SB566: Bill Text

SB566,312,20 181.1133 Approval of interest exchange; amendment; abandonment. (1) Subject to s. 181.1180, a plan of interest exchange must be approved in accordance with the procedures that govern a plan of merger under s. 181.1103 with respect to each domestic corporation acquired entity.

SB566,313,2 (2) Subject to s. 181.1180 and the governing law of each of the acquiring entity and acquired entity, after a plan of interest exchange is approved, and at any time before an interest exchange becomes effective, the acquiring and acquired entities may amend the plan of interest exchange or abandon the interest exchange as provided in the plan of interest exchange or, except as otherwise provided in the plan of interest exchange, with the same vote or consent as was required to approve the plan of interest exchange.

SB566,313,11 (3) If, after articles of interest exchange have been delivered to the department for filing and before the interest exchange becomes effective, the plan of interest exchange is amended in a manner that requires an amendment to the articles of interest exchange or if the interest exchange is abandoned, a statement of amendment or abandonment, signed by either the acquiring entity or the acquired entity, must be delivered to the department for filing before the interest exchange becomes effective. When a statement of abandonment becomes effective, the interest exchange is abandoned and does not become effective. The statement of amendment or abandonment must contain all of the following:

SB566,313,12 (a) The name of the acquiring and acquired entities.

SB566,313,13 (b) The amendment to or abandonment of the articles of interest exchange.

SB566,313,15 (c) A statement that the amendment or abandonment was approved in accordance with this section.

SB566,313,18 (4) In addition to approval under sub. (1), a plan of interest exchange must be approved by any acquiring or acquired entity that is not a domestic corporation in accordance with any requirements of its governing law.

SB566,536 Section 536. 181.1134 of the statutes is created to read:

SB566,313,24 181.1134 Filings required for interest exchange; effective date. (1) After an interest exchange has been approved with respect to the acquiring and acquired entity in accordance with their governing laws, the acquiring entity shall deliver, or cause to be delivered, to the department for filing articles of interest exchange setting forth all of the following:

SB566,313,25 (a) The name, type of entity, and governing law of the acquired entity.

SB566,314,1 (b) The name, type of entity, and governing law of the acquiring entity.

SB566,314,3 (c) A statement that the plan of interest exchange has been approved by the acquired and acquiring entities in accordance with their respective governing laws.

SB566,314,6 (d) Any amendments to the organizational documents of the acquired or acquiring entity that are to be in a public record under their respective governing laws or, if there are no such amendments, a statement to that effect.

SB566,314,8 (e) A statement that the plan of interest exchange is on file at the principal office of the acquiring entity.

SB566,314,10 (f) A statement that upon request the acquiring entity will provide a copy of the plan of interest exchange to any interest holder of the acquired entity.

SB566,314,13 (2) In addition to the requirements of sub. (1), articles of interest exchange may contain any other provisions relating to the interest exchange, as determined by the acquiring entity in accordance with the plan of interest exchange.

SB566,314,15 (3) An interest exchange takes effect at the effective date and time of the articles of interest exchange.

SB566,537 Section 537. 181.1135 of the statutes is created to read:

SB566,314,18 181.1135 Effect of interest exchange. (1) When an interest exchange becomes effective, all of the following apply:

SB566,314,25 (a) The interests in the acquired entity which are the subject of the interest exchange are exchanged as provided in the plan of interest exchange, and the former interest holders of those interests are entitled only to the rights provided to them under the plan of interest exchange or to their rights, if any, under ss. 178.1161, 179.1161, 180.1301 to 180.1331, 181.1180, 183.1061, or otherwise under the governing law of the acquired entity. All other terms and conditions of the interest exchange also take effect.

SB566,315,2 (b) The acquiring entity becomes the interest holder of the interests which are the subject of the interest exchange as provided in the plan of interest exchange.

SB566,315,6 (c) The provisions of the organizational documents of the acquiring and acquired entity are amended to the extent, if any, provided in the plan of interest exchange and to the extent such amendments are to be reflected in a public record, as provided in the articles of interest exchange.

SB566,315,10 (2) Except as otherwise provided in the articles and plan of interest exchange, if the acquired entity is a domestic or foreign partnership, limited liability company, or other organization subject to dissolution under its governing law, the interest exchange does not dissolve the acquired entity.

SB566,315,12 (3) (a) Except as provided in this subsection, no interest holder shall have interest holder liability with respect to either the acquiring or acquired entity.

SB566,315,19 (b) If, under the governing law of either entity, one or more of the interest holders thereof had interest holder liability prior to the interest exchange with respect to the entity, such interest holder or holders shall continue to have such liability and any associated contribution and other rights to the extent provided in such governing law with respect to debts, obligations, and other liabilities of the entity that accrued during the period or periods in which such interest holder or holders had such interest holder liability.

SB566,315,25 (c) If, under the governing law of either entity, one or more of the interest holders thereof will have interest holder liability after the interest exchange with respect to the entity, such interest holder or holders shall have such liability and any associated contribution and other rights to the extent provided in such governing law with respect to the debts, obligations, and other liabilities of the entity that accrue on or after the interest exchange.

SB566,316,1 (d) This subsection does not affect liability under any taxation laws.

SB566,316,5 (4) (a) When an interest exchange takes effect, the department is the agent of any foreign acquiring entity for service of process in a proceeding to enforce any obligation or the rights of interest holders, in their capacities as such, of each domestic corporation acquired entity.

SB566,316,8 (b) When an interest exchange takes effect, any foreign acquiring entity shall timely honor the rights and obligations of interest holders under this chapter with respect to each domestic corporation acquired entity.

SB566,538 Section 538. 181.1161 (title) of the statutes is amended to read:

SB566,316,10 181.1161 (title) Conversion authorized.

SB566,539 Section 539. 181.1161 (1) (a) of the statutes is renumbered 181.1161 (1m) and amended to read:

SB566,316,19 181.1161 (1m) A domestic corporation may convert to another form of business type of domestic entity if it satisfies the requirements under this section and, or to any type of foreign entity, pursuant to ss. 181.1161 to 181.1165 and a plan of conversion if the conversion is permitted under the applicable governing law of the jurisdiction that governs the organization of the business entity into which the domestic corporation is converting entity and the governing law that is to apply to the converted entity.

SB566,540 Section 540. 181.1161 (1) (b) of the statutes is repealed.

SB566,541 Section 541. 181.1161 (2) (a) of the statutes is renumbered 181.1161 (2m) and amended to read:

SB566,317,3 181.1161 (2m) A business foreign or domestic entity, other than a domestic corporation, may convert to a domestic corporation if it satisfies the requirements under this section and pursuant to ss. 181.1161 to 181.1165 and a plan of conversion if the conversion is permitted under the applicable governing law of the jurisdiction that governs the business converting entity and the converted entity will satisfy the definition of a corporation under this chapter immediately after the conversion.

SB566,542 Section 542. 181.1161 (2) (b) of the statutes is repealed.

SB566,543 Section 543. 181.1161 (3) (intro.), (a) and (b) of the statutes are renumbered 181.1162 (1) (intro.), (a) and (b) and amended to read:

SB566,317,8 181.1162 (1) (intro.) A plan of conversion shall set forth must be in a record and contain all of the following:

SB566,317,10 (a) The name, form type of business entity, and the identity of the jurisdiction governing the business law of the converting entity that is to be converted.

SB566,317,12 (b) The name, form type of business entity, and the identity of the jurisdiction that will govern the new business governing law of the converted entity.

SB566,544 Section 544. 181.1161 (3) (c) of the statutes is renumbered 181.1162 (1) (c).

SB566,545 Section 545. 181.1161 (3) (d) of the statutes is renumbered 181.1162 (1) (d) and amended to read:

SB566,317,21 181.1162 (1) (d) The manner and basis of converting the shares or other ownership interests of the business entity that is to be converted into the shares or other ownership interests of the new form of business entity interests in the converting entity into interests, securities, or obligations of the surviving entity, rights to acquire such interests or securities, money, other property, or any combination of the foregoing.

SB566,546 Section 546. 181.1161 (3) (e), (f) and (g) of the statutes are repealed.

SB566,547 Section 547. 181.1161 (4), (5) and (6) of the statutes are repealed.

SB566,548 Section 548. 181.1162 (title) of the statutes is created to read:

SB566,317,25 181.1162 (title) Plan of conversion.

SB566,549 Section 549. 181.1162 (1) (e) and (f) of the statutes are created to read:

SB566,318,3 181.1162 (1) (e) The organizational documents of the converted entity that are to be in a record immediately after the conversion becomes effective.

SB566,318,4 (f) Any other matters required by the governing law of the converting entity.

SB566,550 Section 550. 181.1162 (2) of the statutes is created to read:

SB566,318,7 181.1162 (2) In addition to the requirements of sub. (1), a plan of conversion may contain any other provision relating to the conversion and not prohibited by law.

SB566,551 Section 551. 181.1163 of the statutes is created to read:

SB566,318,14 181.1163 Approval of conversion; amendment; abandonment. (1) Subject to s. 181.1180, a plan of conversion must be approved in accordance with the procedures that govern a plan of merger under s. 181.1103 for the submission and approval of a plan of conversion with respect to a converting domestic corporation. A plan of conversion into a converted domestic corporation must be approved pursuant to the governing law of the converting entity.

SB566,318,20 (2) Subject to s. 181.1180 and the governing law of each of the converting entity and converted entity, after a plan of conversion is approved, and at any time before a conversion becomes effective, the converting entity may amend the plan of conversion or abandon the conversion as provided in the plan of conversion or, except as otherwise provided in the plan of conversion, with the same vote or consent as was required to approve the plan of conversion.

SB566,319,3 (3) If, after articles of conversion have been delivered to the department for filing and before the conversion becomes effective, the plan of conversion is amended in a manner that requires an amendment to the articles of conversion or if the conversion is abandoned, a statement of amendment or abandonment, signed by the converting entity, must be delivered to the department for filing before the conversion becomes effective. When a statement of abandonment becomes effective, the conversion is abandoned and does not become effective. The statement of amendment or abandonment must contain all of the following:

SB566,319,5 (a) The name of the converting entity and the converted entity under the plan of conversion.

SB566,319,6 (b) The amendment to or abandonment of the articles of conversion.

SB566,319,8 (c) A statement that the amendment or abandonment was approved in accordance with this section.

SB566,552 Section 552. 181.1164 of the statutes is created to read:

SB566,319,13 181.1164 Filings required for conversion; effective date. (1) After the converting entity has approved a plan of conversion in accordance with its governing law, the converting entity shall deliver, or cause to be delivered, to the department for filing articles of conversion setting forth all of the following:

SB566,319,14 (a) The name, type of entity, and governing law of the converting entity.

SB566,319,15 (b) The name, type of entity, and governing law of the converted entity.

SB566,319,17 (c) A statement that the plan of conversion has been approved and adopted by the converting entity in accordance with its governing law.

SB566,319,19 (d) Any organizational documents of the converted entity that are to be in a public record under its governing law.

SB566,319,21 (e) A statement that the plan of conversion is on file at the principal office of the converted entity.

SB566,319,23 (f) A statement that upon request the converted entity will provide a copy of the plan of conversion to any interest holder of the converting entity.

SB566,319,24 (g) A statement whether s. 181.1180 applies to the conversion.

SB566,320,3 (2) In addition to the requirements of sub. (1), the articles of conversion may contain any other provisions relating to the conversion, as determined by the converting entity in accordance with the plan of conversion.

SB566,320,6 (3) If the converted entity is a foreign entity that will be required to register to do business in this state immediately after the conversion and it has not previously registered to do so, it shall so register.

SB566,320,8 (4) A conversion takes effect at the effective date and time of the articles of conversion.

SB566,553 Section 553. 181.1165 of the statutes is created to read:

SB566,320,11 181.1165 Effect of conversion. (1) When a conversion becomes effective, all of the following apply:

SB566,320,15 (a) The converting entity continues its existence in the form of the converted entity and is the same entity that existed before the conversion, except that the converting entity is no longer subject to the governing law that applied prior to the conversion and is subject to the governing law of the converted entity.

SB566,320,17 (am) 1. Except as provided in this paragraph, no interest holder shall have interest holder liability with respect to the converting or converted entity.

SB566,320,24 2. If, under the governing law of the converting entity, one or more of the interest holders thereof had interest holder liability prior to the conversion with respect to the converting entity, such interest holder or holders shall continue to have such liability and any associated contribution and other rights to the extent provided in such governing law with respect to the debts, obligations, and other liabilities of the converting entity that accrued during the period or periods in which the interest holder or holders had such interest holder liability.

SB566,321,6 3. If, under the governing law of the converted entity, one or more of the interest holders thereof will have interest holder liability after the conversion with respect to the converted entity, such interest holder or holders will have such liability and any associated contribution and other rights to the extent provided in such governing law with respect to the debts, obligations, and other liabilities of the converted entity that accrue after the conversion.

SB566,321,7 4. This paragraph does not affect liability under any taxation laws.

SB566,321,9 (b) The title to all property owned by the converting entity is vested in the converted entity without transfer, reversion, or impairment.

SB566,321,11 (c) The converted entity has all debts, obligations, and other liabilities of the converting entity.

SB566,321,14 (d) A civil, criminal, or administrative proceeding pending by or against the converted entity may be continued as if the conversion did not occur, or the converted entity may be substituted in the proceeding for the converting entity.

SB566,321,17 (e) The organizational documents of the converted entity are as provided in the plan of conversion and, to the extent such organizational documents are to be reflected in a public record, as provided in the articles of conversion.

SB566,321,25 (f) The interests of the converting entity that are to be converted into interests, securities, or obligations of the surviving entity, rights to acquire such interests or securities, money, other property, or any combination of the foregoing, are converted as provided in the plan of conversion, and the former interest holders of the converting entity are entitled only to the rights provided in the plan of conversion or to their rights, if any, under ss. 178.1161, 179.1161, 180.0301 to 180.1331, 181.1180, 183.1061, or otherwise under the governing law of the converting entity. All other terms and conditions of the conversion also take effect.

SB566,322,3 (g) Except as prohibited by other law or as otherwise provided in the articles and plan of conversion, all of the rights, privileges, immunities, powers, and purposes of the converting entity vest in the converted entity.

SB566,322,7 (h) Except as otherwise provided in the articles and plan of conversion, if the converting entity is a partnership, limited liability company, or other entity subject to dissolution under its governing law, the conversion does not dissolve the converting entity for the purposes of its governing law.

SB566,322,11 (2) (a) When a conversion takes effect, the department is the agent of any foreign converted entity for service of process in a proceeding to enforce any obligation or the rights of interest holders, in their capacity as such, of any domestic corporation converting entity.

SB566,322,14 (b) When a conversion takes effect, any foreign converted entity shall timely honor the rights and obligations of interest holders under this chapter with respect to any domestic corporation converting entity.

SB566,554 Section 554. 181.1171 of the statutes is created to read: