Ala. Code § 10A-3A-13.03

Current through the 2024 Regular Session.

Section 10A-3A-13.03 - Action on a plan of conversion in a membership nonprofit corporation

In the case of a conversion of a membership nonprofit corporation the plan of conversion shall be adopted in the following manner:

(a) The plan of conversion shall first be adopted by the board of directors.

(b) The plan of conversion shall then be approved by the members entitled to vote thereon. In submitting the plan of conversion to the members for their approval, the board of directors must recommend that the members approve the plan of conversion, unless the board of directors makes a determination that because of conflicts of interest or other special circumstances it should not make a recommendation, in which case the board of directors shall inform the members of the basis for its so proceeding.

(c) The board of directors may set conditions for the approval of the plan of conversion by the members or the effectiveness of the plan of conversion.

(d) If the approval of the members is to be given at a meeting, the nonprofit corporation shall notify each member entitled to vote of the meeting of members at which the plan of conversion is to be submitted for approval. The notice must state that the purpose, or one of the purposes, of the meeting is to consider the plan of conversion and must contain or be accompanied by a copy or summary of the plan of conversion. The notice must include or be accompanied by a copy of the organizational documents of the converted organization which are to be in writing as they will be in effect immediately after the conversion.

(e) Unless the certificate of incorporation or the board of directors acting pursuant to subsection (c), requires a greater vote or a greater quorum, approval of the plan of conversion requires (i) the approval of the members entitled to vote at a meeting at which a quorum exists consisting of a majority of the votes entitled to be cast on the plan of conversion, and (ii) the approval of each class of members voting as a separate voting group at a meeting at which a quorum of the voting group exists consisting of a majority of the votes entitled to be cast on the plan of conversion by that voting group.

(f) In addition to the adoption and approval of the plan of conversion as required by this section, the plan of conversion must also be approved in writing by a person or group of persons, if any, whose approval is required under Section 10A-3A-13.08.

Ala. Code § 10A-3A-13.03 (1975)

Added by Act 2023-503,§ 1, eff. 1/1/2024.