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This entry was published on 2014-09-22
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SECTION 601-C
Sale, lease, exchange or other disposition of property, rights, privileges and franchises
Banking (BNK) CHAPTER 2, ARTICLE 13
§ 601-c. Sale, lease, exchange or other disposition of property,
rights, privileges and franchises. 1. Subject to subdivision eight of
section six hundred five of this chapter, and except as otherwise
provided by law or by its organization certificate or other certificate
filed pursuant to law, a corporation organized under the laws of this
state and subject to the provisions of article three, article six,
article eight, article ten or article twelve of this chapter may
voluntarily sell, lease, exchange or otherwise dispose of its property,
rights, privileges and franchises, or any interest therein or any part
thereof; provided, however, that if such sale, lease, exchange or other
disposition is not made in the regular course of business of the
corporation and involves all or substantially all of its property,
rights, privileges and franchises, or an integral part thereof essential
to the conduct of the business of the corporation, such sale, lease,
exchange or other disposition shall be authorized only in accordance
with the following procedure:

(a) In the case of a corporation subject to the provisions of article
three, article eight, article twelve or a stock-form banking
organization subject to either article six or article ten of this
chapter, the board of directors of the corporation by a majority vote of
all the members thereof shall approve the proposed sale, lease, exchange
or other disposition and direct its submission to a vote of
stockholders.

Notice of meeting shall be given to each stockholder of record,
whether or not entitled to vote.

The stockholders shall authorize such sale, lease, exchange or other
disposition and may fix, or may authorize the board of directors to fix,
any of the terms and conditions thereof and the consideration to be
received by the corporation therefor, which may consist in whole or in
part of cash or other property, real or personal, including shares,
bonds or other securities of any other domestic or foreign corporation
or corporations, by vote at a meeting of stockholders of the holders of
two-thirds of all outstanding shares entitled to vote thereon.

(b) In the case of a mutual corporation subject to the provisions of
article six of this chapter, the board of trustees of the corporation by
a vote of a majority of all the members thereof shall approve and
authorize the proposed sale, lease, exchange or other disposition and
shall fix any of the terms and conditions thereof and the consideration
to be received by the corporation therefor, which may consist in whole
or in part of cash or other property, real or personal, including such
shares, bonds or other securities of any other domestic or foreign
corporation or corporations as are authorized investments for savings
banks, subject to those limitations applicable to such investments.

A verified copy of the minutes of the meeting at which the board of
trustees approves and authorizes the proposed transaction shall be filed
in the office of the superintendent together with a copy of the
agreement governing the proposed transaction, a statement setting forth
the reasons why the trustees believe the proposed transaction would be
in the best interest of the savings bank, its depositors and the public
and such other information as the superintendent may require. In
determining whether or not to approve the proposed transaction, the
superintendent shall consider whether the proposed transaction would be
in the best interests of the savings bank, its depositors and the public
and such other information as the superintendent may deem appropriate.
The superintendent shall notify the board of trustees in writing of his
or her determination. If the superintendent disapproves, the board of
trustees shall abandon the proposed transaction.

(c) In the case of a mutual corporation subject to the provisions of
article ten of this chapter, the board of directors of the corporation
by a majority vote of all the members thereof shall approve the proposed
sale, lease, exchange or other disposition and direct its submission to
a vote of shareholders.

Notice of meeting shall be given to each shareholder.

The shareholders shall authorize such sale, lease, exchange or other
disposition and may fix, or may authorize the board of directors to fix,
any of the terms and conditions thereof and the consideration to be
received by the corporation therefor, which may consist in whole or in
part of cash or other property, real or personal, including such shares,
bonds or other securities of any other domestic or foreign corporation
or corporations as are authorized investments for savings and loan
associations, subject to those limitations applicable to such
investments, by vote at a meeting of shareholders of the holders of
two-thirds in amount of the book value of all outstanding shares
entitled to vote thereon.

A verified copy of the minutes of the meetings at which the board of
directors and shareholders approve and authorize the proposed
transaction shall be filed in the office of the superintendent together
with a copy of the agreement governing the proposed transaction, a
statement setting forth the reasons why the directors believe the
proposed transaction would be in the best interest of the savings and
loan association, its shareholders and the public and such other
information as the superintendent may require. In determining whether or
not to approve the proposed transaction, the superintendent shall
consider whether the proposed transaction would be in the best interests
of the savings and loan association, its shareholders and the public.
The superintendent shall notify the board of directors in writing of his
or her determination. If the superintendent disapproves, the board of
directors shall abandon the proposed transaction.

2. Notwithstanding stockholder or shareholder authorization, the board
may abandon the proposed sale, lease, exchange or other disposition
without further action by the stockholders or shareholders, subject to
the rights, if any, of third parties under any contract relating
thereto.

3. This section shall not be applicable to a sale or disposition of
assets the acquisition of which is authorized by section six hundred
one-a of this chapter, or to any sale or other disposition of assets
after the entry of an order pursuant to subdivision four of section six
hundred five of this chapter, or to a sale or disposition of all or
substantially all of the assets by a mutual corporation subject to the
provisions of article six or article ten of this chapter to a national
banking association or national banking associations or a corporation or
corporations subject to the provisions of article three, article eight
or article twelve of this chapter or to a stock-form corporation subject
to article six or article ten of this chapter or to a stock-form federal
savings bank or to a stock-form federal savings and loan association.