47-25A-8. For-profit conversion--Plan of for-profit conversion.

(a) A domestic nonprofit corporation may become a domestic business corporation pursuant to a plan of for-profit conversion.

(b) A domestic nonprofit corporation may become a foreign business corporation if the for-profit conversion is permitted by the laws of the foreign jurisdiction. Regardless of whether the laws of the foreign jurisdiction require the adoption of a plan of for-profit conversion, the foreign for-profit conversion shall be approved by the adoption by the domestic nonprofit corporation of a plan of for-profit conversion.

(c) The plan of for-profit conversion must include:

(1)    The terms and conditions of the conversion;

(2)    The manner and basis of:

(i)    Issuing at least one share in the corporation following its conversion; and

(ii)    Otherwise reclassifying the memberships in the corporation, if any, following its conversion into shares and other securities, obligations, rights to acquire shares or other securities, cash, other property, or any combination of the foregoing;

(3)    Any desired amendments to the articles of incorporation or bylaws of the corporation following its conversion; and

(4)    If the domestic nonprofit corporation is to be converted to a foreign business corporation, a statement of the jurisdiction in which the corporation will be incorporated after the conversion.

(d) The plan of for-profit conversion may also include a provision that the plan may be amended prior to filing articles of for-profit conversion, except that subsequent to approval of the plan by the members the plan may not be amended without the approval of the members to change:

(1)    The amount or kind of shares and other securities, obligations, rights to acquire shares or other securities, cash, or other property to be received by the members under the plan;

(2)    The articles of incorporation to be in effect immediately following the conversion; or

(3)    Any of the other terms or conditions of the plan if the change would adversely affect any of the members in any material respect.

(e) If any debt security, note, or similar evidence of indebtedness for money borrowed, whether secured or unsecured, or a contract of any kind, issued, incurred, or executed by a domestic nonprofit corporation before July 1, 2016 contains a provision applying to a merger of the corporation and the document does not refer to a for-profit conversion of the corporation, the provision shall be deemed to apply to a for-profit conversion of the corporation until such time as the provision is amended subsequent to that date.

(f) The attorney general shall be provided with notice of the proposed for-profit conversion at least ten days prior to any conversion.

Source: SL 2016, ch 221, § 23.