West Virginia Code 31D-11-1104 – Action on a plan of merger or share exchange
In the case of a domestic corporation that is a party to a merger or share exchange:
Terms Used In West Virginia Code 31D-11-1104
- Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
- Articles of incorporation: includes , but is not limited to, amended and restated articles of incorporation and articles of merger. See West Virginia Code 31D-1-150
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- domestic corporation: means a corporation for profit, which is not a foreign corporation, incorporated under or subject to the provisions of this chapter. See West Virginia Code 31D-1-150
- Entity: includes corporations and foreign corporations. See West Virginia Code 31D-1-150
- Interests: means the proprietary interests in an other entity. See West Virginia Code 31D-11-1101
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Merger: means a business combination pursuant to section one thousand one hundred two of this article. See West Virginia Code 31D-11-1101
- Organizational documents: means the basic document or documents that create, or determine the internal governance of, an other entity. See West Virginia Code 31D-11-1101
- Other entity: means any association or legal entity, other than a domestic or foreign corporation, organized to conduct business, including, but not limited to, limited partnerships, general partnerships, limited liability partnerships, limited liability companies, joint ventures, joint stock companies and business trusts. See West Virginia Code 31D-11-1101
- Person: includes , but is not limited to, an individual and an entity. See West Virginia Code 31D-1-150
- Quorum: The number of legislators that must be present to do business.
- Share exchange: means a business combination pursuant to section one thousand one hundred three of this article. See West Virginia Code 31D-11-1101
- 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 of the rights granted by a nominee certificate on file with a corporation. See West Virginia Code 31D-1-150
- Shares: means the units into which the proprietary interests in a corporation are divided. See West Virginia Code 31D-1-150
- State: when applied to a part of the United States and not restricted by the context, includes the District of Columbia and the several territories, and the words "United States" also include the said district and territories. See West Virginia Code 2-2-10
- Voting group: means all shares of one or more classes or series that, pursuant to the articles of incorporation or this chapter, are entitled to vote and be counted together collectively on a matter at a meeting of shareholders. See West Virginia Code 31D-1-150
(1) The plan of merger or share exchange must be adopted by the board of directors.
(2) Except as provided in subdivision (7) of this section and in section one thousand one hundred five of this article, after adopting the plan of merger or share exchange the board of directors must submit the plan to the shareholders for their approval. The board of directors must also transmit to the shareholders a recommendation that the shareholders approve the plan, unless the board of directors determines that because of conflicts of interest or other special circumstances it should not make a recommendation, in which case the board of directors must transmit to the shareholders the basis for that determination.
(3) The board of directors may condition its submission of the plan of merger or share exchange to the shareholders on any basis.
(4) If the plan of merger or share exchange is required to be approved by the shareholders and if the approval is to be given at a meeting, the corporation must notify each shareholder, whether or not entitled to vote, of the meeting of shareholders at which the plan is to be submitted for approval. The notice must state that the purpose, or one of the purposes, of the meeting is to consider the plan and must contain or be accompanied by a copy or summary of the plan. If the corporation is to be merged into an existing corporation or other entity, the notice is also to include or be accompanied by a copy or summary of the articles of incorporation or organizational documents of that corporation or other entity. If the corporation is to be merged into a corporation or other entity that is to be created pursuant to the merger, the notice is to include or be accompanied by a copy or a summary of the articles of incorporation or organizational documents of the new corporation or other entity.
(5) Unless the articles of incorporation, or the board of directors acting pursuant to subdivision (3) of this section, requires a greater vote or a greater number of votes to be present, approval of the plan of merger or share exchange requires the approval of the shareholders at a meeting at which a quorum consisting of at least a majority of the votes entitled to be cast on the plan exists and, if any class or series of shares is entitled to vote as a separate group on the plan of merger or share exchange, the approval of each separate voting group at a meeting at which a quorum of the voting group consisting of at least a majority of the votes entitled to be cast on the merger or share exchange by that voting group is present.
(6) Separate voting by voting groups is required:
(A) On a plan of merger, by each class or series of shares that: (i) Are to be converted, pursuant to the provisions of the plan of merger, into shares or other securities, interests, obligations, rights to acquire shares or other securities, cash, other property or any combination of the foregoing; or (ii) would have a right to vote as a separate group on a provision in the plan that, if contained in a proposed amendment to articles of incorporation, would require action by separate voting groups under section one thousand four, article ten of this chapter;
(B) On a plan of share exchange, by each class or series of shares included in the exchange, with each class or series constituting a separate voting group; and
(C) On a plan of merger or share exchange, if the voting group is entitled under the articles of incorporation to vote as a voting group to approve a plan of merger or share exchange.
(7) Unless the articles of incorporation otherwise provide, approval by the corporation's shareholders of a plan of merger or share exchange is not required if:
(A) The corporation will survive the merger or is the acquiring corporation in a share exchange;
(B) Except for amendments permitted by section one thousand five, article ten of this chapter, its articles of incorporation will not be changed;
(C) Each shareholder of the corporation whose shares were outstanding immediately before the effective date of the merger or share exchange will hold the same number of shares, with identical preferences, limitations and relative rights, immediately after the effective date of change; and
(D) The issuance in the merger or share exchange of shares or other securities convertible into or rights exercisable for shares does not require a vote under subsection (f), section six hundred twenty-one, article six of this chapter.
(8) If as a result of a merger or share exchange one or more shareholders of a domestic corporation would become subject to personal liability for the obligations or liabilities of any other person or entity, approval of the plan of merger requires the execution, by each shareholder subject to liability, of a separate written consent to become subject to personal liability.