06 SB469/AP
Senate
Bill 469
By:
Senators Smith of the 52nd, Meyer von Bremen of the 12th, Harp of the 29th and
Reed of the 35th
AS PASSED
AS PASSED
AN
ACT
To
amend Title 14 of the Official Code of Georgia Annotated, relating to
corporations, partnerships, and associations, so as to provide for the updating
of provisions relating to corporations, partnerships, and associations; to
provide confirmation when an order for relief with respect to a corporation has
been entered pursuant to the federal Bankruptcy Code of the power and authority
of such corporation to take action pursuant to the decree of order or the court
or judge in such bankruptcy proceedings; to provide that a board of directors
can commit a corporation to submit a matter for shareholder approval even if the
board of directors subsequently determines to recommend against it later; to
correct cross-references; to change certain provisions relating to court ordered
indemnification and advancement for expenses; to confirm the authority of a
court to order advancement of expenses before determining a
directoŕs
ultimate entitlement to indemnification; to provide statutory rules of
construction for language frequently used in mandatory indemnification
provisions; to change certain provisions relating to amendment to articles of
incorporation by board of directors and shareholders; to repeal certain
provisions relating to amendment to articles of incorporation pursuant to
reorganization; to clarify existing law by expressly recognizing the possibility
of different treatment of shareholders in a plan of merger of share exchange; to
change certain provisions relating to merger; to change certain provisions
relating to share exchange; to change certain provisions relating to action on
plan of merger; to change certain provisions relating to merger with subsidiary;
to change certain provisions relating to merger with other entities; to change
certain provisions relating to election to become limited liability company; to
streamline the process of permitting an entity to convert from one form into
another; to allow entities organized in other states to convert to certain
corporations or partnerships in this state; to change certain provisions
relating to sale of assets requiring shareholder approval; to change certain
provisions relating to right to dissent; to change provisions relating to
dissolution by board of directors and shareholders; to change certain provisions
relating to amended certificate of authority; to change certain provisions
relating to corporate name of foreign corporation; to change certain provisions
relating to election to become a limited partnership; to change certain
provisions relating to certificate of authority for foreign limited
partnerships; to change certain provisions relating to change of name or state
of organization; to change certain provisions relating to amended certificate
required for change of name or jurisdiction of organization; to change certain
provisions relating to election to become a limited liability company; to add a
filing fee for entity conversion; to change certain provisions relating to right
to dissent; to provide for related matters; to repeal conflicting laws; and for
other purposes.
BE
IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
SECTION
1.
Title
14 of the Official Code of Georgia Annotated, relating to corporations,
partnerships, and associations, is amended by adding a new Code Section 14-2-104
to the end of Part 1 of Article 1 of Chapter 2, relating to short title and
reservation of power, to read as follows:
"14-2-104.
(a)
Any corporation, an order for relief with respect to which has been entered
pursuant to the federal Bankruptcy Code (11 U.S.C. Section 101, et seq.), may
put into effect and carry out any decrees and orders of the court or judge in
such bankruptcy proceeding and may take any corporate action provided or
directed by such decrees and orders, without further action by its directors or
shareholders. Such power and authority may be exercised, and such corporate
action may be taken, as may be directed by such decrees and orders, by the
trustee or trustees of such corporation appointed or elected in the bankruptcy
proceeding, or a majority thereof, or, if none be appointed or elected and
acting, by designated officers of the corporation, or by a representative
appointed by the court or judge, with like effect as if exercised and taken by
unanimous action of the directors and shareholders of the
corporation.
(b)
Such corporation may, in the manner provided in subsection (a) of this Code
section, but without limiting the generality or effect of the foregoing, alter,
amend, or repeal its bylaws; constitute or reconstitute and classify or
reclassify its board of directors, and name, constitute, or appoint directors
and officers in place of or in addition to all or some of the directors or
officers then in office; amend its articles of incorporation, and make any
change in its shares, or any other amendment, change, or alteration, or
provision, authorized by this chapter; be dissolved, transfer all or part of its
assets, merge or effect any share exchange in connection with any action taken
under this Code section; change the location of its registered office, change
its registered agent, and remove or appoint any agent to receive service of
process; authorize and fix the terms, manner, and conditions of, the issuance of
bonds, debentures, or other obligations, regardless of whether convertible into
shares of any class or series, or bearing warrants or other evidences of
optional rights to purchase or subscribe for shares of any class or series; or
lease its property and franchises to any corporation, if permitted by law. No
shareholder shall have the right to dissent under Article 13 of this chapter
with respect to such
shareholdeŕs
shares in connection with any action taken under this Code section.
(c)
Articles or a certificate of any amendment, correction, merger, share exchange,
or dissolution, made by such corporation pursuant to this Code section, shall be
filed with the Secretary of State in accordance with Code Section 14-2-120, and,
subject to Code Section 14-2-123 and subsection (c) of Code Section 14-2-124,
shall thereupon become effective in accordance with its terms and the provisions
thereof. Such articles, certificate, or other instrument shall be made,
executed, and acknowledged, as may be directed by such decrees and orders, by
the trustee or trustees appointed or elected in the bankruptcy proceeding, or a
majority thereof, or, if none be appointed or elected and acting, by the
officers of the corporation, or by a representative appointed by the court or
judge, and shall certify that provision for the making of such articles,
certificate, or instrument is contained in a decree or order of a court or judge
having jurisdiction of a proceeding under the federal Bankruptcy
Code.
(d)
This Code section shall cease to apply to such corporation upon the entry of a
final decree in the bankruptcy proceeding closing the case and discharging the
trustee or trustees, if any; provided, however, that the closing of a case and
discharge of trustee or trustees, if any, will not affect the validity of any
act previously performed pursuant to subsection (a), (b), or (c) of this Code
section.
(e)
On filing any articles, certificate, report, or other paper made or executed
pursuant to this Code section, there shall be paid to the Secretary of State for
the use of the state the same fees as are payable by corporations not in
bankruptcy upon the filing of like articles, certificates, agreements, reports,
or other
papers."
SECTION
2.
Said
title is further amended by adding a new Code Section 14-2-305 to the end of
Article 3 of Chapter 2, relating to purposes and powers of business
corporations, to read as follows:
"14-2-305.
Subject
to the requirements set forth in paragraph (1) of subsection (b) of Code Section
14-2-1003, with respect to the submission of amendments to the articles of
incorporation to shareholders; paragraph (1) of subsection (b) of Code Section
14-2-1103, with respect to the submission of a plan of merger or share exchange
to shareholders; paragraph (1) of subsection (b) of Code Section 14-2-1202, with
respect to the submission of a disposition of assets requiring shareholder
approval to shareholders; and paragraph (1) of subsection (b) of Code Section
14-2-1402, with respect to the submission of a proposed dissolution to
shareholders, a corporation may agree to submit a matter to a vote of its
shareholders regardless of whether the board of directors determines at any time
subsequent to adopting or approving such matter that such matter is no longer
advisable and recommends that the shareholders reject or vote against the
matter."
SECTION
3.
Said
title is further amended by striking paragraph (2) of subsection (b) of Code
Section 14-2-401, relating to corporate name, and inserting in lieu thereof the
following:
"(2)
A corporate name reserved under Code Section
14-2-402;"
SECTION
4.
Said
title is further amended by striking Code Section 14-2-854, relating to court
ordered indemnification and advances for expenses, and inserting in lieu thereof
the following:
"14-2-854.
(a)
A director who is a party to a proceeding because he or she is a director may
apply for indemnification or advance for expenses to the court conducting the
proceeding or to another court of competent jurisdiction. After receipt of an
application and after giving any notice it considers necessary, the court
shall:
(1)
Order indemnification or advance for expenses if it determines that the director
is entitled to indemnification or advance for expenses under this part;
or
(2)
Order indemnification or advance for expenses if it determines, in view of all
the relevant circumstances, that it is fair and reasonable to indemnify the
director or to advance expenses to the director, even if the director has not
met the relevant standard of conduct set forth in subsections (a) and (b) of
Code Section 14-2-851, failed to comply with Code Section 14-2-853, or was
adjudged liable in a proceeding referred to in paragraph (1) or (2) of
subsection (d) of Code Section 14-2-851, but if the director was adjudged so
liable, the indemnification shall be limited to reasonable expenses incurred in
connection with the proceeding.
(b)
If the court determines that the director is entitled to indemnification or
advance for expenses under paragraph (1) of subsection (a) of this Code section,
it shall also order the corporation to pay the
directoŕs
reasonable expenses to obtain court ordered indemnification or advance for
expenses. If the court determines that the director is entitled to
indemnification or advance for expenses under paragraph (2) of subsection (a) of
this Code section, it may also order the corporation to pay the
directoŕs
reasonable expenses to obtain court ordered indemnification or advance for
expenses.
(c)
The court may summarily determine, without a jury, a
corporatiońs
obligation to advance
expenses."
SECTION
5.
Said
title is further amended by striking Code Section 14-2-859, relating to
application of part, and inserting in lieu thereof the following:
"14-2-859.
(a)
A corporation may, by a provision in its articles of incorporation or bylaws or
in a resolution adopted or a contract approved by its board of directors or
shareholders, obligate itself in advance of the act or omission giving rise to a
proceeding to provide indemnification or advance funds to pay for or reimburse
expenses consistent with this part. Any such obligatory provision shall be
deemed to satisfy the requirements for authorization referred to in subsection
(c) of Code Section 14-2-853 or subsection (c) of Code Section 14-2-855.
(b)
Any provision pursuant to subsection (a) of this Code section shall not obligate
the corporation to indemnify or advance expenses to a director of a predecessor
of the corporation, pertaining to conduct with respect to the predecessor,
unless otherwise specifically provided. Any provision for indemnification or
advance for expenses in the articles of incorporation, bylaws, or a resolution
of the board of directors or shareholders, partners, or, in the case of limited
liability companies, members or managers of a predecessor of the corporation or
other entity in a merger or in a contract to which the predecessor is a party,
existing at the time the merger takes effect, shall be governed by paragraph (3)
of subsection (a) of Code Section 14-2-1106.
(c)
A corporation may, by a provision in its articles of incorporation, limit any of
the rights to indemnification or advance for expenses created by or pursuant to
this part.
(d)
This part shall not limit a
corporatiońs
power to pay or reimburse expenses incurred by a director or an officer in
connection with his or her appearance as a witness in a proceeding at a time
when he or she is not a party.
(e)
Except as expressly provided in Code Section 14-2-857, this part shall not limit
a
corporatiońs
power to indemnify, advance expenses to, or provide or maintain insurance on
behalf of an employee or agent.
(f)
Any provision in a
corporatiońs
articles of incorporation or bylaws or in a resolution adopted or contract
approved by its board of directors or shareholders that obligates the
corporation to provide indemnification to the fullest extent permitted by law
shall, unless such provision or another provision in the
corporatiońs
articles of incorporation or bylaws or in a resolution adopted or a contract
approved by its board of directors or shareholders expressly provides otherwise,
be deemed to obligate the corporation:
(1)
To advance funds to pay for or reimburse expenses in accordance with Code
Section 14-2-853 to the fullest extent permitted by law; and
(2)
To indemnify directors to the fullest extent permitted in Code Section 14-2-856,
provided that such provision is duly authorized as required in subsection (a) of
Code Section 14-2-856, and to indemnify officers to the fullest extent permitted
in paragraph (2) of subsection (a) and subsection (b) of Code Section
14-2-857."
SECTION
6.
Said
title is further amended by striking paragraph (1) of subsection (b) of Code
Section 14-2-1003, relating to amendment by board of directors and shareholders,
and inserting in lieu thereof the following:
"(1)
The board of directors shall also transmit to the shareholders a recommendation
that the shareholders approve the amendment, unless the board of directors makes
a determination that, because of conflicts of interest or other special
circumstances, it should either refrain from making such a recommendation or
recommend that the shareholders reject or vote against the amendment, in which
case the board of directors shall transmit to the shareholders the basis for
such determination;
and"
SECTION
7.
Said
title is further amended by striking Code Section 14-2-1008, relating to
amendment pursuant to reorganization, and inserting in lieu thereof the
following:
"14-2-1008.
Reserved."
SECTION
8.
Said
title is further amended by striking Code Section 14-2-1101, relating to merger,
and inserting in lieu thereof the following:
"14-2-1101.
(a)
One or more corporations may merge into another corporation if the board of
directors of each corporation adopts and its shareholders (if required by Code
Section 14-2-1103) approve a plan of merger.
(b)
The plan of merger must set forth:
(1)
The name of each corporation planning to merge and the name of the surviving
corporation into which each other corporation plans to merge;
(2)
The terms and conditions of the merger; and
(3)
The manner and basis of converting the shares of each corporation into shares or
other securities, obligations, rights to acquire shares or other securities,
cash, other property, or any combination of the foregoing, and if any shares of
any holder of a class or series of shares are to be converted in a manner or
basis different from any other holder of shares of such class or series, the
manner or basis applicable to each such holder.
(c)
The plan of merger may set forth:
(1)
Amendments to the articles of incorporation of the surviving
corporation;
(2)
A provision that the plan may be amended prior to the time the merger has become
effective, but if shareholders of a corporation that is a party to the merger
are required or permitted to vote on the plan, subsequent to approval of the
plan by such shareholders the plan may not be amended to change in any respect
not expressly authorized by such shareholders in connection with the approval of
the plan:
(A)
The amount or kind of shares or other securities, obligations, rights to acquire
shares or other securities, cash, or other property to be received under the
plan by the shareholders of any party to the merger if such change would
adversely affect such shareholders;
(B)
The articles of incorporation of any corporation that will survive as a result
of the merger, except for changes permitted by Code Section 14-2-1002 or changes
that would not adversely affect such shareholders; or
(C)
Any of the other terms or conditions of the plan if such change would adversely
affect such shareholders in any material respect; and
in
the event that the plan of merger is amended after articles or a certificate of
merger has been filed with the Secretary of State but before the merger has
become effective, a certificate of amendment of merger executed on behalf of
each party to the merger by an officer or other duly authorized representative
shall be delivered to the Secretary of State for filing prior to the
effectiveness of the merger; and
(3)
Other provisions relating to the merger.
(d)
Any of the terms of the plan of merger may be made dependent upon facts
ascertainable outside of the plan of merger, provided that the manner in which
such facts shall operate upon the terms of the merger is clearly and expressly
set forth in the plan of merger. As used in this subsection, the term 'facts'
includes, but is not limited to, the occurrence of any event, including a
determination or action by any person or body, including the
corporation."
SECTION
9.
Said
title is further amended by striking Code Section 14-2-1102, relating to share
exchange, and inserting in lieu thereof the following:
"14-2-1102.
(a)
A corporation may acquire all of the outstanding shares of one or more classes
or series of another corporation through a share exchange if the board of
directors of each corporation adopts and its shareholders (if required by Code
Section 14-2-1103) approve the share exchange.
(b)
The plan of share exchange must set forth:
(1)
The name of the corporation whose shares will be acquired and the name of the
acquiring corporation;
(2)
The terms and conditions of the share exchange; and
(3)
The manner and basis of exchanging the shares to be acquired for shares or other
securities, obligations, rights to acquire shares or other securities, cash,
other property, or any combination of the foregoing, and if any shares of any
holder of a class or series of shares are to be exchanged in a manner or basis
different from any other holder of shares of such class or series, the manner or
basis applicable to each such holder.
(c)
The plan of share exchange may set forth other provisions relating to the share
exchange, including a provision that the plan may be amended prior to the time
the share exchange has become effective, but if shareholders of a corporation
that is a party to the share exchange are required or permitted to vote on the
plan, subsequent to approval of the plan by such shareholders the plan may not
be amended to change in any respect not expressly authorized by such
shareholders in connection with the approval of the plan:
(1)
The amount or kind of shares or other securities, obligations, rights to acquire
shares or other securities, cash, or other property to be issued by the
corporation or to be received under the plan by the shareholders of any party to
the share exchange if such change would adversely affect such shareholders;
or
(2)
Any of the other terms or conditions of the plan if such change would adversely
affect such shareholders in any material respect; and
in
the event that the plan of share exchange is amended after articles or a
certificate of share exchange has been filed with the Secretary of State but
before the share exchange has become effective, a certificate of amendment of
share exchange executed on behalf of each party to the share exchange by an
officer or other duly authorized representative shall be delivered to the
Secretary of State for filing prior to the effectiveness of the share
exchange.
(d)
Any of the terms of the plan of share exchange may be made dependent upon facts
ascertainable outside of the plan of share exchange, provided that the manner in
which such facts shall operate upon the terms of the share exchange is clearly
and expressly set forth in the plan of share exchange. As used in this
subsection, the term 'facts' includes, but is not limited to, the occurrence of
any event, including a determination or action by any person or body, including
the corporation.
(e)
This Code section does not limit the power of a corporation to acquire all or
part of the shares of one or more classes or series of another corporation
through a voluntary exchange of shares or
otherwise."
SECTION
10.
Said
title is further amended by striking paragraph (1) of subsection (b) of Code
Section 14-2-1103, relating to action on plan, and inserting in lieu thereof the
following: "(1)
The board of directors shall also transmit to the shareholders a recommendation
that the shareholders approve the plan, unless the board of directors makes a
determination that, because of conflicts of interest or other special
circumstances, it should either refrain from making such a recommendation or
recommend that the shareholders reject or vote against the plan, in which case
the board of directors shall transmit to the shareholders the basis for such
determination;
and"
SECTION
11.
Said
title is further amended by striking paragraph (2) of subsection (b) of Code
Section 14-2-1104, relating to merger with subsidiary, and inserting in lieu
thereof the following:
"(2)
The manner and basis of converting the shares of the parent or subsidiary into
shares or other securities, obligations, rights to acquire shares or other
securities, cash, other property, or any combination thereof, and if any shares
of any holder of a class or series of shares are to be converted in a manner or
basis different from any other holder of shares of such class or series, the
manner or basis applicable to such
holder."
SECTION
12.
Said
title is further amended by striking subsection (d) of Code Section 14-2-1109,
relating to merger with other entities, and inserting in lieu thereof the
following:
"(d)
The plan of merger:
(1)
Must set forth:
(A)
The name of each corporation and entity planning to merge and the name of the
surviving corporation or entity into which each other corporation and entity
plans to merge;
(B)
The terms and conditions of the merger; and
(C)
The manner and basis of converting the shares of each corporation and the
shares, memberships, or financial or beneficial interests or units in each of
the entities into shares or other securities, obligations, rights to acquire
shares or other securities, cash, other property, or any combination of the
foregoing, and if any shares of any holder of a class or series of shares are to
be converted in a manner or basis different from any other holder of shares of
such class or series, the manner or basis applicable to each such holder;
and
(2)
May set forth:
(A)
Amendments to the articles of incorporation or governing agreements of the
surviving corporation or entity;
(B)
A provision that the plan may be amended prior to the time the merger has become
effective, but if shareholders of a domestic corporation that is a party to the
merger or shareholders, partners, or members of a domestic entity that is a
party to the merger are required or permitted to vote on the plan, subsequent to
approval of the plan by such shareholders, partners, or members the plan may not
be amended to change in any respect not expressly authorized by such approving
shareholders, partners, or members in connection with the approval of the
plan:
(i)
The amount or kind of shares or other securities, obligations, rights to acquire
shares or other securities, cash, or other property to be received under the
plan by the shareholders, partners, or members of any party to the merger if
such change would adversely affect such approving shareholders, partners, or
members;
(ii)
The articles or certificate of incorporation of any domestic or foreign
corporation, or the governing agreements of any other entity, that will survive
or be created as a result of the merger, except for changes permitted by Code
Section 14-2-1002 or by comparable provisions of the law of the state or
jurisdiction under which any such other entity was organized or changes that
would not adversely affect such approving shareholders, partners, or members;
or
(iii)
Any of the other terms or conditions of the plan if such change would adversely
affect such approving shareholders, partners, or members in any material
respect; and
in
the event that the plan of merger is amended after articles or a certificate of
merger has been filed with the Secretary of State but before the merger has
become effective, a certificate of amendment of merger executed on behalf of
each party to the merger by an officer or other duly authorized representative
shall be delivered to the Secretary of State for filing prior to the
effectiveness of the merger; and
(C)
Other provisions relating to the
merger."
SECTION
13.
Said
title is further amended by striking Code Section 14-2-1109.1, relating to
election to become a limited liability company, and inserting in lieu thereof
the following:
"14-2-1109.1.
(a)
As used in this Code section, the term:
(1)
'Limited liability company' means any limited liability company formed under
Chapter 11 of this title.
(2)
'Limited partnership' means any limited partnership formed under Chapter 9 of
this title.
(b)
Pursuant to Code Section 14-11-212 or 14-9-206.2 and this Code section, a
corporation may elect to become a limited liability company or limited
partnership if the board of directors adopts and its shareholders approve a plan
of conversion.
(c)
The plan of conversion must set forth:
(1)
The name of the limited liability company or limited partnership to be formed
pursuant to such election;
(2)
The manner and basis of converting the shares of such corporation into interests
as members of the limited liability company to be formed pursuant to such
election or interests as partners of the limited partnership to be formed
pursuant to such election or a statement that such information is contained in
the written operating agreement proposed for such limited liability company or
the written limited partnership agreement proposed for such limited
partnership;
(3)
The effective date and time of such election, if later than the date and time
the certificate of conversion is filed;
(4)
The contents of the articles of organization that shall be the articles of
organization of the limited liability company to be formed pursuant to such
election unless and until modified in accordance with the provisions of Chapter
11 of this title or the contents of the certificate of limited partnership that
shall be the certificate of limited partnership of the limited partnership to be
formed pursuant to such election unless and until modified in accordance with
the provisions of Chapter 9 of this title; and
(5)(A)
The contents of the written operating agreement to be entered into among the
persons who will be the members of the limited liability company to be formed
pursuant to such election, which shall, if not separately provided in the plan
of election, state:
(i)
The manner and basis for the conversion of the shares of such corporation into
interests as members of the limited liability company to be formed pursuant to
such election; and
(ii)
That approval of the election will be deemed to be execution of the operating
agreement by such persons; or
(B)
The contents of the written limited partnership agreement to be entered into
among the persons who will be the partners of the limited partnership to be
formed pursuant to such election, which shall, if not separately provided in the
plan of conversion, state:
(i)
The manner and basis for the conversion of the shares of such corporation into
interests as partners of the limited partnership to be formed pursuant to such
conversion; and
(ii)
That approval of the election will be deemed to be execution of the limited
partnership agreement by such persons.
(d)
For a plan of conversion to become a limited liability company or limited
partnership to be approved:
(1)
The board of directors shall submit the plan of conversion approved by the
shareholders and shall recommend the plan of conversion to the shareholders in
the same manner and subject to the same exceptions as provided in paragraph (1)
of subsection (b) of Code Section 14-2-1103, and may condition its submission
and provide notice to each shareholder entitled to vote in the same manner as
provided in subsections (c) and (d) of Code Section 14-2-1103; and
(2)
All of the shareholders must approve the plan of conversion.
(e)
The plan of conversion may set forth other provisions relating to the
conversion, including a provision that the plan may be amended prior to the time
that the conversion has become effective, but subsequent to approval of the plan
by shareholders the plan may not be amended to change in any respect not
expressly authorized by such shareholders in connection with the approval of the
plan:
(1)
The amount or kind of interests, shares or other securities, obligations, or
rights to acquire interests, shares or other securities to be received under the
plan by the shareholders if the change would adversely affect such shareholders;
or
(2)
Any of the other terms or conditions of the plan if the change would adversely
affect such shareholders in any material respect; and
in
the event that the plan of conversion is amended after a certificate of
conversion has been filed with the Secretary of State but before the conversion
has become effective, a certificate of amendment of conversion executed by an
officer or other duly authorized representative shall be delivered to the
Secretary of State for filing prior to the effectiveness of the
conversion.
(f)
Any of the terms of the plan of conversion may be made dependent upon facts
ascertainable outside of the plan of conversion, provided that the manner in
which such facts shall operate upon the terms of the conversion is clearly and
expressly set forth in the plan of conversion. As used in this subsection, the
term 'facts' includes, but is not limited to, the occurrence of any event,
including a determination or action by any person or body, including the
corporation.
(g)
After a conversion is authorized, unless the plan of conversion provides
otherwise, and at any time before the conversion has become effective, 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.
(h)
After a plan of conversion is approved by the shareholders, the corporation
shall deliver to the Secretary of State for filing a certificate of conversion
complying with subsection (b) of Code Section 14-11-212 or subsection (b) of
Code Section 14-9-206.2, as
applicable."
SECTION
14.
Said
title is further amended by adding two new Code sections to the end of Part 1 of
Article 11 of Chapter 2, relating to merger and share exchange, to read as
follows:
"14-2-1109.2.
(a)
A foreign corporation, domestic limited partnership, foreign limited
partnership, domestic general partnership, foreign general partnership, domestic
limited liability company, or foreign limited liability company may elect to
become a corporation. Such election shall require the approval of all of the
electing
entitýs
partners, members, or shareholders, or such other approval or compliance as may
be sufficient under applicable law or the governing documents of the electing
entity to authorize such election.
(b)
Such election shall be made by delivering a certificate of conversion to the
Secretary of State for filing. The certificate shall set forth:
(1)
The name and jurisdiction of organization of the entity making the election;
(2)
That the entity elects to become a corporation;
(3)
The effective date, or the effective date and time, of such conversion if later
than the date and time the certificate of conversion is filed;
(4)
That the election has been approved as required by subsection (a) of this Code
section;
(5)
That filed with the certificate of conversion are articles of incorporation that
are in the form required by Code Section 14-2-202, setting forth a name for the
corporation that satisfies the requirements of Code Section 14-2-401, and
stating that such articles of incorporation shall be the articles of
incorporation of the corporation formed pursuant to such election unless and
until modified in accordance with this chapter; and
(6)
If not provided for in the articles of incorporation required by paragraph (5)
of this subsection, a statement setting forth the manner and basis for
converting the ownership interests in the entity making the election into shares
of the corporation formed pursuant to such election.
(c)
Upon the election becoming effective:
(1)
The electing entity shall become a corporation formed under this chapter by such
election, except that the existence of the corporation so formed shall be deemed
to have commenced on the date the entity making the election commenced its
existence in the jurisdiction in which such entity was first created, formed,
incorporated, or otherwise came into being;
(2)
The ownership interests in the entity making the conversion shall be converted
on the basis stated or referred to in the certificate of conversion in
accordance with paragraph (6) of subsection (b) of this Code section;
(3)
The articles of incorporation filed with the certificate of conversion shall be
the articles of incorporation of the corporation formed pursuant to such
election unless and until amended in accordance with this chapter;
(4)
The governing documents of the entity making the election shall be of no further
force or effect;
(5)
The corporation formed by such election shall thereupon and thereafter possess
all of the rights, privileges, immunities, franchises, and powers of the entity
making the election; all property, real, personal, and mixed, all contract
rights, and all debts due to such entity, as well as all other choses in action,
and each and every other interest of or belonging to or due to the entity making
the election shall be taken and deemed to be vested in the corporation formed by
such election without further act or deed; the title to any real estate, or any
interest therein, vested in the entity making the election shall not revert or
be in any way impaired by reason of such election; and none of such items shall
be deemed to have been conveyed, transferred, or assigned by reason of such
election for any purpose; and
(6)
The corporation formed by such election shall thereupon and thereafter be
responsible and liable for all the liabilities and obligations of the entity
making the election, and any claim existing or action or proceeding pending by
or against such entity may be prosecuted as if such election had not become
effective. Neither the rights of creditors nor any liens upon the property of
the entity making such election shall be impaired by such election.
(d)
A conversion pursuant to this Code section shall not be deemed to constitute a
dissolution of the entity making the election and shall constitute a
continuation of the existence of the entity making the election in the form of a
corporation. A corporation formed by an election pursuant to this Code section
shall for all purposes be deemed to be the same entity as the entity making such
election.
(e)
A corporation formed by an election pursuant to this Code section may file a
copy of such certificate of conversion, certified by the Secretary of State, in
the office of the clerk of the superior court of the county where any real
property owned by such corporation is located and record such certified copy of
the certificate of conversion in the books kept by such clerk for recordation of
deeds in such county with the entity electing to become a corporation indexed as
the grantor and the corporation indexed as the grantee. No real estate transfer
tax under Code Section 48-6-1 shall be due with respect to the recordation of
such election.
14-2-1109.3.
(a)
A corporation may elect to become a foreign limited liability company, a foreign
limited partnership, or a foreign corporation, if such a conversion is permitted
by the law of the state or jurisdiction under whose law the resulting entity
would be formed.
(b)
To effect a conversion under this Code section, the corporation must adopt a
plan of conversion that sets forth the manner and basis of converting the shares
of the corporation into interests, shares, obligations, or other securities, as
the case may be, of the resulting entity. The plan of conversion may set forth
other provisions relating to the conversion.
(c)
For the plan of conversion to be adopted:
(1)
The board of directors shall submit the plan of conversion for approval by the
shareholders and shall recommend the plan of conversion to the shareholders in
the same manner and subject to the same exceptions as provided in paragraph (1)
of subsection (b) of Code Section 14-2-1103, and may condition its submission
and provide notice to each shareholder entitled to vote in the same manner as
provided in subsections (c) and (d) of Code Section 14-2-1103; and
(2)
All of the shareholders must approve the plan of conversion.
(d)
The plan of conversion may set forth other provisions relating to the
conversion, including a provision that the plan may be amended prior to the time
that the conversion has become effective, but subsequent to approval of the plan
by shareholders the plan may not be amended to change in any respect not
expressly authorized by such shareholders in connection with the approval of the
plan:
(1)
The amount or kind of interests, shares or other securities, obligations, or
rights to acquire interests, shares or other securities to be received under the
plan by the shareholders if the change would adversely affect such shareholders;
or
(2)
Any of the other terms or conditions of the plan if the change would adversely
affect such shareholders in any material respect; and
in
the event that the plan of conversion is amended after a certificate of
conversion has been filed with the Secretary of State but before the conversion
has become effective, a certificate of amendment of conversion executed by an
officer or other duly authorized representative shall be delivered to the
Secretary of State for filing prior to the effectiveness of the
conversion.
(e)
Any of the terms of the plan of conversion may be made dependent upon facts
ascertainable outside of the plan of conversion, provided that the manner in
which such facts shall operate upon the terms of the conversion is clearly and
expressly set forth in the plan of conversion. As used in this subsection, the
term 'facts' includes, but is not limited to, the occurrence of any event,
including a determination or action by any person or body, including the
corporation.
(f)
After a conversion is authorized, unless the plan of conversion provides
otherwise, and at any time before the conversion has become effective, 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.
(g)
The conversion shall be effected as provided in, and shall have the effects
provided by, the law of the state or jurisdiction under whose law the resulting
entity is formed and by the plan of conversion, to the extent not inconsistent
with such law.
(h)
If the resulting entity is required to obtain a certificate of authority to
transact business in this state by the provisions of this title governing
foreign corporations, foreign limited partnerships, or foreign limited liability
companies, it shall do so pursuant to Code Section 14-2-1501, 14-9-902, or
14-11-705."
SECTION
15.
Said
title is further amended by striking paragraph (1) of subsection (b) of Code
Section 14-2-1202, relating to sale of assets requiring shareholder approval,
and inserting in lieu thereof the following:
"(1)
The board of directors shall also transmit to the shareholders a recommendation
that the shareholders approve the proposed disposition, unless the board of
directors makes a determination that, because of conflicts of interest or other
special circumstances, it should either refrain from making such a
recommendation or recommend that the shareholders reject or vote against the
plan, in which case the board of directors shall transmit to the shareholders
the basis for such determination;
and"
SECTION
16.
Said
title is further amended by striking subsection (c) of Code Section 14-2-1302,
relating to right to dissent, and inserting in lieu thereof the
following:
"(c)
Notwithstanding any other provision of this article, there shall be no right of
dissent in favor of the holder of shares of any class or series which, at the
record date fixed to determine the shareholders entitled to receive notice of
and to vote at a meeting at which a plan of merger or share exchange or a sale
or exchange of property or an amendment of the articles of incorporation is to
be acted on, were either listed on a national securities exchange or held of
record by more than 2,000 shareholders, unless:
(1)
In the case of a plan of merger or share exchange, any holders of shares of the
class or series are required under the plan of merger or share exchange to
accept for their shares:
(A)
Anything except shares of the surviving corporation or another publicly held
corporation which at the effective date of the merger or share exchange are
either listed on a national securities exchange or held of record by more than
2,000 shareholders, except for scrip or cash payments in lieu of fractional
shares; or
(B)
Any shares of the surviving corporation or another publicly held corporation
which at the effective date of the merger or share exchange are either listed on
a national securities exchange or held of record by more than 2,000 shareholders
that are different, in type or exchange ratio per share, from the shares to be
provided or offered to any other holder of shares of the same class or series of
shares in exchange for such shares; or
(2)
The articles of incorporation or a resolution of the board of directors
approving the transaction provides
otherwise."
SECTION
17.
Said
title is further amended by striking subsection (b) of Code Section 14-2-1402,
relating to dissolution by board of directors and shareholders, and inserting in
lieu thereof the following:
"(1)
The board of directors shall also transmit to the shareholders a recommendation
that the shareholders approve the proposed dissolution, unless the board of
directors makes the recommendation that because of conflicts of interest or
other special circumstances, it should either refrain from making such a
recommendation or recommend that the shareholders reject or vote against
dissolution, in which case the board of directors shall transmit to the
shareholders the basis for such determination;
and"
SECTION
18.
Said
title is further amended by striking Code Section 14-2-1504, relating to amended
certificate of authority, and inserting in lieu thereof the following:
"14-2-1504.
(a)
A foreign corporation authorized to transact business in this state must obtain
an amended certificate of authority from the Secretary of State if it
changes:
(1)
Its corporate name;
(2)
The period of its duration; or
(3)
The state or country of its incorporation.
(b)
The requirements of Code Section 14-2-1503 for obtaining an original certificate
of authority apply to obtaining an amended certificate under this Code
section.
(c)
If a foreign corporation authorized to transact business in this state converts
into a foreign limited liability company:
(1)
The foreign corporation shall notify the Secretary of State that such conversion
has occurred no later than 30 days after the conversion, using such form as the
Secretary of State shall specify, which form may require such information and
statements as may be required to be submitted by a foreign limited liability
company that applies for a certificate of authority to transact business in this
state; and
(2)
If such notice is timely given:
(A)
The authorization of such entity to transact business in this state shall
continue without interruption; and
(B)
The certificate of authority issued to such foreign corporation under this
article shall constitute a certificate of authority issued under Code Section
14-11-704 to the foreign limited liability company resulting from the conversion
effective as of the date of the conversion.
The
Secretary of State shall adjust its records accordingly.
(d)
If a foreign corporation authorized to transact business in this state converts
into a foreign limited partnership:
(1)
The foreign corporation shall notify the Secretary of State that such conversion
has occurred no later than 30 days after the conversion, using such form as the
Secretary of State shall specify, which form may require such information and
statements as may be required to be submitted by a foreign limited partnership
that applies for a certificate of authority to transact business in this state;
and
(2)
If such notice is timely given:
(A)
The authorization of such entity to transact business in this state shall
continue without interruption; and
(B)
The certificate of authority issued to such foreign corporation under this part
shall constitute a certificate of authority issued under Code Section 14-9-903
to the foreign limited partnership resulting from the conversion effective as of
the date of the conversion.
The
Secretary of State shall adjust its records
accordingly."
SECTION
19.
Said
title is further amended by striking paragraph (2) of subsection (b) of Code
Section 14-2-1506, relating to corporate name of a foreign corporation, and
inserting in lieu thereof the following:
"(2)
A corporate name reserved under Code Section
14-2-402;"
SECTION
20.
Said
title is further amended by striking Code Section 14-9-206.2, relating to
election to become a limited partnership, and inserting in lieu thereof the
following:
"14-9-206.2.
(a)
A corporation, foreign corporation, limited liability company, foreign limited
liability company, foreign limited partnership, general partnership, or foreign
general partnership may elect to become a limited partnership. Such election
shall require:
(1)
Compliance with Code Section 14-2-1109.1 in the case of a Georgia corporation;
or
(2)
Approval of all of its partners, members, or shareholders, or such other
approval as may be sufficient under applicable law or the governing documents of
the electing entity to authorize such election, in the case of a foreign
corporation, limited liability company, foreign limited liability company,
foreign limited partnership, general partnership, or foreign general
partnership.
(b)
Such election is made by delivery of a certificate of conversion to the
Secretary of State for filing. The certificate shall set forth:
(1)
The name and jurisdiction of organization of the entity making the
election;
(2)
That the entity elects to become a limited partnership;
(3)
The effective date and time of such election if later than the date and time the
certificate of conversion is filed;
(4)
That the election has been approved as required by subsection (a) of this Code
section;
(5)
That filed with the certificate of conversion is a certificate of limited
partnership that is in the form required by Code Section 14-9-201, that sets
forth a name for the limited partnership that satisfies the requirements of Code
Section 14-9-102, and that shall be the certificate of limited partnership of
the limited partnership formed pursuant to such election unless and until
modified in accordance with this chapter; and
(6)
A statement setting forth either:
(A)
The manner and basis for converting the ownership interests in the entity making
the election into interests as partners of the limited partnership formed
pursuant to such election; or
(B)(i)
That a written limited partnership agreement has been entered into among the
persons who will be the partners of the limited partnership formed pursuant to
such election;
(ii)
That such limited partnership agreement will be effective immediately upon the
effectiveness of such election; and
(iii)
That such limited partnership agreement provides for the manner and basis of
such conversion.
(c)
Upon the election becoming effective the:
(1)
Electing entity shall become a limited partnership formed under this chapter by
such election except that the existence of the limited partnership so formed
shall be deemed to have commenced on the date the entity making the election
commenced its existence in the jurisdiction in which such entity was first
created, formed, incorporated, or otherwise came into being;
(2)
Ownership interests in the entity making the election shall be converted on the
basis stated or referred to in the certificate of conversion in accordance with
paragraph (6) of subsection (b) of this Code section;
(3)
Certificate of limited partnership filed with the certificate of conversion
shall be the certificate of limited partnership of the limited partnership
formed pursuant to such election unless and until amended in accordance with
this chapter;
(4)
Governing documents of the entity making the election shall be of no further
force or effect;
(5)
Limited partnership formed by such election shall thereupon and thereafter
possess all of the rights, privileges, immunities, franchises, and powers of the
entity making the election; all property, real, personal, and mixed, all
contract rights, and all debts due to such entity, as well as all other choses
in action, and each and every other interest of, belonging to, or due to the
entity making the election shall be taken and deemed to be vested in the limited
partnership formed by such election without further act or deed; the title to
any real estate, or any interest in real estate, vested in the entity making the
election shall not revert or be in any way impaired by reason of such election;
and none of such items shall be deemed to have been conveyed, transferred, or
assigned by reason of such election for any purpose; and
(6)
Limited partnership formed by such election shall thereupon and thereafter be
responsible and liable for all the liabilities and obligations of the entity
making the election, and any claim existing or action or proceeding pending by
or against such entity may be prosecuted as if such election had not become
effective. Neither the rights of creditors nor any liens upon the property of
the entity making such election shall be impaired by such election.
(d)
A conversion pursuant to this Code section shall not be deemed to constitute a
dissolution of the entity making the election and shall constitute a
continuation of the existence of the entity making the election in the form of a
limited partnership. A limited partnership formed by an election pursuant to
this Code section shall for all purposes be deemed to be the same entity as the
entity making such election.
(e)
A limited partnership formed by the election pursuant to this Code section may
file a copy of such certificate of conversion, certified by the Secretary of
State, in the office of the clerk of the superior court of the county where any
real property owned by such limited partnership is located and record such
certified copy of the certificate of conversion in the books kept by such clerk
for recordation of deeds in such county with the entity electing to become a
limited partnership indexed as the grantor and the limited partnership indexed
as the grantee. No real estate transfer tax under Code Section 48-6-1 shall be
due with respect to the recordation of such election.
(f)
The Secretary of State shall be authorized to promulgate such rules and charge
such filing fees as are necessary to carry out the purpose of this Code
section."
SECTION
21.
Said
title is further amended by adding a new Code Section 14-9-206.8 to the end of
Article 2 of Chapter 9, relating to formation, amendment, cancellation, and
merger, to read as follows:
"14-9-206.8.
(a)
A limited partnership may elect to become a foreign limited liability company, a
foreign limited partnership, or a foreign corporation, if such a conversion is
permitted by the law of the state or jurisdiction under whose law the resulting
entity would be formed.
(b)
To effect a conversion under this Code section, the limited partnership must
adopt a plan of conversion that sets forth the manner and basis of converting
the interests of the partners of the limited partnership into interests, shares,
obligations, or other securities, as the case may be, of the resulting entity.
The plan of conversion may set forth other provisions relating to the
conversion.
(c)
The limited partnership shall have the plan of conversion authorized and
approved by the unanimous consent of the partners, unless the limited
partnership agreement of such limited partnership provides
otherwise.
(d)
After a conversion is authorized, unless the plan of conversion provides
otherwise, and at any time before the conversion has become effective, the
planned conversion may be abandoned, subject to any contractual rights, in
accordance with the procedure set forth in the plan of conversion or, if none is
set forth, by the unanimous consent of the partners of the limited partnership,
unless the limited partnership agreement of such limited partnership provides
otherwise.
(e)
The conversion shall be effected as provided in, and shall have the effects
provided by, the law of the state or jurisdiction under whose law the resulting
entity is formed and by the plan of conversion, to the extent not inconsistent
with such law.
(f)
If the resulting entity is required to obtain a certificate of authority to
transact business in this state by the provisions of this title governing
foreign corporations, foreign limited partnerships, or foreign limited liability
companies, it shall do
so."
SECTION
22.
Said
title is further amended by striking the introductory language of Code Section
14-9-902, relating to the certificate of authority for foreign limited
partnerships, and inserting in lieu thereof the following:
"(a)
A foreign limited partnership transacting business in this state shall procure a
certificate of authority to do so from the Secretary of State. In order to
procure a certificate of authority to transact business in this state, a foreign
limited partnership shall submit to the Secretary of State an application for a
certificate of authority as a foreign limited partnership, signed by a general
partner setting
forth:"
SECTION
23.
Said
title is further amended by striking Code Section 14-9-905, relating to change
of name or state of an organization, and inserting in lieu thereof the
following:
"14-9-905.
(a)
A foreign limited partnership authorized to transact business in this state must
obtain an amended certificate of authority from the Secretary of State if it
changes its name or its state of organization. The requirements of Code
Sections 14-9-902 and 14-9-903 for obtaining an original certificate of
authority shall apply to obtaining an amended certificate under this Code
section.
(b)
If a foreign limited partnership authorized to transact business in this state
converts into a foreign limited liability company:
(1)
The foreign limited partnership shall notify the Secretary of State that such
conversion has occurred no later than 30 days after the conversion, using such
form as the Secretary of State shall specify, which form may require such
information and statements as may be required to be submitted by a foreign
limited liability company that applies for a certificate of authority to
transact business in this state; and
(2)
If such notice is timely given:
(A)
The authorization of such entity to transact business in this state shall
continue without interruption; and
(B)
The certificate of authority issued to such foreign limited partnership under
this article shall constitute a certificate of authority issued under Code
Section 14-11-704 to the foreign limited liability company resulting from the
conversion effective as of the date of the conversion.
The
Secretary of State shall adjust its records accordingly.
(c)
If a foreign limited partnership authorized to transact business in this state
converts into a foreign corporation:
(1)
The foreign limited partnership shall notify the Secretary of State that such
conversion has occurred no later than 30 days after the conversion, using such
form as the Secretary of State shall specify, which form may require such
information and statements as may be required to be submitted by a foreign
corporation that applies for a certificate of authority to transact business in
this state; and
(2)
If such notice is timely given:
(A)
The authorization of such entity to transact business in this state shall
continue without interruption; and
(B)
The certificate of authority issued to such foreign limited partnership under
this article shall constitute a certificate of authority issued under Code
Sections 14-2-1501 and 14-2-1503 to the foreign corporation resulting from the
conversion effective as of the date of the conversion.
The
Secretary of State shall adjust its records
accordingly."
SECTION
24.
Said
title is further amended by striking Code Section 14-11-212, relating to
election to become a limited liability company, and inserting in lieu thereof
the following:
"14-11-212.
(a)
A corporation, foreign corporation, foreign limited liability company, limited
partnership, foreign limited partnership, general partnership, or foreign
general partnership may elect to become a limited liability company. Such
election shall require (1) compliance with Code Section 14-2-1109.1 in the case
of a Georgia corporation, or (2) the approval of all of its partners, members or
shareholders (or such other approval or compliance as may be sufficient under
applicable law or the governing documents of the electing entity to authorize
such election) in the case of a foreign corporation, foreign limited liability
company, limited partnership, foreign limited partnership, or foreign general
partnership.
(b)
Such election is made by delivering a certificate of conversion to the Secretary
of State for filing. The certificate shall set forth:
(1)
The name and jurisdiction of organization of the entity making the
election;
(2)
That the entity elects to become a limited liability company;
(3)
The effective date, or the effective date and time, of such election if later
than the date and time the certificate of conversion is filed;
(4)
That the election has been approved as required by subsection (a) of this Code
section;
(5)
That filed with the certificate of conversion are articles of organization that
are in the form required by Code Section 14-11-204, that set forth a name for
the limited liability company that satisfies the requirements of Code Section
14-11-207, and that shall be the articles of organization of the limited
liability company formed pursuant to such election unless and until modified in
accordance with this chapter; and
(6)
A statement setting forth either (A) the manner and basis for converting the
ownership interests in the entity making the election into interests as members
of the limited liability company formed pursuant to such election, or (B) (i)
that a written operating agreement has been entered into among the persons who
will be the members of the limited liability company formed pursuant to such
election, (ii) that such operating agreement will be effective immediately upon
the effectiveness of such election, and (iii) that such operating agreement
provides for the manner and basis of such conversion.
(c)
Upon the election becoming effective:
(1)
The electing entity shall become a limited liability company formed under this
chapter by such election except that the existence of the limited liability
company so formed shall be deemed to have commenced on the date the entity
making the election commenced its existence in the jurisdiction in which such
entity was first created, formed, incorporated, or otherwise came into
being;
(2)
The ownership interests in the entity making the election shall be converted on
the basis stated or referred to in the certificate of conversion in accordance
with paragraph (6) of subsection (b) of this Code section;
(3)
The articles of organization filed with the certificate of conversion shall be
the articles of organization of the limited liability company formed pursuant to
such election unless and until amended in accordance with this
chapter;
(4)
The governing documents of the entity making the election shall be of no further
force or effect;
(5)
The limited liability company formed by such election shall thereupon and
thereafter possess all of the rights, privileges, immunities, franchises, and
powers of the entity making the election; all property, real, personal, and
mixed, all contract rights, and all debts due to such entity, as well as all
other choses in action, and each and every other interest of or belonging to or
due to the entity making the election shall be taken and deemed to be vested in
the limited liability company formed by such election without further act or
deed; and the title to any real estate, or any interest therein, vested in the
entity making the election shall not revert or be in any way impaired by reason
of such election; and none of such items shall be deemed to have been conveyed,
transferred, or assigned by reason of such election for any purpose;
and
(6)
The limited liability company formed by such election shall thereupon and
thereafter be responsible and liable for all the liabilities and obligations of
the entity making the election, and any claim existing or action or proceeding
pending by or against such entity may be prosecuted as if such election had not
become effective. Neither the rights of creditors nor any liens upon the
property of the entity making such election shall be impaired by such
election.
(d)
A conversion pursuant to this Code section shall not be deemed to constitute a
dissolution of the entity making the election and shall constitute a
continuation of the existence of the entity making the election in the form of a
limited liability company. A limited liability company formed by an election
pursuant to this Code section shall for all purposes be deemed to be the same
entity as the entity making such election.
(e)
A limited liability company formed by an election pursuant to this Code section
may file a copy of such certificate of conversion, certified by the Secretary of
State, in the office of the clerk of the superior court of the county where any
real property owned by such limited liability company is located and record such
certified copy of the certificate of conversion in the books kept by such clerk
for recordation of deeds in such county with the entity electing to become a
limited liability company indexed as the grantor and the limited liability
company indexed as the grantee. No real estate transfer tax under Code Section
48-6-1 shall be due with respect to recordation of such
election."
SECTION
25.
Said
title is further amended by striking Code Section 14-11-706, relating to amended
certificate required for change of name or jurisdiction of organization, and
inserting in lieu thereof the following:
"14-11-706.
(a)
A foreign limited liability company authorized to transact business in this
state must procure an amended certificate of authority from the Secretary of
State if it changes its name or its jurisdiction of organization. The
requirements of Code Sections 14-11-702 and 14-11-704 for procuring an original
certificate of authority shall apply to procuring an amended certificate under
this Code section.
(b)
If a foreign limited liability company authorized to transact business in this
state converts into a foreign limited partnership:
(1)
The foreign limited liability company shall notify the Secretary of State that
such conversion has occurred no later than 30 days after the conversion, using
such form as the Secretary of State shall specify, which form may require such
information and statements as may be required to be submitted by a foreign
limited partnership that applies for a certificate of authority to transact
business in this state; and
(2)
If such notice is timely given:
(A)
The authorization of such entity to transact business in this state shall
continue without interruption; and
(B)
The certificate of authority issued to such foreign limited liability company
under this article shall constitute a certificate of authority issued under Code
Section 14-11-903 to the foreign limited partnership resulting from the
conversion effective as of the date of the conversion.
The
Secretary of State shall adjust its records accordingly.
(c)
If a foreign limited liability company authorized to transact business in this
state converts into a foreign corporation:
(1)
The foreign limited liability company shall notify the Secretary of State that
such conversion has occurred no later than 30 days after the conversion, using
such form as the Secretary of State shall specify, which form may require such
information and statements as may be required to be submitted by a foreign
corporation that applies for a certificate of authority to transact business in
this state; and
(2)
If such notice is timely given:
(A)
The authorization of such entity to transact business in this state shall
continue without interruption; and
(B)
The certificate of authority issued to such foreign limited liability company
under this article shall constitute a certificate of authority issued under Code
Section 14-2-1501 to the foreign corporation resulting from the conversion
effective as of the date of the conversion.
The
Secretary of State shall adjust its records
accordingly."
SECTION
26.
Said
title is further amended by adding a new Code Section 14-11-906 to the end of
Article 9 of Chapter 11, relating to merger, to read as follows:
"14-11-906.
(a)
A limited liability company may elect to become a foreign limited liability
company, a foreign limited partnership, or a foreign corporation, if such a
conversion is permitted by the law of the state or jurisdiction under whose law
the resulting entity would be formed.
(b)
To effect a conversion under this Code section, the limited liability company
must adopt a plan of conversion that sets forth the manner and basis of
converting the interests of the members of the limited liability company into
interests, shares, obligations, or other securities, as the case may be, of the
resulting entity. The plan of conversion may set forth other provisions
relating to the conversion.
(c)
The limited liability company shall have the plan of conversion authorized and
approved by the unanimous consent of the members, unless the articles of
organization or a written operating agreement of such limited liability company
provides otherwise.
(d)
After a conversion is authorized, unless the plan of conversion provides
otherwise, and at any time before the conversion has become effective, the
planned conversion may be abandoned, subject to any contractual rights, in
accordance with the procedure set forth in the plan of conversion or, if none is
set forth, by the unanimous consent of the members of the limited liability
company, unless the articles of organization or a written operating agreement of
such limited liability company provides otherwise.
(e)
The conversion shall be effected as provided in, and shall have the effects
provided by, the law of the state or jurisdiction under whose law the resulting
entity is formed and by the plan of conversion, to the extent not inconsistent
with such law.
(f)
If the resulting entity is required to obtain a certificate of authority to
transact business in this state by the provisions of this title governing
foreign corporations, foreign limited partnerships, or foreign limited liability
companies, it shall do
so."
SECTION
27.
Said
title is further amended by adding a new paragraph (16) to subsection (a) of
Code Section 14-11-1101, relating to filing fees and penalties, to read as
follows:
|
"(16)
All foreign entity conversions
|
95.00
"
|
SECTION
28.
Said
title is further amended by striking subsection (a) of Code Section 14-11-1002,
relating to right to dissent, and inserting in lieu thereof the following:
"(a)
Unless otherwise provided by the articles of organization or a written operating
agreement, a record member of the limited liability company is entitled to
dissent from, and obtain payment of the fair value of his or her membership
interest in the event of, any of the following actions:
(1)
Consummation of a plan of merger to which the limited liability company is a
party if approval of less than all of the members of the limited liability
company is required for the merger by the articles of organization or a written
operating agreement and the member is entitled to vote on the
merger;
(2)
Consummation of a plan of conversion pursuant to Code Section 14-2-1109.2 or
14-11-906;
(3)
Consummation of a sale, lease, exchange, or other disposition of all or
substantially all of the property of the limited liability company if approval
of less than all of the members is required by the articles of organization or a
written operating agreement and the member is entitled to vote on the sale,
lease, exchange, or other disposition, but not including a sale pursuant to
court order or a sale for cash pursuant to a plan by which all or substantially
all of the net proceeds of the sale will be distributed to the members within
one year after the date of sale;
(4)
An amendment of the articles of organization that materially and adversely
affects rights in respect of a
dissenteŕs
membership interest in the limited liability company because it:
(A)
Alters or abolishes a preferential right of the
membeŕs
interest;
(B)
Creates, alters, or abolishes a right in respect of redemption, including a
provision respecting a sinking fund for the redemption or repurchase, of the
membership interest;
(C)
Alters or abolishes a preemptive right of the holder of the membership interest
to acquire additional interest or other securities;
(D)
Excludes or limits the right of the member to vote on any matter, other than a
limitation by dilution through additional member contributions or other
securities with similar voting rights; or
(E)
Cancels, redeems, or repurchases all or part of the membership interest of the
class; or
(5)
Any limited liability company action taken pursuant to a member vote to the
extent that the articles of organization or a written operating agreement
provides that voting or nonvoting members are entitled to dissent and obtain
payment for their membership
interests."
SECTION
29.
All
laws and parts of laws in conflict with this Act are repealed.