§415A-16.5  Conversion into and fromprofessional corporations.  (a)  A professional corporation may adopt aplan of conversion and convert to any other entity if:

(1)  The board of directors and shareholders of theprofessional corporation approve a plan of conversion in the manner prescribedby section 414-313 and the conversion is treated as a merger to whichthe converting entity is a party and not the surviving entity;

(2)  The conversion is permitted by and complies withthe laws of the state or country in which the converted entity is to beincorporated, formed, or organized; and the incorporation, formation, ororganization of the converted entity complies with such laws;

(3)  At the time the conversion becomes effective,each shareholder of the converting entity, unless otherwise agreed to by thatshareholder, owns an equity interest or other ownership interest in, and is ashareholder, partner, member, owner, or other security holder of, the convertedentity;

(4)  The shareholders of the professional corporation,as a result of the conversion, shall not become personally liable without theshareholders' consent, for the liabilities or obligations of the convertedentity; and

(5)  The converted entity is incorporated, formed, ororganized as part of or pursuant to the plan of conversion.

(b)  Any other entity may adopt a plan ofconversion and convert to a professional corporation if the conversion ispermitted by and complies with the laws under which the other entity isincorporated, formed, or organized.

(c)  A plan of conversion shall set forth:

(1)  The name of the converting entity and theconverted entity;

(2)  A statement that the converting entity iscontinuing its existence in the organizational form of the converted entity;

(3)  A statement describing the organizational form ofthe converted entity and the state or country under the laws of which theconverted entity is to be incorporated, formed, or organized; and

(4)  The manner and basis of converting the shares orother forms of ownership of the converting entity into shares or other forms ofownership of the converted entity, or any combination thereof.

(d)  A plan of conversion may set forth anyother provisions relating to the conversion that are not prohibited by law,including without limitation the initial bylaws and officers of the convertedentity.

(e)  After a conversion of a professionalcorporation is approved, and at any time before the conversion becomeseffective, the plan of conversion may be abandoned by the professionalcorporation without shareholder action and in accordance with the proceduresset forth in the plan of conversion or, if these procedures are not provided inthe plan, in the manner determined by the board of directors.  If articles ofconversion have been filed with the director but the conversion has not becomeeffective, the conversion may be abandoned if a statement, executed on behalfof the converting entity by an officer or other duly authorized representativeand stating that the plan of conversion has been abandoned in accordance withapplicable law, is filed with the director prior to the effective date of theconversion.  If the director finds that the statement satisfies therequirements provided by law, the director, after all fees have been paidshall:

(1)  Stamp the word "Filed" on the statementand the date of the filing;

(2)  File the document in the director's office; and

(3)  Issue a certificate of abandonment to theconverting entity or its authorized representatives.

(f)  Once the statement provided in subsection(e) is filed with the director, the conversion shall be deemed abandoned andshall not be effective. [L 1999, c 280, pt of §2; am L 2001, c 129, §54; am L2002, c 40, §49]