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Lotzar Law Firm P.C.

Legal talent that pays for itself.
480.905.0300 x103 8687 E. Via de Ventura, Suite 115 Scottsdale, Arizona 85258

Can You Restructure Your Business Under the Arizona Entity Restructuring Act?

November 5, 2015 by Charles Lotzar

The Arizona Entity Restructuring Act has streamlined the process of restructuring a business entity.  You can take advantage of the new business-friendly process under five different circumstances. business

Lotzar Law Firm, P.C. can provide you with assistance if you wish to restructure your business under the Arizona Entity Restructuring Act. Our Scottsdale Arizona attorneys can provide guidance on whether restructuring makes sense for your organization and can assist you throughout the new streamlined and cost-effective process of entity restructuring that became effective on January 1, 2015.

How to Restructure Your Business under the Arizona Entity Restructuring Act

You are eligible to restructure your business under the Arizona Entity Restructuring Act if:

  • A merger is occurring: Your organization is combining with one or more additional organizations to form one business.
  • An interest exchange is occurring: Your organization is acquiring a 100 percent ownership interest in another company or your organization is being fully acquired by another entity.
  • A conversion is occurring: Your organization is currently structured as a particular type of entity, such as a Corporation, Partnership, LLC, Individual Trust, or Government Entity, and you wish to convert the organization to another entity type.
  • The organization’s domicile is changing: Your organization is currently domiciled in another state and you wish to change your company’s state of domicile to Arizona.
  • A division is occurring: You wish to split your existing business entity into two or more separate entities.

Prior to the passage of the Arizona Entity Restructuring Act, completing any of these types of restructuring was much more complicated and expensive. For example, changing a domicile would require first forming an Arizona organization, then merging into the newly formed organization.  Division of any entity was also not permissible prior to the change in the law.

Now, the Arizona Entity Restructuring Act has made things much simpler.  The Arizona Entity Restructuring Act not only established a streamlined process for each of these different types of restructuring, but it also made it possible to combine them.  For example, a company could both convert its type of business structure and assume an interest in another organization, or could convert its structure and domesticate by changing its domicile to an Arizona entity.

In order to complete the necessary restructuring, your organization will need to follow the initial governing documents that were created by your company. This typically means obtaining a majority vote of shareholders affirming that the restructuring is appropriate. If there are dissenters who do not vote in favor of the restructuring, it will also be necessary to comply with any statutes related to dissenter’s rights.  If you are relocating from another jurisdiction, you will also be required to follow the laws of the state where your business was formed.

Lotzar Law Firm, P.C. can make the process of restructuring easier because our Scottsdale Arizona business lawyers have an in-depth understanding of how the Arizona Entity Restructuring Act applies to your organization.  Call today to schedule a consultation and learn more about how to restructure your business by taking advantage of Arizona Entity Restructuring Act provisions.

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Charles Lotzar
Charles Lotzar
With more than 25 years of legal experience, Chuck Lotzar knows how to solve problems and make deals happen. He earned his Bachelor of Arts in Business from Michigan State University in 1982, and his Juris Doctorate from the University of Detroit School of Law in 1985. Mr. Lotzar has extensive experience dealing with public contracts and issues related to public officials and has been involved in bond financings with an aggregate value in excess of $5 billion.
Charles Lotzar
Latest posts by Charles Lotzar (see all)
  • How Often Do I Have to Re-Certify a Tax Credit Tenant’s Household Income? - November 12, 2015
  • Property Tax Abatement vs. Property Tax Exemptions – GPLET - November 12, 2015
  • Can You Restructure Your Business Under the Arizona Entity Restructuring Act? - November 5, 2015

About Charles Lotzar

With more than 25 years of legal experience, Chuck Lotzar knows how to solve problems and make deals happen. He earned his Bachelor of Arts in Business from Michigan State University in 1982, and his Juris Doctorate from the University of Detroit School of Law in 1985. Mr. Lotzar has extensive experience dealing with public contracts and issues related to public officials and has been involved in bond financings with an aggregate value in excess of $5 billion.

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FROM OUR BLOG

How Often Do I Have to Re-Certify a Tax Credit Tenant’s Household Income?

Property Tax Abatement vs. Property Tax Exemptions – GPLET

Can You Restructure Your Business Under the Arizona Entity Restructuring Act?

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