S 834 Session 115 (2003-2004)
S 0834 General Bill, By Hayes, Kuhn, Knotts and Branton
Similar(H 4650)
A BILL TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING CHAPTER 9
TO TITLE 33 SO AS TO PROVIDE FOR PROCEDURES FOR, AND THE LEGAL EFFECT OF,
DOMESTICATION IN SOUTH CAROLINA OF A FOREIGN CORPORATION; BY ADDING ARTICLE 14
TO CHAPTER 41 OF TITLE 33 AND ARTICLE 12 TO CHAPTER 42 OF TITLE 33, SO AS TO
PROVIDE FOR PROCEDURES FOR, AND THE LEGAL EFFECTS OF, THE MERGERS WITH OTHER
ENTITIES OF A PARTNERSHIP AND A LIMITED PARTNERSHIP, RESPECTIVELY; BY ADDING
SECTIONS 33-11-109 AND 33-11-110, SO AS TO PROVIDE FOR THE CONVERSION OF A
PARTNERSHIP OR LIMITED PARTNERSHIP TO A CORPORATION, SECTIONS 33-11-111 AND
33-11-112, SO AS TO PROVIDE FOR A CONVERSION OF A CORPORATION TO A LIMITED
LIABILITY COMPANY, AND SECTIONS 33-11-113 AND 33-11-114, SO AS TO PROVIDE FOR
CONVERSION OF A CORPORATION TO A PARTNERSHIP OR A LIMITED PARTNERSHIP, AND
SECTION 33-11-115, SO AS TO PROVIDE THAT THESE CONVERSIONS MAY BE UNDERTAKEN
PURSUANT TO OTHER LAW; BY ADDING SECTIONS 33-44-908, 33-44-909, 33-44-910,
33-44-911, 33-44-912, 33-44-913, AND 33-44-914, SO AS TO PROVIDE FOR
PROCEDURES FOR, AND THE LEGAL EFFECTS OF, CONVERSIONS OF A LIMITED LIABILITY
COMPANY TO A CORPORATION, A LIMITED PARTNERSHIP, OR A PARTNERSHIP,
RESPECTIVELY; BY ADDING SECTION 33-44-1208, SO AS TO PROVIDE FOR CIRCUMSTANCES
UNDER WHICH A FOREIGN CORPORATION IS NOT REQUIRED TO OBTAIN AUTHORITY TO DO
BUSINESS IN THIS STATE; BY ADDING SECTION 36-8-307, SO AS TO REQUIRE THE
TRANSFEROR OF A SECURITY FOR VALUE TO PROVIDE DOCUMENTATION NECESSARY FOR
REGISTRATION OF THE SECURITY; TO AMEND SECTION 33-1-220, AS AMENDED, RELATING
TO FILING, SERVICE, AND COPYING FEES PAYABLE TO THE SECRETARY OF STATE, SO AS
TO INCLUDE FEES FOR FILING OF ARTICLES OF DOMESTICATION AND ARTICLES OF C
01/14/04 Senate Introduced and read first time SJ-8
01/14/04 Senate Referred to Committee on Judiciary SJ-8
S. 834
A BILL
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING CHAPTER 9 TO TITLE 33 SO AS TO PROVIDE FOR PROCEDURES FOR, AND THE LEGAL EFFECT OF, DOMESTICATION IN SOUTH CAROLINA OF A FOREIGN CORPORATION; BY ADDING ARTICLE 14 TO CHAPTER 41 OF TITLE 33 AND ARTICLE 12 TO CHAPTER 42 OF TITLE 33, SO AS TO PROVIDE FOR PROCEDURES FOR, AND THE LEGAL EFFECTS OF, THE MERGERS WITH OTHER ENTITIES OF A PARTNERSHIP AND A LIMITED PARTNERSHIP, RESPECTIVELY; BY ADDING SECTIONS 33-11-109 AND 33-11-110, SO AS TO PROVIDE FOR THE CONVERSION OF A PARTNERSHIP OR LIMITED PARTNERSHIP TO A CORPORATION, SECTIONS 33-11-111 AND 33-11-112, SO AS TO PROVIDE FOR A CONVERSION OF A CORPORATION TO A LIMITED LIABILITY COMPANY, AND SECTIONS 33-11-113 AND 33-11-114, SO AS TO PROVIDE FOR CONVERSION OF A CORPORATION TO A PARTNERSHIP OR A LIMITED PARTNERSHIP, AND SECTION 33-11-115, SO AS TO PROVIDE THAT THESE CONVERSIONS MAY BE UNDERTAKEN PURSUANT TO OTHER LAW; BY ADDING SECTIONS 33-44-908, 33-44-909, 33-44-910, 33-44-911, 33-44-912, 33-44-913, AND 33-44-914, SO AS TO PROVIDE FOR PROCEDURES FOR, AND THE LEGAL EFFECTS OF, CONVERSIONS OF A LIMITED LIABILITY COMPANY TO A CORPORATION, A LIMITED PARTNERSHIP, OR A PARTNERSHIP, RESPECTIVELY; BY ADDING SECTION 33-44-1208, SO AS TO PROVIDE FOR CIRCUMSTANCES UNDER WHICH A FOREIGN CORPORATION IS NOT REQUIRED TO OBTAIN AUTHORITY TO DO BUSINESS IN THIS STATE; BY ADDING SECTION 36-8-307, SO AS TO REQUIRE THE TRANSFEROR OF A SECURITY FOR VALUE TO PROVIDE DOCUMENTATION NECESSARY FOR REGISTRATION OF THE SECURITY; TO AMEND SECTION 33-1-220, AS AMENDED, RELATING TO FILING, SERVICE, AND COPYING FEES PAYABLE TO THE SECRETARY OF STATE, SO AS TO INCLUDE FEES FOR FILING OF ARTICLES OF DOMESTICATION AND ARTICLES OF CONVERSION; TO AMEND SECTION 33-1-400, AS AMENDED, RELATING TO DEFINITIONS FOR PURPOSES OF THE SOUTH CAROLINA BUSINESS CORPORATION ACT, SO AS TO INCLUDE DEFINITIONS FOR "LIMITED PARTNERSHIP" AND "PARTNERSHIP"; TO AMEND SECTION 33-2-102, AS AMENDED, RELATING TO ARTICLES OF INCORPORATION, SO AS TO DELETE THE REQUIREMENT OF AN INITIAL ANNUAL REPORT; TO AMEND SECTION 33-4-104, AS AMENDED, RELATING TO THE FILING OF A NAME CHANGE BY A CORPORATION OWNING REAL PROPERTY, SO AS TO PROVIDE FOR FILING UPON THE CONVERSION OR DOMESTICATION OF A CORPORATION; TO AMEND SECTION 33-6-260, AS AMENDED, RELATING TO THE ISSUANCE OF CORPORATE SHARES WITHOUT A CERTIFICATE, SO AS TO REQUIRE A WRITTEN STATEMENT CONTAINING THE CERTIFICATION INFORMATION UPON THE ISSUE OR TRANSFER; TO AMEND SECTION 33-11-101, AS AMENDED, RELATING TO ENTITIES WITH WHICH A CORPORATION MAY MERGE, SO AS TO INCLUDE A DOMESTIC OR FOREIGN LIMITED LIABILITY COMPANY, PARTNERSHIP, LIMITED PARTNERSHIP, OR OTHER ENTITY; TO AMEND SECTIONS 33-11-105 AND 33-11-106, BOTH RELATING TO THE MERGER OF A SUBSIDIARY OF A CORPORATION AND THE EFFECT OF THE MERGER OR EXCHANGE OF STOCK, SO AS TO SUBSTITUTE "ENTITY" FOR "CORPORATION"; TO AMEND SECTION 33-13-102, AS AMENDED, RELATING TO A SHAREHOLDER'S RIGHT OF DISSENT AND PAYMENT UPON CERTAIN CORPORATE ACTIONS, SO AS TO DELETE A REFERENCE TO A NONPUBLIC CORPORATION AND TO PROVIDE FOR CONVERSION OF A CORPORATION INTO ANOTHER ENTITY; TO AMEND SECTION 33-14-107, RELATING TO UNKNOWN CLAIMS AGAINST A CORPORATION, SO AS TO INCREASE THE TIME FOR ENFORCING THE CLAIM TO TEN YEARS AFTER PUBLICATION OF NOTICE OF DISSOLUTION AND TO PROVIDE FOR A CLAIM ARISING AFTER DISSOLUTION; TO AMEND SECTION 33-14-200, AS AMENDED, AND SECTION 33-14-210, BOTH RELATING TO ADMINISTRATIVE DISSOLUTION OF A CORPORATION, BOTH SO AS TO CORRECT A CROSS-REFERENCE TO THE STATE INCOME TAX PROVISIONS; TO AMEND SECTION 33-15-101, AS AMENDED, RELATING TO ACTIVITIES NOT CONSTITUTING THE TRANSACTION OF BUSINESS BY A CORPORATION, SO AS TO INCLUDE THE MERE OWNERSHIP OF AN INTEREST IN A LIMITED LIABILITY COMPANY IN THIS STATE; TO AMEND SECTION 33-15-103, AS AMENDED, RELATING TO APPLICATION FOR A CERTIFICATE OF AUTHORITY FOR A FOREIGN CORPORATION TO DO BUSINESS IN THIS STATE, SO AS TO CORRECT A CROSS-REFERENCE; TO AMEND SECTIONS 33-15-300 AND 33-15-310, BOTH AS AMENDED, BOTH RELATING TO REVOCATION OF A CERTIFICATE OF AUTHORITY OF A FOREIGN CORPORATION TO DO BUSINESS IN THIS STATE, BOTH SO AS TO CORRECT A CROSS-REFERENCE TO A STATE INCOME TAX PROVISION; TO AMEND SECTION 33-31-1101, RELATING TO THE MERGER OF A NONPROFIT CORPORATION AND THE MERGER OF A BUSINESS CORPORATION, SO AS TO PROVIDE FOR MERGERS WITH A DOMESTIC OR FOREIGN LIMITED LIABILITY COMPANY, PARTNERSHIP, LIMITED PARTNERSHIP, OR OTHER ENTITY; TO AMEND SECTION 33-42-1690, RELATING TO ACTIVITIES NOT CONSIDERED THE TRANSACTION OF BUSINESS BY A LIMITED PARTNERSHIP, SO AS TO INCLUDE THE MERE OWNERSHIP OF AN INTEREST IN A LIMITED LIABILITY COMPANY IN THIS STATE; TO AMEND SECTION 33-44-208, RELATING TO CERTIFICATES OF EXISTENCE OR AUTHORITY OF A LIMITED LIABILITY COMPANY, SO AS TO DELETE REFERENCES TO ITS MOST RECENT ANNUAL REPORT; TO AMEND SECTION 33-44-404, AS AMENDED, RELATING TO MANAGEMENT ISSUES OF A LIMITED LIABILITY COMPANY REQUIRING CONSENT BY ALL MEMBERS, SO AS TO CORRECT A CROSS-REFERENCE; TO AMEND SECTION 33-44-410, RELATING TO ACTIONS BY A MEMBER OF A LIMITED LIABILITY COMPANY SO AS TO PROVIDE FOR ACTIONS BY A MANAGER OF THE COMPANY; TO AMEND SECTION 33-44-801, AS AMENDED, RELATING TO EVENTS GIVING RISE TO THE DISSOLUTION OF A LIMITED LIABILITY COMPANY, SO AS TO PROVIDE FOR THE EFFECT OF AN AGREEMENT CHANGING THE STATUTORY PROVISIONS FOR THE PURCHASE OF A DISTRIBUTIONAL INTEREST; TO AMEND SECTION 33-44-806, RELATING TO DISTRIBUTING OF ASSETS IN THE WINDING UP OF THE BUSINESS OF A LIMITED LIABILITY COMPANY, SO AS TO PROVIDE THAT THE DISTRIBUTION TO MEMBERS ACCORD WITH THEIR POSITIVE CAPITAL ACCOUNT BALANCES; TO AMEND SECTION 33-44-809, RELATING TO GROUNDS FOR ADMINISTRATIVE DISSOLUTION OF A LIMITED LIABILITY COMPANY, SO AS TO DELETE THE REQUIREMENT FOR AN ANNUAL REPORT FILED WITH THE SECRETARY OF STATE; TO AMEND SECTION 33-44-903, RELATING TO THE EFFECT OF CONVERSION OF AN ENTITY TO A LIMITED LIABILITY COMPANY, SO AS TO REQUIRE A FILING GIVING NOTICE OF THE NAME CHANGE IF THE ENTITY OWNS REAL PROPERTY IN THIS STATE; TO AMEND SECTION 33-44-905, RELATING TO ARTICLES OF MERGER OF A LIMITED LIABILITY COMPANY, SO AS TO PROVIDE FOR A FOREIGN ENTITY AS A MERGING OR SURVIVING ENTITY OF THE MERGER; TO AMEND SECTION 33-44-1003, RELATING TO ACTIVITIES NOT CONSTITUTING THE TRANSACTION OF BUSINESS IN THIS STATE BY A FOREIGN CORPORATION, SO AS TO INCLUDE THE MERE OWNERSHIP OF AN INTEREST IN A LIMITED LIABILITY COMPANY IN THIS STATE; TO AMEND SECTION 33-44-1006, RELATING TO REVOCATION OF THE AUTHORITY OF A FOREIGN CORPORATION TO DO BUSINESS IN THIS STATE, SO AS TO DELETE THE REQUIREMENT OF FILING AN ANNUAL REPORT WITH THE SECRETARY OF STATE; TO AMEND SECTION 33-44-1204 , RELATING TO FEES COLLECTIBLE BY THE SECRETARY OF STATE FROM A LIMITED LIABILITY COMPANY, SO AS TO DELETE THE FEE FOR FILING AN ANNUAL REPORT; TO AMEND SECTION 38-90-20, RELATING TO LICENSING REQUIREMENTS FOR A CAPTIVE INSURANCE COMPANY, SO AS TO REQUIRE LICENSING FOR OPERATION WITHIN THE STATE; TO AMEND SECTION 38-90-60, AS AMENDED, RELATING TO INCORPORATION OPTIONS AND REQUIREMENTS OF A CAPTIVE INSURANCE COMPANY, SO AS TO REQUIRE APPROVAL BY THE DIRECTOR OF THE DEPARTMENT OF INSURANCE BEFORE THE SECRETARY OF STATE ACTS IN CONNECTION WITH A CAPTIVE INSURANCE COMPANY; TO AMEND SECTION 12-20-40, RELATING TO INITIAL FILINGS WITH THE SECRETARY OF STATE BY A CORPORATION, SO AS TO INCLUDE A DOMESTICATING CORPORATION; AND TO REPEAL SECTION 33-14-410, RELATING TO ACTIONS AND JUDGMENTS AGAINST SHAREHOLDERS OF DISSOLVED CORPORATIONS, SECTION 33-44-211, RELATING TO FILING OF AN ANNUAL REPORT BY A FOREIGN OR DOMESTIC LIMITED LIABILITY COMPANY, AND SECTIONS 39-13-10 THROUGH 39-13-40, RELATING TO NAMES OF BUSINESS ESTABLISHMENTS.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Title 33 of the 1976 Code is amended by adding:
"CHAPTER 9
Domestication of a Foreign Corporation
Section 33-9-100. (a) A foreign corporation may become a domestic corporation by filing with the Secretary of State:
(1) articles of domestication that, upon filing, are the articles of incorporation for the corporation, and include the information required by Section 33-2-102(a)(1) through (3), any optional provisions desired and permitted by Section 33-2-102(b) and (e), and the certifications required by subsection (c) of this section; and
(2) an initial annual report of the corporation as provided in Section 12-20-40.
(b) A foreign corporation that becomes a domestic corporation shall file, within five business days with the state where previously incorporated, articles of dissolution or the equivalent or other appropriate filing permitted by the law of that state.
(c) The articles of domestication shall certify:
(1) the date and jurisdiction of each state where the corporation has been incorporated before the filing of the articles of domestication;
(2) the name of the corporation immediately before the filing of the articles of domestication, as well as the corporate name to be used pursuant to Section 33-4-101;
(3) that the corporation shall file, within five business days with the state where previously incorporated, articles of dissolution or the equivalent, or such other appropriate filing as permitted by the law of such state;
(4) that articles of domestication do not contain a provision that would require action by one or more separate voting groups on a proposed amendment pursuant to Section 33-10-104;
(5) that the filing of the articles of domestication has been authorized by a majority of the votes cast by all shareholders entitled to vote on the proposal, unless a greater vote is required by the articles of incorporation or other charter documents existing immediately before the filing of the articles of incorporation; and
(6) that the articles of dissolution or their equivalent or other appropriate filing as permitted by the law of the state where the corporation was previously incorporated, must be filed within five business days after these articles of domestication are filed.
(d) Upon filing with the Secretary of State of the articles of domestication, the corporation is domesticated in this State, and after that is subject to the South Carolina Business Corporation Act. Notwithstanding the provision of Section 33-2-103, the existence of the corporation is deemed to have commenced on the date the corporation commenced its existence in the jurisdiction in which the corporation was first formed, incorporated, or otherwise came into being.
(e) The filing of the articles of domestication does not affect the choice of law applicable to the corporation; except that, from the date the certificate of domestication is filed, the law of this State, including the South Carolina Business Corporation Act, applies to the corporation to the same extent as if the corporation had been incorporated as a corporation of this State on that date.
(f)(1) If a foreign corporation that owns real property in South Carolina becomes a domestic corporation by domesticating in South Carolina pursuant to this chapter and changes its name pursuant to Section 33-4-101, the newly named surviving corporation must file a notice of that name change in the office of the register of deeds of the county in South Carolina in which the real property is located. If there is no office in that county, the notice of name change must be filed with the clerk of court of the county in which that real property is located.
(2) The filing must be by:
(i) affidavit executed in accordance with the provisions of Section 33-1-200 and containing the old and new names of the corporation, and describing the real property owned by that corporation; or
(ii) filing a certified copy of the articles of domestication including a description of the property; or
(iii) a duly recorded deed of conveyance to the newly named surviving corporation.
(3) The affidavit or filed articles of domestication must be duly indexed in the index of deeds.
(4) The purpose of this subsection is to establish record notice pursuant to Chapter 7 of Title 30. Failure to make the required filing of a corporation name change does not affect the legality, force, effect, or enforceability as between the parties of any conveyance or other transaction involving the real estate owned by the affected corporation which is made after the change in name.
Section 33-9-110. (a) A corporation that is domesticated pursuant to this chapter is for all purposes the same entity that existed before the domestication.
(b) When a domestication is effective:
(1) the title to all real and personal property, both tangible and intangible, of the corporation remains in the corporation without reversion or impairment;
(2) the debts, liabilities, and other obligations of the corporation remain the obligations of the corporation;
(3) an action or proceeding pending against the corporation may be continued against the corporation as if the domestication had not occurred;
(4) the articles of domestication are the articles of incorporation of the corporation;
(5) the shares of the corporation issued and outstanding before the domestication are the shares issued and outstanding of the corporation; and
(6) except as prohibited by other law, all the rights, privileges, immunities, powers, and purposes of the domesticating corporation remain vested in the corporation.
(c) The owner liability of a shareholder in a foreign corporation that is domesticated in this State:
(1) is not discharged as to owner liability pursuant to the laws of the foreign jurisdiction to the extent the owner liability arose before the effective time of the articles of domestication;
(2) does not attach pursuant to the laws of the foreign jurisdiction for any debt, obligation, or liability of the corporation that arises after the effective time of the articles of domestication;
(3) is governed by provisions of the laws of the foreign jurisdiction as to the collection or discharge of owner liability preserved by item (1), as if the domestication had not occurred; and
(4) is subject to the right of contribution from other shareholders as provided by the laws of the foreign jurisdiction with respect to owner liability preserved by item (1), as if the domestication had not occurred.
(d) A shareholder who becomes subject to owner liability for some or all of the debts, obligations, or liabilities of the corporation as a result of its domestication in this State has owner liability only for those debts, obligations, or liabilities of the corporation that arise after the effective time of the articles of domestication."
SECTION 2. Chapter 41, Title 33 of the 1976 Code is amended by adding:
"Article 14
Mergers
Section 33-41-1310. (a) Pursuant to a plan of merger approved pursuant to subsection (c), a partnership may be merged with or into one or more partnerships, foreign partnerships, corporations, foreign corporations, limited liability companies, foreign limited liability companies, limited partnerships, foreign limited partnerships, or other domestic or foreign entities.
(b) A plan of merger must include the:
(1) name of each entity that is a party to the merger;
(2) name of the surviving entity into which the other entities are to merge;
(3) type of organization of the surviving entity;
(4) terms and conditions of the merger;
(5) manner and basis for converting the interests of each party to the merger into interests or obligations of the surviving entity or into money or other property in whole or in part; and
(6) street address of the surviving entity's principal place of business.
(c) A plan of merger must be approved by:
(1) all the partners or the number or percentage of the partners required for merger in the partnership agreement, in the case of a partnership or a domestic limited partnership that is a party to the merger;
(2) all the members or the number or percentage of members specified in the operating agreement, in the case of a limited liability company that is a party to the merger;
(3) the vote required for approval of a merger by the law of the state or foreign jurisdiction in which the foreign limited liability company is organized, in the case of a foreign limited liability company that is a party to the merger; or
(4) the vote required for approval of a merger by the law of this State or of the state or foreign jurisdiction in which the entity is organized and, in the absence of that requirement, by all the owners of interests in the entity, in the case of any other entities that are parties to the merger.
(d) After a plan of merger is approved and before the merger takes effect, the plan may be amended or abandoned as provided in the plan.
(e) Unless the surviving entity is a general partnership, the merger is effective upon the filing of the articles of merger with the Secretary of State or at a later date the articles may provide. Filing of the articles of merger is not required if the surviving entity is a general partnership. If the surviving entity is a general partnership, the merger is effective when the agreement is signed.
(f)(1) If a partnership that owns real property in South Carolina is converted to another entity by articles of merger, the newly named surviving, acquiring, or reorganized partnership must file a notice of that name change in the office of the register of deeds of the county in South Carolina in which the real property is located. If there is no office in that county, the notice of name change must be filed with the clerk of court of the county in which that real property is located.
(2) The filing must be by:
(i) affidavit executed in accordance with the provisions in Section 33-1-200 and containing the old and new names of the partnership and describing the real property owned by that partnership; or
(ii) filing a certified copy of the articles of merger including a description of the property it owns; or
(iii) a duly recorded deed of conveyance to the newly named surviving, acquiring, or reorganized partnership.
(3) The affidavit or filed articles must be duly indexed in the index of deeds.
(4) The purpose of this subsection is to establish record notice pursuant to Chapter 7 of Title 30. Failure to make the required filing of a partnership name change does not affect the legality, force, effect, or enforceability as between the parties of any conveyance or other transaction involving real estate owned by the affected partnership that is made after the change in name.
Section 33-41-1320. (a) When a merger takes effect:
(1) the separate existence of each partnership and other entity that is a party to the merger, other than the surviving entity, terminates;
(2) all property owned by each of the partnerships and other entities that are party to the merger vests in the surviving entity;
(3) all debts, liabilities, and other obligations of each partnership and other entity that is party to the merger become the obligations of the surviving entity;
(4) an action or proceeding pending by or against a partnership or other party to a merger may be continued as if the merger had not occurred or the surviving entity may be substituted as a party to the action or proceeding; and
(5) except as prohibited by other law, all the rights, privileges, immunities, powers, and purposes of every partnership and other entity that is a party to the merger vest in the surviving entity.
(b) Unless the surviving entity is a partnership, the Secretary of State is an agent for service of process in an action or proceeding against the surviving foreign entity to enforce an obligation of any party to a merger if the surviving foreign entity fails to appoint or maintain an agent designated for service of process in this State or the agent for service of process cannot with reasonable diligence be found at the registered office. Upon receipt of process, the Secretary of State shall send a copy of the process by registered or certified mail, return receipt requested, to the surviving entity at the address set forth in the articles of merger. Service is effected pursuant to this subsection at the earliest of:
(1) the date the entity receives the process, notice, or demand;
(2) the date shown on the return receipt, if signed on behalf of the entity; or
(3) five days after its deposit in the mail, if mailed postpaid and correctly addressed.
(c) A partner of a merging partnership is liable for all obligations as a party to the merger for which the partner was personally liable before the merger.
(d) Unless otherwise agreed, a merger of a partnership that is not the surviving entity in the merger does not require the partnership to wind up its business or pay its liabilities and distribute its assets pursuant to this chapter.
Section 33-41-1330. This article does not preclude a partnership from being merged pursuant to other law."
SECTION 3. Chapter 42, Title 33 of the 1976 Code is amended by adding:
"Article 12
Mergers
Section 33-42-2110. (a) Pursuant to a plan of merger approved pursuant to subsection (c), a limited partnership may be merged with or into one or more partnerships, foreign partnerships, corporations, foreign corporations, limited liability companies, foreign limited liability companies, limited partnerships, foreign limited partnerships, or other domestic or foreign entities.
(b) A plan of merger includes the:
(1) name of each entity that is a party to the merger;
(2) name of the surviving entity into which the other entities are to merge;
(3) type of organization of the surviving entity;
(4) terms and conditions of the merger;
(5) manner and basis for converting the interests of each party to the merger into interests or obligations of the surviving entity or into money or other property in whole or in part; and
(6) street address of the surviving entity's principal place of business.
(c) A plan of merger must be approved by:
(1) all the partners or the number or percentage of the partners required for merger in the partnership agreement, in the case of a partnership or a domestic limited partnership that is a party to the merger;
(2) all the members or the number or percentage of members specified in the operating agreement, in the case of a limited liability company that is a party to the merger;
(3) the vote required for approval of a merger by the law of the state or foreign jurisdiction in which the foreign limited liability company is organized, in the case of a foreign limited liability company that is a party to the merger; or
(4) the vote required for approval of a merger by the law of this State or of the state or foreign jurisdiction in which the entity is organized and, in the absence of that requirement, by all the owners of interests in the entity, in the case of any other entities that are parties to the merger.
(d) After a plan of merger is approved and before the merger takes effect, the plan may be amended or abandoned as provided in the plan.
(e) The merger is effective upon the filing of the articles of merger with the Secretary of State or at a later date the articles may provide.
(f)(1) If a limited partnership that owns real property in South Carolina is converted to another entity by articles of merger, the newly named surviving, acquiring, or reorganized partnership must file a notice of that name change in the office of the register of deeds of the county in South Carolina in which the real property is located. If there is no office in that county, the notice of name change must be filed with the clerk of court of the county in which that real property is located.
(2) The filing must be by:
(i) affidavit executed in accordance with the provisions in Section 33-1-200 and containing the old and new names of the limited partnership and describing the real property owned by that limited partnership; or
(ii) filing a certified copy of the articles of merger including a description of the property it owns; or
(iii) a duly recorded deed of conveyance to the newly named surviving, acquiring, or reorganized partnership.
(3) The affidavit or filed articles must be duly indexed in the index of deeds.
(4) The purpose of this subsection is to establish record notice pursuant to Chapter 7 of Title 30. Failure to make the required filing of a limited partnership name change does not affect the legality, force, effect, or enforceability as between the parties of any conveyance or other transaction involving real estate owned by the affected limited partnership that is made after the change in name.
Section 33-42-2120. (a) After approval of the plan of merger pursuant to Section 33-42-2110(c), unless the merger is abandoned pursuant to Section 33-42-2110(d), articles of merger must be signed on behalf of each limited partnership and other entity that is a party to the merger and delivered to the Secretary of State for filing. The articles must include: (1) the name and jurisdiction of formation or organization of each of the limited partnerships and other entities that are parties to the merger;
(2) for each limited partnership that is to merge, the date its certificate of limited partnership was filed with the Secretary of State;
(3) that a plan of merger has been approved by the required votes and signed by each limited partnership and other entity that is to merge;
(4) the name and address of the surviving limited partnership or other surviving entity;
(5) the effective date of the merger;
(6) if a limited partnership is the surviving entity, changes in its certificate of limited partnership necessary by reason of the merger;
(7) if a foreign entity is a party to the merger, the jurisdiction and date of filing of its articles of incorporation, articles of organization, certificate of limited partnership, or other organizational document, if any, and the date its application for authority was filed by the Secretary of State or, if an application has not been filed, a statement to that effect; and
(8) if the surviving entity is a foreign entity, an agreement that the surviving entity may be served with process in this State and is subject to liability in any action or proceeding for the enforcement of any liability or obligation of a merging limited partnership previously subject to suit in this State, and for the enforcement, as provided in this chapter, of the right of partners of the limited partnership to receive payment for their interests against the surviving entity.
(b) If a foreign corporation, limited liability company, or partnership is the surviving entity of a merger, it may not do business in this State until an application for authority is filed with the Secretary of State.
(c) The surviving limited partnership or other entity shall furnish a copy of the plan of merger, on request and without cost, to a partner of a limited partnership or person holding an interest in another entity that is to merge.
(d) Articles of merger operate as an amendment to the limited partnership's certificate of limited partnership.
Section 33-42-2130. (a) When a merger takes effect:
(1) the separate existence of each limited partnership and other entity that is a party to the merger, other than the surviving entity, terminates;
(2) all property owned by each of the limited partnerships and other entities that are party to the merger vests in the surviving entity;
(3) all debts, liabilities, and other obligations of each limited partnership and other entity that is party to the merger become the obligations of the surviving entity;
(4) an action or proceeding pending by or against a limited partnership or other party to a merger may be continued as if the merger had not occurred or the surviving entity may be substituted as a party to the action or proceeding; and
(5) except as prohibited by other law, all the rights, privileges, immunities, powers, and purposes of every limited partnership and other entity that is a party to the merger vest in the surviving entity.
(b) Unless the surviving entity is a partnership, the Secretary of State is an agent for service of process in an action or proceeding against the surviving foreign entity to enforce an obligation of any party to a merger if the surviving foreign entity fails to appoint or maintain an agent designated for service of process in this State or the agent for service of process cannot with reasonable diligence be found at the registered office. Upon receipt of process, the Secretary of State shall send a copy of the process by registered or certified mail, return receipt requested, to the surviving entity at the address set forth in the articles of merger. Service is effected pursuant to this subsection at the earliest of:
(1) the date the entity receives the process, notice, or demand;
(2) the date shown on the return receipt, if signed on behalf of the entity; or
(3) five days after its deposit in the mail, if mailed postpaid and correctly addressed.
(c) A partner of a merging limited partnership is liable for all obligations as a party to the merger for which the partner was personally liable before the merger.
(d) Unless otherwise agreed, a merger of a limited partnership that is not the surviving entity in the merger does not require the limited partnership to wind up its business or pay its liabilities and distribute its assets pursuant to this chapter.
Section 33-42-2140. This article does not preclude a limited partnership from being merged pursuant to other law."
SECTION 4. Chapter 11, Title 33 of the 1976 Code is amended by adding:
"Section 33-11-109. (a) A partnership or limited partnership may be converted to a corporation pursuant to this section.
(b) The terms and conditions of a conversion of a partnership or limited partnership to a corporation must be approved by all the partners or by the number or percentage of the partners required for conversion in the partnership agreement.
(c) An agreement of conversion must include the terms and conditions of the conversion of the interests of partners of a partnership or of a limited partnership into shares, obligations, or other securities in the converted corporation or the cash or other consideration to be paid or delivered as a result of the conversion of the interests of the partners, or both.
(d) After a conversion is approved pursuant to subsection (b), the partnership or limited partnership shall file with the Secretary of State articles of incorporation that satisfy the requirements of Section 33-2-102 and contain:
(1) a statement that the partnership or limited partnership is converted to a corporation from a partnership or limited partnership;
(2) its former name;
(3) a statement of the number of votes cast by the partners entitled to vote for and against the conversion and, if the vote is less than unanimous, the number or percentage required to approve the conversion pursuant to subsection (b); and
(4) in the case of a limited partnership, a statement that the certificate of limited partnership is canceled as of the date the conversion takes effect.
(e) In the case of a limited partnership, the filing of articles of incorporation pursuant to subsection (d) cancels its certificate of limited partnership as of the date the conversion takes effect.
(f) A conversion takes effect when the articles of incorporation are filed in the office of the Secretary of State or at a later date specified in the articles of incorporation.
(g) A general partner who becomes a shareholder of a corporation as a result of a conversion remains liable as a partner for an obligation incurred by the partnership or limited partnership before the conversion takes effect.
(h) A limited partner who becomes a shareholder as a result of a conversion remains liable only to the extent the limited partner was liable for an obligation incurred by the limited partnership before the conversion takes effect.
(i) A partner's liability for all obligations of the corporation incurred after the conversion takes effect is that of a shareholder of the corporation.
Section 33-11-110. (a) A partnership or limited partnership that is converted pursuant to Section 33-11-109 is for all purposes the same entity that existed before the conversion.
(b) When a conversion takes effect:
(1) all property owned by the converting partnership or limited partnership vests in the corporation;
(2) all debts, liabilities, and other obligations of the converting partnership or limited partnership continue as obligations of the corporation;
(3) an action or proceeding pending by or against the converting partnership or limited partnership may be continued as if the conversion has not occurred;
(4) except as prohibited by other law, all the rights, privileges, immunities, powers, and purposes of the converting partnership or limited partnership vest in the corporation; and
(5) except as otherwise provided in the agreement of conversion pursuant to Section 33-11-109(c), all the partners of the converting partnership continue as shareholders of the corporation.
(c)(1) If a partnership or limited partnership that owns real property in South Carolina changes its name by amendment of its articles or by merger, reorganization, domestication, or conversion, the newly named surviving, acquiring, reorganized, domesticated, or converted entity must file a notice of that name change in the office of the register of deeds of the county in South Carolina in which the real property is located. If there is no office in that county, the notice of name change must be filed with the clerk of court of the county in which that real property is located.
(2) The filing must be by:
(i) affidavit containing the old name of the partnership or limited partnership and new name of the entity and describing the real property owned by that entity; or
(ii) filing a certified copy of the amendment to certificate of limited partnership, articles of merger, articles of domestication, or articles of conversion and including a description of the real property; or
(iii) a duly recorded deed of conveyance to the newly named surviving, acquiring, reorganized, domesticated, or converted entity.
(3) The affidavit, filed amendment, or articles must be duly indexed in the index of deeds.
(4) The purpose of this subsection is to establish record notice pursuant to Chapter 7 of Title 30. Failure to make the required filing of a partnership or limited partnership name change does not affect the legality, force, effect, or enforceability as between the parties of any conveyance or other transaction involving the real estate owned by the affected entity that is made after the change in name.
Section 33-11-111. (a) A corporation may be converted to a limited liability company pursuant to this section.
(b) After adopting a plan of conversion, the board of directors shall submit the plan of conversion for approval by its shareholders. For a plan of conversion to be approved:
(1) the corporation shall notify each shareholder of the proposed shareholders' meeting in accordance with Section 33-7-105. The notice also must state that a purpose of the meeting is to consider a plan of conversion and must contain or be accompanied by a copy or summary of the plan;
(2) unless Chapters 1 through 20 of this title or the articles of incorporation require a different vote, the plan of conversion must be approved by:
(i) two-thirds of the votes entitled to be cast on the plan, regardless of the class or voting group to which the shares belong; and
(ii) two-thirds of the votes entitled to be cast on the plan within each voting group entitled to vote as a separate group on the plan;
(3) the articles of incorporation may require a lower or higher vote for approval than that specified in subsection (2), but the required vote must be at least a majority of the votes entitled to be cast on the plan by each voting group entitled to vote separately on the plan;
(4) separate voting by voting groups is required to approve the plan of conversion if the plan contains a provision that would require action by one or more separate voting groups if the provision were included in a proposed amendment to the articles of incorporation, pursuant to Section 33-10-104; and
(5) a shareholder may dissent from the plan of conversion and obtain payment of fair value of his shares as provided in Sections 33-11-101 through 33-13-310.
(c) An agreement of conversion must include the terms and conditions of the conversion of the shares of shareholders of a corporation into interests in the converted limited liability company or the cash or other consideration to be paid or delivered as a result of the conversion of the shares of the shareholders, or both.
(d) After a conversion is approved pursuant to subsection (b), the corporation shall file with the Secretary of State articles of organization that satisfy the requirements of Section 33-44-203 and contain:
(1) a statement that the corporation is converted to a limited liability company from a corporation;
(2) its former name;
(3) a statement of the number of votes cast by the shareholders entitled to vote for and against the conversion and, if the vote is less than unanimous, the number or percentage required to approve the conversion pursuant to subsection (b);
(4) if voting by voting group is required, the information in subsection (3) must be provided for each voting group entitled to vote separately on the plan of conversion; and
(5) a statement that the articles of incorporation are cancelled as of the date the conversion takes effect.
(e) The filing of articles of organization pursuant to subsection (d) cancels the articles of incorporation of the corporation as of the date the conversion takes effect.
(f) A conversion takes effect when the articles of organization are filed in the office of the Secretary of State or at a later date specified in the articles of organization.
(g) A shareholder's liability for all obligations of the limited liability company incurred after the conversion takes effect is that of a member of the company. A shareholder who becomes a member of a limited liability company as a result of a conversion remains liable only to the extent the shareholder was liable for an obligation incurred by the corporation before the conversion takes effect.
Section 33-11-112. (a) A corporation that is converted to a limited liability company is for all purposes the same entity that existed before the conversion.
(b) When a conversion takes effect:
(1) all property owned by the converting corporation vests in the limited liability company;
(2) all debts, liabilities, and other obligations of the converting corporation continue as obligations of the limited liability company;
(3) an action or proceeding pending by or against the converting corporation may be continued as if the conversion has not occurred;
(4) except as prohibited by other law, all the rights, privileges, immunities, powers, and purposes of the converting corporation vest in the limited liability company; and
(5) except as otherwise provided in the agreement of conversion pursuant to Section 33-11-111(c), all the shareholders of the converting corporation continue as members of the limited liability company.
(c)(1) If an entity that owns real property in South Carolina is converted to a limited liability company, the newly named limited liability company must file a notice of that name change in the office of the register of deeds of the county in South Carolina in which the real property is located. If there is no office in that county, a notice of name change must be filed with the clerk of court of the county in which that real property is located.
(2) The filing must be by:
(i) affidavit containing the old name of the corporation and the new name of the limited liability company and describing the real property owned by that limited liability company; or
(ii) filing a certified copy of the articles of organization including a description of the property; or
(iii) a duly recorded deed of conveyance to the newly named limited liability company.
(3) The affidavit, filed articles, or deed must be duly indexed in both the grantor and grantee indices to deeds in the index of deeds.
(4) The purpose of this subsection is to establish record notice pursuant to Chapter 7 of Title 30. Failure to make the required filing of a corporation name change does not affect the legality, force, effect, or enforceability as between the parties of any conveyance or other transaction involving the real estate owned by the affected limited liability company that is made after the change in name.
Section 33-11-113. (a) A corporation may be converted to a partnership or limited partnership pursuant to this section.
(b) After adopting a plan of conversion, the board of directors shall submit the plan of conversion for approval by its shareholders. For a plan of conversion to be approved:
(1) the corporation shall notify each shareholder of the proposed shareholders' meeting in accordance with Section 33-7-105. The notice also must state that a purpose of the meeting is to consider a plan of conversion and must contain or be accompanied by a copy or summary of the plan;
(2) unless Chapters 1 through 20 of this title or the articles of incorporation require a different vote, the plan of conversion must be approved by:
(i) two-thirds of the votes entitled to be cast on the plan, regardless of the class or voting group to which the shares belong; and
(ii) two-thirds of the votes entitled to be cast on the plan within each voting group entitled to vote as a separate group on the plan;
(3) the articles of incorporation may require a lower or higher vote for approval than that specified in subsection (2), but the required vote must be at least a majority of the votes entitled to be cast on the plan by each voting group entitled to vote separately on the plan;
(4) separate voting by voting groups is required to approve the plan of conversion if the plan contains a provision that would require action by one or more separate voting groups if the provision was included in a proposed amendment to the articles of incorporation pursuant to Section 33-10-104; and
(5) a shareholder may dissent from the plan of conversion and obtain payment of fair value of his shares as provided in Sections 33-11-101 through 33-13-310.
(c) An agreement of conversion must include the terms and conditions of the conversion of the shares of shareholders of a corporation into interests in the converted partnership or limited partnership or the cash or other consideration to be paid or delivered as a result of the conversion of the shares of the shareholders, or both.
(d) After a conversion is approved pursuant to subsection (b), the corporation shall file with the Secretary of State articles of conversion or certificate of limited partnership that satisfies the requirements of Section 33-42-210 and contains:
(1) a statement that the corporation was converted to a partnership or limited partnership from a corporation, as the case may be;
(2) its former name;
(3) a statement of the number of votes cast by the shareholders entitled to vote for and against the conversion and, if the vote is less than unanimous, the number or percentage required to approve the conversion pursuant to subsection (b);
(4) if voting by voting groups was required, the information in subsection (3) must be provided for each voting group entitled to vote separately on the plan of conversion; and
(5) a statement that the articles of incorporation are to be cancelled as of the date the conversion takes effect.
(e) The filing of a certificate of limited partnership pursuant to subsection (d) cancels the articles of incorporation of the corporation as of the date the conversion takes effect.
(f) A conversion takes effect when the articles of conversion or certificate of limited partnership is filed with the Secretary of State or at a later date specified in the articles of conversion or certificate of limited partnership.
(g) A shareholder's liability for all obligations of the limited partnership incurred after the conversion takes effect is that of a general partner or limited partner. A shareholder who becomes a partner of a partnership or limited partnership as a result of a conversion remains liable only to the extent the shareholder was liable for an obligation incurred by the corporation before the conversion takes effect.
Section 33-11-114. (a) A corporation that is converted to a partnership or limited partnership is for all purposes the same entity that existed before the conversion.
(b) When a conversion takes effect:
(1) all property owned by the converting corporation vests in the partnership or limited partnership;
(2) all debts, liabilities, and other obligations of the converting corporation continue as obligations of the partnership or limited partnership;
(3) an action or proceeding pending by or against the converting corporation may be continued as if the conversion has not occurred;
(4) except as prohibited by other law, all of the rights, privileges, immunities, powers, and purposes of the converting corporation vest in the partnership or limited partnership; and
(5) except as otherwise provided in the agreement of conversion pursuant to Section 33-11-133(c), all of the shareholders of the converting corporation continue as either general partners or limited partners of the general or limited partnership and as specified in accord with the plan of conversion.
Section 33-11-115. This chapter does not preclude an entity from being converted pursuant to other law."
SECTION 5. Chapter 44, Title 33 of the 1976 Code is amended by adding:
"Section 33-44-908. (a) A limited liability company may be converted to a corporation pursuant to this section.
(b) The terms and conditions of a conversion of a limited liability company to a corporation must be approved by all the members or by the number or percentage of the members required for conversion in the limited liability company agreement.
(c) An agreement of conversion must include the terms and conditions of the conversion of the interests of members of a limited liability company into interests in the converted corporation or the cash or other consideration to be paid or delivered as a result of the conversion of the interests of the members, or both.
(d) After a conversion is approved pursuant to subsection (b), the limited liability company shall file with the Secretary of State articles of incorporation that satisfy the requirements of Section 33-2-102 and contain:
(1) a statement that the limited liability company was converted to a corporation from a limited liability company;
(2) its former name;
(3) a statement of the number of votes cast by the members entitled to vote for and against the conversion and, if the vote is less than unanimous, the number or percentage required to approve the conversion pursuant to subsection (b); and
(4) a statement that the articles of organization are cancelled as the date the conversion takes effect.
(e) A conversion takes effect when the articles of incorporation are filed in the office of the Secretary of State or at a later date specified in the articles of incorporation.
(f) A member who becomes a shareholder of a corporation as a result of a conversion remains liable as a member for an obligation incurred by the limited liability company before the conversion takes effect and for which a member would be personally liable.
Section 33-44-909. (a) A limited liability company that is converted to a corporation is for all purposes the same entity that existed before the conversion.
(b) When a conversion takes effect:
(1) all property owned by the converting limited liability company vests in the corporation;
(2) all debts, liabilities, and other obligations of the converting limited liability company continue as obligations of the corporation;
(3) an action or proceeding pending by or against the converting limited liability company may be continued as if the conversion had not occurred;
(4) except as prohibited by other law, all the rights, privileges, immunities, powers, and purposes of the converting limited liability company vest in the corporation;
(5) except as otherwise provided in the agreement of conversion pursuant to Section 33-44-908, all the members of the converting limited liability company continue as shareholders of the corporation; and
(6) a member's liability for all obligations of the corporation incurred after the conversion takes effect is that of a shareholder of the corporation.
(c)(1) If a limited liability company that owns real property in South Carolina is converted to a corporation, the newly named corporation must file a notice of that name change in the office of the register of deeds of the county in South Carolina in which the real property is located. If there is no office in that county, a notice of name change must be filed with the clerk of court of the county in which that real property is located.
(2) The filing must be by:
(i) affidavit executed in accordance with the provisions of Section 33-1-200 and containing the old name of the limited liability company and new name of the corporation and describing the real property owned by that corporation; or
(ii) filing a certified copy of the articles of incorporation including a description of the property; or
(iii) by a duly recorded deed of conveyance to the newly named corporation.
(3) The affidavit, filed articles, or deed must be duly indexed in both the grantor and grantee indices to deeds in the index of deeds.
(4) The purpose of this subsection is to establish record notice pursuant to Chapter 7 of Title 30. Failure to make the required filing of a limited liability company name change does not affect the legality, force, effect, or enforceability as between the parties of any conveyance or other transaction involving the real estate owned by the affected corporation that is made after the change in name.
Section 33-44-910. (a) A limited liability company may be converted to a limited partnership pursuant to this section.
(b) The terms and conditions of a conversion of a limited liability company to a limited partnership must be approved by all the members or by the number or percentage of the members required for conversion in the limited liability company agreement.
(c) An agreement of conversion must include the terms and conditions of the conversion of the interests of members of a limited liability company into interests in the converted limited partnership or the cash or other consideration to be paid or delivered as a result of the conversion of the interests of the members, or both.
(d) After a conversion is approved pursuant to subsection (b), the limited liability company shall file with the Secretary of State a certificate of limited partnership that satisfies the requirements of Section 33-42-210 and contains:
(1) a statement that the limited liability company is converted to a limited partnership from a limited liability company;
(2) its former name;
(3) a statement of the number of votes cast by the members entitled to vote for and against the conversion and, if the vote is less than unanimous, the number or percentage required to approve the conversion pursuant to subsection (b); and
(4) a statement that the articles of organization are cancelled as of the date the conversion takes effect.
(e) The filing of a certificate of limited partnership pursuant to subsection (d) cancels the articles of organization of the limited liability company as of the date the conversion takes effect.
(f) A conversion takes effect when the certificate of limited partnership is filed with the Secretary of State or at a later date specified in the certificate of limited partnership.
(g) A member's liability for all obligations of the limited partnership incurred after the conversion takes effect is that of a general partner or limited partner. A member who becomes a partner of a limited partnership as a result of a conversion remains liable only to the extent the member was liable for an obligation incurred by the limited liability company before the conversion takes effect.
Section 33-44-911. (a) A limited liability company that is converted to a limited partnership is for all purposes the same entity that existed before the conversion.
(b) When a conversion takes effect:
(1) all property owned by the converting limited liability company vests in the limited partnership;
(2) all debts, liabilities, and other obligations of the converting limited liability company continue as obligations of the limited partnership;
(3) an action or proceeding pending by or against the converting limited liability company may be continued as if the conversion has not occurred;
(4) except as prohibited by other law, all the rights, privileges, immunities, powers, and purposes of the converting limited liability company vest in the limited partnership; and
(5) except as otherwise provided in the agreement of conversion pursuant to Section 33-44-910(c), all the members of the converting limited liability company continue as general partners or limited partners of the limited partnership in accord with the agreement of conversion.
(c)(1) If a limited liability company that owns real property in South Carolina is converted to a limited partnership, the newly named limited partnership must file a notice of that name change in the office of the register of deeds of the county in South Carolina in which the real property is located. If there is no office in that county, a notice of name change must be filed with the clerk of court of the county in which that real property is located.
(2) The filing must be by:
(i) affidavit containing the old name of the limited liability company and new name of the limited partnership and describing the real property owned by that partnership or limited partnership; or
(ii) filing a certified copy of the certificate of limited partnership including a description of the property; or
(iii) a duly recorded deed of conveyance to the newly named limited partnership.
(3) The affidavit, filed articles, or deed must be duly indexed in both the grantor and grantee indices to deeds in the index of deeds.
(4) The purpose of this subsection is to establish record notice pursuant to Chapter 7 of Title 30. Failure to make the required filing of a limited liability company name change does not affect the legality, force, effect, or enforceability as between the parties of any conveyance or other transaction involving the real estate owned by the affected partnership or limited partnership that is made after the change in name.
Section 33-44-912. (a) A limited liability company may be converted to a partnership pursuant to this section.
(b) The terms and conditions of a conversion of a limited liability company to a partnership must be approved by all the members or by the number or percentage of the members required for conversion in the limited liability company agreement.
(c) An agreement of conversion must include the terms and conditions of the conversion of the interests of members of a limited liability company into interests in the converted partnership or the cash or other consideration to be paid or delivered as a result of the conversion of the interests of the members, or both.
(d) After a conversion is approved pursuant to subsection (b), the limited liability company shall file with the Secretary of State articles of conversion that contain:
(1) a statement that the limited liability company is converted to a partnership from a limited liability company;
(2) its former name;
(3) a statement of the number of votes cast by the members entitled to vote for and against the conversion and, if the vote is less than unanimous, the number or percentage required to approve the conversion pursuant to subsection (b); and
(4) a statement that the articles of organization are cancelled as of the date the conversion takes effect.
(e) A conversion takes effect when the articles of conversion are filed with the Secretary of State or at a later date specified in the articles of conversion.
(f) A member who becomes a partner of a partnership as a result of a conversion remains liable as a member for an obligation incurred by the limited liability company before the conversion takes effect and for which a member would be personally liable.
Section 33-44-913. (a) A limited liability company that has been converted to a partnership is for all purposes the same entity that existed before the conversion.
(b) When a conversion takes effect:
(1) all property owned by the converting limited liability company vests in the partnership;
(2) all debts, liabilities, and other obligations of the converting limited liability company continue as obligations of the partnership;
(3) an action or proceeding pending by or against the converting limited liability company may be continued as if the conversion has not occurred;
(4) except as prohibited by other law, all the rights, privileges, immunities, powers, and purposes of the converting limited liability company vest in the partnership;
(5) except as otherwise provided in the agreement of conversion pursuant to Section 33-44-910(c), all the members of the converting limited liability company continue as general partners of the partnership in accord with the agreement of conversion; and
(6) a member's liability for all obligations of the partnership incurred after the conversion takes effect is that of a general partner of the partnership.
(c)(1) If a limited liability company that owns real property in South Carolina is converted to a partnership, the newly named partnership must file a notice of that name change in the office of the register of deeds of the county in South Carolina in which the real property is located. If there is no office in that county, a notice of name change must be filed with the clerk of court of the county in which that real property is located.
(2) The filing must be by:
(i) affidavit containing the old name of the limited liability company and new name of the partnership and describing the real property owned by that partnership; or
(ii) filing a certified copy of the articles of conversion including a description of the property; or
(iii) a duly recorded deed of conveyance to the newly named partnership.
(3) The affidavit, filed articles, or deed must be duly indexed in both the grantor and grantee indices to deeds in the index of deeds.
(4) The purpose of this subsection is to establish record notice pursuant to Chapter 7 of Title 30. Failure to make the required filing of a limited liability company name change does not affect the legality, force, effect, or enforceability as between the parties of any conveyance or other transaction involving the real estate owned by the affected partnership that is made after the change in name.
Section 33-44-914. A limited liability company is not precluded from being converted pursuant to other law."
SECTION 6. Chapter 44, Title 33 of the 1976 Code is amended by adding:
"Section 33-44-1208. A foreign corporation is not required to qualify to do business in South Carolina merely because it is a member of a manager-run limited liability company, or because it is a member in a limited liability company but does not take part in the management of the limited liability company."
SECTION 7. Chapter 8, Title 36 of the 1976 Code is amended by adding:
"Section 36-8-307. (A) Unless otherwise agreed, the transferor of a security on due demand shall supply the purchaser with proof of authority to transfer or with other documentation necessary to obtain registration of the transfer of the security. If the transferor fails to comply with the demand within a reasonable time, the purchaser may reject or rescind the transfer.
(B) If the transfer is not for value, a transferor is not required to comply with subsection (A) unless the purchaser pays the necessary expense."
SECTION 8. Section 33-1-220(a) and (d) of the 1976 Code, as last amended by Act 378 of 1994, is further amended to read:
"(a) The Secretary of State shall collect the following fees when the documents described in this subsection are delivered to him for filing:
DOCUMENT FEE
(1) Articles of incorporation $10.00.
(2) Application for use of
indistinguishable name $10.00.
(3) Application for reserved
name $10.00.
(4) Notice of transfer of
reserved name $ 3.00.
(5) Application for registered
name $10.00.
(6) Application for renewal of
registered name $10.00.
(7) Corporation's statement of
change of registered agent
or registered office or
both $10.00.
(8) Agent's statement of change
of registered office for
each affected corporation $ 2.00.
(9) Agent's statement of
resignation $ 3.00.
(10) Amendment of articles
of incorporation $10.00.
(11) Restatement of articles
of incorporation with
amendment of articles $10.00.
(12) Articles of merger or share
exchange $10.00.
(13) Articles of dissolution $10.00.
(14) Articles of revocation of
dissolution $10.00.
(15) Certificate of administrative
dissolution No fee.
(16) Application for
reinstatement following
administrative dissolution $25.00.
(17) Certificate of reinstatement No fee.
(18) Certificate of judicial
dissolution No fee.
(19) Application for certificate
of authority $10.00.
(20) Application for amended
certificate of authority $10.00.
(21) Application for certificate
of withdrawal $10.00.
(22) Certificate of revocation
of authority to transact
business No fee.
(23) Annual report--As Fee Paid
provided in Section to Tax
12-19-20 Commission
(24) Articles of correction $10.00.
(25) Application for certificate
of existence or
authorization $ 2.00.
(26) Articles of domestication $10.00
(27) Articles of conversion $10.00
(28) Any other document required
or permitted to be filed by
this act. $10.00.
(d) Before filing any of the following documents, the Secretary of State shall collect the following taxes which must be remitted to the State Treasurer for use of the State:
(1) articles of incorporation, one hundred dollars plus the minimum license fee imposed pursuant to Chapter 19 of Title 12;
(2) amendment to articles of incorporation, one hundred dollars;
(3) articles of merger or share exchange, one hundred dollars;
(4) application by a foreign corporation for a certificate of authority to do business in South Carolina, one hundred dollars plus the minimum license fee imposed pursuant to Chapter 19 of Title 12;
(5) amendment by a foreign corporation of its certificate of authority, one hundred dollars. ;
(6) articles of conversion pursuant to either Section 33-11-111 or Section 33-11-113, one hundred dollars;
(7) articles of domestication pursuant to Section 33-9-100, one hundred dollars."
SECTION 9. Section 33-1-400(16) through (29) of the 1976 Code, as last amended by Act 371 of 2000, is further amended to read:
"(16) 'Limited partnership' means a limited partnership created pursuant to the Uniform Limited Partnership Act, Chapter 42 of Title 33, a predecessor law, or a comparable law of another jurisdiction.
(17) 'Means' denotes an exhaustive definition.
(17) (18) 'Notice' is defined in Section 33-1-410.
(19) 'Partnership' means a general partnership subject to the Uniform Partnership Act, Chapter 41 of Title 33, a predecessor law, or a comparable law of another jurisdiction.
(18) (20) 'Person' includes individual and entity.
(19) (21) 'Principal office' means the in-state or out-of-state location of the principal executive offices of a domestic or foreign corporation as designated in the annual report.
(20) (22) 'Proceeding' includes civil suit and criminal, administrative, and investigatory action, and formal or informal arbitration.
(21) (23) 'Record date' means the date established by Chapter 6 or 7 on which a corporation determines the identity of its shareholders for purposes of Chapters 1 through 20 of this title.
(22) (24) 'Secretary' means the corporate officer to whom the board of directors has delegated responsibility pursuant to Section 33-8-400(c) for custody of the minutes of the meetings of the board of directors and of the shareholders and for authenticating records of the corporation.
(23) (25) 'Shares' means the units into which the proprietary interests in a corporation are divided.
(24) (26) 'Shareholder' means the person in whose name shares are registered in the records of a corporation or the beneficial owner of shares to the extent rights granted by a nominee certificate are on file with a corporation. Creditors of a corporation may have the rights of a shareholder as allowed in the corporation's articles of incorporation.
(25) (27) 'State' includes a state, commonwealth, territory, and insular possession, and their agencies and governmental subdivisions, of the United States and the District of Columbia.
(26) (28) 'Subscriber' means a person who subscribes for shares in a corporation before or after incorporation.
(27) (29) 'United States' includes district, authority, bureau, commission, department, and other agency of the United States.
(28) (30) 'Voting group' means all shares of one or more classes or series that may vote and be counted together collectively on a matter at a meeting of shareholders pursuant to the articles of incorporation or Chapters 1 through 20 of this Title. Shares entitled to vote generally on the matter are for that purpose a single voting group.
(29) (31) 'Public corporation' means a corporation that has a class of equity securities registered with a federal agency pursuant to the Securities Exchange Act of 1934 or a successor act to the Securities Exchange Act of 1934."
SECTION 10. Section 33-2-102(d) of the 1976 Code is amended to read:
"(d) To be filed, the articles of incorporation must additionally be accompanied by the initial annual report of the corporation as specified in Section 12-19-20 12-20-40."
SECTION 11. Section 33-4-104(a) and (b) of the 1976 Code, as last amended by Act 34 of 1997, is further amended to read:
"(a) When any If a corporation which that owns real property in South Carolina changes its corporate name by amendment of its articles or by merger, share exchange, or reorganization, the newly-named, newly named surviving, acquiring, or reorganized corporation must file a notice of that name change in the office of the register of deeds of the county in South Carolina in which the real property is situate located. If there is no such office in that county, a notice of name change must be filed with the clerk of court of the county in which that real property is situate located.
(b) The filing must be by:
(1) by affidavit executed in accordance with the provisions of Section 33-1-200 and containing the old and new names of the corporation, which affidavit also may describe and describing the real property owned by that corporation; or
(2) by filing a certified copy of the amended articles, articles of merger, articles of conversion, articles of domestication, or articles of share exchange accompanied by a description of the real property; or
(3) by a duly recorded deed of conveyance to the newly-named, newly named surviving, acquiring, or reorganized corporation."
SECTION 12. Section 33-6-260 of the 1976 Code, as last amended by Act 67 of 2001, is further amended to read:
"Section 33-6-260 (A) Unless the articles of incorporation or bylaws provide otherwise, the board of directors of a corporation may authorize the issue of some or all of the shares of any or all of its classes or series without certificates to the extent that investment securities not evidenced by certificates are authorized by Chapter 8 of Title 36 of the South Carolina Uniform Commercial Code. The authorization does not affect shares already represented by certificates until they are surrendered to the corporation.
(B) Within a reasonable time after the issue or transfer of shares to a shareholder without certificates, the corporation shall send the shareholder a written statement containing the information required on a certification by Section 33-6-250(b) and (c) and Section 33-6-270, if applicable."
SECTION 13. Section 33-11-101 of the 1976 Code, as last amended by Act 384 of 1994, is further amended to read:
"Section 33-11-101. (a) Business corporations A business corporation may merge into, :
(i) another business corporation or ;
(ii) a nonprofit corporation, to the extent permitted by Section 33-31-1101, if the board of directors of each corporation adopts and it's the shareholders, of a business corporation, and or members, of a nonprofit corporation approve the plan of merger, if required by Section 33-11-103 for business corporations and or Section 33-31-1103 for nonprofit corporations, approve a plan of merger. ;
(iii) a limited liability company, domestic or foreign;
(iv) a partnership, domestic or foreign;
(v) a limited partnership, domestic or foreign;
(vi) another domestic or foreign entity.
(b) The plan of merger must set forth include the:
(1) name of each corporation entity planning to merge and the name of the surviving corporation entity into which each other corporation entity plans to merge;
(2) terms and conditions of the merger; and
(3) manner and basis of converting the shares of each business corporation into shares, obligations, other securities, or membership interests of the surviving or any other corporation entity or into cash or other property in whole or part.
(c) The plan of merger may set forth:
(1) amendments to the articles of incorporation of the surviving corporation entity; and
(2) other provisions relating to the merger.
(d) For purposes of this Section 33-11-101, the term "corporation" means both business and nonprofit corporations."
SECTION 14. Section 33-11-105(a) of the 1976 Code is amended to read:
"(a) After a plan of merger or share exchange is approved by the shareholders, or adopted by the board of directors if shareholder approval is not required, the surviving or acquiring corporation entity shall deliver to the Secretary of State for filing articles of merger or share exchange setting forth including:
(1) the plan of merger or share exchange;
(2) if shareholder approval was not required, a statement to that effect;
(3) if approval of the shareholders of one or more corporations party to the merger or share exchange was required:
(i) the designation, number of outstanding shares, and number of votes entitled to be cast by each voting group entitled to vote separately on the plan as to each corporation; and
(ii) either the total number of votes cast for and against the plan by each voting group entitled to vote separately on the plan or the total number of undisputed votes cast for the plan separately by each voting group and a statement that the number cast for the plan by each voting group was sufficient for approval by that voting group."
SECTION 15. Section 33-11-106(a) of the 1976 Code is further amended to read:
"(a) When a merger takes effect:
(1) every other corporation party to the merger merges into the surviving corporation entity and the separate existence of every corporation except the surviving corporation entity ceases;
(2) the title to all real estate and other property owned by each corporation party to the merger is vested in the surviving corporation entity without reversion or impairment;
(3) the surviving corporation entity has all liabilities of each corporation party to the merge merger;
(4) a proceeding pending against any a corporation party to the merger may be continued as if the merger did not occur or the surviving corporation entity may be substituted in the proceeding for the corporation whose existence ceased;
(5) the articles of incorporation organization of the surviving corporation entity are amended to the extent provided in the plan of merger; and
(6) the shares of each corporation party to the merger that are to be converted into shares, obligations, or other securities of the surviving or any other corporation entity or into cash or other property are converted as appropriate, and the former holders of the shares are entitled only to the rights provided in the articles of merger or to their rights under pursuant to Chapter 13."
SECTION 16. Section 33-13-102(A)(5) of the 1976 Code, as amended by Act 328 of 1998, is further amended to read:
"(5) in the case of corporations which are not public corporations, the approval of a control share acquisition under Article 1 of Chapter 2 of Title 35;
(6) any corporate action to the extent the articles of incorporation, bylaws, or a resolution of the board of directors provides that voting or nonvoting shareholders are entitled to dissent and obtain payment for their shares.;
(6) the conversion of a corporation into a limited liability company pursuant to Section 33-11-111 or conversion of a corporation into either a general partnership or limited partnership pursuant to Section 33-11-113;
(7) the consummation of a plan of conversion to a limited liability company pursuant to Section 33-11-111 or to a partnership or limited partnership pursuant to Section 33-11-113."
SECTION 17. Section 33-14-107(c) of the 1976 Code is amended to read:
"(c) If the dissolved corporation publishes a newspaper notice in accordance with subsection (b), the claim of each of the following claimants is barred unless the claimant commences a proceeding to enforce the claim against the dissolved corporation within five ten years after the publication date of the newspaper notice:
(1) a claimant who did not receive written notice under pursuant to Section 33-14-106;
(2) a claimant whose claim was timely sent to the dissolved corporation but not acted on. ; and
(3) a claimant whose claim is contingent or based on an event occurring after the effective date of the dissolution."
SECTION 18. Section 33-14-200(b) of the 1976 Code, as last amended by Act 181 of 1993, is amended to read:
"(b) The Secretary of State shall dissolve a corporation under pursuant to Section 33-14-210(c) if he is notified by the Department of Revenue that the corporation has failed to file a required tax return within sixty days of the notice required by Section 12-7-1675 12-6-5520."
SECTION 19. Section 33-14-210(c) of the 1976 Code is amended to read:
"(c) If the Secretary of State is notified by the Department of Revenue that the corporation has failed to file a required tax return within sixty days of the notice required by Section 12-7-1675 12-6-5520, the Secretary of State shall dissolve the corporation administratively by signing a certificate of dissolution that recites the grounds for dissolution and its effective date. The Secretary of State shall file the original of the certificate and send a copy to the corporation by registered or certified mail addressed to its registered agent at its registered office or to the office of the secretary of the corporation at its principal office."
SECTION 20. Section 33-15-101(b) of the 1976 Code, as last amended by Act 446 of 1990, is further amended to read:
"(b) The following activities, among others, do not constitute transacting business within the meaning of subsection (a):
(1) maintaining, defending, or settling any a proceeding;
(2) holding meetings of the board of directors or shareholders or carrying on other activities concerning internal corporate affairs;
(3) maintaining bank accounts;
(4) maintaining offices or agencies for the transfer, exchange, and registration of the corporation's own securities or maintaining trustees or depositories with respect to those securities;
(5) selling through independent contractors;
(6) soliciting or obtaining orders, whether by mail or through employees or agents or otherwise, if the orders require acceptance outside this State before they become contracts;
(7) creating or acquiring any indebtedness, mortgages, and security interests in real or personal property;
(8) securing or collecting any debts or enforcing mortgages, security interests, or any other rights in property securing debts;
(9) owning, without more, real or personal property;
(10) conducting an isolated transaction that is completed within thirty days and that is not one in the course of repeated transactions of a like nature;
(11) transacting business in interstate commerce; or
(12) owning and controlling a subsidiary corporation incorporated in or transacting business within this State. ;or
(13) owning, without more, an interest in a limited liability company organized or transacting business in this State."
SECTION 21. Section 33-15-103(c) of the 1976 Code is amended to read:
"(c) The foreign corporation shall deliver with the completed application the initial annual report of the corporation as specified in Section 12-19-20 12-20-40."
SECTION 22. Section 33-15-300(b) of the 1976 Code, as last amended by Act 181 of 1993, is further amended to read:
"(b) The Secretary of State shall proceed under pursuant to Section 33-15-310(c) to revoke the certificate of authority of a foreign corporation authorized to transact business in this State if he is notified by the Department of Revenue that the corporation has failed to file a required tax return within sixty days of the notice required by Section 12-7-1675 12-6-5520."
SECTION 23. Section 33-15-310(c) of the 1976 Code, as last amended by Act 181 of 1993, is further amended to read:
"(c) If the Secretary of State is notified by the Department of Revenue that the foreign corporation has failed to file a required tax return within sixty days of the notice required by Section 12-7-1675 12-6-5520, the Secretary of State shall revoke the foreign corporation's certificate of authority by signing a certificate of revocation that recites the grounds for revocation and its effective date. The Secretary of State shall file the original of the certificate and send a copy to the foreign corporation by registered or certified mail addressed to its registered agent at its registered office or to the office of the secretary of the corporation at its principal office."
SECTION 24. Section 33-31-1101 of the 1976 Code, as added by Act 384 of 1994, is amended to read:
"Section 33-31-1101. (a) Subject to the limitations set forth in Section 33-31-1102, one or more nonprofit corporations may merge into with:
(1) a business or nonprofit corporation, and one or more business corporations may merge into with a nonprofit corporation to the extent permitted in Section 33-11-101, if the plan of merger is approved as provided in Section 33-31-1103. ;
(2) a limited liability company, domestic or foreign;
(3) a partnership, domestic or foreign;
(4) a limited partnership, domestic or foreign; or
(5) another domestic or foreign entity.
(b) The plan of merger must set forth include:
(1) the name of each corporation entity planning to merge and the name of the surviving corporation entity into which each plans to merge;
(2) the terms and conditions of the planned merger;
(3) the manner and basis, if any, of converting the members of each public benefit or religious corporation into members of the surviving corporation entity;
(4) if the merger involves a mutual benefit corporation, the manner and basis, if any, of converting membership of each merging corporation entity into membership, obligations, or securities of the surviving or any other corporation entity or into cash or other property in whole or part.
(c) The plan of merger may set forth:
(1) any amendments to the articles of incorporation or bylaws of the surviving corporation entity to be effected by the planned merger; and,
(2) other provisions relating to the planned merger."
SECTION 25. Section 33-42-1690(a) of the 1976 Code is amended to read:
"(a) Without excluding other activities which may that do not constitute transacting business in this State, a foreign limited partnership shall not be deemed is considered not to be transacting business in this State, for purposes of this chapter, solely by reason of carrying on in this State any one or more of the following activities:
(1) maintaining, defending, or participating in any action, suit, or proceeding whether judicial, administrative, arbitrative, or otherwise, or effecting the settlement thereof or the settlement of claims or disputes;
(2) holding meetings of its partners or of committees thereof of its partners or carrying on other activities concerning its internal affairs;
(3) maintaining bank accounts;
(4) maintaining offices or agencies for the transfer, exchange, and registration of its securities, or appointing and maintaining trustees;
(5) borrowing or lending or acquiring indebtedness or mortgages or other security interests in real or personal property;
(6) securing or collecting debts or enforcing any rights in property securing the same;
(7) effecting a transaction in interstate or foreign commerce;
(8) owning or controlling a corporation incorporated in or transacting business within this State;
(9) conducting within this State an isolated transaction which that is completed within a period of one hundred and eighty days and which that is not in the course of a series or number of repeated transactions;
(10) effecting sales through independent contractors; or
(11) soliciting or procuring orders, whether by mail or through employees or agents or otherwise, where such if the orders require acceptance without outside this State before becoming binding contracts. ; or
(12) owning, without more, an interest in a limited liability company organized or transacting business in this State."
SECTION 26. Section 33-44-208(b) and (c) of the 1976 Code, as added by Act 343 of 1996, is amended to read:
"(b) A certificate of existence for a limited liability company must set forth include:
(1) the company's name;
(2) that it is duly organized under the laws of this State, the date of organization, whether its duration is at-will or for a specified term, and, if the latter, the period specified;
(3) if payment is reflected in the records of the Secretary of State and if nonpayment affects the existence of the company, that all fees, taxes, and penalties owed to this State have been paid;
(4) whether its most recent annual report required by Section 33-44-211 has been filed with the Secretary of State;
(5) that articles of termination have not been filed; and
(6) (5) other facts of record in the office of the Secretary of State which may be requested by the applicant.
(c) A certificate of authorization for a foreign limited liability company must set forth include:
(1) the company's name used in this State;
(2) that it is authorized to transact business in this State;
(3) if payment is reflected in the records of the Secretary of State and if nonpayment affects the authorization of the company, that all fees, taxes, and penalties owed to this State have been paid;
(4) whether its most recent annual report required by Section 33-44-211 has been filed with the Secretary of State;
(5) that a certificate of cancellation has not been filed; and
(6) (5) other facts of record in the office of the Secretary of State which may be requested by the applicant."
SECTION 27. Section 33-44-404(c)(9) of the 1976 Code is amended to read:
"(9) the consent to dissolve the company under pursuant to Section 33-44-801(b)(2);"
SECTION 28. Section 33-44-410(a) of the 1976 Code, as added by Act 343 of 1996, is amended to read:
"(a) A member or manager may maintain an action against a limited liability company or another member or manager for legal or equitable relief, with or without an accounting as to the company's business, to enforce:
(1) the member's rights under the operating agreement;
(2) the member's rights under this chapter; and
(3) the rights and that otherwise protect the interests of the member, including rights and interests arising independently of the member's relationship to the company."
SECTION 29. Section 33-44-801 of the 1976 Code, as last amended by Act 442 of 1998, is further amended to read:
"Section 33-44-801. A limited liability company is dissolved, and its business must be wound up, upon the occurrence of any of the following events:
(1) an event specified in the operating agreement;
(2) consent of the number or percentage of members specified in the operating agreement;
(3) an event that makes it unlawful for all or substantially all of the business of the company to be continued, but a cure of illegality within ninety days after notice to the company of the event is effective retroactively to the date of the event for purposes of this section;
(4) on application by a member or a dissociated member, upon entry of a judicial decree that:
(a) the economic purpose of the company is likely to be unreasonably frustrated;
(b) another member has engaged in conduct relating to the company's business that makes it not reasonably practicable to carry on the company's business with that member;
(c) it is not otherwise reasonably practicable to carry on the company's business in conformity with the articles of organization and the operating agreement;
(d) the company failed to purchase the petitioner's distributional interest as required by after giving effect to provisions of the operating agreement modifying or superseding the provisions of Section 33-44-701; or
(e) the managers or members in control of the company have acted, are acting, or will act in a manner that is illegal, oppressive, fraudulent, or unfairly prejudicial to the petitioner;
(5) on application by a transferee of a member's interest, a judicial determination that it is equitable to wind up the company's business:
(a) after the expiration of the specified term, if the company was for a specified term at the time the applicant became a transferee by way of member dissociation, transfer, or entry of a charging order that gave rise to the transfer; or
(b) at any time, if the company existed at will at the time the applicant became a transferee by way of member dissociation, transfer, or entry of a charging order that gave rise to the transfer."
SECTION 30. Section 33-44-806(b) of the 1976 Code, as added by Act 343 of 1996, is amended to read:
"(b) Each member is entitled to a distribution upon the winding up of the limited liability company's business consisting of a return of all contributions which have not previously been returned and a distribution of any remainder in equal shares After application of subsection (a), and if the company is required to maintain capital accounts for its members as contemplated by the Internal Revenue Code, as defined in Chapter 6 of Title 12 and applicable treasury regulations, all remaining cash and other assets must be distributed to the members in accordance with their positive capital account balances, determined after taking into account all capital account adjustments for the taxable year of the company during which the distribution occurs, including adjustments for distributions made pursuant to this section."
SECTION 31. Section 33-44-809 of the 1976 Code, as added by Act 343 of 1996, is amended to read:
"Section 33-44-809. The Secretary of State may commence a proceeding to dissolve a limited liability company administratively if the company does not:
(1) pay any a fees, taxes, or penalties penalty imposed by this chapter or other law within sixty days after they are it is due; or
(2) deliver its annual report to the Secretary of State within sixty days after it is due."
SECTION 32. Section 33-44-903 of the 1976 Code, as added by Act 343 of 1996, is amended by adding:
"(c)(1) If an entity that owns real property in South Carolina is converted to a limited liability company by amendment of its articles or by merger, share exchange, or reorganization, the newly named surviving, acquiring, or reorganized limited liability company shall file a notice of that name change in the office of the register of deeds of that county. If there is no office in that county, the notice of name change must be filed with the clerk of court of the county in which that real property is located.
(2) The filing must be by:
(i) affidavit executed in accordance with the provisions of Section 33-1-200 and containing the old and new names of the limited liability company and describing the real property owned by that limited liability company; or
(ii) filing a certified copy of the amended articles, articles of merger, or articles of share exchange, including a description of the property; or
(iii) a duly recorded deed of conveyance to the newly named surviving, acquiring, or reorganized limited liability company.
(3) The affidavit or filed articles must be duly indexed in the index of deeds.
(4) The purpose of this subsection is to establish record notice pursuant to Chapter 7 of Title 30. Failure to make the required filing of a limited liability name change does not affect the legality, force, effect, or enforceability as between the parties of a conveyance or other transaction involving the real estate owned by the affected limited liability company that is made after the change in name."
SECTION 33. Section 33-44-905(a) and (b) of the 1976 Code, as added by Act 343 of 1996, is amended to read:
"(a) After approval of the plan of merger under pursuant to Section 33-44-904(c), unless the merger is abandoned under pursuant to Section 33-44-904(d), articles of merger must be signed on behalf of each limited liability company and other entity that is a party to the merger and delivered to the Secretary of State for filing. The articles must set forth include:
(1) the name and jurisdiction of formation or organization of each of the limited liability companies and other entities that are parties to the merger;
(2) for each limited liability company that is to merge, the date its articles of organization were filed with the Secretary of State;
(3) that a plan of merger has been is approved and signed by each limited liability company and other entity that is to merge;
(4) the name and address of the surviving limited liability company or other surviving entity;
(5) the effective date of the merger;
(6) if a limited liability company is the surviving entity, such changes in its articles of organization as are necessary by reason of the merger;
(7) if a party to a merger is a foreign limited liability company entity, the jurisdiction and date of filing of its initial articles of organization articles of incorporation, articles of organization, certificate of limited partnership, or other organizational document, if any, and the date when its application for authority was filed by the Secretary of State or, if an application has not been filed, a statement to that effect; and
(8) if the surviving entity is not a limited liability company foreign entity, an agreement that the surviving entity may be served with process in this State and is subject to liability in any action or proceeding for the enforcement of any liability or obligation of any limited liability company previously subject to suit in this State which is to merge, and for the enforcement, as provided in this chapter, of the right of members of any limited liability company to receive payment for their interest against the surviving entity.
(b) If a foreign limited liability company entity is the surviving entity of a merger, it may not do business in this State until an application for that authority is filed with the Secretary of State."
SECTION 34. Section 33-44-1003(a) of the 1976 Code, as added by Act 343 of 1996, is amended to read:
"(a) activities of a foreign limited liability company that do not constitute are not considered transacting business in this State within the meaning of this article include:
(1) maintaining, defending, or settling an action or proceeding;
(2) holding meetings of its members or managers or carrying on any other activity concerning its internal affairs;
(3) maintaining bank accounts;
(4) maintaining offices or agencies for the transfer, exchange, and registration of the foreign company's own securities or maintaining trustees or depositories with respect to those securities;
(5) selling through independent contractors;
(6) soliciting or obtaining orders, whether by mail or through employees or agents or otherwise, if the orders require acceptance outside this State before they become contracts;
(7) creating or acquiring indebtedness, mortgages, or security interests in real or personal property;
(8) securing or collecting debts or enforcing mortgages or other security interests in property securing the debts, and holding, protecting, and maintaining property so acquired;
(9) conducting an isolated transaction that is completed within thirty days and is not one in the course of similar transactions of a like manner; and
(10) transacting business in interstate commerce. ; and
(11) owning, without more, an interest in a limited liability company organized or transacting business in this State."
SECTION 35. Section 33-44-1006(a) of the 1976 Code, as added by Act 343 of 1996, is amended to read:
"(a) A certificate of authority of a foreign limited liability company to transact business in this State may be revoked by the Secretary of State in the manner provided in subsection (b) if:
(1) the company fails to:
(i) pay any a fees, taxes, and penalties or penalty owed to this State;
(ii) deliver its annual report required under Section 33-44-211 to the Secretary of State within sixty days after it is due;
(iii) appoint and maintain an agent for service of process as required by this article; or
(iv) (iii) file a statement of a change in the name or business address of the agent as required by this article; or
(2) a misrepresentation has been made of any a material matter in any application, report, affidavit, or other record submitted by the company pursuant to this article."
SECTION 36. Section 33-44- 1204(a) of the 1976 Code, as added by Act 343 of 1996, is amended to read:
"(a) The Secretary of State shall collect the following fees when the following documents described in this subsection are delivered to him for filing:
(1) Articles articles of organization of a limited liability company: one hundred and ten dollars.
(2) Amendment amendment or restatement of the articles of organization of a limited liability company: one hundred and ten dollars.
(3) Articles articles of merger involving a domestic or foreign limited liability company: one hundred and ten dollars.
(4) Application application by a foreign limited liability company for a certificate of authority to transact business in South Carolina: one hundred and ten dollars.
(5) Amendment amendment by a foreign limited liability company of its certificate of authority: one hundred and ten dollars.
(6) Application application for reservation of a limited liability company name: twenty-five dollars.
(7) Notice notice of transfer of a reserved limited liability company name: ten dollars.
(8) Annual annual application for registration (or renewal) of a foreign limited liability company name: ten dollars.
(9) Annual report of a domestic or foreign limited liability company: ten dollars.
(10) Statement of change of designated office or agent for the service of process, or both: ten dollars.
(11) (10) Articles articles of termination: ten dollars.
(12) (11) Application application for reinstatement after administrative dissolution: twenty-five dollars.
(13) (12) Application application for certificate of cancellation: ten dollars.
(14) (13) Application application for certificate of existence or authorization: ten dollars.
(15) (14) Any other document required or permitted to be filed pursuant to this chapter: two dollars."
SECTION 37. Section 38-90-20(F) of the 1976 Code, as added by Act 228 of 2002, is amended to read:
"(F) The terms and conditions set forth in Section 38-5-170 apply in full to captive insurance companies licensed under this chapter. A captive insurance company may not operate from a location in South Carolina unless it is licensed as a captive insurance company pursuant to this chapter."
SECTION 38. Section 38-90-60(E) of the 1976 Code, as last amended by Act 73 of 2003, is further amended to read:
"(E) The articles of incorporation or articles of organization, the certificate issued pursuant to subsection (D), and the organization fees required by Section 33-1-220 must be transmitted to the Secretary of State, who shall record both the articles of incorporation or articles of organization and the certificate. It is unlawful for the Secretary of State to issue a charter or grant amendments of charter to a captive insurance company or permit a foreign or alien captive insurance company to do business in this State without the written approval of the director or his designee."
SECTION 39. Section 12-20-40(A) of the 1976 Code is amended to read:
"(A) An initial annual report and the minimum license fee required by Sections 12-20-50 and 12-20-100(C) must be filed with the Secretary of State with the initial articles of incorporation filed by a domestic corporation, or an application for certificate of authority filed by a foreign corporation, or the articles of domestication filed by a corporation domesticating in South Carolina, as appropriate. The initial annual report must be submitted to the department by the Secretary of State and contain the information required in Section 12-20-30(A)."
SECTION 40. Sections 33-14-410, 33-44-211, 39-13-10, 39-13-20, 39-13-30, and 39-13-40 of the 1976 Code are repealed.
SECTION 41. This act takes effect upon approval by the Governor.
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