Section 156D:9.31 - Action on a plan of nonprofit conversionIn the case of a conversion of a domestic business corporation to a domestic or foreign nonprofit corporation:
(1) The plan of nonprofit conversion shall be adopted by the board of directors.(2) After adopting the plan of nonprofit conversion, the board of directors shall submit the plan to the shareholders for their approval. 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 not make such a recommendation, in which case the board of directors shall transmit to the shareholders the basis for that determination.(3) The board of directors may condition its submission of the plan of nonprofit conversion to the shareholders on any basis.(4) If the approval of the shareholders is to be given at a meeting, the corporation shall notify each shareholder, whether or not entitled to vote, of the meeting of shareholders at which the plan of nonprofit conversion is to be submitted for approval. The notice shall state that the purpose, or one of the purposes, of the meeting is to consider the plan and shall contain or be accompanied by a copy or summary of the plan. The notice shall include or be accompanied by a copy of the articles of organization as they will be in effect immediately after the nonprofit conversion.(5) Unless (1) a greater percentage vote, or one or more additional separate voting groups, is required by the articles of organization, pursuant to section 7.27(a), by the bylaws, pursuant to section 10.22, or by the board of directors, acting pursuant to paragraph (3), or (2) the articles provide for a lesser percentage vote, in accordance with subsection (b) of section 7.27, approval of the plan of domestication requires approval by two-thirds of all the shares entitled generally to vote on the matter by the articles of organization, and in addition two-thirds of the shares in any voting group entitled to vote separately on the matter by this chapter, by the articles, by the bylaws, or by action of the board of directors pursuant to section 9.31(c).(6) Separate voting by voting groups is required by each class or series of shares that: (i) would have a right to vote as a separate group on a provision in the plan that, if contained in a proposed amendment to articles of organization, would require action by separate voting groups under section 10.04; or(ii) is entitled under the articles of organization to vote as a voting group to approve a plan of merger or amendment of articles.(7) If any provision of the articles of organization, bylaws or an agreement to which any of the directors or shareholders are parties, adopted or entered into before the effective date of this chapter, applies to a merger of the corporation and does not refer to a nonprofit conversion of the corporation, the provision shall be deemed to apply to a nonprofit conversion of the corporation until such time as the provision is amended subsequent to that date. Mass. Gen. Laws ch. 156D, § 9.31
Added by Acts 2003, c. 127, § 17, eff. 7/1/2004.