Article Archives >> Lead Stories >> March 16-31, 2008
Preview of Article:
For-Profit Conversion to Nonprofit
Invalid Without Reclassifying Shares
Post-conversion valuation of shares
does not meet requirements of statute
Excerpt
Shareholders of the Sheepscot Island Company, which was essentially a homeowners’ association in for-profit form, voted to convert their corporation into a nonprofit corporation with a new name, the MacMahon Island Association, in 2006.
The corporation served about 40 cottages on MacMahon Island near the mouth of the Sheepscot River in Maine. It maintains the common paths and roads, a yacht club, several floats and tennis courts. About 90% of its shares were owned by cottage owners and members of their families. About 10% of the shareholders were neither cottage owners nor family members.
Article Archives >> Lead Stories >> March 16-31, 2008
What our readers say about Nonprofit Issues
Once again you've tackled a tricky question and explained it so we all can understand the issue.--M.V.
Thank you for your informative and keen advice on nonprofit matters. I believe its a unique and concise place to get answers to this often wispy area called nonprofit. --R.T.
