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The 189th General Court of the Commonwealth of Massachusetts

Section 19S: Merger or consolidation of two or more mutual holding companies; written agreement of terms and conditions; pending actions, obligations and liabilities

Section 19S. (a) Two or more mutual holding companies, at least one of which is a domestic company, may merge or consolidate under the laws of any state of the United States, into a mutual holding company incorporated under the laws of such state. The resulting corporation may be a continuing corporation under the name of one or more of the merged or consolidated corporations or a new corporation. If the continuing or new corporation is to be a domestic corporation: (i) it shall be subject to the provisions of sections 19F to 19W, inclusive, (ii) its name shall be subject to approval by the commissioner and the provisions of section 11 of chapter 156B, (iii) the members of any mutual holding company whose existence will cease upon the effectiveness of such merger or consolidation shall become members of the continuing mutual holding company, and (iv) all persons with equity rights in any mutual holding company whose existence will cease upon the effectiveness of such merger or consolidation shall have equity rights in the continuing mutual holding company.

(b) Companies merging or consolidating under this section shall enter into a written agreement for such merger or consolidation prescribing its terms and conditions. Such agreement shall be assented to by a vote of the majority of the board of directors of each domestic company participating in such merger or consolidation and approved by the votes of at least two-thirds of the members of such company as are present and voting at a special meeting called for the purpose, notice of which meeting shall be given to such persons and in such manner as provided by the commissioner. Such agreement shall be subject to the written approval of the commissioner, who may consider the fairness of the terms and conditions of the agreement, whether the interests of the members of each domestic mutual holding company that is a party to the agreement are protected, and whether the proposed merger or consolidation is in the public interest.

(i) If the continuing or new mutual holding company is to be a domestic company, such agreement shall be executed in duplicate by the president and secretary and by a majority of the board of directors of each company under its corporate seal, shall be accompanied by copies of the resolutions authorizing the merger or consolidation and the execution of the agreement attested by the recording officer of each company and shall, with the records of the companies pertaining thereto, be submitted to the commissioner. If it appears that the requirements of this section have been complied with, the commissioner may so certify and approve the agreement by the commissioner's endorsement thereon. One of the duplicates of such agreement shall thereupon be filed with the state secretary, who shall cause the same to be recorded and shall issue a certificate of reincorporation to the continuing company or the new company with the powers retained and specified in the agreement, and the other duplicate shall be retained by the commissioner. No such agreement shall take effect until it has been filed with the state secretary.

(ii) If the continuing or new company is to be a foreign company, such agreement, and such other information as the commissioner may require, shall be filed with the commissioner and shall not be executed until approved by the commissioner. Upon the execution of such agreement, the new or continuing company shall file with the commissioner, in such form as the commissioner may require, documentary evidence thereof, showing the date when the merger or the consolidation shall become effective. If the commissioner finds that such agreement has been executed in accordance with the commissioner's authorization, the commissioner shall file forthwith with the state secretary a certificate setting forth the fact, including said effective date, and the corporate existence of such company shall cease and determine on said effective date.

(c) No action or proceeding pending in any court of the commonwealth at the time of the merger or consolidation in which any such domestic company may be a party shall abate or be discontinued by reason of the merger or the consolidation, but may be prosecuted to final judgment in the same manner as if the merger or the consolidation had not taken place, or the continuing, surviving or resulting company may be substituted in place of any such domestic company by order of the court in which the action or proceeding is pending.

(d) If the new or continuing company is a domestic company, upon such merger or consolidation all rights and properties of the several companies shall accrue to and become the property of the continuing corporation or the new company which shall succeed to all the obligations and liabilities of the merged or consolidated companies, in the same manner as if they had been incurred or contracted by it.

(e) Nothing in this subsection shall authorize the merger or consolidation of stock companies with mutual holding companies.