The Vermont Statutes Online

Title 8 : Banking and Insurance

Chapter 207 : Merger, Share Exchange, Consolidations, and Acquisitions

Subchapter 001 : APPLICABILITY OF CHAPTER; APPROVAL

• § 17101. General provisions on mergers, share exchanges, consolidations, and acquisitions

  (a) The provisions of this chapter and Titles 11 and 11A govern mergers, consolidations, acquisition of assets, or assumption of liabilities undertaken by financial institutions subject to the laws of this State. References in this chapter to mergers shall be deemed to include share exchanges, as applicable in the circumstances.

  (b) Commissioner’s approval. Following approval by a majority vote of the governing body of each participating institution, unless a higher percentage is required by either institution’s organizational documents, the plan of merger, consolidation, acquisition, or assumption, together with certified copies of the authorizing resolutions adopted by the governing body of each participating institution, shall be forwarded to the Commissioner for approval pursuant to chapter 201, subchapter 7 of this title; provided, however, the approval of the Commissioner shall not be required for any transaction in which the resulting institution will be a national financial institution. If the Commissioner disapproves the plan, the Commissioner shall state the reasons for the disapproval in writing and furnish them to the participating institutions. The institutions shall be given an opportunity to amend the plan to eliminate the reasons for disapproval.

  (c) Vote of investors or mutual voters. The plan of merger or consolidation, as approved by the Commissioner, shall be submitted to the investors or mutual voters of the participating institutions for their approval at an annual meeting or at a special meeting called for that purpose in the following manner:

  (1) Unless a greater percentage is required by the organizational documents of either financial institution, the plan of merger, consolidation, acquisition, or assumption must be approved by the investors or mutual voters by each voting group entitled to vote separately on the plan by a majority of all votes entitled to be cast on the plan by that voting group at the meeting called for this purpose. The vote constitutes the adoption of the organizational documents of the resulting institution, including amendments, contained in the merger, or consolidation agreement.

  (2) The rights of investors dissenting to the merger or consolidation are those specified in Title 11 or 11A, depending upon the organizational form of the institution. To the extent that dissenters’ rights are not addressed in Title 11 or 11A or these rights are less beneficial to the dissenting investors than those rights listed in the institution’s organizational documents, the organizational documents govern.

  (3) The rights of dissenting investors in a national financial institution shall be governed by federal law.

  (d) Executed plan; certificate; effective date. The following provisions apply to the executed plan, certificate, and effective date.

  (1) Upon approval by the investors or mutual voters of the participating institutions, an executive officer and the secretary of each institution shall submit the executed plan of merger or consolidation to the Commissioner, together with the certified record of the vote of the investors or mutual voters approving it, each certified by these officers.

  (2) Upon receipt of the items in subdivision (1) of this subsection and evidence that the participating institutions have complied with all applicable federal law and regulations, the Commissioner shall issue to the resulting institution a certificate specifying the name of each participating institution and the name of the resulting institution. The resulting institution shall file a copy of the certificate with the Secretary of State for record. This certificate is conclusive evidence of the merger or consolidation and of the correctness of all proceedings relating to the merger or consolidation in all courts and places. The certificate may be filed in any land records office to evidence the new name in which property of the participating institutions is to be held.

  (3) Unless a later date is specified in the certificate, the merger or consolidation is effective upon filing of the certificate as provided in subdivision (2) of this subsection and the authority of all but the resulting institution shall terminate automatically upon filing. The Commissioner may file or order any financial institution to file conforming documents with the Secretary of State.

  (4) Any plan of merger or consolidation may contain a provision that, notwithstanding approval of the investors, mutual voters or the Commissioner, the plan may be abandoned at any time prior to the effective date of the merger or consolidation by the governing body of any participating institution either at the absolute discretion of the governing body or upon the occurrence of any stated condition.

  (e) Chapter 208 of this title applies to mergers, consolidations, and acquisitions made pursuant to this chapter.

  (f) Authority of expedited mergers and consolidations. Notwithstanding any other provision of law, or any organizational document of any participating institution, following approval of the plan of merger or consolidation by a majority vote of the governing body of each participating institution and receipt by the Commissioner of certified copies of the authorizing resolutions adopted by the governing body of each participating institution, the Commissioner may order that the merger of the consolidation become effective immediately if the Commissioner believes that the action is necessary for the protection of depositors or the public. (Added 1999, No. 153 (Adj. Sess.), § 2, eff. Jan. 1, 2001.)