State of Vermont
Office of the Secretary of State
State of Vermont
§ 11.01. APPROVAL OF PLAN OF MERGER
(a) Subject to the limitations set forth in section 11.02 of this title, one or more nonprofit corporations may merge into an existing business or nonprofit corporation, which may be one of the merging corporations as long as the plan of merger is approved as provided in section 11.03 of this title.
(b) The plan of merger must set forth:
(1) the name of each corporation planning to merge and the name of the surviving corporation into which each plans to merge;
(2) the terms and conditions of the planned merger; and
(3) the manner and basis, if any, of converting the memberships of each public benefit corporation into memberships of the surviving corporation; and
(4) if the merger involves a mutual benefit corporation, the manner and basis, if any, of converting memberships of each merging corporation into memberships, obligations or securities of the surviving or any other corporation or into cash or other property in whole or part.
(c) The plan of merger shall set forth any amendments to the articles of incorporation or bylaws of the surviving corporation to be effected by the planned merger and may set forth other provisions relating to the planned merger.
§ 11.02. LIMITATIONS ON MERGERS BY PUBLIC BENEFIT CORPORATIONS
(a) Without the prior approval of the superior court of Washington county in a proceeding of which the attorney general has been given written notice, a public benefit corporation may merge only with:
(1) another public benefit corporation;
(2) a foreign corporation which would qualify under this title as a public benefit corporation;
(3) a wholly owned foreign or domestic business corporation, provided the public benefit corporation is the surviving corporation and continues to be a public benefit corporation after the merger; or
(4) a business corporation, provided that:
(A) on or prior to the effective date of the merger, assets with a value equal to the greater of the fair market value of the net tangible and intangible assets (including goodwill) of the public benefit corporation or the fair market value of the public benefit corporation if it were to be operated as a business concern are transferred or conveyed to one or more persons who would have received its assets under subdivisions 14.05(a)(5) and (6) of this title had it dissolved;
(B) it shall return, transfer or convey any assets held by it upon condition requiring return, transfer or conveyance, which condition occurs by reason of the merger, in accordance with such condition; and
(C) the merger is approved by a majority of directors of the public benefit corporation who are not and will not become shareholders in or officers, employees, agents or consultants of the business corporation.
(b) At least 20 days before consummation of any merger of a public benefit corporation notice, including a copy of the proposed plan of merger, must be delivered to the attorney general.
(c) Without the prior written consent of the attorney general or of the superior court of Washington county in a proceeding in which the attorney general has been given notice, when a public benefit corporation merges each member of a public benefit corporation may only receive or keep a membership or memberships in the surviving public benefit corporation, if any.
§ 11.03. ACTION ON PLAN BY BOARD, MEMBERS AND THIRD PERSONS
(a) Unless this title, the articles, bylaws or the board of directors or members (acting pursuant to subsection (c) of this section) require a greater vote or voting by class, a plan of merger to be adopted must be approved:
(1) by the board;
(2) by the members, if any, by two-thirds of the votes cast or a majority of the voting power, whichever is less; and
(3) in writing by any person or persons whose approval is required by a provision of the articles authorized by section 10.30 of this title for an amendment to the articles or bylaws.
(b) If the corporation does not have members, the merger must be approved by a majority of the directors in office at the time the merger is approved. In addition the corporation shall provide notice of any directors' meeting at which such approval is to be obtained in accordance with subsection 8.22(c) of this title. The notice must also state that the purpose, or one of the purposes, of the meeting is to consider the proposed merger.
(c) The board may condition its submission of the proposed merger, and the members may condition their approval of the merger, on receipt of a higher percentage of affirmative votes or on any other basis.
(d) If the board seeks to have the plan approved by the members at a membership meeting, the corporation shall give notice to its members of the proposed membership meeting in accordance with section 7.05 of this title. The notice must also state that the purpose, or one of the purposes, of the meeting is to consider the plan of merger andcontain or be accompanied by a copy of the plan and any summary of the plan. The copy and any summary of the plan for members of the surviving corporation shall include any provision that, if contained in a proposed amendment to the articles of incorporation or bylaws, would entitle members to vote on the provision. The copy and any summary of the plan for members of the disappearing corporation shall include a copy of the articles and bylaws which will be in effect immediately after the merger takes effect.
(e) If the board seeks to have the plan approved by the members by written consent or written ballot, the material soliciting the approval shall contain or be accompanied by a copy and any summary of the plan. The copy and any summary of the plan for members of the surviving corporation shall include any provision, that, if contained in a proposed amendment to the articles of incorporation or bylaws, would entitle members to vote on the provision. The copy and any summary of the plan for members of the disappearing corporation shall include a copy of the articles and bylaws which will be in effect immediately after the merger takes effect.
(f) Voting by a class of members is required on a plan of merger if the plan contains a provision that, if contained in a proposed amendment to articles of incorporation or bylaws, would entitle the class of members to vote as a class on the proposed amendment under section 10.04 or 10.22 of this title. The plan is approved by a class of members by two-thirds of the votes cast by the class or a majority of the voting power of the class, whichever is less.
(g) After a merger is adopted, and at any time before articles of merger are filed, the planned merger may be abandoned (subject to any contractual rights) without further action by members or other persons who approved the plan in accordance with theprocedure set forth in the plan of merger or, if none is set forth, in the manner determined by the board of directors.
§ 11.04. ARTICLES OF MERGER
After a plan of merger is approved by the board of directors, and if required by section 11.03 of this title, by the members and any other persons, the surviving or acquiring corporation shall deliver to the secretary of state articles of merger setting forth:
(1) the plan of merger;
(2) if approval of members was not required, a statement to that effect and a statement that the plan was approved by a sufficient vote of the board of directors;
(3) if approval by members was required:
(A) the designation, number of memberships outstanding, number of votes entitled to be cast by each class entitled to vote separately on the plan, and number of votes of each class indisputably voting on the plan; and
(B) either the total number of votes cast for and against the plan by each class entitled to vote separately on the plan or the total number of undisputed votes cast for the plan by each class and a statement that the number cast for the plan by each class was sufficient for approval by that class;
(4) if approval of the plan by some person or persons other than the members or the board is required pursuant to subdivision 11.03(a)(3) of this title, a statement that the approval was obtained.
§ 11.05. EFFECT OF MERGER
When a merger takes effect:
(1) every other corporation party to the merger merges into the surviving corporation and the separate existence of every corporation except the surviving corporation 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 without reversion or impairment, and such vesting shall occur without further act or deed;
(3) the surviving corporation has all liabilities and obligations of each corporation party to the merger; provided that trust obligations upon property of a disappearing corporation shall be limited to the property affected thereby immediately prior to the time the merger is effective;
(4) a proceeding pending against any corporation party to the merger may be continued as if the merger did not occur or the surviving corporation may be substituted in the proceeding for the corporation whose existence ceased;
(5) the articles of incorporation and bylaws of the surviving corporation are amended to the extent provided in the plan of merger.
§ 11.06. MERGER WITH FOREIGN CORPORATION
(a) Except as provided in section 11.02 of this title, one or more foreign business or nonprofit corporations may merge with one or more domestic nonprofit corporations if:
(1) the merger is permitted by the law of the state or country under whose law each foreign corporation is incorporated and each foreign corporation complies with that law in effecting the merger;
(2) the foreign corporation complies with section 11.04 of this title if it is the surviving corporation of the merger; and
(3) each domestic nonprofit corporation complies with the applicable provisions of sections 11.01 through 11.03 of this title and, if it is the surviving corporation of the merger, with section 11.04 of this title.
(b) Upon the merger taking effect, the surviving foreign business or foreign nonprofit corporation for which a certificate of authority has not been issued is deemed to have irrevocably appointed the secretary of state as its agent for service of process in any proceeding brought against it.
§ 11.07 BEQUESTS, DEVISES AND GIFTS
Any bequest, devise, gift, grant, or promise contained in a will or other instrument of donation, subscription, or conveyance, which is made to a constituent corporation and which takes effect or remains payable after the merger, inures to the surviving corporation unless the will or other instrument otherwise specifically provides.