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by Richard R. Hammar, J.D., LL.M., CPA

Merger and Consolidation

§ 6.14
Key point 6-14. Two or more religious congregations can merge or consolidate. In a merger, one corporation absorbs the other and remains in existence while the other is dissolved, whereas in a consolidation a new corporation is created and the consolidating corporations are extinguished. The procedure for merging and consolidating incorporated churches is specified by state nonprofit corporation law.

Although the terms merger and consolidation frequently are used interchangeably, they have separate legal meanings. In a merger, one corporation absorbs the other and remains in existence while the other is dissolved, whereas in a consolidation a new corporation is created and the consolidating corporations are extinguished.

One court has observed ...

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