1.1.................... moves to amend H.F. No. 1345, the first engrossment, as follows:
1.2Page 5, after line 2, insert:

1.3    "Sec. 4. Minnesota Statutes 2008, section 319B.02, is amended by adding a subdivision
1.4to read:
1.5    Subd. 21a. Surviving spouse. "Surviving spouse" means a surviving spouse of a
1.6deceased professional as an individual, as the personal representative of the estate of the
1.7decedent, as the trustee of an inter vivos or testamentary trust created by the decedent, or
1.8as the sole heir or beneficiary of an estate or trust of which the personal representative or
1.9trustee is a bank or other institution that has trust powers.
1.10EFFECTIVE DATE.This section is effective the day following final enactment
1.11and applies to surviving spouses of professionals who die on or after that date.

1.12    Sec. 5. Minnesota Statutes 2008, section 319B.07, subdivision 1, is amended to read:
1.13    Subdivision 1. Ownership of interests restricted. Ownership interests in a
1.14professional firm may not be owned or held, either directly or indirectly, except by any of
1.15the following:
1.16(1) professionals who, with respect to at least one category of the pertinent
1.17professional services, are licensed and not disqualified;
1.18(2) general partnerships, other than limited liability partnerships, authorized to
1.19furnish at least one category of the professional firm's pertinent professional services;
1.20(3) other professional firms authorized to furnish at least one category of the
1.21professional firm's pertinent professional services;
1.22(4) a voting trust established with respect to some or all of the ownership interests
1.23in the professional firm, if (i) the professional firm's generally applicable governing law
1.24permits the establishment of voting trusts, and (ii) all the voting trustees and all the holders
1.25of beneficial interests in the trust are professionals licensed to furnish at least one category
1.26of the pertinent professional services; and
2.1(5) an employee stock ownership plan as defined in section 4975(e)(7) of the
2.2Internal Revenue Code of 1986, as amended, if (i) all the voting trustees of the plan are
2.3professionals licensed to furnish at least one category of the pertinent professional services,
2.4and (ii) the ownership interests are not directly issued to anyone other than professionals
2.5licensed to furnish at least one category of the pertinent professional services; and
2.6(6) sole ownership by a surviving spouse of a deceased professional who was the
2.7sole owner of the professional firm at the time of the professional's death, but only during
2.8the period of time ending one year after the death of the professional.
2.9EFFECTIVE DATE.This section is effective the day following final enactment
2.10and applies to surviving spouses of professionals who die on or after that date.

2.11    Sec. 6. Minnesota Statutes 2008, section 319B.08, is amended to read:
2.12319B.08 EFFECT OF DEATH OR DISQUALIFICATION OF OWNER.
2.13    Subdivision 1. Acquisition of interests or automatic loss of professional
2.14firm status. (a) If an owner dies or becomes disqualified to practice all the pertinent
2.15professional services, then either:
2.16(1) within 90 days after the death or the beginning of the disqualification, all of
2.17that owner's ownership interest must be acquired by the professional firm, by persons
2.18permitted by section 319B.07 to own the ownership interest, or by some combination; or
2.19(2) at the end of the 90-day period, the firm's election under section 319B.03,
2.20subdivision 2 , or 319B.04, subdivision 2, is automatically rescinded, the firm loses
2.21its status as a professional firm, and the authority created by that election and status
2.22terminates.
2.23An acquisition satisfies clause (1) if all right and title to the deceased or disqualified
2.24owner's interest are acquired before the end of the 90-day period, even if some or all of
2.25the consideration is paid after the end of the 90-day period. However, payment cannot be
2.26secured in any way that violates sections 319B.01 to 319B.12.
2.27(b) If automatic rescission does occur under paragraph (a), the firm must immediately
2.28and accordingly update its organizational document, certificate of authority, or statement
2.29of foreign qualification. Even without that updating, however, the rescission, loss of
2.30status, and termination of authority provided by paragraph (a) occur automatically at the
2.31end of the 90-day period.
2.32    Subd. 2. Terms of acquisition. (a) If:
2.33(1) an owner dies or becomes disqualified to practice all the pertinent professional
2.34services;
3.1(2) the professional firm has in effect a mechanism, valid according to the
3.2professional firm's generally applicable governing law, to effect a purchase of the deceased
3.3or disqualified owner's ownership interest so as to satisfy subdivision 1, paragraph (a),
3.4clause (1); and
3.5(3) the professional firm does not agree with the disqualified owner or the
3.6representative of the deceased owner to set aside the mechanism,
3.7then that mechanism applies.
3.8(b) If:
3.9(1) an owner dies or becomes disqualified to practice all the pertinent professional
3.10services;
3.11(2) the professional firm has in effect no mechanism as described in paragraph (a), or
3.12has agreed as mentioned in paragraph (a), clause (3), to set aside that mechanism; and
3.13(3) consistent with its generally applicable governing law, the professional firm
3.14agrees with the disqualified owner or the representative of the deceased owner, before
3.15the end of the 90-day period, to an arrangement to effect a purchase of the deceased
3.16or disqualified owner's ownership interest so as to satisfy subdivision 1, paragraph (a),
3.17clause (1),
3.18then that arrangement applies.
3.19(c) If:
3.20(1) an owner of a Minnesota professional firm dies or becomes disqualified to
3.21practice all the pertinent professional services;
3.22(2) the Minnesota professional firm does not have in effect a mechanism as described
3.23in paragraph (a);
3.24(3) the Minnesota professional firm does not make an arrangement as described in
3.25paragraph (b); and
3.26(4) no provision or tenet of the Minnesota professional firm's generally applicable
3.27governing law and no provision of any document or agreement authorized by the
3.28Minnesota professional firm's generally applicable governing law expressly precludes an
3.29acquisition under this paragraph,
3.30then the firm may acquire the deceased or disqualified owner's ownership interest as
3.31stated in this paragraph. To act under this paragraph, the Minnesota professional firm
3.32must within 90 days after the death or beginning of the disqualification tender to the
3.33representative of the deceased owner's estate or to the disqualified owner the fair value
3.34of the owner's ownership interest, as determined by the Minnesota professional firm's
3.35governance authority. That price must be at least the book value, as determined in
3.36accordance with the Minnesota professional firm's regular method of accounting, as of the
4.1end of the month immediately preceding the death or loss of license. The tender must be
4.2unconditional and may not attempt to have the recipient waive any rights provided in this
4.3section. If the Minnesota professional firm tenders a price under this paragraph within
4.4the 90-day period, the deceased or disqualified owner's ownership interest immediately
4.5transfers to the Minnesota professional firm regardless of any dispute as to the fairness
4.6of the price. A disqualified owner or representative of the deceased owner's estate who
4.7disputes the fairness of the tendered price may take the tendered price and bring suit
4.8in district court seeking additional payment. The suit must be commenced within one
4.9year after the payment is tendered. A Minnesota professional firm may agree with a
4.10disqualified owner or the representative of a deceased owner's estate to delay all or part
4.11of the payment due under this paragraph, but all right and title to the owner's ownership
4.12interests must be acquired before the end of the 90-day period and payment may not be
4.13secured in any way that violates sections 319B.01 to 319B.12.
4.14    Subd. 3. Expiration of firm-issued option on death or disqualification of holder.
4.15If the holder of an option issued under section 319B.07, subdivision 3, paragraph (a),
4.16clause (1), dies or becomes disqualified, the option automatically expires.
4.17    Subd. 4. One-year period for surviving spouse of sole owner. For purposes
4.18of this section, each mention of "90 days," "90-day period," or similar term shall be
4.19interpreted as one year after the death of a professional who was the sole owner of the
4.20professional firm if the surviving spouse of the deceased professional owns and controls
4.21the firm after the death.
4.22EFFECTIVE DATE.This section is effective the day following final enactment
4.23and applies to surviving spouses of professionals who die on or after that date.

4.24    Sec. 7. Minnesota Statutes 2008, section 319B.09, subdivision 1, is amended to read:
4.25    Subdivision 1. Governance authority. (a) Except as stated in paragraph (b), a
4.26professional firm's governance authority must rest with:
4.27(1) one or more professionals, each of whom is licensed to furnish at least one
4.28category of the pertinent professional services; or
4.29(2) a surviving spouse of a deceased professional who was the sole owner of the
4.30professional firm, while the surviving spouse owns and controls the firm, but only during
4.31the period of time ending one year after the death of the professional.
4.32(b) In a Minnesota professional firm organized under chapter 317A and in a foreign
4.33professional firm organized under the nonprofit corporation statute of another state, at least
4.34one individual possessing governance authority must be a professional licensed to furnish
4.35at least one category of the pertinent professional services.
5.1(c) Individuals who possess governance authority within a professional firm may
5.2delegate administrative and operational matters to others. No decision entailing the
5.3exercise of professional judgment may be delegated or assigned to anyone who is not a
5.4professional licensed to practice the professional services involved in the decision.
5.5(d) An individual whose license to practice any pertinent professional services is
5.6revoked or suspended may not, during the time the revocation or suspension is in effect,
5.7possess or exercise governance authority, hold a position with governance authority,
5.8or take part in any decision or other action constituting an exercise of governance
5.9authority. Nothing in this chapter prevents a board from further terminating, restricting,
5.10limiting, qualifying, or imposing conditions on an individual's governance role as board
5.11disciplinary action.
5.12(e) A professional firm owned and controlled by a surviving spouse must comply
5.13with all requirements of this chapter, except those clearly inapplicable to a firm owned
5.14and governed by a surviving spouse who is not a professional of the same type as the
5.15surviving spouse's decedent.
5.16EFFECTIVE DATE.This section is effective the day following final enactment
5.17and applies to surviving spouses of professionals who die on or after that date."
5.18Renumber the sections in sequence and correct the internal references
5.19Amend the title accordingly