or perform

the act, contract, conveyance, or transfer.

Sec. 8.

Minnesota Statutes 2024, section 322C.0102, is amended by adding a subdivision

to read:

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Subd. 8a.

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Election activity.

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Election activity means:

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(1) paying, contributing, or expending anything of value, either monetarily or in-kind,

to (i) aid, promote, or defeat the nomination or election of a candidate, or (ii) aid or promote

the interests, success, or defeat of any political party or organization; or

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(2) paying, contributing, or expending anything of value, either monetarily or in-kind,

to aid, promote, or defeat the passage of a ballot question.

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Sec. 9.

Minnesota Statutes 2024, section 322C.0105, subdivision 1, is amended to read:

Subdivision 1.

Powers generally
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; limitation
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.

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(a)
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Except as provided in subdivision 2,

a limited liability company has the capacity to sue and be sued in its own name and the

power to do all things necessary or convenient to carry on its activities.

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(b) Nothing in this chapter, in any other statute or regulation of this state, or in any

corporation's articles of incorporation or, if a foreign corporation in any certificate of

authority to transact business in this state, shall be deemed or interpreted as a grant of power

to participate in, conduct, or otherwise influence, directly or indirectly, any election activity.

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