New York Laws
Article 9 - Merger or Consolidation; Guarantee; Disposition of Assets; Share Exchanges
913 - Share Exchanges.

(a) (1) Two domestic corporations may, as provided in this section,
participate in the consummation of a plan for binding share exchanges.
(2) Whenever used in this article:
(A) "Acquiring corporation" means a corporation that is participating
in a procedure pursuant to which such corporation is acquiring all of
the outstanding shares of one or more classes of a subject corporation.
(B) "Subject corporation" means a corporation that is participating in
a procedure pursuant to which all of the outstanding shares of one or
more classes of such corporation are being acquired by an acquiring
corporation.
(b) The board of the acquiring corporation and the board of the
subject corporation shall adopt a plan of exchange, setting forth:
(1) The name of the acquiring corporation and the name of the subject
corporation, and, if the name of either of them has been changed, the
name under which it was formed;
(2) As to the acquiring corporation and the subject corporation, the
designation and number of outstanding shares of each class and series,
specifying the classes and series entitled to vote and further
specifying each class and series, if any, entitled to vote as a class;
and, if the number of any such shares is subject to change prior to the
effective date of the exchange, the manner in which such change may
occur;
(3) The terms and conditions of the proposed exchange, including the
manner and basis of exchanging the shares to be acquired for shares,
bonds or other securities of the acquiring corporation, or the cash or
other consideration to be paid or delivered in exchange for such shares
to be acquired, or a combination thereof; and
(4) Such other provisions with respect to the proposed exchange as the
board considers necessary or desirable.
(c) The board of the subject corporation, upon adopting the plan of
exchange, shall submit such plan, except as provided in paragraph (g) of
this section, to a vote of shareholders in accordance with the
following:
(1) Notice of meeting shall be given to each shareholder of record, as
of the record date fixed pursuant to section 604 (Fixing record date),
whether or not entitled to vote. A copy of the plan of exchange or an
outline of the material features of the plan shall accompany such
notice.
(2) (A) The plan of exchange shall be adopted at a meeting of
shareholders by (i) for any corporation in existence on the effective
date of subclause (ii) of this clause, two-thirds of the votes of all
outstanding shares entitled to vote thereon and (ii) for any corporation
in existence on the effective date of this subclause the certificate of
incorporation of which expressly provides such and for any corporation
incorporated after the effective date of this subclause, a majority of
the votes of all outstanding shares entitled to vote thereon.
Notwithstanding any provision in the certificate of incorporation, the
holders of shares of a class or series of a class shall be entitled to
vote together and to vote as a separate class if both of the following
conditions are satisfied:
1. Such shares will be converted into shares of the acquiring
corporation, and
2. The certificate or articles of incorporation of the acquiring
corporation immediately after the share exchange would contain any
provision which is not contained in the certificate of incorporation of
the subject corporation and which, if contained in an amendment to the
certificate of incorporation of the subject corporation, would entitle

the holders of shares of such class or such one or more series to vote
and to vote as a separate class thereon pursuant to section 804 (Class
voting on amendment).
In such case, in addition to the authorization of the exchange by the
proportion of votes indicated above of all outstanding shares entitled
to vote thereon, the exchange shall be authorized by a majority of the
votes of all outstanding shares of the class entitled to vote as a
separate class. If any provision referred to in subclause 2 of this
clause (A) would affect the rights of the holders of shares of only one
or more series of any class but not the entire class, then only the
holders of those series whose rights would be affected shall together be
considered a separate class for purposes of this section.
Notwithstanding shareholder authorization and at any time prior to the
filing of the certificate of exchange, the plan of exchange may be
abandoned pursuant to a provision for such abandonment, if any,
contained in the plan of exchange.
(B) Any corporation may adopt an amendment of the certificate of
incorporation which provides that such plan of exchange shall be adopted
at a meeting of the shareholders by vote of a specified proportion of
the holders of outstanding shares, or class or series of shares,
entitled to vote thereon, provided that such proportion may not be less
than a majority and subject to the second sentence of clause (A) of
this subparagraph (2).
(d) After adoption of the plan of exchange by the board of the
acquiring corporation and the board of the subject corporation and by
the shareholders of the subject corporation entitled to vote thereon,
unless the exchange is abandoned in accordance with paragraph (c), a
certificate of exchange, entitled "Certificate of exchange of shares of
.............., subject corporation, for shares of .............,
acquiring corporation, or other consideration, under section 913 of the
Business Corporation Law", shall be signed on behalf of each corporation
and delivered to the department of state. It shall set forth:
(1) the statements required by subparagraphs (1) and (2) of paragraph
(b) of this section;
(2) the effective date of the exchange if other than the date of
filing of the certificate of exchange by the department of state;
(3) the date when the certificate of incorporation of each corporation
was filed by the department of state;
(4) the designation of the shares to be acquired by the acquiring
corporation and a statement of the consideration for such shares; and
(5) the manner in which the exchange was authorized with respect to
each corporation.
(e) Upon the filing of the certificate of exchange by the department
of state or on such date subsequent thereto, not to exceed thirty days,
as shall be set forth in such certificate, the exchange shall be
effected. When such exchange has been effected, ownership of the shares
to be acquired pursuant to the plan of exchange shall vest in the
acquiring corporation, whether or not the certificates for such shares
have been surrendered for exchange, and the acquiring corporation shall
be entitled to have new certificates registered in its name or at its
direction. Shareholders whose shares have been so acquired shall become
entitled to the shares, bonds or other securities of the acquiring
corporation, or the cash or other consideration, required to be paid or
delivered in exchange for such shares pursuant to the plan. Subject to
any terms of the plan regarding surrender of certificates theretofore
evidencing the shares so acquired and regarding whether such
certificates shall thereafter evidence securities of the acquiring
corporation, such certificates shall thereafter evidence only the right

to receive the consideration required to be paid or delivered in
exchange for such shares pursuant to the plan or, in the case of
dissenting shareholders, their rights under section 910 (Right of
shareholder to receive payment for shares upon merger or consolidation,
or sale, lease, exchange or other disposition of assets, or share
exchange) and section 623 (Procedure to enforce shareholder's right to
receive payment for shares).
(f) (1) A foreign corporation and a domestic corporation may
participate in a share exchange, but, if the subject corporation is a
foreign corporation, only if such exchange is permitted by the laws of
the jurisdiction under which such foreign corporation is incorporated.
With respect to such exchange, any reference in subparagraph (2) of
paragraph (a) of this section to a corporation shall, unless the context
otherwise requires, include both domestic and foreign corporations, and
the provisions of paragraphs (b), (c), (d) and (e) of this section shall
apply, except to the extent otherwise provided in this paragraph.
(2) With respect to procedure, including the requirement of
shareholder authorization, a domestic corporation shall comply with the
provisions of this chapter relating to share exchanges in which domestic
corporations are participating, and a foreign corporation shall comply
with the applicable provisions of the law of the jurisdiction under
which it is incorporated.
(3) If the subject corporation is a foreign corporation, the
certificate of exchange shall set forth, in addition to the matters
specified in paragraph (d), the jurisdiction and date of incorporation
of such corporation and a statement that the exchange is permitted by
the laws of the jurisdiction of such corporation and is in compliance
therewith.
(g) (1) Any corporation owning at least ninety percent of the
outstanding common shares, having full voting rights, of another
corporation may acquire by exchange the remainder of such outstanding
common shares, without the authorization of the shareholders of any such
corporation and with the effect provided for in paragraph (e) of this
section. The board of the acquiring corporation shall adopt a plan of
exchange, setting forth the matters specified in paragraph (b) of this
section. A copy of such plan of exchange or an outline of the material
features thereof shall be given, personally or by mail, to all holders
of shares of the subject corporation that are not owned by the acquiring
corporation, unless the giving of such copy or outline has been waived
by such holders.
(2) A certificate of exchange, entitled "Certificate of exchange of
shares of .........., subject corporation, for shares of ..........,
acquiring corporation, or other consideration, under paragraph (g) of
section 913 of the Business Corporation Law" and complying with the
provisions of paragraph (d) and, if applicable, subparagraph (3) of
paragraph (f) shall be signed, verified and delivered to the department
of state by the acquiring corporation, but not less than thirty days
after the giving of a copy or outline of the material features of the
plan of exchange to shareholders of the subject corporation, or at any
time after the waiving thereof by the holders of all the outstanding
shares of the subject corporation not owned by the acquiring
corporation.
(3) The right of exchange of shares granted by this paragraph to
certain corporations shall not preclude the exercise by such
corporations of any other right of exchange under this article.
(4) The procedure for the exchange of shares of a subject corporation
under this paragraph (g) of this section shall be available where either
the subject corporation or the acquiring corporation is a foreign

corporation, and, in case the subject corporation is a foreign
corporation, where such exchange is permitted by the laws of the
jurisdiction under which such foreign corporation is incorporated.
(h) This section does not limit the power of a domestic or foreign
corporation to acquire all or part of the shares of one or more classes
of another domestic or foreign corporation by means of a voluntary
exchange or otherwise.
(i) (1) A binding share exchange pursuant to this section shall
constitute a "business combination" pursuant to section nine hundred
twelve of this chapter (Requirements relating to certain business
combinations) if the subject corporation is a domestic corporation and
the acquiring corporation is an "interested shareholder" of the subject
corporation, as such term is defined in section nine hundred twelve of
this chapter.
(2) With respect to convertible securities and other securities
evidencing a right to acquire shares of a subject corporation, a binding
share exchange pursuant to this section shall have the same effect on
the rights of the holders of such securities as a merger of the subject
corporation.
(3) A binding share exchange pursuant to this section which is
effectuated on or after September first, nineteen hundred ninety-one is
intended to have the same effect as a "merger" in which the subject
corporation is a surviving corporation, within the meaning of any
provision of the certificate of incorporation, bylaws or other contract
or instrument by which the subject corporation was bound on September
first, nineteen hundred eighty-six, unless it is apparent on the face of
such instrument that the term "merger" was not intended to include a
binding share exchange.