TITLE 7
Corporations, Associations, and Partnerships

CHAPTER 7-1.2
Rhode Island Business Corporation Act

PART 7-1.2-1001
Merger

SECTION 7-1.2-1002


§ 7-1.2-1002 Approval by shareholders of merger.

(a) The board of directors of each corporation, upon approving the plan of merger, shall, by resolution, direct that the plan be submitted to a vote at a meeting of shareholders, which may be either an annual or a special meeting. Written notice must be given to each shareholder, whether or not entitled to vote at the meeting, not less than twenty (20) days before the meeting, in the manner provided in this chapter for the giving of notice of meetings of shareholders, and, whether the meeting is an annual or a special meeting, must state that the purpose or one of the purposes is to consider the proposed plan of merger. A copy or a summary of the plan of merger, as the case may be, together with a statement of the shareholder's right to dissent and a copy or a summary of § 7-1.2-1202, must be included in or enclosed with the notice except where no such right is available.

(b) At each meeting, shareholders shall vote on the proposed plan of merger. The plan of merger is approved upon receiving the affirmative vote of the holders of a majority of the shares entitled to vote on the plan of merger of each corporation, unless any class of shares of any corporation is entitled to vote as a class on it, in which event, as to the corporation, approval of the plan of merger also requires the affirmative vote of the holders of a majority of the shares of each class of shares entitled to vote as a class on it. Any class of shares of the surviving corporation and the merged corporation in a merger is entitled to vote as a class, whether or not the class is otherwise entitled to vote, if the plan of merger contains any provision which, if contained in a proposed amendment to articles of incorporation, would entitle the class of shares to a class vote.

(c)(1) Notwithstanding the foregoing provisions of this section, except as may be required by the articles of incorporation, no approval of a plan of merger by the shareholders of the surviving corporation in a merger, and no notice to any of the shareholders of the corporation, are required if:

(i) The plan of merger does not amend the articles of incorporation of the corporation;

(ii) The plan of merger does not involve the issuance or transfer by the corporation (either directly or through the medium of options or warrants for, or shares or debt instruments convertible within one year into, the shares) of shares possessing more than twenty percent (20%) of the total combined voting power of all classes of shares then entitled to vote for the election of directors which will be outstanding immediately after the merger; and

(iii) Each shareholder of the corporation whose shares were outstanding immediately before the effective date of the merger will hold the same number of shares, with identical preferences, limitations, and relative rights, immediately after the effective date of change.

(2) If a plan of merger is adopted by the surviving corporation in a merger without any approval by its shareholders, pursuant to the provisions of this subsection, that fact must be certified in the articles of merger.

(d) After approval as already stated by each corporation, and at any time prior to the filing of the articles of merger, the merger may be abandoned pursuant to provisions for abandonment, if any, set forth in the plan of merger.

History of Section.
(P.L. 2004, ch. 216, § 2; P.L. 2004, ch. 274, § 2.)