17-1637.   Merger or consolidation of cooperative associations andcorporations.(a) Any two or more associations incorporated under thecooperative marketing act, cited at K.S.A. 17-1601, et seq., andamendmentsthereto,or any association incorporated underthe cooperative marketing act, cited at K.S.A. 17-1601, et seq., andamendments thereto, and a corporation existing underthe laws of this state, may merge into a single association or corporation,which may be any of the constituent associations or corporations or they mayconsolidate into a new association or corporation formed by the consolidation,pursuant to an agreement of merger or consolidation, as the case may be,complying and approved in accordance with this section.

      (b)   The board of directors of each association or corporation which desiresto merge or consolidate shall adopt a resolution approving an agreement ofmerger or consolidation. The agreement shall state:

      (1)   The terms and conditions of the merger or consolidation;

      (2)   the mode of carrying the same into effect;

      (3)   in the case of a merger, such amendments or changes in the articles ofincorporation of the surviving association or corporation as are desired to beeffected by the merger or, if no such amendments or changes are desired, astatement that the articles of incorporation of the surviving association orcorporation shall be its articles of incorporation;

      (4)   in the case of consolidation, that the articles of incorporation of theresulting association or corporation shall be as is set forth in an attachmentto the agreement;

      (5)   the manner of converting the shares of each of the constituents intoshares or other securities of the association or corporation surviving orresulting from the merger or consolidation, and, if any shares of any of theconstituents are not to be converted solely into shares or other securities ofthe surviving or resulting association or corporation, the cash, property,rights or securities of any other association or corporation which the holdersof such shares are to receive in exchange for, or upon conversion of, suchshares and the surrender of the certificates evidencing certificated shares,which cash, property, rights or securities of any other association orcorporation may be in addition to or in lieu of shares or other securities ofthe surviving or resulting association or corporation; and

      (6)   such other details or provisions as are deemed desirable, including,without limiting the generality of the foregoing, a provision for the paymentof cash in lieu of the issuance or recognition of fractional shares, interestsor rights, or for any other arrangement with respect thereto, consistent withthe provisions of K.S.A. 17-6405, and amendments thereto.

      (c)   The agreement adopted as provided in this sectionshall be executed in accordance with K.S.A.17-6003, and amendments thereto. Any terms of the agreement of merger orconsolidation may be made dependent upon facts ascertainable outside of suchagreement, provided that the manner in which such facts shall operate upon theterms of the agreement is clearly and expressly set forth in the agreement ofmerger or consolidation.

      (d)   The agreement required by subsection (b) shall be submitted to themembers or stockholders of each constituent association or corporation at anannual or special meeting for the purpose of acting on the agreement. Duenotice of the time, place and purpose of the meeting shall be mailed to eachmember or holder of stock of the association or corporation, whether voting ornonvoting, at the member's or stockholder's address as it appearson the records of the association or corporation, at least 20 days prior to thedate of the meeting. At the meeting the agreement shall be considered and avote taken for its adoption or rejection. If the agreement is adopted by a voterepresenting a majority of all members of the association or, amajority vote ofall outstanding stock of the corporation entitled to vote thereon,asapplicable, that fact shall be certified on the agreement by the secretary orassistant secretary of the association or corporation. In lieu of anaffirmative vote of a majority of all members of the association or, amajorityvote of all outstanding stock of the association entitled to vote,as applicable, theagreement may be adopted by a vote of 2/3 of the members or votingstockholderspresent and voting at any annual meeting or special meetingcalled for suchpurpose. The method of adoption and the votes cast shall be certified on theagreement by the secretary or assistant secretary of the association orcorporation. If the agreement is adopted andcertified by eachconstituent association or corporation, the agreement shall then beexecuted and filed, and shall become effective, in accordance withK.S.A.17-6003, and amendments thereto.In lieu of filing theagreementof merger or consolidation, the surviving or resulting association orcorporation may file a certificate of merger or consolidation, executed inaccordance with K.S.A. 17-6003, and amendments thereto, which states:

      (1)   The name and state of incorporation of each of the constituentassociations or corporations;

      (2)   that an agreement of merger or consolidation has been approved, adopted,certified and executed by each of theconstituent associations orcorporations in accordance with this subsection;

      (3)   the name of the surviving or resulting association or corporation;

      (4)   in the case of a merger, such amendments or changes in the articles ofincorporation of the surviving association or corporation as are desired to beeffected by the merger or, if no such changes or amendments are desired, astatement that the articles of incorporation of one of the survivingassociations or corporation shall be the articles of incorporation;

      (5)   in the case of a consolidation, that the articles of incorporationof the resulting corporation shall be as is set forth in an attachment to thecertificate;

      (6)   that the executed agreement of consolidation or merger is on file at theprincipal place of business of the surviving association or corporation,stating the address thereof; and

      (7)   that a copy of the agreement of consolidation or merger will befurnished by the surviving association or corporation, on request and withoutcost, to any member or stockholder of any constituent association orcorporation.

      (e)   Any agreement of merger or consolidation may contain a provision that atany time prior to the filing of the agreement with the secretary of state, theagreement may be terminated by the board of directors of any constituentassociation or corporation notwithstanding approval of the agreement by themembers or stockholders of all or any of the constituent associations orcorporations. Any agreement of merger or consolidation may contain a provisionthat the boards of directors of the constituent associations or corporationsmay amend the agreement at any time prior to the filing of the agreement, or acertificate in lieu thereof, with the secretary of state provided that anamendment made subsequent to the adoption of the agreement by the members orstockholders of any constituent association or corporation shall not:

      (1)   Alter or change the amount or kind of shares, securities, cash, propertyor rights, or any of the proceedings, in exchange for or on conversion of allor any of the shares of any class or series thereof of such constituentassociation or corporation;

      (2)   alter or change any term of the articles of incorporation of thesurviving association or corporation to be effected by the merger orconsolidation; or

      (3)   alter or change any of the terms and conditions of the agreement if suchalteration or change would adversely affect the members or holders of any classof series thereof of such constituent association or corporation.

      (f)   In the case of a merger, the articles of incorporation of the survivingassociation or corporation shall automatically be amended to the extent, ifany, that change in the articles of incorporation are set forth in theagreement of merger.

      (g)   Notwithstanding the requirements of subsection (d), unless required byits articles of incorporation, no vote of members or stockholders of aconstituent association or corporation surviving a merger shall be necessary toauthorize a merger if:

      (1)   The agreement of merger does not amend in any respect the articles ofincorporation of the surviving corporation; and

      (2)   the aggregate stockholders' equity, as determined in accordance withgenerally accepted accounting principles, of the stock or other equity of thesurviving association or corporation to be issued or delivered under the planof merger does not constitute more than 25% of the aggregate stockholders'equity, as determined in accordance with generally accepted accountingprinciples, of all classes of stock or other equity of the survivingassociation or corporation immediately following the effectiveness of themerger.If an agreement of merger is adopted by the constituent association orcorporation surviving the merger, by action of its board of directors andwithout any vote of the constituent association's or corporation's members orstockholders pursuant to this subsection, the secretary or assistant secretaryof such association or corporation shall certify on the agreement, under theseal, that the agreement has been adopted pursuant to this subsection and that,as of the date of such certificate, the stockholders' equity of the associationor corporation was such as to render this subsection applicable. The agreementadopted and certified as provided in this section shallbe executed and filed,andshall become effective, in accordance with K.S.A. 17-6003, and amendmentsthereto. Such filing shall constitute a representation by the person whoexecutes the agreement that the facts stated in the certificate remain trueimmediately prior to such filing.

      History:   L. 1991, ch. 74, § 1;L. 1998, ch. 189, § 1;L. 2000, ch. 39, § 6; July 1.