Iowa Code 490.932 – Action on a plan of conversion
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In the case of a conversion of a domestic corporation to a domestic or foreign eligible entity, the plan of conversion shall be adopted in the following manner:
1. The plan of conversion shall first be adopted by the board of directors.
Terms Used In Iowa Code 490.932
- Articles of incorporation: means the articles of incorporation described in section 490. See Iowa Code 490.140
- 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.
- Entity: includes a domestic and foreign business corporation; domestic and foreign nonprofit corporation; estate; trust; domestic and foreign unincorporated entity; and a state, the United States, and a foreign government. See Iowa Code 490.140
- following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
- Interest: means either or both of the following rights under the organic law governing an unincorporated entity:a. See Iowa Code 490.140
- Interest holder: means a person who holds of record an interest. See Iowa Code 490.140
- Interest holder liability: means any of the following:
(1) Personal liability for a debt, obligation, or other liability of a domestic or foreign corporation or eligible entity that is imposed on a person by any of the following:(a) Solely by reason of the person's status as a shareholder, member, or interest holder. See Iowa Code 490.140- Organic rules: means the public organic record and private organic rules of a domestic or foreign corporation or eligible entity. See Iowa Code 490.140
- Plan: means a plan of domestication, conversion, merger, or share exchange. See Iowa Code 490.120
- Proceeding: includes a civil suit and criminal, administrative, and investigatory action. See Iowa Code 490.140
- Quorum: The number of legislators that must be present to do business.
- Shareholder: means a record shareholder. See Iowa Code 490.140
- Shares: means the units into which the proprietary interests in a domestic or foreign corporation are divided. See Iowa Code 490.140
- state: when applied to the different parts of the United States, includes the District of Columbia and the territories, and the words "United States" may include the said district and territories. See Iowa Code 4.1
- Voting group: means all shares of one or more classes or series that under the articles of incorporation or this chapter are entitled to vote and be counted together collectively on a matter at a meeting of shareholders. See Iowa Code 490.140
- written: means any information in the form of a document. See Iowa Code 490.140
2. a. The plan of conversion shall then be approved by the shareholders. In submitting the plan of conversion to the shareholders for their approval, the board of directors must recommend that the shareholders approve the plan, unless any of the following applies:(1) The board of directors makes a determination that because of conflicts of interest or other special circumstances it should not make such a recommendation.(2) Section 490.826 applies.b. If paragraph “a”, subparagraph (1) or (2) applies, the board of directors shall inform the shareholders of the basis for its so proceeding.3. The board of directors may set conditions for approval of the plan of conversion by the shareholders or the effectiveness of the plan of conversion.4. If the approval of the shareholders is to be given at a meeting, the corporation shall notify each shareholder, regardless of whether entitled to vote, of the meeting of shareholders 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. The notice must include or be accompanied by a copy of the organic rules of the converted entity which are to be in writing as they will be in effect immediately after the conversion.5. Unless the articles of incorporation, bylaws, or the board of directors acting pursuant to subsection 3, require a greater vote or a greater quorum, approval of the plan of conversion requires all of the following:a. The approval of the shareholders at a meeting at which a quorum exists consisting of a majority of the votes entitled to be cast on the plan.b. Except as provided in subsection 6, the approval of each class or series of shares 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 by that voting group.6. If as a result of the conversion one or more shareholders of the converting domestic corporation would become subject to interest holder liability, approval of the plan of conversion shall require the signing in connection with the transaction, by each such shareholder, of a separate written consent to become subject to such interest holder liability.