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The Vermont Statutes Online



Title

08

:
Banking and Insurance






Chapter

101

:
INSURANCE COMPANIES GENERALLY






Subchapter

003
:
MERGERS, CONSOLIDATIONS, CONVERSIONS, MUTUALIZATIONS, BULK REINSURANCE, SUBSIDIARIES










 

§

3424. Procedure for merger

Any domestic

insurer subject to the prohibitions of section 3422 of this title may merge

with any other insurer in the following manner:

(1) The board of

directors of each insurer shall, by a resolution adopted by a majority vote of

the members of such board, approve a joint agreement of merger setting forth:

(A) The names of

the insurers proposed to merge, and the name of the insurer into which they

propose to merge, which is hereafter designated as the surviving company.

(B) The terms

and conditions of the proposed merger and the mode of carrying the same into

effect.

(C) The manner

and basis of converting the shares of capital stock of stock insurers, if

applicable, other than the surviving insurer into shares or other securities or

obligations of the surviving insurer.

(D) A

restatement of such provisions of the articles of incorporation of the

surviving insurer as may be deemed necessary or advisable to give effect to the

proposed merger.

(E) Such other

provisions with respect to the proposed merger as are deemed necessary or

desirable.

(2) The

resolution of the board of directors of each insurer approving the agreement

shall direct that the agreement be submitted to a vote of the shareholders,

members or policyholders, as the case may be, of such insurer entitled to vote

in respect thereof at a designated meeting thereof, which may be an annual

meeting of shareholders, members or policyholders entitled to vote in respect

thereof. If the designated meeting of any insurer at which the agreement is to

be submitted is an annual meeting, notice of the submission of the agreement

shall be included in the notice of such annual meeting. If the designated

meeting of any insurer at which the agreement is to be submitted is a special meeting

of the shareholders, members or policyholders, entitled to vote in respect

thereof, such special meeting shall be called by the resolution designating the

meeting, and notice of such meeting shall be given as provided in the bylaws or

charter, as the case may be, of each insurer.

(3) The

agreement of merger so approved shall be submitted to a vote of the

shareholders, members or policyholders, as the case may be, of each insurer

entitled to vote in respect thereof at the meeting directed by the resolution

of the board of directors of such company approving the agreement, and the

agreement shall be adopted by such insurer upon receiving the affirmative vote

of such proportion of the shareholders, members or policyholders as provided in

section 3427 of this title.

(4) Following

the adoption of the agreement by any insurer, the clerk or secretary thereof,

within such time and in such manner as shall be approved by the commissioner,

shall give notice of the adoption of the agreement to each shareholder, member

or policyholder, as the case may be, of record of such insurer entitled to vote

who was not present in person or represented by proxy at the meeting at which

the agreement was adopted. The insurer shall file an affidavit with the

commissioner, signed by the clerk or secretary of such insurer, that such

notice was given.

(5) Any

shareholder, member or policyholder, as the case may be, of any such insurer,

who did not vote in favor of the adoption of the agreement of merger, may

object to such merger in the manner and with the effect provided in sections

3428 and 3429 of this title.

(6) As soon as

practicable after the expiration of a period of 30 days after the adoption of

the agreement of merger by the shareholders, members or policyholders, as the

case may be, of that one of the merging insurers which is the last, in point of

time, to adopt the same, the agreement shall again be considered by the board

of directors of each insurer a party thereto, at a regular or special meeting

of such board, and if the board of directors of each such insurer, by a

majority vote of the members of such board, shall again approve the agreement

and shall authorize the execution thereof, the agreement shall be signed on

behalf of each such insurer by its president or a vice-president and its clerk

or secretary or an assistant clerk or secretary and shall have the corporate

seal of each such insurer thereto affixed.

(7) Articles of

merger shall be adopted in the following manner:

(A) Upon the

execution of the agreement of merger by all of the insurers parties thereto,

there shall be executed and filed, in the manner hereafter provided, articles

of merger setting forth the agreement of merger, the signatures of the several

insurers parties thereto, the manner of its adoption and the vote by which

adopted by each of such insurers.

(B) The articles

of merger shall be signed on behalf of each insurer by its president or a

vice-president and its clerk or secretary or an assistant clerk or secretary,

and acknowledged before a notary public by the officers signing the same, in

such multiple copies as shall be required to enable the insurers to comply with

the provisions of this subchapter with respect to filing and recording the

articles of merger, and shall then be presented to the commissioner.

(C) The

commissioner shall approve the articles of merger if he or she finds that the

merger will promote the general good of the state in conformity with those

standards set forth in section 3305 of this title. If he or she approves the

articles of merger, he or she shall indorse his or her approval thereon and

shall present the same to the secretary of state of the State of Vermont at his

or her office.

(8) Upon the

presentation of the articles of merger, the secretary of state, if he or she finds

that they conform to law, shall indorse his or her approval on each of the

multiple copies of the articles, and, when all fees have been paid as required

by law, shall file one copy of the articles of merger in his or her office and

issue a certificate of merger, and shall return the remaining copies of the

articles bearing the indorsement of his or her approval, together with the

certificate of merger, to the surviving insurer, or its representatives.

(9) The

surviving insurer shall obtain a certified copy of the certificate of merger

from the secretary of state and file the same with the commissioner,

accompanied by a copy of the articles of merger bearing the indorsement and

approval of the secretary of state. (1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch.

4, § 3).)