Merger Transactions

Mergers are realized when the partners of the company that is transferred acquire the shares of the transferee company automatically in exchange for the assets of the company that is transferred, according to an exchange rate. In a merger, at least one company is terminated without liquidation. With the merger, the transferee company takes over the assets of the transferee company as a whole.

Mergers can be of two types;

1- One commercial company takes over another, “merger in the form of acquisition”

2- Mergers of commercial companies into a new company, “merger in the form of a new establishment”

The following mergers are considered valid mergers in commercial companies and commercial enterprises.

* Capital companies; with another capital company, cooperatives, collective and limited partnerships, provided that the transferee company is the company,

* Individual companies; with another individual company, with capital companies and cooperatives, provided that the transferee company is the company,

* Cooperatives; with another cooperative, capital company, a sole proprietorship provided that it is the transferee company,

* with a commercial enterprise, a trading company provided that it is the transferee.

* If the transferee company wants to use the trade name of the transferred company, it can be used after the expiration of the three-month guarantee period specified in Article 157 of the TCC.

Required documents for registration:

1-) MERSİS Application

2-) Petition

* It must be signed by the authorized person with the company stamp, if signed by proxy, the original or certified copy of the power of attorney must be attached, and it must include the attached document statement.

3-) A photocopy of the registry gazette where the announcement regarding the right to review of the company transferred/taking over, which was issued in accordance with the attached example, was published 33 days before the general assembly,

* Each company participating in the merger must announce where the documents submitted for review are deposited and where they are kept ready for review, in the Turkish Trade Registry Gazette and the newspaper specified in the company agreement at least three business days before the date of deposit. The same announcement clearly states that all interested parties have the right to review the merger documents. These matters are also published on the websites of capital companies subject to the obligation to establish a website.

* Each of the companies participating in the merger must publish the merger agreement, merger report and the year-end financial statements and annual activity reports of the last three years, and interim balance sheets, if necessary, at their headquarters and branches, and in the case of public joint stock companies, at the locations to be determined by the Capital Markets Board, within thirty days before the general assembly decision; is obliged to present it to the examination of the partners, the holders of the usufruct certificates, the holders of the securities issued by the company, the persons with interests and other interested parties. These documents are also published on the websites of the capital companies that are required to open a website.

* Companies that are determined to meet the Small and Medium Enterprise criteria by a SMMM or YMM report may waive the right to examine the report and the activity certificate of the consultant, provided that all partners approve.

4-) Notarized copies of the decisions regarding the approval of the merger agreement by the general assemblies of the transferee and transferee companies (1 copy),

5-) Merger agreement signed by the parties (One original copy and, in the case of property and rights that need to be recorded in a special registry, photocopies as many as the number of authorities to be notified must be attached.)

6-) In case of permission or approval from the Ministry or other official institutions, this permission or approval letter for the transferee and transferee companies,

7-) In case the transferee company increases its capital due to the merger, the documents required for the registration of the capital increase;

* In case the capital increase is not made, this issue must be stated in the general assembly decision.

8-) In terms of the transferee company; if the merger is made as a new establishment, the establishment documents of the new company,

9-) SMMM or YMM report and the activity certificate of the consultant;

In this report;

* Determination of whether the capital of each company participating in the merger has remained unpaid and their equity,

* Determination that the receivables of the creditors have not been jeopardized, if this determination cannot be made, a declaration by the management body that the receivables in question have been secured,

* In the event that half of the total of the capital and legal reserve funds of the company party to the merger has been lost or is insolvent, the other company party to the merger has equity that it can freely dispose of in an amount that will cover the lost capital or insolvent status, and the relevant amounts are verified by showing the calculation method or it is verified that the specified situations do not exist,

* If the transferred company has assets registered in the land registry, ship and intellectual property registers and similar registers, a list of these and determination of their fair values, (Notification(A photocopy of the report must be attached for each authority to be consulted.)

* The latest balance sheet approved by the company's management body, and by the auditor in companies subject to audit, must be attached.

* If the companies participating in the merger are subject to audit, the Merger Report may also be prepared by the company auditor.

10-) If the transferred company is in liquidation, the report to be prepared by the liquidators stating that the distribution of the assets among the shareholders has not started

11-) A declaration signed by the company authorities addressing the Trade Registry Directorate, which includes the list of the transferred company's assets and rights registered in the land registry, ship and intellectual property registries and similar registries, and the information and values ​​of the registries where they are registered and the records of the said assets and rights in the relevant registries, must be attached with a photocopy of the document showing that the declared assets and rights belong to your company. A separate declaration must be prepared for each directorate to be notified.

* If there are no such issues; a declaration letter stating that there are no assets or rights that need to be registered in the special registry.

Note: If the company to be taken over and closed due to the merger has a branch or branches registered in our directorate where the company headquarters is located or in other Trade Registry Directorates, whether the registration of the branch will continue with the title of the transferee company must be clearly stated in the merger agreement.

* If there are no branch/branches, a signed declaration must be submitted in this regard.

12-) The announcement texts to be prepared in accordance with the sample regarding granting creditors the right to request the security of their receivables by the companies that are parties to the merger must be submitted to the directorate together with the registration documents to ensure that they are published in the registry gazette 3 times with an interval of 7 days. The first of the call announcements to creditors must be published in the same registry gazette together with the announcement regarding the registration of the merger decision.

13-) The merger report prepared by the management bodies of all companies that are parties to the merger, separately or together, must be submitted to the directorates where the companies are registered.

* Companies that are determined to meet the Small and Medium Enterprise criteria by a CPA or YMM report may waive the right to review the report in question and the consultant's activity certificate, provided that all partners approve.

* The transferee company cannot register the merger decision before the transferred company registers the merger decision.

* Provisions regarding the contribution of capital in kind are not applied in merger transactions.

* A provision cannot be included in the merger agreement stating that it will be valid before the general assembly approval. The only exception to this is the merger transaction made in a facilitated manner specified in Articles 155 and 156 of the Law.

* If more than 6 months have passed between the date of signing the merger agreement and the balance sheet date, or if there have been significant changes in the assets of the companies participating in the merger since the last balance sheet was prepared, the companies participating in the merger are required to prepare an interim balance sheet in accordance with the provisions of Article 144 of the Law, and a CPA or SMMM report regarding the evaluation made according to the interim balance sheet and the activity certificate of the consultant are submitted.

If a heavier quorum is not stipulated in the company agreement at the general assembly, the merger agreement;

* In joint stock companies whose shares are traded on stock exchanges, it must be approved by a majority of the votes present at the meeting, provided that at least one-fourth of the capital is represented,

* In joint stock companies and limited partnerships divided into shares, it must be approved by three-fourths of the votes present at the general assembly, provided that it represents the majority of the principal or issued capital,

* In capital companies to be taken over by a cooperative, it must be approved by three-fourths of the votes present at the general assembly, provided that it represents the majority of the capital,

* In limited companies, it must be approved by three-fourths of the votes of all partners, provided that they hold shares representing at least three-fourths of the capital,

* In cooperatives, it must be approved by a majority of two-thirds of the votes cast; if additional payment and other performance obligations or unlimited liability are accepted in the articles of association or if these are present and expanded, it must be approved by a decision of three-fourths of all partners registered in the cooperative.

Matters that must be included in the merger agreement;

* Trade names of the companies participating in the merger, the trade registry office where they are registered and trade registry number, tax number, company types, head office address; in case of a merger through a new establishment, the type of the new company, trade name and head office address,

* Exchange rate of company shares, equalization amount if foreseen; explanations of the partners of the transferred company regarding their shares and rights in the transferee company,

* Rights granted by the transferee company to the owners of privileged and non-voting shares and usufruct share owners,

* Method of changing company shares,

* Acquisition in the mergerthe date on which the acquired shares became entitled to the balance sheet profit of the transferee or newly established company and all the features related to this request,

* If necessary, the separation fee pursuant to Article 141 of the Law,

* The date on which the transactions and actions of the transferred company will be deemed to have been made on behalf of the transferee company,

* Special benefits granted to the management bodies and managing partners,

* If necessary, the names of the unlimited liability partners,

* The date of the merger agreement.

Matters that should be included in the merger report;

* The purpose and results of the merger,

* The merger agreement,

* The exchange rate of the company shares and the equalization fee, if foreseen; partnership rights granted to the partners of the transferred companies by the transferee company,

* If necessary, the amount of the separation fee and the reasons for giving the separation fee instead of the company share and partnership rights,

* Features regarding the valuation of the shares in terms of determining the exchange rate,

* If necessary, the amount of the increase to be made by the transferee company,

* If foreseen, information on additional payment and other personal performance obligations and personal responsibilities to be imposed on the partners of the transferred company due to the merger,

* In mergers of different types of companies, the obligations falling on the partners due to the new type,

* The effects of the merger on the employees of the companies participating in the merger and, if possible, the content of a social plan,

* The effects of the merger on the creditors of the companies participating in the merger,

* If necessary, the approvals obtained from the relevant authorities.

* In mergers through a new establishment, it is mandatory to attach the contract of the new company to the merger report.

MERGER IN A FACILITATED WAY;

WARNINGS:

* Facilitated mergers are only valid for capital companies.

* It is not valid for mergers through new establishments.

* If the transferee capital company owns all the voting shares of the transferred capital company or a company or a real person or groups of persons connected by law or contract own all the voting shares of the capital companies participating in the merger, capital companies can merge in a facilitated manner.

* Companies are not required to prepare a merger report and provide the right to review and submit this merger agreement to the approval of the general assemblies.

* In capital increases made due to mergers, the condition of having paid the previous capital is not required.

Matters that must be included in the merger agreement;

- Trade names of the companies participating in the merger, the trade registry office where they are registered and trade registry number, tax number, company types, head office address;

- If necessary, the separation fee in accordance with Article 141 of the Law,

- The date on which the transactions and actions of the transferred company will be deemed to have been made on behalf of the transferee company,

- Special benefits granted to the management bodies and managing partners,

- If necessary, the names of the unlimited liability partners,

Documents requested for registration, taking into account the explanations provided above;

* Merger agreement signed by the parties (One original copy and, if there is a property and right that needs to be recorded in the special registry, photocopies as many as the number of authorities to be notified must be attached.)

* In case of permission or favorable opinion of the Ministry or other official institutions, this permission or favorable opinion letter for the transferee and the transferee company,

* In case the transferee company makes a capital increase due to the merger, the documents required for the registration of the capital increase;

* In case the capital increase is not made, this issue must be stated in the decision of the board of directors/board of directors.

Note: If the transferee company is the sole legal partner of the transferee company, no capital increase will be made,

- However, if the partners of the transferee company are not the transferee company but real person/persons and different legal person/persons, the transferee company must make a capital increase due to the merger and the registration must be applied with the appropriate documents,

- SMMM or YMM report and the consultant's activity certificate;

In this report;

- Determination of whether the capital of each company participating in the merger has remained unpaid and their equity,

- Determination that the receivables of the creditors have not been jeopardized, or if this determination cannot be made, a declaration by the management body that the receivables in question have been secured,

- In the event that half of the total of the capital and legal reserve funds of the company party to the merger has been lost or is insolvent, the other company party to the merger has equity that it can freely dispose of in an amount that will cover the lost capital or insolvent status, and the relevant amounts are verified by showing the calculation method or it is verified that the specified situations do not exist,

- If the transferred company has assets registered in the land registry, ship and intellectual property registers and similar registers, the list of these and determination of their fair values, (A photocopy of the report must be attached for each authority to be notified.)

- In its annex, the company managementby the body, the latest balance sheet approved by the auditor in companies subject to audit,

should be included.

- If the companies participating in the merger are subject to audit, this report may also be prepared by the company auditor.

- If the transferred company is in liquidation, the report to be prepared by the liquidators stating that the distribution of the assets among the shareholders has not started

- A declaration signed by the company authorities, including the list of the assets and rights of the transferred company registered in the land registry, ship and intellectual property registries and similar registries, and the information and values ​​of the registries where they are registered and the records of the said assets and rights in the relevant registries; (A separate declaration should be prepared for each authority to be notified.)

- If the said issues do not exist; a declaration stating that there are no assets and rights that need to be recorded in a special registry.

- The announcement texts to be prepared in accordance with the sample regarding granting the right to claim the security of receivables to creditors by the companies that are parties to the merger must be submitted to the directorate together with the registration documents in order to ensure that they are published in the registry gazette 3 times at 7-day intervals. The first announcements to be made to creditors must be published in the same registry gazette together with the announcements regarding the registration of the merger decision. (ANNEX 2)

- In capital companies that merge with the simplified method in accordance with Article 156 of the Law, if the merger agreement is not submitted to the general assembly for approval, a notary-certified copy of the board of directors' decision regarding the acceptance of the merger, the implementation of the simplified merger method and the basis for this method must be submitted to the directorate.

- For minority shareholders if the transferee capital company owns at least ninety percent of the shares of the transferred capital company that grant voting rights; In the case that shares equivalent to these shares are given in the transferee company, in addition to the company shares, a cash equivalent exactly equivalent to the real value of the company shares is proposed in accordance with Article 141 of the Law and no additional payment debt or any personal performance obligation or personal liability arises due to the merger, capital companies may merge in a facilitated manner.

Matters that must be included in the merger agreement;

- The purpose and results of the merger,

- The amount of the increase to be made by the transferee company when necessary,

- If foreseen, information on the additional payment and other personal performance obligations and personal responsibilities to be incurred by the partners of the transferee company due to the merger,

- In mergers of different types of companies, the obligations incumbent on the partners due to the new type,

- The effects of the merger on the employees of the companies participating in the merger and, if possible, the content of a social plan.

- Companies are not obliged to prepare a merger report and submit this merger agreement to the approval of the general assemblies. However, the right to review must be provided 30 days before the application to the trade registry for the registration of the merger.

- In the capital increase made due to the merger, the previous capital payment condition is not required.

Documents requested for registration, considering the explanations above;

* A photocopy of the registry gazette where the announcement regarding the right to review of the company transferred/acquired, given in accordance with the example in the annex (ANNEX 1) 33 days before the general assembly, was published,

* Merger agreement signed by the parties (One original copy and, in the case of property and rights that need to be recorded in the special registry, photocopies as many as the number of authorities to be notified must be attached.)

* In case of permission or approval of the Ministry or other official institutions, this permission or approval letter for the transferee and the transferee company,

* Documents required for the registration of the capital increase in case the transferee company makes a capital increase due to the merger;

* If there is no capital increase, this issue must be stated in the board of directors/managers' board decision.

* SMMM or YMM report and the consultant's activity certificate;

In this report;

Whether the capital of each of the companies participating in the merger has remained unpaid, and their equity,

Determination that the receivables of the creditors have not been jeopardized, and if this determination cannot be made, a declaration by the management body that the receivables in question have been secured,

If half of the total of the capital and legal reserve funds of the company party to the merger has been lost or is insolvent, the other company party to the merger has equity that it can freely dispose of in an amount that will cover the lost capital or insolvent status, and the amounts related to this are verified by showing the calculation method or it is verified that the specified situations do not exist,

If the transferred company has assets registered in the land registry, ship and intellectual property registers and similar registers, a list of these and determination of their fair values, (For each authority to be notified(A photocopy of the report must be attached.)

The latest balance sheet approved by the company's management body and by the auditor in companies subject to audit must be included in the annex.

If the companies participating in the merger are subject to audit, this report may also be prepared by the company auditor.

If the company being transferred is in liquidation, the report to be prepared by the liquidators stating that the distribution of the assets among the shareholders has not started

A list of the transferred company's assets and rights registered in the land registry, ship and intellectual property registries and similar registries, and the information and values ​​of the registries where they are registered and the records of the said assets and rights in the relevant registries, signed by the company authorities, addressed to the Trade Registry Directorate, must be submitted as an annex to Declaration 1, and a photocopy of the document indicating that the declared assets and rights belong to your company. A separate declaration must be prepared for each authority to be notified. It must be prepared addressed to the relevant directorates.

If the aforementioned issues do not exist; declaration that there are no assets and rights that need to be registered in a special registry.

Note: If the company to be taken over and closed due to the merger has a branch or branches registered in our directorate where the company headquarters is located or in other Trade Registry Directorates, the attached Branch Information Declaration must be signed and submitted as an attachment to the document,

If there are no branch/branches, a signed declaration must be submitted stating that there are none.

The announcement texts to be prepared in accordance with the sample regarding granting the right to demand the security of their receivables to the creditors by the companies that are parties to the merger must be submitted to the directorate together with the registration documents to ensure that they are published in the registry gazette 3 times with an interval of 7 days. The first announcements to be made to the creditors must be published in the same registry gazette together with the announcements regarding the registration of the merger decision. (ANNEX 2)

In capital companies that merge with a simplified method in accordance with Article 156 of the Law, if the merger agreement is not submitted to the general assembly for approval, a notarized copy of the board of directors/managers' decision stating that the merger has been accepted, that the simplified merger method has been applied and the basis for this method must be submitted to the directorate.