35-14-921. Action on plan of domestication. In the case of a domestication of a domestic corporation into a foreign jurisdiction, the plan of domestication must be adopted in the following manner:

(1) The plan of domestication must first be adopted by the board of directors.

(2) (a) The plan of domestication must then be approved by the shareholders. In submitting the plan of domestication to the shareholders for approval, the board of directors shall recommend that the shareholders approve the plan unless:

(i) the board of directors makes a determination that because of conflicts of interest or other special circumstances it should not make the recommendation; or

(ii) 35-14-826 applies.

(b) If either subsection (2)(a)(i) or (2)(a)(ii) applies, the board shall inform the shareholders of the basis for its determination.

(3) The board of directors may set conditions for approval of the plan of domestication by the shareholders or for the effectiveness of the plan of domestication.

(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 domestication 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 domestication 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 articles of incorporation and the bylaws as they will be in effect immediately after the domestication.

(5) Unless the articles of incorporation or the board of directors acting pursuant to subsection (3) requires a greater vote or a lesser vote, approval of the plan of domestication requires the approval of a majority of the votes entitled to be cast on the plan and, except as provided in subsection (6), the approval of a majority of the votes entitled to be cast on the plan by any class or series of shares entitled to vote as a separate group on the plan. The articles of incorporation may not provide a lower quorum for a voting group than shares representing a majority of the votes entitled to be cast on the matter by the voting group or a lesser vote for a voting group than is provided for in 35-14-725(3).

(6) The articles of incorporation may expressly limit or eliminate the separate voting rights in subsection (5) of any class or series of shares, except when the articles of incorporation of the foreign corporation resulting from the domestication include what would be in effect an amendment that would entitle the class or series to vote as a separate group under 35-14-1004 if it were a proposed amendment of the articles of incorporation of the domestic domesticating corporation.

(7) If as a result of a domestication one or more shareholders of a domestic domesticating corporation would become subject to interest holder liability, approval of the plan of domestication must require the signing in connection with the domestication, by each affected shareholder, of a separate written consent to become subject to the interest holder liability unless, in the case of a shareholder that already has interest holder liability with respect to the domesticating corporation, the terms and conditions of the interest holder liability with respect to the domesticated corporation are substantially identical to those of the existing interest holder liability, other than changes that eliminate or reduce that interest holder liability.

History: En. Sec. 139, Ch. 271, L. 2019.