Download as PDF
275.376 Conversion of corporation to limited liability company.
(1)
A corporation may be converted to a limited liability company pursuant to this
section.
(2) The terms and conditions of the conversion of a corporation to a limited liability
company shall be set forth in a written plan of conversion and approved by the
board of directors and by the shareholders of the corporation.
(3) The plan of conversion shall set forth:
(a) The name of the corporation planning to convert;
(b) The terms and conditions of the conversion, including the articles of
organization and the written operating agreement, if any, of the limited
liability company into which the corporation will convert; and
(c) The manner and basis of converting the shares of the corporation into
membership interests, obligations, or other securities of the limited liability
company or into cash or other property in whole or part.
(4) The plan of conversion may set forth any other provision relating to the
conversion.
(5) For a plan of conversion to be approved:
(a) The board of directors shall recommend the plan of conversion to the
shareholders, unless the board of directors determines that, because of
conflict of interest or other special circumstances, it should make no
recommendation and communicates the basis for its determination to the
shareholders with a plan; and
(b) The shareholders entitled to vote shall approve the plan.
(6) The board of directors may condition its submission of the proposed
conversion on any basis.
(7) The corporation shall notify each shareholder, whether or not entitled to vote,
of the proposed shareholders' meeting in accordance with KRS 271B.7-050.
The notice shall also state that the purpose, or one (1) of the purposes, of the
meeting is to consider the plan of conversion and contain or be accompanied
by a copy or summary of the plan.
(8) Unless KRS Chapter 271B, the articles of incorporation, or the board of
directors acting pursuant to subsection (6) of this section, require a greater
vote or vote by voting groups, the plan of conversion to be authorized shall be
approved by each voting group entitled to vote separately on the plan by a
majority of all the votes entitled to be cast on the plan by that voting group.
(9) Separate voting by voting groups shall be required on a plan of conversion if
the plan contains a provision that, if contained in a proposed amendment to the
articles of incorporation, would require action by one (1) or more separate
voting groups on the proposed amendment under KRS 271B.10-040.
(10) After a conversion is authorized, and at any time before articles of organization
are filed, the planned conversion may be abandoned subject to any contractual
rights, without further shareholder action, in accordance with the procedure set
forth in the plan of conversion or, if none is set forth, in the manner determined
by the board of directors.
(11) After the conversion is approved, the corporation shall file articles of
organization with the office of the Secretary of State that satisfy the
requirements of KRS 275.025 and also include:
(a) A statement that the corporation was converted to a limited liability
company;
(b) Its former name; and
(c) The designation, number of outstanding shares, and number of votes to
be cast by each voting group entitled to vote separately on the plan of
conversion and either the total number of undisputed votes cast for the
plan separately by each voting group or a statement that the number cast
for the plan by each voting group was sufficient for approval by that voting
group.
(12) The conversion shall take effect when the articles of organization are filed with
the office of the Secretary of State or, subject to KRS 14A.2-070, at a later date
specified in the articles of organization.
Effective:January 1, 2011
History: Repealed and reenacted 2010 Ky. Acts ch. 51, sec. 16, effective July 15,
2010; amended ch. 133, sec. 44, effective July 15, 2010; and amended ch. 151,
sec. 143, effective January 1, 2011. -- Created 2007 Ky. Acts ch. 137, sec. 16,
effective June 26, 2007.
Legislative Research Commission Note (7/15/2010). 2010 Ky. Acts ch. Acts
ch. 51, sec. 183, provides, "The specific textual provisions of Sections 1 to 178
of this Act which reflect amendments made to those sections by 2007 Ky. Acts
ch. 137 shall be deemed effective as of June 26, 2007, and those provisions are
hereby made expressly retroactive to that date, with the remainder of the text of
those sections being unaffected by the provisions of this section."
Legislative Research Commission Note (7/15/2010). This section was amended
by 2010 Ky. Acts chs. 133 and 151, and repealed and reenacted by 2010 Ky.
Acts ch. 51. Pursuant to Section 184 of Acts ch. 51, it was the intent of the
General Assembly that the repeal and reenactment not serve to void the
amendments, and these Acts do not appear to be in conflict; therefore, they
have been codified together.
Legislative Research Commission Note (6/26/2007). The Reviser of Statutes has
corrected a manifest clerical or typographical error in this section pursuant to the
authority of KRS 7.136.
Disclaimer: These codes may not be the most recent version. Kentucky may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.