The Vermont Statutes Online

Title 11A: Vermont Business Corporations

Chapter 001: General Provisions

• Subchapter 001: Short Title and Reservation of Power

• § 1.01. Short title

  This title shall be known and may be cited as the “Vermont Business Corporation Act.” (Added 1993, No. 85, § 2, eff. Jan. 1, 1994.)

• § 1.02. Reservation of power

  Nothing contained in this title shall give the right to impair the obligation of any charter, or any amendment thereof, granted or made prior to November 19, 1851; nor shall the General Assembly enact any law that would so affect any charter or amendment passed prior to such date. Subject to the foregoing restriction, any act creating, continuing, altering, or renewing a corporation or body politic may be repealed by the General Assembly, as the public good requires; and any such act may be altered or amended by the General Assembly, as the public good requires, if within the exception specified in section 69 of Chapter II of the Vermont Constitution. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994.)

• Subchapter 002: Filing Documents

• § 1.20. Filing requirements

  (a) A document must satisfy the requirements of this section, and of any other section that adds to or varies these requirements, to be entitled to filing by the Secretary of State.

  (b) This title must require or permit filing the document in the Office of the Secretary of State.

  (c) The document must contain the information required by this title. It may contain other information as well.

  (d) The document must be typewritten or printed or, if electronically transmitted, it must be in a format that can be retrieved or reproduced in typewritten or printed form or in an electronic format prescribed by the Secretary of State.

  (e) The document must be in the English language. A corporate name need not be in English if written in English letters or Arabic or Roman numerals, and the certificate of existence required of foreign corporations need not be in English if accompanied by a reasonably authenticated English translation.

  (f) The document must be executed:

  (1) by the chair of the board of directors of a domestic or foreign corporation, or by any officer of the corporation;

  (2) if directors have not been selected or the corporation has not been formed, by an incorporator; or

  (3) if the corporation is in the hands of a receiver, trustee, or other court-appointed fiduciary, by that fiduciary.

  (g) The person executing the document shall sign it and state beneath or opposite his or her signature his or her name and the capacity in which he or she signs. The document may but need not contain:

  (1) the corporate seal;

  (2) an attestation by the secretary or an assistant secretary;

  (3) an acknowledgement, verification, or proof.

  (h) If the Secretary of State has prescribed a mandatory form or electronic format for the document under section 1.21 of this title, the document must be in or on the prescribed form.

  (i) The document must be delivered to the Office of the Secretary of State for filing and must be accompanied by one exact or conformed copy, the correct filing fee, and any penalty required by this title.

  (j)(1) Any of the terms of a plan or filed documents may be made dependent on facts ascertainable outside the plan or filed documents as follows:

  (A) The manner in which the facts operate on the terms of the plan or filed document must be clearly and expressly set forth in the plan or filed document.

  (B) The facts may include without limitation actions or events within the control of, or determinations made by, a part to the plan or filing the filed document or a representative of a party to the plan or filing the filed document.

  (2) As used in this section:

  (A) “Filed document” means a document filed with the secretary of state under any provision of this title, except chapter 15 or section 16.22 of this title.

  (B) “Plan” means a plan of merger or share exchange. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994; amended 2007, No. 190 (Adj. Sess.), § 77, eff. June 6, 2008.)

• § 1.21. Forms

  (a) The Secretary of State may prescribe the form or electronic format of and furnish on request forms or specifications for formats for:

  (1) Articles of incorporation. Such form shall note the information required under subsection 2.02(a) of this title, together with a summary of such information or provisions as are permitted by this title.

  (2) An application for a certificate of good standing.

  (3) A foreign corporation’s application for a certificate of authority to transact business in this State.

  (4) A foreign corporation’s application for a certificate of withdrawal.

  (5) The annual report.

  If the Secretary of State so requires, compliance with these forms is mandatory.

  (b) The Secretary of State may prescribe the form of and furnish on request forms for other documents required or permitted to be filed by this title but their use is not mandatory. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994; amended 2007, No. 190 (Adj. Sess.), § 78, eff. June 6, 2008.)

• § 1.22. Filing; service and copying fees

  (a) The Secretary of State shall collect the following fees when the documents described in this section are delivered to the Office of the Secretary of State for filing:

  (1) Articles of incorporation $ 155.00

  (2) Application for reserved name $ 40.00

  (3) Notice of transfer of reserved name $ 20.00

  (4) Application for registered name of a foreign corpo- ration $ 50.00

  (5) Application for renewal of registered name of a foreign corporation $ 50.00

  (6) Statement of change of registered agents or

  registered office, or both $ 25.00

  and

  not to

  exceed

  $1,000.00

  per

  filer

  per

  calen-

  dar

  year.

  (7) Agent’s statement of resignation No fee

  (8) Amendment of articles of incorporation $ 50.00

  (9) Restatement of articles of incorporation $ 50.00

  (10) Articles of merger or share exchange $ 95.00

  (11) Articles of dissolution $ 35.00

  (12) Articles of revocation of dissolution $ 35.00

  (13) Application for certificate of authority $ 155.00

  (14) Application for amended certificate of authority $ 50.00

  (15) Application for certificate of withdrawal $ 25.00

  (16) Annual report of a foreign corporation $ 250.00

  (17) Annual report of a domestic corporation $ 60.00

  (18) Application for certificate of good standing $ 25.00

  (19) Any other document required or permitted to be

  filed by this title $ 3.00

  (20) Articles of correction $ 20.00

  (21) Articles of domestication $ 20.00

  (22) Statement of conversion $ 20.00

  (b) The Secretary of State shall collect a fee of $25.00 each time process is served on him or her under this title. The party to a proceeding causing service of process is entitled to recover this fee as costs if he or she prevails in the proceeding.

  (c) The Secretary of State shall collect a fee of $25.00 for copying and certifying the copy of any filed document relating to a domestic or foreign corporation.

  (d) When a corporation has been involuntarily terminated for failure to file its annual report, the Secretary of State shall collect, for each year the corporation failed to file its annual report, the annual report filing fee and a reinstatement fee of $50.00. (Added 1993, No. 85, § 2; amended 1993, No. 206 (Adj. Sess.), § 1, eff. June 14, 1994; 1997, No. 64, § 17, eff. Jan. 1, 1998; 2003, No. 70 (Adj. Sess.), § 15, eff. March 1, 2004; 2007, No. 153 (Adj. Sess.), § 35; 2013, No. 72, § 9; 2023, No. 77, § 36, eff. June 20, 2023.)

• § 1.23. Effective time and date of document

  (a) Except as provided in subsection (b) of this section, subsection 1.24(c) of this title, and section 2.03 of this title, a document accepted for filing is effective:

  (1) at the date and time of filing, as evidenced by such means as the Secretary of State may use for the purpose of recording the date and time of filing; or

  (2) at the time specified in the document as its effective time on the date it is filed.

  (b) A document may specify a delayed effective time and date, and if it does so the document becomes effective at the time and date specified. If a delayed effective date but no time is specified, the document is effective at the close of business on that date. A delayed effective date for a document may not be later than the 90th day after the date it is filed. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994; amended 2007, No. 190 (Adj. Sess.), § 79, eff. June 6, 2008.)

• § 1.24. Correcting filed document

  (a) A domestic or foreign corporation may correct a document filed by the Secretary of State if the document:

  (1) is incomplete;

  (2) contains an incorrect statement;

  (3) was defectively executed, attested, sealed, verified, or acknowledged; or

  (4) the electronic transmission of which was defective.

  (b) A document is corrected:

  (1) by preparing articles of correction that:

  (A) describe the document (including its filing date) or attach a copy of it to the articles;

  (B) specify the incorrect statement and the reason it is incorrect or the manner in which the execution was defective;

  (C) correct the incorrect statement or defective execution; and

  (2) by delivering the articles to the Secretary of State for filing.

  (c) Articles of correction are effective on the effective date of the document they correct except as to persons relying to their detriment on the uncorrected document. As to those persons, articles of correction are effective when filed. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994; amended 2007, No. 190 (Adj. Sess.), § 80, eff. June 6, 2008.)

• § 1.25. Filing duty of Secretary of State

  (a) If a document delivered to the Office of the Secretary of State for filing satisfies the requirements of section 1.20 of this title, the Secretary of State shall file it.

  (b) The Secretary of State files a document by recording it as “filed” together with his or her name and official title on the date and time of receipt, on both the document and on the record of the receipt for the filing fee. After filing a document, except as provided in sections 5.03 and 15.10 of this title, the Secretary of State shall deliver a copy of the document and filing fee receipt (or acknowledgment of receipt if no fee is required) to the domestic or foreign corporation or its representative.

  (c) If the Secretary of State refuses to file a document, he or she shall return it to the domestic or foreign corporation or its representative within five days after the document is delivered, together with a brief, written explanation of the reason for refusing to file the document.

  (d) The Secretary of State’s duty to file documents under this section is ministerial. His or her filing or refusing to file a document does not:

  (1) affect the validity or invalidity of the document in whole or in part;

  (2) relate to the correctness or incorrectness of information contained in the document;

  (3) create a presumption that the document is valid or invalid or that information contained in the document is correct or incorrect. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994; amended 2007, No. 190 (Adj. Sess.), § 81, eff. June 6, 2008.)

• § 1.26. Appeal from Secretary of State’s refusal to file document

  (a) If the Secretary of State refuses to file a document delivered to his or her office for filing, the domestic or foreign corporation may appeal the refusal within 30 days after the return of the document to the Superior Court of the county of the corporation’s principal office, in the case of a domestic corporation, or the corporation’s registered office, in the case of a foreign corporation. The appeal is commenced by filing a civil action to compel filing the document and by attaching to the petition the document and the Secretary of State’s explanation of his or her refusal to file. Such a civil action shall be tried by the court without a jury.

  (b) The court may summarily order the Secretary of State to file the document, sustain the Secretary’s action, or take other action the court considers appropriate.

  (c) The court’s final judgment may be appealed as in other civil actions. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994.)

• § 1.27. Evidentiary effect of copy of filed document

  A certificate from the Secretary of State delivered with a copy of a document filed by the Secretary of State is conclusive evidence that the document is on file with the Secretary of State. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994; amended 2007, No. 190 (Adj. Sess.), § 82, eff. June 6, 2008.)

• § 1.28. Certificate of good standing

  (a) Anyone may apply to the Secretary of State to furnish a certificate of good standing for a domestic corporation or a certificate of authorization for a foreign corporation.

  (b) A certificate of good standing or authorization sets forth:

  (1) the domestic corporation’s corporate name or the foreign corporation’s corporate name used in this State;

  (2) that:

  (A) the domestic corporation is duly incorporated under the law of this state, the date of its incorporation, and the period of its duration if less than perpetual; or

  (B) the foreign corporation is authorized to transact business in this State;

  (3) that all fees and penalties owed to this state under section 1.22 of this title have been paid if:

  (A) payment is reflected in the records of the Secretary of State; and

  (B) nonpayment affects the existence or authorization of the domestic or foreign corporations;

  (4) that its most recent annual report required by section 16.22 of this title has been delivered to the Secretary of State;

  (5) that articles of dissolution have not been filed; and

  (6) other facts of records in the office of the Secretary of State that may be requested by the applicant.

  (c) Subject to any qualification stated in the certificate, a certificate of good standing or authorization issued by the Secretary of State may be relied upon as conclusive evidence that the domestic or foreign corporation is in existence or is authorized to transact business in this State. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994.)

• § 1.29. Signing false documents

  (a) No officer, director, or incorporator may sign a document, knowing that the document is false in any material respect, and intending that the document be delivered to the Secretary of State for filing.

  (b) A person who violates the provisions of subsection (a) of this section shall be fined not more than $1,000.00.

  (c) A person harmed by reliance on a false document filed in violation of the provisions of subsection (a) of this section may bring an action against the person signing and filing such document for damages and such further relief as the court deems proper. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994.)

• Subchapter 003: Secretary of State

• § 1.30. Powers

  The Secretary of State has the power reasonably necessary to perform the duties required of him or her by this title. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994.)

• Subchapter 004: Definitions

• § 1.40. Definitions

  As used in this title:

  (1) “Articles of incorporation” include amended and restated articles of incorporation, articles of merger, and special charters.

  (2) “Authorized shares” mean the shares of all classes a domestic or foreign corporation has authority to issue.

  (3) “Conspicuous” means so written that a reasonable person against whom the writing is to operate should notice it. For example, printing in italics or boldface or contrasting color, or typing in capitals or underlined, is conspicuous.

  (4) “Corporation” or “domestic corporation” means a corporation for profit, which is not a foreign corporation, incorporated under or subject to the provisions of this title.

  (5) “Deliver” or “delivery” means any method of delivery used in conventional commercial practice, including delivery by hand, mail, commercial delivery, and electronic transmission.

  (6) “Distribution” means a direct or indirect transfer of money or other property (except its own shares) or incurrence of indebtedness by a corporation to or for the benefit of its shareholders in respect of any of its shares. A distribution may be in the form of a declaration or payment of a dividend; a purchase, redemption, or other acquisition of shares; a distribution of indebtedness; or otherwise.

  (7) “Employee” includes an officer but not a director. A director may accept duties that make the director also an employee.

  (8) “Entity” includes corporation and foreign corporation; not-for-profit corporation; profit and not-for-profit unincorporated association; business trust, estate, partnership, trust, and two or more persons having a joint or common economic interest; and state, United States, and foreign government.

  (9) “Foreign corporation” means a corporation for profit incorporated under a law other than the law of this State.

  (10) “Governmental subdivision” includes authority, county, district, and municipality.

  (11) “Includes” denotes a partial definition.

  (12) “Individual” includes the estate of an individual who is incompetent or deceased.

  (13) “Means” denotes an exhaustive definition.

  (14) “Person” includes individual and entity.

  (15) “Principal office” means the office (in or outside this State) so designated in the annual report where the principal executive offices of a domestic or foreign corporation are located.

  (16) “Proceeding” includes civil suit and criminal, administrative, and investigatory action.

  (17) “Record date” means the date established under chapter 6 or 7 of this title on which a corporation determines the identity of shareholders and their shareholdings for purposes of this title. The determination shall be made as of the close of business on the record date unless another time for doing so is specified when the record date is fixed.

  (18) “Secretary” means the corporate officer to whom the board of directors has delegated responsibility under subsection 8.40(c) of this title for custody of the minutes of the meetings of the board of directors and of the shareholders and for authenticating records of the corporation.

  (19) “Shares” mean the units into which the proprietary interests in a corporation are divided.

  (20) “Shareholder” means the person in whose name shares are registered in the records of a corporation or upon presentation for registration are entitled to be registered in the records of a corporation.

  (21) “State,” when referring to a part of the United States, includes a state and commonwealth (and their agencies and governmental subdivisions) and a territory and insular possession (and their agencies and governmental subdivisions) of the United States.

  (22) “Subscriber” means a person who subscribes for shares in a corporation, whether before or after incorporation.

  (23) “United States” includes district, authority, bureau, commission, department, and any other agency of the United States.

  (24) “Voting group” means all shares of one or more classes or series that under the articles of incorporation or this title are entitled to vote and be counted together collectively on a matter at a meeting of shareholders. All shares entitled by the articles of incorporation or this title to vote generally on the matter are for that purpose a single voting group.

  (25) “Electronic transmission” or “electronically transmitted” means a process of communication not directly involving the physical transfer of paper that is suitable for the retention, retrieval, and reproduction of information by the recipient.

  (26) “Meeting” means any structured communications conducted by participants in person or through the use of electronic or telecommunications medium permitting simultaneous or sequentially structured communications for the purpose of reaching a collective agreement.

  (27) “Sign” or “signature” includes any manual, facsimile, conformed, or electronic signature. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994; amended 2007, No. 190 (Adj. Sess.), § 83, eff. June 6, 2008; 2013, No. 96 (Adj. Sess.), § 42.)

• § 1.41. Notice

  (a) Notice under this title must be in writing unless oral notice is authorized in the bylaws of the corporation and is reasonable under the circumstances.

  (b) Notice may be communicated in person; by telephone, voice mail, telegraph, teletype, facsimile, or other form of wire, wireless, or electronic communication; or by mail or private carrier or other method of delivery. If these forms of personal notice are impracticable, notice may be communicated by a newspaper of general circulation in the area where published; or by radio, television, or other form of public broadcast communication.

  (c) Notice to shareholders. Written notice by a domestic or foreign corporation to its shareholder, if in a comprehensible form, is effective when:

  (1) mailed first class postpaid and correctly addressed to the shareholder’s address as shown in the corporation’s current record of shareholders; or

  (2) electronically transmitted to the shareholder in a manner authorized by the shareholder.

  (d) Notice to corporations. Written notice to a domestic or foreign corporation (authorized to transact business in this State) may be addressed to:

  (1) its registered agent at its registered office;

  (2) the corporation or its secretary at its principal office shown in its most recent annual report; or

  (3) in the case of a foreign corporation that has not yet delivered an annual report, the corporation or its secretary at its principal office shown in its application for a certificate of authority.

  (e) Except as provided in subsection (c) of this section, written notice, if in a comprehensible form, is effective at the earliest of the following:

  (1) when received;

  (2) five days after its deposit in the U.S. mail, as evidenced by the postmark, if mailed postpaid and correctly addressed;

  (3) on the date shown on the return receipt, if sent by registered or certified mail, return receipt requested, and the receipt is signed by or on behalf of the addressee.

  (f) Oral notice is effective when communicated if communicated in a comprehensible manner.

  (g) If this title prescribes notice requirements for particular circumstances, those requirements govern. If articles of incorporation or bylaws prescribe notice requirements, not inconsistent with this section or other provisions of this title, those requirements govern. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994; amended 2007, No. 190 (Adj. Sess.), § 84, eff. June 6, 2008.)

• § 1.42. Number of shareholders

  (a) For purposes of this title, the following identified as a shareholder in a corporation’s current record of shareholders constitutes one shareholder:

  (1) all co-owners of the same shares;

  (2) a corporation, partnership, trust, estate, or other entity;

  (3) the trustees, guardians, custodians, or other fiduciaries of a single trust, estate, or account.

  (b) For purposes of this title, shareholdings registered in substantially similar names constitute one shareholder if it is reasonable to believe that the names represent the same person. The provisions of this subsection shall not affect the voting rights of shareholders under chapter 7 of this title. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994.)