2006 Minnesota Statutes

302A.626 MERGER TO EFFECT A HOLDING COMPANY REORGANIZATION.
    Subdivision 1. Definitions. (a) For purposes of this section, the terms defined in this
subdivision have the meanings given them.
(b) "Holding company" means the corporation that is or becomes the direct parent of the
surviving corporation of a merger accomplished under this section.
(c) "Parent constituent corporation" means the parent corporation that merges with or into
the subsidiary constituent corporation.
(d) "Subsidiary constituent corporation" means the subsidiary corporation that the parent
constituent corporation merges with or into in the merger.
    Subd. 2. Authorization. Unless its articles expressly provide otherwise, and subject to
subdivision 3, a parent constituent corporation may merge with or into a subsidiary constituent
corporation without a vote of the shareholders of the parent constituent corporation.
    Subd. 3. Requirements. A merger may be accomplished under this section only if each of
the following requirements is met:
(1) the holding company and the constituent corporations to the merger are each organized
under this chapter;
(2) at all times following the issuance of shares until the consummation of a merger under
this section, the holding company was a direct wholly owned subsidiary of the parent constituent
corporation;
(3) immediately before the consummation of a merger under this section, the subsidiary
constituent corporation is an indirect wholly owned subsidiary of the parent constituent
corporation and a direct wholly owned subsidiary of the holding company;
(4) the parent constituent corporation and the subsidiary constituent corporation are the
only constituent corporations to the merger;
(5) immediately after the merger becomes effective, the surviving corporation becomes or
remains a direct wholly owned subsidiary of the holding company;
(6) each share or fraction of a share of the parent constituent corporation outstanding
immediately before the effective time of the merger is converted in the merger into a share or
equal fraction of a share of the holding company having the same designation and relative rights
and preferences, and the same restrictions thereon, as the share or fraction of a share of the parent
constituent corporation being converted in the merger;
(7) the articles and bylaws of the holding company immediately following the effective time
of the merger contain provisions identical to the articles and bylaws of the parent constituent
corporation immediately before the effective time of the merger, other than provisions, if any,
regarding the incorporator or incorporators, the corporate name, the registered office and agent,
the initial board of directors, and the initial subscribers for shares and the provisions contained
in any amendment to the articles of the parent constituent corporation that were necessary to
effect an exchange, reclassification, or cancellation of shares, if the exchange, reclassification, or
cancellation has become effective;
(8) the articles and bylaws of the surviving corporation immediately following the effective
time of the merger are identical to the articles and bylaws of the parent constituent corporation
immediately before the effective time of the merger, other than provisions, if any, regarding the
incorporator or incorporators, the corporate name, the registered office and agent, the initial board
of directors, and the initial subscribers for shares and the provisions contained in any amendment
to the articles of the parent constituent corporation that were necessary to effect an exchange,
reclassification, or cancellation of shares, if the exchange, reclassification, or cancellation has
become effective, except that:
(i) the articles of the surviving corporation shall be amended in the merger to contain a
provision requiring that any act or transaction by or involving the surviving corporation, other
than the election or removal of directors of the surviving corporation, that requires for its adoption
under this chapter or its articles the approval of the shareholders of the surviving corporation
shall, by specific reference to this section, require, in addition, the approval of the shareholders of
the holding company, or any successor by merger, by the same vote as is required by this chapter
and/or by the articles of the surviving corporation; and
(ii) the articles of the surviving corporation may be amended in the merger to reduce the
number of classes, series, and shares that the surviving corporation is authorized to issue;
(9) the directors of the parent constituent corporation become or remain the directors of the
holding company immediately after the merger becomes effective;
(10) the board of directors of the parent constituent corporation determines that the
shareholders of the parent constituent corporation will not recognize gain or loss for United States
federal income tax purposes; and
(11) a resolution approved by the affirmative vote of a majority of the directors of the parent
constituent corporation present sets forth a plan of merger that contains provisions addressing the
requirements of clauses (1) to (10).
    Subd. 4. Removal of directors of surviving corporation. Neither subdivision 3, clause (8),
item (i), nor any provisions of the surviving corporation's articles required by that item may be
construed to require approval of the shareholders of the holding company to elect or remove
directors of the surviving corporation.
    Subd. 5. Interaction with certain other sections. To the extent restrictions under section
302A.671 or 302A.673 applied to the parent constituent corporation or any of its shareholders
at the effective time of the merger, those restrictions apply to the holding company and its
shareholders immediately after the merger becomes effective as though the holding company were
the parent constituent corporation. No shareholder who, immediately before the merger becomes
effective, was not an acquiring person or an interested shareholder of the parent constituent
corporation shall, solely by reason of the merger, become an acquiring person or interested
shareholder of the holding company.
    Subd. 6. Share certificates. If the name of the holding company at the time the merger takes
effect is the same as the name of the parent constituent corporation immediately before that time,
the shares of the holding company into which the shares of the parent constituent corporation
are converted in the merger must, unless new certificates are issued, be represented by the share
certificates that previously represented shares of the parent constituent corporation.
    Subd. 7. Articles of merger; filing with secretary of state. (a) Articles of merger must be
prepared that contain:
(1) the plan of merger; and
(2) a statement that the plan of merger was adopted under this section.
(b) The articles of merger must be signed on behalf of the parent constituent corporation
and filed with the secretary of state.
    Subd. 8. Certificate. The secretary of state shall issue a certificate of merger to the surviving
corporation or its legal representative.
    Subd. 9. Nonexclusivity. A merger between a parent and a subsidiary may be accomplished
under sections 302A.611, 302A.613, and 302A.615, or section 302A.621 instead of this section,
in which case this section does not apply.
History: 2002 c 311 art 1 s 25; 2006 c 250 art 1 s 42