State Codes and Statutes

Statutes > Utah > Title-16 > Chapter-16 > 16-16-1603

16-16-1603. Action on plan of conversion by converting limited cooperativeassociation.
(1) For a limited cooperative association to convert to another entity, a plan ofconversion shall be approved by a majority of the board of directors, or a greater percentage ifrequired by the organic rules, and the board of directors shall call a members meeting to considerthe plan of conversion, hold the meeting not later than 90 days after approval of the plan by theboard, and mail or otherwise transmit or deliver in a record to each member:
(a) the plan, or a summary of the plan and a statement of the manner in which a copy ofthe plan in a record may be reasonably obtained by a member;
(b) a recommendation that the members approve the plan of conversion, or if the boarddetermines that because of a conflict of interest or other circumstances it should not make afavorable recommendation, the basis for that determination;
(c) a statement of any condition of the board's submission of the plan of conversion tothe members; and
(d) notice of the meeting at which the plan of conversion will be considered, which shallbe given in the same manner as notice of a special meeting of members.
(2) Subject to Subsections (3) and (4), a plan of conversion shall be approved by:
(a) at least two-thirds of the voting power of members present at a members meetingcalled under Subsection (1); and
(b) if the limited cooperative association has investor members, at least a majority of thevotes cast by patron members, unless the organic rules require a greater percentage vote bypatron members.
(3) The organic rules may require that the percentage of votes under Subsection (2)(a) is:
(a) a different percentage that is not less than a majority of members voting at themeeting;
(b) measured against the voting power of all members; or
(c) a combination of Subsections (3)(a) and (b).
(4) The vote required to approve a plan of conversion may not be less than the voterequired for the members of the limited cooperative association to amend the articles oforganization.
(5) Consent in a record to a plan of conversion by a member shall be delivered to thelimited cooperative association before delivery of articles of conversion for filing if as a result ofthe conversion the member will have:
(a) personal liability for an obligation of the association; or
(b) an obligation or liability for an additional contribution.
(6) Subject to Subsection (5) and any contractual rights, after a conversion is approvedand at any time before the effective date of the conversion, a converting limited cooperativeassociation may amend a plan of conversion or abandon the planned conversion:
(a) as provided in the plan; and
(b) except as prohibited by the plan, by the same affirmative vote of the board ofdirectors and of the members as was required to approve the plan.
(7) The voting requirements for districts, classes, or voting groups under Section16-16-404 apply to approval of a conversion under this part.

Amended by Chapter 378, 2010 General Session