Conversions and Mergers.

Ala. Code tit. 10A, ch. 5A, art. 10

in effect

Ala. Code § 10A-5A-10.01 Conversion.

10A-5A-10.01. Conversion. (a) An organization other than a limited liability company may convert to a limited liability company, and a limited liability company may convert to an organization other than a limited liability company pursuant to this section, Sections 10A-5A-10.02 through 10A-5A-10.03, and a plan of conversion, if: (1) the governing statute of the organization that is not a limited liability company authorizes the conversion; (2) the law of the jurisdiction governing the converting organization and the converted organization does not prohibit the conversion; and (3) the converting organization and the converted organization each comply with the governing statute and organizational documents applicable to that organization in effecting the conversion. (b) A plan of conversion must be in writing and must include: (1) the name, type of organization, and mailing address of the principal office of the converting organization, and its unique identifying number or other designation as assigned by the Secretary of State, if any, before conversion; (2) the name, type of organization, and mailing address of the principal office of the converted organization after conversion; (3) the terms and conditions of the conversion, including the manner and basis for converting interests in the converting organization into any combination of money, interests in the converted organization, and other consideration allowed in Section 10A-5A-10.01(c); and (4) the organizational documents of the converted organization. (c) In connection with a conversion, rights or securities of or interests in the converting organization may be exchanged for or converted into cash, property, or rights or securities of or interests in the converted organization, or, in addition to or in lieu thereof, may be exchanged for or converted into cash, property, or rights or securities of or interests in another organization or may be cancelled. (d) At the time of the approval of the plan of conversion in accordance with Section 10A-5A-10.02, the plan of conversion is not required to contain or have attached thereto any disclosure letter, disclosure schedules, or similar documents or instruments contemplated by the plan of conversion that modify, supplement, qualify, or make exceptions to representations, warranties, covenants, or conditions contained in the plan of conversion. (Act 2014-144, p. 265, §1; Act 2019-94, §2; Act 2025-281, §5.)

Ala. Code § 10A-5A-10.02 Action on Plan of Conversion by Converting Limited Liability Company.

10A-5A-10.02. Action on Plan of Conversion by Converting Limited Liability Company. (a) Subject to Section 10A-5A-10.09, a plan of conversion must be consented to by all the members of a converting limited liability company. (b) Subject to Section 10A-5A-10.09 and any contractual rights, after a conversion is approved, and at any time before a filing is made under Section 10A-5A-10.03, a converting limited liability company may amend the plan or abandon the planned conversion: (1) as provided in the plan; and (2) except as prohibited by the plan, by the same consent as was required to approve the plan. (Act 2014-144, p. 265, §1.)

Ala. Code § 10A-5A-10.03 Filings Required for Conversion; Effective Date.

10A-5A-10.03. Filings Required for Conversion; Effective Date. (a) After a plan of conversion is approved: (1) if the converting organization is an organization formed under, or its internal affairs are governed by, the laws of this state, the converting organization shall file a statement of conversion in accordance with subsection (c), which statement of conversion must be signed in accordance with Section 10A-5A-2.04(a) and which must include: (A) the name, type of organization, and mailing address of the principal office of the converting organization, and its unique identifying number or other designation as assigned by the Secretary of State, if any, before conversion; (B) the date of the filing of the certificate of formation of the converting organization, if any, and all prior amendments and the filing office or offices, if any, where such is filed; (C) a statement that the converting organization has been converted into the converted organization; (D) the name and type of organization of the converted organization and the jurisdiction of its governing statute; (E) the street and mailing address of the principal office of the converted organization; (F) the date the conversion is effective under the governing statute of the converted organization; (G) a statement that the conversion was approved as required by this chapter; (H) a statement that the conversion was approved as required by the governing statute of the converted organization; and (I) a statement that a copy of the plan of conversion will be furnished by the converted organization, on request and without cost, to any owner of the converting organization; and (J) if the converted organization is a foreign organization not authorized to conduct activities and affairs in this state, the street and mailing address of an office for the purposes of Section 10A-5A-10.04(b); and (2) if the converted organization is a limited liability company, the converting organization shall deliver for filing a certificate of formation in accordance with subsection (d), which certificate of formation must include, in addition to the information required by Section 10A-5A-2.01(a): (A) a statement that the limited liability company was converted from the converting organization; (B) the name and type of organization of the converting organization, the jurisdiction of the converting organization’s governing statute, and the converting organization’s unique identifying number or other designation as assigned by the Secretary of State, if any; and (C) a statement that the conversion was approved in a manner that complied with the converting organization’s governing statute. (b) A conversion becomes effective: (1) if the converted organization is a limited liability company, when the certificate of formation takes effect; and (2) if the converted organization is not a limited liability company, as provided by the governing statute of the converted organization. (c) If the converting organization is an organization formed under, or its internal affairs are governed by, the laws of this state, then the converting organization shall deliver for filing the statement of conversion required under subsection (a)(1) to the Secretary of State. (d) If the converted organization is a limited liability company, the converting organization shall deliver for filing the certificate of formation required under subsection (a)(2) to the Secretary of State. (e) If the converting organization is required to deliver for filing a statement of conversion and a certificate of formation to the Secretary of State, then the converting organization shall deliver for filing the statement of conversion and the certificate of formation to the Secretary of State simultaneously. (f) After a conversion becomes effective, if the converted organization is a limited liability company then, except for certified copies of documents permitted to be delivered to the judge of probate for filing pursuant to subsection (h) all filing instruments required to be filed under this title regarding that converted organization shall be filed with the Secretary of State. (g) If: (1) the converting organization is a filing entity or a foreign filing entity registered to conduct activities and affairs in this state; (2) the converted organization will be a filing entity or a foreign filing entity registered to conduct activities and affairs in this state; (3) the name of the converting organization and the converted organization are to be the same, other than words, phrases, or abbreviations indicating the type of entity; and (4) the name of the converted organization complies with Division A of Article 5 of Chapter 1 or Section 10A-1-7.07, as the case may be; then notwithstanding Division B of Article 5 of Chapter 1, no name reservation shall be required and the converted organization shall for all purpose of this title be entitled to utilize the name of the converting organization without any further action by the converting organization or the converted organization. (h) A certified copy of any document required to be filed under this section may be filed in the real estate records in the office of the judge of probate in any county in which the converting organization owned real property, without payment and without collection by the judge of probate of any deed or other transfer tax or fee. The judge of probate shall, however, be entitled to collect a filing fee of five dollars ($5). Any such filing shall evidence chain of title, but lack of filing shall not affect the converted organization’s title to such real property. (i) A statement of conversion is a filing instrument under Chapter 1. (j) The filing fees for a statement of conversion shall be as set forth in Chapter 1. (Act 2014-144, p. 265, §1; Act 2016-379, p. 934, §4; Act 2019-94, §2.)

Ala. Code § 10A-5A-10.04 Effect of Conversion.

10A-5A-10.04. Effect of Conversion. (a) When a conversion takes effect: (1) all property and contract rights owned by the converting organization, or series thereof, remains vested in the converted organization without transfer, reversion, or impairment and the title to any property vested by deed or otherwise in the converting organization shall not revert or be in any way impaired by reason of the conversion; (2) all debts, obligations, or other liabilities of the converting organization, or series thereof, continue as debts, obligations, or other liabilities of the converted organization and neither the rights of creditors, nor the liens upon the property of the converting organization shall be impaired by the conversion; (3) an action or proceeding pending by or against the converting organization, or series thereof, continues as if the conversion had not occurred and the name of the converted entity may, but need not, be substituted for the name of the converting entity in any pending action or proceeding; (4) except as prohibited by law other than this chapter, all of the rights, privileges, immunities, powers, and purposes of the converting organization, or series thereof, remain vested in the converted organization; (5) except as otherwise provided in the plan of conversion, the terms and conditions of the plan of conversion take effect; (6) except as otherwise agreed, for all purposes of the laws of this state, the converting organization, and any series thereof, shall not be required to wind up its affairs or pay its liabilities and distribute its assets, and the conversion shall not be deemed to constitute a dissolution of the converting organization, or series thereof; (7) for all purposes of the laws of this state, the rights, privileges, powers, interests in property, debts, liabilities, and duties of the converting organization, and all series thereof, shall be the rights, privileges, powers, interests in property, debts, liabilities, and duties of the converted organization, and shall not be deemed as a consequence of the conversion, to have been transferred to the converted organization; (8) if the converted organization is a limited liability company, for all purposes of the laws of this state, the limited liability company shall be deemed to be the same organization as the converting organization, and the conversion shall constitute a continuation of the existence of the converting organization in the form of a limited liability company; (9) if the converted organization is a limited liability company, the existence of the limited liability company shall be deemed to have commenced on the date the converting organization commenced its existence in the jurisdiction in which the converting organization was first created, formed, organized, incorporated, or otherwise came into being; (10) the conversion shall not affect the choice of law applicable to matters arising prior to conversion; and (11) If the Secretary of State has assigned a unique identifying number or other designation to the converting organization and (i) the converted organization is formed pursuant to, or its internal affairs are governed by, the laws of this state or (ii) the converted organization is, within 30 days after the effective date of the conversion, registered to transact business in this state, then that unique identifying number or other designation shall continue to be assigned to the converted organization. (b) A converted organization that is a foreign entity consents to the jurisdiction of the courts of this state to enforce any debt, obligation, or other liability for which the converting limited liability company, or series thereof, is liable if, before the conversion, the converting limited liability company was subject to suit in this state on the debt, obligation, or other liability. If a converted organization that is a foreign entity fails to designate or maintain a registered agent, or the designated registered agent cannot with reasonable diligence be served, then service of process on that converted organization for the purposes of enforcing a debt, obligation, or other liability under this subsection may be made in the same manner and has the same consequences as provided in Section 10A-1-5.35. (Act 2014-144, p. 265, §1; Act 2016-379, p. 934, §4; Act 2019-94, §2.)

Ala. Code § 10A-5A-10.05 Merger.

10A-5A-10.05. Merger. (a) A limited liability company may merge with one or more other constituent organizations pursuant to this section, Sections 10A-5A-10.06 through 10A-5A-10.08, and a plan of merger, if: (1) the governing statute of each of the other organizations authorizes the merger; (2) the merger is not prohibited by the law of a jurisdiction that enacted any of those governing statutes; and (3) each of the other organizations complies with its governing statute in effecting the merger. (b) A plan of merger must be in writing and must include: (1) the name, type of organization, and mailing address of the principal office of each constituent organization, the jurisdiction of the governing statute of each constituent organization, and the respective unique identifying number or other designation as assigned by the Secretary of State, if any, of each constituent organization; (2) the name, type of organization, and mailing address of the principal office of the surviving organization, the unique identifying number or other designation as assigned by the Secretary of State, if any, of the surviving organization, the jurisdiction of the governing statute of the surviving organization, and, if the surviving organization is to be created pursuant to the merger, a statement to that effect; (3) the terms and conditions of the merger, including the manner and basis for converting the interests in each constituent organization into any combination of money, interests in the surviving organization, and other consideration as allowed by subsection (c); (4) if the surviving organization is to be created pursuant to the merger, the surviving organization’s organizational documents; and (5) if the surviving organization is not to be created pursuant to the merger, any amendments to be made by the merger to the surviving organization’s organizational documents. (c) In connection with a merger, rights or securities of or interests in a constituent organization may be exchanged for or converted into cash, property, or rights or securities of or interests in the surviving organization, or, in addition to or in lieu thereof, may be exchanged for or converted into cash, property, or rights or securities of or interests in another organization or may be cancelled. (d) In addition to the requirements of subsection (b), a plan of merger may: (1) provide that (i) a constituent organization or any other party to the plan of merger that fails to perform its obligations under the plan of merger in accordance with the terms and conditions of the plan of merger, or that otherwise fails to comply with the terms and conditions of the plan of merger, in each case, required to be performed or complied with prior to the time the merger becomes effective, or that otherwise fails to consummate, or fails to cause the consummation of, the merger (whether prior to a specified date, upon satisfaction or, to the extent permitted by law, waiver of all conditions to consummation set forth in the plan of merger, or otherwise) shall be subject, in addition to any other remedies available at law or in equity, to the penalties or consequences as are set forth in the plan of merger (which penalties or consequences may include an obligation to pay to the other party or parties to the plan of merger an amount representing, or based on the loss of, any premium or other economic entitlement the owners of the other party would be entitled to receive pursuant to the terms of the plan of merger if the merger were consummated in accordance with the terms of the plan of merger) and (ii) if, pursuant to the terms of the plan of merger, a limited liability company is entitled to receive payment from another party to the plan of merger of any amount representing a penalty or consequence (as specified in clause (i) of this Section 10A-5A-10.02(d)(1)), the limited liability company shall be entitled to enforce the other party’s payment obligation and, upon receipt of any payment, shall be entitled to retain the amount of the payment so received; (2) provide (i) for the appointment, at or after the time at which the plan of merger is adopted by the members of a constituent limited liability company in accordance with the requirements of Section 10A-5A-10.06, of one or more persons (which may include the surviving or resulting entity or any officer, manager, representative, or agent thereof) as representative of the members of a constituent limited liability company, including those whose transferable interest shall be cancelled, converted, or exchanged in the merger, and for the delegation to that person or persons of the sole and exclusive authority to take action on behalf of the members pursuant to the plan of merger, including taking such actions as the representative determines to enforce (including by entering into settlements with respect to) the rights of the members under the plan of merger, on the terms and subject to the conditions set forth in the plan of merger, (ii) that any appointment pursuant to clause (i) of this Section 10A-5A-10.02(d)(2) shall be irrevocable and binding on all members from and after the adoption of the plan of merger by the requisite vote of the members pursuant to Section 10A-5A-10.06, and (iii) that any provision adopted pursuant to this Section 10A-5A-10.02(d)(2) may not be amended after the merger has become effective or may be amended only with the consent or approval of persons specified in the plan of merger; and (3) contain any other provision not prohibited by law. (e) At the time of the approval of the plan of merger in accordance with Section 10A-5A-10.06, the plan of merger is not required to contain or have attached thereto any disclosure letter, disclosure schedules, or similar documents or instruments contemplated by the plan of merger that modify, supplement, qualify, or make exceptions to representations, warranties, covenants, or conditions contained in the plan of merger. (Act 2014-144, p. 265, §1; Act 2019-94, §2; Act 2025-281, §5.)

Ala. Code § 10A-5A-10.06 Action on Plan of Merger by Constituent Limited Liability Company.

10A-5A-10.06. Action on Plan of Merger by Constituent Limited Liability Company. (a) Subject to Section 10A-5A-10.09, a plan of merger must be consented to by all the members of a constituent limited liability company. (b) Subject to Section 10A-5A-10.09 and any contractual rights, after a merger is approved, and at any time before a filing is made under Section 10A-5A-10.07, a constituent limited liability company may amend the plan or abandon the merger: (1) as provided in the plan; and (2) except as prohibited by the plan, with the same consent as was required to approve the plan. (Act 2014-144, p. 265, §1.)

Ala. Code § 10A-5A-10.07 Filings Required for Merger; Effective Date.

10A-5A-10.07. Filings Required for Merger; Effective Date. (a) After each constituent organization has approved the plan of merger, a statement of merger must be signed on behalf of: (1) each constituent limited liability company, as provided in Section 10A-5A-2.04(a); and (2) each other constituent organization, as provided by its governing statute. (b) A statement of merger under this section must include: (1) the name, type of organization, and mailing address of the principal office of each constituent organization, the jurisdiction of the governing statute of each constituent organization, and the respective unique identifying number or other designation as assigned by the Secretary of State, if any, of each constituent organization; (2) the name, type of organization, and mailing address of the principal office of the surviving organization, the unique identifying number or other designation as assigned by the Secretary of State, if any, of the surviving organization, the jurisdiction of the governing statute of the surviving organization, and, if the surviving organization is created pursuant to the merger, a statement to that effect; (3) the date the merger is effective under the governing statute of the surviving organization; (4) if the surviving organization is to be created pursuant to the merger: (A) if it will be a limited liability company, the limited liability company’s certificate of formation; or (B) if it will be an organization other than a limited liability company, any organizational document that creates the organization that is required to be in a public writing; (5) if the surviving organization exists before the merger, any amendments provided for in the plan of merger for the organizational document that created the organization that are required to be in a public writing; (6) a statement as to each constituent organization that the merger was approved as required by the organization’s governing statute; (7) a statement that a copy of the plan of merger will be furnished by the surviving organization, on request and without cost, to any owner of any constituent organization which is a party to the merger; (8) if the surviving organization is a foreign organization not authorized to conduct activities and affairs in this state, the street and mailing address of an office for the purposes of Section 10A-5A-10.08(b); and (9) any additional information required by the governing statute of any constituent organization. (c) The statement of merger shall be delivered for filing to the Secretary of State. (d) A merger becomes effective under this article: (1) if the surviving organization is a limited liability company, upon the later of: (A) the filing of the statement of merger with the Secretary of State; or (B) as specified in the statement of merger; or (2) if the surviving organization is not a limited liability company, as provided by the governing statute of the surviving organization. (e) A certified copy of the statement of merger required to be filed under this section may be filed in the real estate records in the office of the judge of probate in any county in which any constituent organization owned real property, without payment and without collection by the judge of probate of any deed or other transfer tax or fee. The judge of probate, however, shall be entitled to collect the filing fee of five dollars ($5). Any such filing shall evidence chain of title, but lack of filing shall not affect the surviving organization’s title to such real property. (f) A statement of merger is a filing instrument under Chapter 1. (g) The filing fees for a statement of merger shall be as set forth in Chapter 1. (Act 2014-144, p. 265, §1; Act 2016-379, p. 934, §4; Act 2019-94, §2; Act 2023-503, §5.)

Ala. Code § 10A-5A-10.08 Effect of Merger.

10A-5A-10.08. Effect of Merger. (a) When a merger becomes effective: (1) the surviving organization continues or, in the case of a surviving organization created pursuant to the merger, comes into existence; (2) each constituent organization that merges into the surviving organization ceases to exist as a separate entity; (3) except as provided in the plan of merger, all property owned by, and every contract right possessed by, each constituent organization, or series thereof, that ceases to exist vests in the surviving organization without transfer, reversion, or impairment and the title to any property and contract rights vested by deed or otherwise in the surviving organization shall not revert, be in any way impaired, or be deemed to be a transfer by reason of the merger; (4) all debts, obligations, and other liabilities of each constituent organization, or series thereof, other than the surviving organization, are debts, obligations, and other liabilities of the surviving organization, and neither the rights of creditors, nor any liens upon the property of any constituent organization, shall be impaired by the merger; (5) an action or proceeding pending by or against any constituent organization, or series thereof, continues as if the merger had not occurred and the name of the surviving organization may be, but need not be, substituted in any pending proceeding for the name of any constituent organization whose separate existence ceased in the merger; (6) except as prohibited by law other than this chapter, or as provided in the plan of merger, all of the rights, privileges, franchises, immunities, powers, and purposes of each constituent organization, or series thereof, other than the surviving organization, vest in the surviving organization; (7) except as otherwise provided in the plan of merger, the terms and conditions of the plan of merger take effect; (8) except as otherwise agreed, if a constituent limited liability company ceases to exist, the merger does not dissolve the limited liability company and does not dissolve a series thereof; (9) if the surviving organization is created pursuant to the merger: (A) if it is a limited liability company, the certificate of formation becomes effective; or (B) if it is an organization other than a limited liability company, the organizational documents that create the organization become effective; and (10) if the surviving organization existed before the merger, any amendments provided for in the statement of merger for the organizational documents of that organization become effective; (11) the transferable interests of each limited liability company that is a constituent organization to the merger, and the ownership interests of each organization that is not a limited liability company, but is a constituent organization to the merger, that are to be converted in accordance with the terms of the merger into transferable interests, ownership interests, other securities, obligations, rights to acquire transferable interests, ownership interests, or other securities, cash, other property, or any combination of the foregoing, are converted, and the former holder of such transferable interests or ownership interests is entitled only to the rights provided to that former holder by those terms or the statute governing that former holder’s constituent organization; and (12) if the surviving organization exists before the merger: (i) except as provided in the plan of merger, all property and contract rights of the surviving organization remain its property and contract rights without transfer, reversion, or impairment; (ii) the surviving organization remains subject to all its debts, obligations, and other liabilities; and (iii) except as provided by law other than this chapter, or the plan of merger, the surviving organization continues to hold all of its rights, privileges, franchises, immunities, powers, and purposes. (b) A surviving organization that is a foreign entity consents to the jurisdiction of this state to enforce any debt, obligation, or other liability owed by a constituent organization, if before the merger the constituent organization was subject to suit in this state on the debt, obligation, or other liability. If a surviving organization that is a foreign entity fails to designate or maintain a registered agent, or the designated registered agent cannot with reasonable diligence be served, then the service of process on that surviving organization for the purposes of enforcing a debt, obligation, or other liability under this subsection may be made in the same manner and has the same consequences as provided in Section 10A-1-5.35. (Act 2014-144, p. 265, §1; Act 2016-379, p. 934, §4; Act 2018-125, §6; Act 2019-94, §2.)

Ala. Code § 10A-5A-10.09 Restrictions on Approval of Mergers and Conversions.

10A-5A-10.09. Restrictions on Approval of Mergers and Conversions. (a) If a member of a converting or constituent limited liability company will have personal liability with respect to a converted or surviving organization, approval and amendment of a plan of conversion or plan of merger are ineffective without that member’s consent to the plan. (b) A member does not give the consent required by subsection (a) merely by consenting to a provision of the limited liability company agreement that permits the limited liability company agreement to be amended with the consent of fewer than all the members. (Act 2014-144, p. 265, §1.)

Ala. Code § 10A-5A-10.10 Article Not Exclusive.

10A-5A-10.10. Article Not Exclusive. This article is not exclusive. This article does not preclude an entity from being converted or merged under law other than this chapter. (Act 2014-144, p. 265, §1.)

Source: Alabama Legislature (alison.legislature.state.al.us)URL: https://alison.legislature.state.al.us/code-of-alabamaFetched: 10/20/2026