Chap. 8.—An ACT to amend and re-enact Sections 3821 and 3874 of the Codé of
Virginia so as to authorize the merger or consolidation of certain non-stock
corporations, to prescribe the manner in which such merger or consolidation
may be effected, and the rights, obligations, duties and powers of such merged

or consolidated corporations, and to increase the amount of real estate which
may be held by non-stock corporations operating as educational institutions.

Approved February 10, 1944

Be it enacted by the General Assembly of Virginia:

1. That sections thirty-eight hundred and twenty-one and thirty-
eight hundred and seventy-four of the Code of Virginia be amended and
re-enacted, as follows:

Section 3821. When merger or consolidation may be effected.—
Except as any merger or consolidation is prohibited by sub-section (e)
of section thirty-eight hundred fifty-seven, and sub-section (e) of section
thirty-eight hundred sixty-six, any corporation not under patronage or
control of the State, organized or to be organized under any law or laws
of this State, whether it be a corporation having capital stock or a non-
stock corporation other than one organized for social purposes only, may
merge or consolidate in the manner prescribed in section thirty-eight
hundred twenty-two of the Code as amended into a single corporation
with any other corporation organized for the purpose of carrying on the
same or a similar business or for the same or similar purposes under the
laws of this or any other state of the United States, or under the laws of
the United States; and corporations organized for social purposes only
may merge or consolidate in the same manner, except that the merger
or consolidation of such corporations shall be by unanimous vote of the
members by whatever name called having voting power at a meeting
legally called for the purpose of considering and voting in person or by
proxy on an agreement for merger or consolidation. Any such merged
or consolidated corporation shall, upon the payment of a proper charter
fee, thereby become a domestic corporation of this State and be subject
to its laws, and to the jurisdiction of its courts, and may be either one
of the merging or consolidating corporations, or a new corporation to
be formed by means of the merger or consolidation; and by virtue of
this chapter, and the proceedings had pursuant thereto, the corporations
shall be consolidated and merged, so that all property, rights, franchises,
and privileges by law vested in each corporation so merged or consoli-
dated shall be transferred to and vested in the corporation formed by the
merger or consolidation.
In the case of corporations having no capital stock the provisions of
this chapter prescribing procedure for the merger or consolidation of
corporations shall be followed as far as applicable, and the directors,
managers, trustees or members of the governing board however called
may take the action required of the board of directors of stock corpora-
tions, and the members of the corporation such action as is required of
stockholders, but non-stock corporations organized for social purposes
only may merge or consolidate only by unanimous vote of the members
of each of the constituent corporations. No dissatisfied member of a non-
stock corporation shall be entitled to recover anything from the corpora-
tion on account of the merger or consolidation.

Section 3874. Execution and Acknowledgement of Certificate ; Cer-
tificate of Judge; Fee; Duties of the Commission; Recordation; Vesting
of Corporate Powers; Amount of Holdings, etc., of Corporate Body.—
(a) Such certificate shall be (1) signed by at least three persons, (2)
acknowledged by them before an officer authorized by the laws of this
State to take acknowledgements of deeds, and (3) presented in term time
or in vacation to the judge of any court of record of the county or city
wherein the principal office of the corporation is to be located. The judge
shall thereupon ascertain and certify thereon whether the persons signing
and acknowledging the certificate are of good moral character, and suitable
and proper persons to be incorporated for the purpose set forth in the
certificate ; and shall further certify whether in his opinion the certificate
is signed and acknowledged in accordance with the requirements of this
chapter, and if not, in what respects it is faulty.

(b) As soon as so endorsed by the judge the certificate, together
with separate certified or cashier’s checks or bank drafts, or postal notes,
or money orders, one payable to the State Corporation Commission cov-
ering charter fee, if any, costs, and fee for recordation in the clerk's of-
fice of the Commission, and the other payable to the clerk of the proper
court for the amount of the proper fee for recording the charter, may
be presented to the Commission, which shall ascertain and declare
whether the applicants have, by complying with the requirements of the
law, entitled themselves to a charter, and shall issue or refuse the same
accordingly. When so issued, the certificate, with all endorsements, to-
gether with the order of the Commission, shall be admitted to record in
the office of the Commission and thereupon. spread by the clerk of the
Commission in the charter records of his office, and the Commission
shall certify the same to the clerk of the circuit court of the county, or
the corporation or other proper court of recordation of the city wherein
the principal office of the corporation is to be located, and the clerk of
the Commission, as soon as he shall have spread the certificate and orders
of the Commission on the charter records in his office, shall forward
same, together with the fee so placed in hand, by registered mail or per-
sonal messenger, to the clerk of the proper court, who shall likewise
record it in a book to be provided and kept for the purpose in his office ;
and when so recorded, the fact of the recordation shall be endorsed upon
the certificate, and the certificate, with all endorsements thereon, shall
be returned by such clerk, by registered mail or personal messenger, to
the Commission and lodged and preserved in the office of its clerk.

(c) As soon as the charter has been so issued and admitted to rec-
ord by the Commission in its office, the persons who signed and acknowl-
edged the certificate and such other persons as may be associated with
them according to the provisions of law, or of their charter, and their suc-
cessors, shall be a body politic and corporate by the name set forth in
the certificate ; and as such shall have power to sue and be sued, to con-
tract and be contracted with, to plead and be impleaded in any court of
law and equity; to make and use a common seal, which may be affixed
by making an impression directly on the paper, and to alter or amend
the same at pleasure; to appoint such officers, managers and agents and
to establish such branches and auxiliaries as the business and purposes
of the corporation may require; to make by-laws, rules and regulations
not inconsistent with the laws of this State or of the United States for
the government of‘the corporation and its members, and for the manage-
ment of its property and the regulation of its affairs; to take and to hold
by gift, purchase, grant, devise or bequest, any property—real, personal
or mixed—and the same to dispose of at pleasure; but, no such corpora-
tion shall, in its corporate capacity, hold real estate the yearly income
derived from which shall exceed the sum of fifty thousand dollars, ex-
cept that non-stock corporations operating as educational institutions
may hold real estate the net annual income from which does not exceed
one hundred thousand dollars. In addition, such corporation shall exer-
cise any corporate powers necessary to the purposes above enumerated
and given, and shall have all the general powers and be subject to all the
general restrictions and liabilities conferred and imposed by this chapter,
and by the general laws of this State applicable thereto.

(d) Any failure on the part of the clerk of any court to comply with
the provisions of this section shall subject him to a fine of not less than
ten dollars nor more than one hundred dollars to be imposed by the
Commission.