(a) Except as otherwise provided in this section, by complying with this subchapter, a domestic entity may become:
(1) A domestic entity of a different type; or
(2) A foreign entity of a different type if the conversion is authorized by the law of the foreign jurisdiction.
(b) Except as otherwise provided in this section, by complying with the provisions of this subchapter applicable to foreign entities, a foreign entity may become a domestic entity of a different type if the conversion is authorized by the law of the foreign entity's jurisdiction of organization.
(c) If a protected agreement contains a provision that applies to a merger of a domestic entity but does not refer to a conversion, the provision shall apply to a conversion of the entity as if the conversion were a merger until the provision is amended after the effective date of this chapter.
(July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720.)
HISTORICAL AND STATUTORY NOTES
Legislative History of Laws
For history of Law 18-378, see notes under § 29-101.01.
(a) A domestic entity may convert to a different type of entity under this subchapter by approving a plan of conversion. The plan shall be in a record and contain:
(1) The name and type of the converting entity;
(2) The name, jurisdiction of organization, and type of the converted entity;
(3) The manner of converting the interests in the converting entity into interests, securities, obligations, rights to acquire interests or securities, cash, or other property, or any combination of the foregoing;
(4) The proposed public organic document of the converted entity if it will be a filing entity;
(5) The full text of the private organic rules of the converted entity that are proposed to be in a record;
(6) The other terms and conditions of the conversion; and
(7) Any other provision required by the law of the District or the organic rules of the converting entity.
(b) A plan of conversion may contain any other provision not prohibited by law.
(July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720.)
HISTORICAL AND STATUTORY NOTES
Legislative History of Laws
For history of Law 18-378, see notes under § 29-101.01.
(a) A plan of conversion shall not be effective unless it has been approved:
(1) By a domestic converting entity:
(A) In accordance with the requirements, if any, in its organic rules for approval of a conversion;
(B) If its organic rules do not provide for approval of a conversion, in accordance with the requirements, if any, in its organic law and organic rules for approval of:
(i) In the case of an entity that is not a business corporation, a merger, as if the conversion were a merger; or
(ii) In the case of a business corporation, a merger requiring approval by a vote of the interest holders of the business corporation as if the conversion were that type of merger; or
(C) If its organic law or organic rules do not provide for approval of a conversion or a merger described in subparagraph (B)(ii) of this paragraph, by all of the interest holders of the entity entitled to vote on or consent to any matter; and
(2) In a record, by each interest holder of a domestic converting entity that will have interest holder liability for liabilities that arise after the conversion becomes effective, unless, in the case of an entity that is not a business or nonprofit corporation:
(A) The organic rules of the entity provide in a record for the approval of a conversion or a merger in which some or all of its interest holders become subject to interest holder liability by the vote or consent of less than all of the interest holders; and
(B) The interest holder voted for or consented in a record to that provision of the organic rules or became an interest holder after the adoption of that provision.
(b) A conversion of a foreign converting entity shall not be effective unless it is approved by the foreign entity in accordance with the law of the foreign entity's jurisdiction of organization.
(July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720.)
HISTORICAL AND STATUTORY NOTES
Legislative History of Laws
For history of Law 18-378, see notes under § 29-101.01.
(a) A plan of conversion of a domestic converting entity may be amended:
(1) In the same manner as the plan was approved if the plan does not provide for the manner in which it may be amended; or
(2) By the governors or interest holders of the entity in the manner provided in the plan, but an interest holder that was entitled to vote on or consent to approval of the conversion is entitled to vote on or consent to any amendment of the plan that will change:
(A) The amount or kind of interests, securities, obligations, rights to acquire interests or securities, cash, or other property, or any combination of the foregoing, to be received by any of the interest holders of the converting entity under the plan;
(B) The public organic document or private organic rules of the converted entity that will be in effect immediately after the conversion becomes effective, except for changes that do not require approval of the interest holders of the converted entity under its organic law or organic rules; or
(C) Any other terms or conditions of the plan if the change would adversely affect the interest holder in any material respect.
(b) After a plan of conversion has been approved by a domestic converting entity and before a statement of conversion becomes effective, the plan may be abandoned:
(1) As provided in the plan; or
(2) Unless prohibited by the plan, in the same manner as the plan was approved.
(c) If a plan of conversion is abandoned after a statement of conversion has been filed with the Mayor and before the filing becomes effective, a statement of abandonment, signed on behalf of the entity, shall be filed with the Mayor before the time the statement of conversion becomes effective. The statement of abandonment shall be effective upon filing, and the conversion shall be abandoned and shall not become effective. The statement of abandonment shall contain:
(1) The name of the converting entity;
(2) The date on which the statement of conversion was filed; and
(3) A statement that the conversion has been abandoned in accordance with this section.
(July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720.)
HISTORICAL AND STATUTORY NOTES
Legislative History of Laws
For history of Law 18-378, see notes under § 29-101.01.
(a) A statement of conversion shall be signed on behalf of the converting entity and filed with the Mayor.
(b) A statement of conversion shall contain:
(1) The name, jurisdiction of organization, and type of the converting entity;
(2) The name, jurisdiction of organization, and type of the converted entity;
(3) If the statement of conversion is not to be effective upon filing, the later date and time on which it will become effective, which shall not be more than 90 days after the date of filing;
(4) If the converting entity is a domestic entity, a statement that the plan of conversion was approved in accordance with this subchapter or, if the converting entity is a foreign entity, a statement that the conversion was approved by the foreign converting entity in accordance with the law of its jurisdiction of organization;
(5) If the converted entity is a domestic filing entity, the text of its public organic document as an attachment; and
(6) If the converted entity is a domestic limited liability partnership, the text of its statement of qualification as an attachment; and
(7) If the converted entity is a foreign entity that is not a qualified foreign entity, a mailing address to which process may be served pursuant to § 29- 204.06(e).
(c) In addition to the requirements of subsection (b) of this section, a statement of conversion may contain any other provision not prohibited by law.
(d) If the converted entity is a domestic entity, its public organic document, if any, shall satisfy the requirements of the law of the District, except that it does not need to be signed and may omit any provision that is not required to be included in a restatement of the public organic document.
(e) A plan of conversion that is signed on behalf of a domestic converting entity and meets all of the requirements of subsection (b) of this section may be filed with the Mayor instead of a statement of conversion and, upon filing, shall have the same effect. If a plan of conversion is filed as provided in this subsection, references in this chapter to a statement of conversion shall refer to the plan of conversion filed under this subsection.
(f) A statement of conversion shall be effective upon the date and time of filing or the later date and time specified in the statement of conversion.
(July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720.)
HISTORICAL AND STATUTORY NOTES
Legislative History of Laws
For history of Law 18-378, see notes under § 29-101.01.
(a) When a conversion becomes effective:
(1) The converted entity shall be:
(A) Organized under and subject to the organic law of the converted entity; and
(B) The same entity without interruption as the converting entity;
(2) All property of the converting entity shall continue to be vested in the converted entity without assignment, reversion, or impairment;
(3) All liabilities of the converting entity shall continue as liabilities of the converted entity;
(4) Except as otherwise provided by law other than this chapter or the plan of conversion, all of the rights, privileges, immunities, powers, and purposes of the converting entity shall remain in the converted entity;
(5) The name of the converted entity may be substituted for the name of the converting entity in any pending action or proceeding;
(6) If a converted entity is a filing entity, its public organic document shall be effective and shall be binding on its interest holders;
(7) If the converted entity is a limited liability partnership, its statement of qualification shall be effective simultaneously;
(8) The private organic rules of the converted entity that are to be in a record, if any, approved as part of the plan of conversion shall be effective and shall be binding on and enforceable by:
(A) Its interest holders; and
(B) In the case of a converted entity that is not a business corporation or nonprofit corporation, any other person that is a party to an agreement that is part of the entity's private organic rules; and
(9) The interests in the converting entity shall be converted, and the interest holders of the converting entity shall be entitled only to the rights provided to them under the plan of conversion, and to any appraisal rights they have under § 29-201.09 and the converting entity's organic law.
(b) Except as otherwise provided in the organic law or organic rules of the converting entity, the conversion shall not give rise to any rights that an interest holder, governor, or third party would otherwise have upon a dissolution, liquidation, or winding-up of the converting entity.
(c) When a conversion becomes effective, a person that did not have interest holder liability with respect to the converting entity and that becomes subject to interest holder liability with respect to a domestic entity as a result of a conversion shall have interest holder liability only to the extent provided by the organic law of the entity and only for those liabilities that arise after the conversion becomes effective.
(d) When a conversion becomes effective:
(1) The conversion shall not discharge any interest holder liability under the organic law of a domestic converting entity to the extent the interest holder liability arose before the conversion became effective;
(2) A person shall not have interest holder liability under the organic law of a domestic converting entity for any liability that arises after the conversion becomes effective;
(3) The organic law of a domestic converting entity shall continue to apply to the release, collection, or discharge of any interest holder liability preserved under paragraph (1) of this subsection as if the conversion had not occurred; and
(4) A person has whatever rights of contribution from any other person as are provided by the organic law or organic rules of the domestic converting entity with respect to any interest holder liability preserved under paragraph (1) of this subsection as if the conversion had not occurred.
(e) When a conversion becomes effective, a foreign entity that is the converted entity may be served with process in the District for the collection and enforcement of any of its liabilities in the manner provided in § 29-104.12.
(f) If the converting entity is a qualified foreign entity, the certificate of registration or other foreign qualification of the converting entity shall be canceled when the conversion becomes effective.
(g) A conversion shall not require the entity to wind up its affairs and shall not constitute or cause the dissolution of the entity.
(July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720.)
HISTORICAL AND STATUTORY NOTES
Legislative History of Laws
For history of Law 18-378, see notes under § 29-101.01.
