48-61-102 - Limitations on mergers by public benefit corporations.
48-61-102. Limitations on mergers by public benefit corporations.
(a) Without the prior approval of any court of record of the state having equity jurisdiction in a proceeding of which the attorney general and reporter has been given written notice, a public benefit corporation may merge only with:
(1) Another public benefit corporation;
(2) A foreign corporation which would qualify under chapters 51-68 of this title as a public benefit corporation;
(3) A foreign or domestic corporation for profit; provided, that the public benefit corporation is the surviving corporation and continues to be a public benefit corporation after the merger; or
(4) A foreign or domestic corporation for-profit that is the surviving corporation; provided, that:
(A) On or prior to the effective date of the merger, assets with a value equal to the greater of the fair market value of the net tangible and intangible assets (including good will) of the public benefit corporation, or the fair market value of the public benefit corporation if it were to be operated as a business concern, are transferred or conveyed to one (1) or more persons who would have received its assets under § 48-64-106(a)(5) and (6) had it dissolved;
(B) It shall return, transfer or convey any assets held by it upon condition requiring return, transfer or conveyance, which condition occurs by reason of the merger, in accordance with such condition; and
(C) The merger is approved by a majority of directors of the public benefit corporation who are not and will not become shareholders in or officers, employees, agents or consultants of the for-profit corporation.
(b) A public benefit corporation must give written notice to the attorney general and reporter at least twenty (20) days before it consummates any merger, unless the attorney general and reporter has given the corporation a written waiver of this subsection.
(c) Without the prior written consent of the attorney general and reporter or a court of record of the state of Tennessee in a proceeding in which the attorney general and reporter has been given notice, when a public benefit corporation merges, each member of a public benefit corporation may only receive or keep a membership or memberships in the surviving public benefit corporation, if any.
[Acts 1987, ch. 242, § 11.02.]