Kentucky Statutes 271B.11-025 – Change of status from or to a public benefit corporation — Conditions for
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(1) Notwithstanding any other provisions of this chapter, a corporation that is not a public benefit corporation shall not, without the approval of ninety percent (90%) of the outstanding shares of each class of the stock of the corporation of which there are outstanding shares, whether voting or nonvoting:
(a) Amend its articles of incorporation to elect to be a public benefit corporation;
or
(b) Merge with or into another entity if, as a result of the merger, the shares in the corporation would become, or be converted into or exchanged for the right to receive, shares or other equity interests in a domestic or foreign public benefit corporation or similar entity. The restrictions of this section shall not apply prior to the time that the corporation has received payment for any of its capital stock.
(2) Any stockholder of a corporation that is not a public benefit corporation who:
(a) Holds shares of stock of the corporation immediately prior to the effective time of:
1. An amendment to the corporation’s articles of incorporation to become a public benefit corporation; or
2. A merger that would result in the conversion of the corporation’s stock into, or exchange of the corporation’s stock for the right to receive, shares or other equity interests in a domestic or foreign public benefit corporation or similar entity; and
(b) Has not voted in favor of the amendment, merger, or consolidation or consented thereto in writing;
shall be entitled to exercise dissenters’ rights under Subtitle 13 of this chapter.
(3) Notwithstanding any other provisions of this chapter, a corporation that is a public benefit corporation shall not, without the approval of two-thirds (2/3) of the outstanding shares of each class of the stock of the corporation of which there are outstanding shares, whether voting or nonvoting:
(a) Amend its articles of incorporation to delete the election to be a public benefit corporation; or
(b) Merge with or into another entity if, as a result of the merger, the shares in the corporation would become, or be converted into or exchanged for the right to receive, shares or other equity interests in a domestic or foreign corporation that is not a public benefit corporation or similar entity and the articles of incorporation of which does not contain the identical public benefit or public benefits as the public benefit corporation identified in its articles of incorporation.
Effective: June 29, 2017
History: Created 2017 Ky. Acts ch. 28, sec. 3, effective June 29, 2017.
(a) Amend its articles of incorporation to elect to be a public benefit corporation;
Terms Used In Kentucky Statutes 271B.11-025
- Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
- Articles of incorporation: include amended and restated articles of incorporation and articles of merger. See Kentucky Statutes 271B.1-400
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Corporation: may extend and be applied to any corporation, company, partnership, joint stock company, or association. See Kentucky Statutes 446.010
- Domestic: when applied to a corporation, partnership, business trust, or limited liability company, means all those incorporated or formed by authority of this state. See Kentucky Statutes 446.010
- Entity: includes a domestic or foreign corporation. See Kentucky Statutes 271B.1-400
- Foreign: when applied to a corporation, partnership, limited partnership, business trust, statutory trust, or limited liability company, includes all those incorporated or formed by authority of any other state. See Kentucky Statutes 446.010
- Foreign corporation: means a corporation for profit incorporated under a law other than the law of this state. See Kentucky Statutes 271B.1-400
- Public benefit: means a positive effect or reduction of negative effects on one (1) or more categories of persons, entities, communities, or interests other than stockholders in their capacities as stockholders. See Kentucky Statutes 271B.1-400
- Public benefit corporation: means a for-profit corporation that is intended to produce a public benefit and to operate in a responsible manner, balancing the stockholders' pecuniary interests, the best interests of those materially affected by the corporation's conduct, and the public benefit identified in its articles of incorporation. See Kentucky Statutes 271B.1-400
or
(b) Merge with or into another entity if, as a result of the merger, the shares in the corporation would become, or be converted into or exchanged for the right to receive, shares or other equity interests in a domestic or foreign public benefit corporation or similar entity. The restrictions of this section shall not apply prior to the time that the corporation has received payment for any of its capital stock.
(2) Any stockholder of a corporation that is not a public benefit corporation who:
(a) Holds shares of stock of the corporation immediately prior to the effective time of:
1. An amendment to the corporation’s articles of incorporation to become a public benefit corporation; or
2. A merger that would result in the conversion of the corporation’s stock into, or exchange of the corporation’s stock for the right to receive, shares or other equity interests in a domestic or foreign public benefit corporation or similar entity; and
(b) Has not voted in favor of the amendment, merger, or consolidation or consented thereto in writing;
shall be entitled to exercise dissenters’ rights under Subtitle 13 of this chapter.
(3) Notwithstanding any other provisions of this chapter, a corporation that is a public benefit corporation shall not, without the approval of two-thirds (2/3) of the outstanding shares of each class of the stock of the corporation of which there are outstanding shares, whether voting or nonvoting:
(a) Amend its articles of incorporation to delete the election to be a public benefit corporation; or
(b) Merge with or into another entity if, as a result of the merger, the shares in the corporation would become, or be converted into or exchanged for the right to receive, shares or other equity interests in a domestic or foreign corporation that is not a public benefit corporation or similar entity and the articles of incorporation of which does not contain the identical public benefit or public benefits as the public benefit corporation identified in its articles of incorporation.
Effective: June 29, 2017
History: Created 2017 Ky. Acts ch. 28, sec. 3, effective June 29, 2017.