A. A plan of reorganization shall not be proposed under the Banking Act unless:
(1) the plan is feasible and fair to all classes of depositors, creditors and stockholders;
(2) the face amount of the interest accorded to any class of depositors, creditors or stockholders under the plan does not exceed the value of the assets upon liquidation less the full amount of the claim of all prior classes, subject, however, to any fair adjustment for new capital that any class will pay in under the plan;
(3) the plan provides for the issuance of common stock in an amount that will provide an adequate ratio to deposits;
(4) any exchange of new common stock for obligations or stock of the bank will be effected in inverse order to the priorities in liquidation of the classes that will retain an interest in the bank, and upon terms that fairly adjust any change in the relative interests of the respective classes that will be produced by the exchange;
(5) the plan assures the removal of any director, officer or employee responsible for any unsound or unlawful action, or the existence of an unsound condition; and
(6) any merger or consolidation provided by the plan conforms to the requirements of the Banking Act.
B. Whenever in the course of reorganization supervening conditions render the plan unfair, or its execution impractical, the commissioner [director of the financial institutions division of the regulation and licensing department] may modify the plan or liquidate the institution. Any such action shall be taken by order upon appropriate notice.
History: 1953 Comp., § 48-22-62, enacted by Laws 1963, ch. 305, § 62.
ANNOTATIONSBracketed material. — The bracketed material was inserted by the compiler and is not part of the law.
Am. Jur. 2d, A.L.R. and C.J.S. references. — 10 Am. Jur. 2d Banks § 821.
Character as holder in due course of bank which takes over assets and assumes liabilities of another bank, 76 A.L.R. 1329.
Guarantor: liability of guarantor of or surety for bank deposit as affected by reorganization, merger or consolidation of bank, 78 A.L.R. 381.
Transfer of assets: novation where bank transfers its assets to another bank which assumes its obligation, 79 A.L.R. 82.
Dissenting stockholders: construction and effect of provisions for payment of dissenting stockholders in statutes relating to merger, consolidation or reorganization of banks or other corporations, 87 A.L.R. 597, 162 A.L.R. 1237, 174 A.L.R. 960.
Constitutionality of recent legislation relating to merger, consolidation or reorganization of banks as affected by rights of dissenting creditors or stockholders, 92 A.L.R. 1337, 96 A.L.R. 1445, 104 A.L.R. 1203.
Estoppel by acquiescence or delay to question validity of plan for reorganization of bank, 139 A.L.R. 659.
9 C.J.S. Banks and Banking § 155 et seq.