(a) A corporation may be converted to a partnership or limited partnership pursuant to this section.

(b) After adopting a plan of conversion, the board of directors shall submit the plan of conversion for approval by its shareholders. For a plan of conversion to be approved:

(1) the corporation shall notify each shareholder of the proposed shareholders' meeting in accordance with Section 33-7-105. The notice also must state that a purpose of the meeting is to consider a plan of conversion and must contain or be accompanied by a copy or summary of the plan;

(2) unless Chapters 1 through 20 of this title or the articles of incorporation require a different vote, the plan of conversion must be approved by:

(i) two-thirds of the votes entitled to be cast on the plan, regardless of the class or voting group to which the shares belong; and

(ii) two-thirds of the votes entitled to be cast on the plan within each voting group entitled to vote as a separate group on the plan;

(3) the articles of incorporation may require a lower or higher vote for approval than that specified in subitem (2), but the required vote must be at least a majority of the votes entitled to be cast on the plan by each voting group entitled to vote separately on the plan;

(4) separate voting by voting groups is required to approve the plan of conversion if the plan contains a provision that would require action by one or more separate voting groups if the provision was included in a proposed amendment to the articles of incorporation pursuant to Section 33-10-104; and

(5) a shareholder may dissent from the plan of conversion and obtain payment of the fair value of his shares as provided in Sections 33-13-101 through 33-13-310.

(c) An agreement of conversion must include the terms and conditions of the conversion of the shares of shareholders of a corporation into interests in the converted partnership or limited partnership or the cash or other consideration to be paid or delivered as a result of the conversion of the shares of the shareholders, or both.

(d) After a conversion is approved pursuant to subsection (b), the corporation shall file with the Secretary of State articles of conversion or certificate of limited partnership that satisfies the requirements of Section 33-42-210 and contains:

(1) a statement that the corporation was converted to a partnership or limited partnership from a corporation, as the case may be;

(2) its former name;

(3) a statement of the number of votes cast by the shareholders entitled to vote for and against the conversion and, if the vote is less than unanimous, the number or percentage required to approve the conversion pursuant to subsection (b);

(4) if voting by voting groups was required, the information in subitem (3) must be provided for each voting group entitled to vote separately on the plan of conversion; and

(5) a statement that the articles of incorporation are to be cancelled as of the date the conversion takes effect.

(e) The filing of articles of conversion or a certificate of limited partnership pursuant to subsection (d) cancels the articles of incorporation of the corporation as of the date the conversion takes effect.

(f) A conversion takes effect when the articles of conversion or certificate of limited partnership is filed with the Secretary of State or at a later date specified in the articles of conversion or certificate of limited partnership.

(g) A shareholder's liability for all obligations of the limited partnership incurred after the conversion takes effect is that of a general partner or limited partner. A shareholder who becomes a partner of a partnership or limited partnership as a result of a conversion remains liable only to the extent the shareholder was liable for an obligation incurred by the corporation before the conversion takes effect.

HISTORY: 2004 Act No. 221, Section 4.