Law Change Affects Conversions in NC

Incorporating Services, Ltd. (Incserv) is an active member of the National Public Records Research Association (NPRRA). One of the many benefits of this membership is the continuous flow of information from other members regarding changes in policy, law and processing of public records searching and filing across the US. We received the below information from the NPRRA on Monday, August 29, 2016.

North Carolina SB 482 (Session Law 2016-114) was signed into law by North Carolina Governor Pat McCrory on July 28, 2016. Amongst other things, the law is amended to allow the conversion of a charitable or religious corporation to a LLC, if the sole member of the surviving entity immediately after the conversion is a charitable or religious corporation. The bill is effective October 1, 2016.

SECTION 3, G.S. 57D-9-20 reads as rewritten: Ҥ 57D-9-20. Conversion:

(a) An eligible entity other than an LLC may convert to an LLC if both of the following requirements are met:

(1) The conversion is permitted by the law governing the organization and internal affairs of the converting entity.

(2) The converting entity complies with the requirements of this Part and, to the extent applicable, the law governing its organization and internal affairs immediately before the conversion.

(b) The conversion of a charitable or religious corporation to an LLC is permitted by law if the sole member of the surviving entity immediately after the conversion is a charitable or religious corporation. This subsection shall not limit the ability of an eligible entity to convert to an LLC if otherwise permitted by law.

(c) For purposes of this section, charitable or Religious Corporation shall be as defined in G.S. 55A-1-40(4).”

For information and to read the full bill please go to: http://www.ncleg.net/gascripts/BillLookUp/BillLookUp.pl?Session=2015&BillID=s482

For assistance in North Carolina with Charitable or Religious Corporations, contact our office at ncorders@incserv.com.

The information within this post is intended for general information purposes only. Incserv and its employees cannot offer legal or financial advice. Please consult with your legal counsel for assistance in how this information may or may not affect you and your business prior to making any decisions. The above information (and any attachments) should be judged accordingly.