Iowa Code 490.1105 – Merger between parent and subsidiary or between subsidiaries
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1. A domestic or foreign parent entity that owns shares of a domestic corporation which carry at least ninety percent of the voting power of each class and series of the outstanding shares of the subsidiary that has voting power may do any of the following:
a. Merge the subsidiary into itself, if it is a domestic or foreign corporation or eligible entity, or into another domestic or foreign corporation or eligible entity in which the parent entity owns at least ninety percent of the voting power of each class and series of the outstanding shares or eligible interests which have voting power.
b. Merge itself, if it is a domestic or foreign corporation or eligible entity, into such subsidiary, in either case without the approval of the board of directors or shareholders of the subsidiary, unless the articles of incorporation or organic rules of the parent entity or the articles of incorporation of the subsidiary corporation otherwise provide.
c. Section 490.1104, subsection 9, applies to a merger under this section. The articles of merger relating to a merger under this section do not need to be signed by the subsidiary.
Terms Used In Iowa Code 490.1105
- Articles of incorporation: means the articles of incorporation described in section 490. See Iowa Code 490.140
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Eligible entity: means a domestic or foreign unincorporated entity or a domestic or foreign nonprofit corporation. See Iowa Code 490.140
- Eligible interests: means interests or memberships. See Iowa Code 490.140
- Entity: includes a domestic and foreign business corporation; domestic and foreign nonprofit corporation; estate; trust; domestic and foreign unincorporated entity; and a state, the United States, and a foreign government. See Iowa Code 490.140
- following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
- Merger: means a transaction pursuant to section 490. See Iowa Code 490.140
- Organic rules: means the public organic record and private organic rules of a domestic or foreign corporation or eligible entity. See Iowa Code 490.140
- Shares: means the units into which the proprietary interests in a domestic or foreign corporation are divided. See Iowa Code 490.140
- Voting power: means the current power to vote in the election of directors. See Iowa Code 490.140
2. A parent entity shall, within ten days after the effective date of a merger approved under subsection 1, notify each of the subsidiary’s shareholders that the merger has become effective.
3. Except as provided in subsections 1 and 2, a merger between a parent entity and a domestic subsidiary corporation shall be governed by the provisions of this subchapter applicable to mergers generally.