                                 CODE OF VIRGINIA

MERGER OR CONSOLIDATION OF COOPERATIVES (§ 55.1-2131)

A. Any two or more cooperatives, by agreement of the proprietary lessees as
provided in subsection B, may be merged or consolidated into a single
cooperative. In the event of a merger or consolidation, unless the agreement
otherwise provides, the resultant cooperative is, for all purposes, the legal
successor of all of the preexisting cooperatives. The operations and activities
of all associations of the preexisting cooperatives shall be merged or
consolidated into a single association, which shall hold all powers, rights,
obligations, assets, and liabilities of all preexisting associations.

B. An agreement of two or more cooperatives to merge or consolidate pursuant to
subsection A must be evidenced by an agreement prepared, executed, recorded, and
certified by the president of the association of each of the preexisting
cooperatives following approval by proprietary lessees of cooperative interests
to which are allocated the percentage of votes in each cooperative required to
terminate that cooperative. Any such agreement must be recorded in every county
or city in which a portion of the cooperative is located and is not effective
until recorded.

C. Every merger or consolidation agreement must provide for the reallocation of
the allocated interests in the new association among the cooperative interests
of the resultant cooperative either (i) by stating the reallocations or the
formulas upon which they are based or (ii) by stating the percentage of overall
allocated interest of the new cooperative that are allocated to all of the
cooperative interests comprising each of the preexisting cooperatives and
providing that the portion of the percentages allocated to each cooperative
interest formerly comprising a part of the preexisting cooperative must be equal
to the percentages of allocated interests allocated to that cooperative interest
by the declaration of the preexisting cooperative.

HISTORY: 1982, c. 277, § 55-457; 2019, c. 712.