LLC & NONPROFIT CORP. MERGERS S.B. 929:
SUMMARY OF INTRODUCED BILL
IN COMMITTEE
Senate Bill 929 (as introduced 5-7-14)
Committee: Economic Development
CONTENT
The bill would amend the Michigan Limited Liability Company Act to authorize the merger of a domestic limited liability company (LLC) with a nonprofit corporation.
Section 705a of the Act allows one or more domestic LLCs to merge with one or more business organizations under certain circumstances. For purposes of Section 705a, "business organization" means a domestic or foreign corporation, limited partnership, general partnership, or any other type of domestic or foreign business enterprise, except a domestic LLC. The bill would include a domestic or foreign nonprofit corporation in the definition of "business organization".
The bill also would define "nonprofit corporation" as a corporation that is incorporated to carry out any lawful purpose or purposes that do not involve pecuniary profit or gain for its directors, officers, shareholders, or members, including a corporation formed under or subject to the Nonprofit Corporate Act.
The bill is tie-barred to Senate Bills 623 and 624. (Senate Bill 623 would make general amendments to the Nonprofit Corporation Act and Senate Bill 624 would amend Public Act 169 of 1965, which regulates the dissolution of charitable purpose corporations.)
MCL 450.4705a Legislative Analyst: Patrick Affholter
FISCAL IMPACT
The bill would have no fiscal impact on State or local government.
This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent.