Any bank may consolidate or merge with or transfer its assets and liabilities to another bank and any bank may move its office or place of business from one city or town to another city or town within the state.
Before such consolidation, merger or transfer shall become effective, the following proceedings must be had and done. The board of directors of each bank affected must pass a resolution stating that such consolidation, merger or transfer is desirable and order the officers of the bank to call a meeting of the stockholders to consider the proposition. Upon the passage of such resolution by the directors, the officers shall mail a notice of such meeting to each stockholder at his last known place of residence, postage prepaid, at least 30 days before the date set for the meeting of stockholders, which notice shall specify the date and place of the meeting and the purpose for which the meeting is to be held. A copy of the resolution must also be forwarded to the superintendent for his information, and he shall investigate the advisability of such consolidation, merger or transfer. On the day of the meeting of the stockholders, a resolution may be prepared setting forth the desirability of the consolidation, merger or transfer of the place of business of such bank, which shall set forth the terms, etc., of such consolidation, merger or transfer and such other matters as the stockholders may see proper, not contrary to law. If a majority of the stock is represented at such meeting and vote in the affirmative for such resolution and the superintendent shall approve all of the proceedings and it is his judgment that the same would be for the best interest of the institution or institutions affected, such resolution shall have the force and effect of consolidating or merging such institution with the other institution, provided such action of the other institution is likewise satisfactorily passed by its stockholders. If the proposition to transfer the place of business from one town or city to the other is affirmatively voted for by a majority of all the stock of the institution and the superintendent, after careful investigation, is of the opinion that it is wise to change or transfer the place of business to another town or city, such transfer shall be made.
Any bank organized under the laws of the United States may, by the vote of the stockholders owning not less than a majority of the capital stock of such bank with the approval of the superintendent and upon the payment by it to the superintendent of a fee prescribed by the Banking Board under Section 5-5A-13, be converted into a state bank with any name approved by the superintendent.
In case of such conversion, the articles of incorporation and organization certificates may be executed by a majority of the directors of the bank and the certificate shall declare that the owners of a majority of the capital stock have authorized the directors to make such certificate and to exchange or convert the national bank into a state bank. A majority of the directors, after executing the articles of incorporation and the organization certificate, shall have power to execute all other papers and to do whatever may be required to make its organization perfect and complete as a state bank. The shares of any such bank may continue to be for the same amount each as they were before they were converted, and the directors may continue to be directors of the state bank until others are elected or appointed in accordance with the statutes of Alabama.
(a) When the superintendent has given to such bank a certificate that the provisions of this article have been complied with, such bank and all its stockholders, officers and employees shall have the same powers and privileges and shall be subject to the same duties, liabilities and regulations, in all respects, as shall have been prescribed for banks originally organized as banking corporations under the laws of Alabama.
(b) At the time when such conversion of the national bank into a state bank, under the charter of the latter, becomes effective, all the property of the national bank, including all its rights, title and interest in and to all property of whatsoever kind, whether real, personal or mixed, and things in action, and every right, privilege, interest and asset of any conceivable value or benefit then existing, belonging or appertaining to it or which would inure to it, shall immediately, by act of law and without any conveyance or transfer and without any further act or deed, be vested in and become the property of the state bank, which shall have, hold and enjoy the same in its own right as fully and to the same extent as if the same were possessed, held and enjoyed by the national bank.
(c) Upon such conversion becoming effective, the state bank shall be deemed to be a continuation of the entity and of the identity of the national bank and all the rights, obligations and relations of the national bank to or in respect to any person, estate, creditor, depositor, trustee or beneficiary of any trust and in, or in respect to, any executorship or trusteeship or other trust or fiduciary function shall remain unimpaired. The state bank as of the time of the taking effect of such conversion, shall succeed to all such rights, obligations, relations and trusts and the duties and liabilities connected therewith and shall execute and perform each and every such trust or relation in the same manner as if the state bank had itself assumed the trust or relation, including the obligations and liabilities connected therewith. If the national bank is acting as administrator, co-administrator, executor, co-executor, trustee or co-trustee of or in respect to any estate or trust being administered under the laws of this state, such relation, as well as any other or similar fiduciary relations, and all rights, privileges, duties and obligations connected therewith shall remain unimpaired and shall continue into and in said state bank from and as of the time of the taking effect of such conversion, irrespective of the date when any such relation may have been created or established and irrespective of the date of any trust agreement relating thereto or the date of the death of any testator or decedent whose estate is being so administered. Nothing done in connection with the conversion of a national bank into a state bank shall in respect of any such executorship, trusteeship or similar fiduciary relation, be deemed to be or to effect, under the laws of this state, a renunciation or revocation of any letters of administration or letters testamentary pertaining to such relation, nor a removal or resignation from any such executorship or trusteeship or other fiduciary relationship, nor shall the same be deemed to be of the same effect as if the executor or trustee or other fiduciary had died or otherwise become incompetent to act.
(d) Any reference to the national bank in any contract, will or document shall be considered a reference to the state bank unless expressly provided to the contrary in the contract, will or document.
Before the issuing of such certificate by the superintendent a majority of the directors of such bank shall file in the office of the official or officials with which a certificate of incorporation would be filed under the business corporation laws of this state a declaration of incorporation, which shall show:
(1) The name to be assumed and used by the corporation;
(2) The objects of the corporation, among which shall be the conversion of a national bank with the name and description of the same, into a state bank with all the power and authority that may be exercised by a state bank;
(3) The location of its principal office;
(4) The amount of its total authorized capital and the amount of its paid-in capital;
(5) The name and post-office address of each officer and director;
(6) The time limit, if any, for the duration of the corporation; and
(7) A certificate, acknowledged before a notary public by a majority of the directors of the national bank so converted, that there has been transferred by the national bank, by a vote of the stockholders owning not less than a majority of the capital stock of such national bank, to such state bank into which it is converted, all the property and assets of said national bank.
Such state bank shall have authority to issue to the stockholders of the national bank from which it was converted shares of stock of the same amount and of the same par value as is held by each of said stockholders in such national bank.
A certificate of all the proceedings, including a copy of the pertinent portion of the minutes of the meeting of the board of directors at which the resolution under Section 5-7A-2 was passed, the notice which was given to each stockholder and a copy of the minutes of the stockholders' meeting, shall be made and certified to by the president and cashier of the institution under the seal thereof and acknowledged before a notary public as deeds are required to be acknowledged by a corporation and forwarded to the superintendent for his certificate of approval.
If the superintendent approves the entire proceedings, he shall issue his certificate of approval in writing, in duplicate, one copy being filed in his office and the other forwarded, along with the certificate, to the official or officials where articles of merger or consolidation would be filed under the business corporation laws of this state, for record at the expense of the institution affected.
Any state bank may, with the consent of the holders of a majority in amount of its stock obtained at a meeting of the shareholders called therefor, be converted or merged into or consolidate with a national bank, in such manner as may, at the time of such conversion, merger or consolidation, be prescribed by the laws of the United States, and the stock of such state bank may be exchanged for stock in such national bank upon such terms as the consenting shareholders may, at the meeting at which the conversion, merger or consolidation is authorized, determine or upon such terms as the holders of a majority of the stock of such state bank may, at any other meeting called for such purpose, determine. All proceedings relating to such a conversion, merger or consolidation shall be conducted in accordance with the requirements of Chapter 2A of Title 10, except that if any provision thereof shall conflict with or be more restrictive than the requirements set forth at 12 U.S.C. §214a then the procedures set forth in such §214a shall govern.
All meetings of shareholders, called for any of the purposes provided for in Section 5-7A-40, shall be called by resolution of the board of directors. Notice of such meeting and of the purposes thereof shall be published once a week for four consecutive weeks prior to the date of such meeting in some newspaper with a general circulation in the city, town or village in which the principal place of business of said state bank is located, provided, that newspaper publication may be dispensed with entirely if waived by all the shareholders, and in the case of a merger or consolidation, one publication at least 10 days before the meeting shall be sufficient if publication for four weeks is waived by holders of at least two-thirds of each class of capital stock. The state bank shall send such notice to each shareholder of record by registered mail or by certified mail at least 10 days prior to the meeting, which notice may be waived specifically by any shareholder.
At the time when such conversion of or consolidation or merger by the state bank with a national bank, under the charter of the latter, becomes effective, all the property of the state bank including all its rights, title and interest in and to all property of whatsoever kind, whether real, personal or mixed, and things in action, and every right, privilege, interest and asset of any conceivable value or benefit then existing, belonging or appertaining to it or which would inure to it, shall immediately, by act of law and without any conveyance or transfer and without any further act or deed, be vested in and become the property of the national bank, which shall have, hold and enjoy the same in its own right as fully and to the same extent as if the same were possessed, held and enjoyed by the state bank.
Upon such conversion, merger or consolidation becoming effective, the national bank shall be deemed to be a continuation of the entity and of the identity of the state bank and all the rights, obligations and relations of the state bank to or in respect to any person, estate, creditor, depositor, trustee or beneficiary of any trust and in, or in respect to, any executorship or trusteeship or other trust or fiduciary function shall remain unimpaired. The national bank, as of the time of the taking effect of such conversion, merger or consolidation shall succeed to all such rights, obligations, relations and trusts and the duties and liabilities connected therewith and shall execute and perform each and every such trust or relation in the same manner as if the national bank had itself assumed the trust or relation, including the obligations and liabilities connected therewith. If the state bank is acting as administrator, co-administrator, executor, co- executor, trustee or co-trustee of or in respect to any estate or trust being administered under the laws of this state, such relation, as well as any other or similar fiduciary relations, and all rights, privileges, duties and obligations connected therewith shall remain unimpaired and shall continue into and in said national bank from and as of the time of the taking effect of such conversion, merger or consolidation, irrespective of the date when any such relation may have been created or established and irrespective of the date of any trust agreement relating thereto or the date of the death of any testator or decedent whose estate is being so administered. Nothing done in connection with the conversion to or merger or consolidation of a state bank with a national bank, shall, in respect to any such executorship, trusteeship or similar fiduciary relation, be deemed to be or to effect, under the laws of this state, a renunciation or revocation of any letters of administration or letters testamentary pertaining to such relation, nor a removal or resignation from any such executorship or trusteeship or other fiduciary relationship, nor shall the same be deemed to be of the same effect as if the executor or trustee or other fiduciary had died or otherwise become incompetent to act.
The rights of shareholders of a national bank dissenting from the conversion, merger or consolidation of the bank shall be governed exclusively by the applicable laws of Congress.
A shareholder of a state bank who votes against the conversion, merger or consolidation of that state bank with or to a national bank, or who has given notice in writing to the bank at or prior to such meeting that he dissents from the conversion, merger or consolidation shall be entitled to receive in cash the value of the shares held by him, if and when the conversion, merger or consolidation is consummated, upon written request made to the resulting national bank at any time before 30 days after the date of consummation of such conversion, merger or consolidation, accompanied by the surrender of his stock certificates. The value of such shares shall be determined as of the date on which the shareholders meeting was held authorizing the conversion, merger or consolidation by a committee of three persons, one to be selected by unanimous vote of the dissenting shareholders entitled to receive the value of their shares, one by the directors of the resulting national bank and the third by the two so chosen. The valuation agreed upon by any two of three appraisers thus chosen shall govern; but, if the value so fixed shall not be satisfactory to any dissenting shareholder who has requested payment as provided herein, such shareholder may within five days after being notified of the appraised value of his shares appeal to the superintendent, who shall cause a reappraisal to be made, which shall be final and binding as to the value of the shares of the appellant.
If within 90 days from the date of consummation of the conversion, merger or consolidation, for any reason one or more of the appraisers is not selected as herein provided, or the appraisers fail to determine the value of such shares, the superintendent shall upon written request of any interested party, cause an appraisal to be made, which shall be final and binding on all parties. The expenses of the superintendent in making the reappraisal, or the appraisal as the case may be, shall be paid by the resulting national bank.
The plan of conversion, merger or consolidation, shall provide the manner of disposing of the shares of the resulting national bank not taken by the dissenting shareholders of the state bank.
Except to the extent necessary to give effect to Section 5-7A-45(b), no general or local law or general law of local application shall be deemed to have been modified or repealed by Sections 5-7A-40 through 5-7A-46, and nothing contained herein shall be deemed in any way to change or repeal the provisions of Section 5-2A-7 or 5-5A-20.
Before approving proceedings to consolidate one such institution with another, the superintendent shall cause to be made an examination of each such institution to determine whether the interests of the depositors, creditors and stockholders of each are protected and that such consolidation is made for legitimate purposes, and his consent or rejection of such consolidation or transfer shall be based upon such examination and investigation. The expense of such examination shall be paid by such institution. No such consolidation shall be made without the written consent of the superintendent.
If such consent is refused, an appeal may be taken therefrom to the circuit court of the county where such institution is located. This article shall apply to banks having branches and to any branch office thereof in the same way as it applies to other banks.
It is the purpose of this article to permit state and federally chartered savings and loan associations and savings banks to convert to state chartered banks with the approval of the Superintendent of Banks for the State of Alabama in accordance with the provisions of this article.
As used in this article, the following terms shall have the following meanings, respectively, unless the context clearly indicates otherwise:
(1) SAVINGS INSTITUTION. A savings and loan association or savings bank organized under the laws of this state or organized under the laws of the United States and having its principal place of business in this state, whether a 'capital stock saving institution' which is authorized to issue capital stock, or a 'mutual savings institution,' shares of which are owned by its members.
(2) RESULTING BANK. The state chartered bank that results from conversion of a savings institution to a state chartered bank pursuant to this article.
(3) SUPERINTENDENT. The Superintendent of Banks for the State of Alabama.
(4) STATE CHARTERED BANK. A bank the same as if such bank were incorporated, chartered and permitted to do business, all as provided in Section 5-5A-1 et seq.
(5) PLAN OF CONVERSION. That written document containing all the information and meeting the requirements as set forth in Section 5-7A-62(1).
(6) APPLICATION FOR CONVERSION. That written application, on a form to be prescribed by the superintendent, which is filed with the superintendent requesting approval of a plan of conversion.
(7) DEPARTMENT. The State Banking Department as provided for and created in Section 5-2A-1.
Any savings institution may apply to the superintendent for permission to convert its charter in order to do business as a state chartered bank in accordance with the following procedures:
(1) The board of directors shall approve a written plan of conversion, the application for conversion and shall adopt an authorizing resolution, all by a vote of a majority of all the directors. The plan of conversion shall include a statement of:
a. The proposed organization and management structure of the resulting bank if the application were approved, and the proposed name under which it would do business as a bank;
b. The method and time schedule for terminating any activities and disposing of any assets which would not conform to the requirements applicable to state chartered banks;
c. The competitive impact of such change, including any effect on the availability of particular financial services in the market area to be served by the resulting bank;
d. Such financial data as may be required by the superintendent to determine compliance with the reserve and liquidity requirements applicable to the resulting bank;
e. Such other information as the superintendent may require; and
f. If the savings institution is a mutual savings institution, shares of which are owned by its members, then the plan of conversion must provide the method and terms for converting the mutual savings institution to a capital stock savings institution provided that such method and terms must comply with and be in accordance with all state and federal laws, procedures and regulations governing the conversion of mutual savings institutions into capital stock institutions.
(2)a. Following approval by the board of directors, the plan of conversion, together with the certified copy of the authorizing resolution adopted by the board, and the application for conversion shall be submitted to the superintendent for tentative approval before being submitted to the stockholders or members of the savings institution.
b. The application for conversion pursuant to this article shall be accompanied by a fee prescribed by the banking board under Section 5-5A-13, payable to the superintendent.
(3) The superintendent shall tentatively approve the plan if he finds that:
a. The public convenience and advantage would be promoted by the conversion;
b. The resulting bank would have an adequate capital structure with regard to its activities and its deposit liabilities would meet the minimum capital requirements for existing state chartered banks under state and federal law; and would meet other applicable state and federal law requirements relating to the safety and soundness of the resulting bank;
c. The proposed conversion would not cause a substantially adverse effect on the financial condition of any bank already established in the primary service area;
d. The proposed officers and directors have sufficient experience, ability and standing to indicate reasonable promise for successful operation of the resulting bank;
e. The proposed name of the resulting bank would not be so similar to that of another bank or other financial institution as to cause confusion; and
f. The schedule for termination of any nonconforming activities and disposition of any nonconforming assets is reasonably prompt, and the plan for such termination and disposition does not include any unsafe or unsound practice.
(4) In the event the superintendent tentatively approves the plan of conversion, such plan shall be submitted to the stockholders or members at an annual meeting or at any special meeting called to consider such plan of conversion. Upon a favorable vote of a majority of the total number of votes eligible to be cast, the plan of conversion shall be adopted. Copies of the minutes of such meeting, verified by the affidavit of the secretary or an assistant secretary, shall be filed with the superintendent within 10 days after such meeting. Such verified copies of the minutes of such meeting shall be presumptive evidence of the holding of such meeting and of the action taken at such meeting. Provided the plan of conversion is adopted at such meeting, the stockholders or members shall elect the directors who shall be the directors of the resulting bank. Said directors must in all respects, both individually and as a group, meet the statutory and regulatory requirements applicable to directors of state chartered banks. Such directors shall then execute new articles of incorporation or amendments to existing articles and two copies of the new bylaws. The directors shall insert in the articles of incorporation the following: 'This bank is incorporated by a plan of conversion from a _______ (state or federal savings and loan association, etc.).' All directors of the resulting bank shall execute and acknowledge the articles of incorporation and the bylaws.
(5)a. In the event the superintendent disapproves the plan of conversion for any reason, he shall state his objections to the plan of conversion in writing.
b. The applicant shall have a period of 28 days from the date of the superintendent's written objections to: a) amend the plan of conversion and to resubmit same to the superintendent for approval; or b) appeal such determination by the superintendent in accordance with the provisions of Section 5-5A-8 et seq.
c. There shall be no limit on the number of times the plan of conversion may be amended prior to the time the applicant exercises its right of appeal as provided in subdivision (5)b.
d. The superintendent may disapprove the plan of conversion for any number of reasons, including but not limited to, a determination that such plan of conversion does not meet the requirements of any state, federal or other law; that the approval of such plan of conversion would not be in the best interest of the citizens of the State of Alabama or its banking community; that such savings institution is subject to a cease and desist order or other supervisory restriction imposed by any supervisory authority, insurer or guarantor.
(6) Upon the adoption of the plan of conversion by the stockholders or members, the institution shall apply to the Federal Deposit Insurance Corporation for a commitment for insurance guaranteeing the deposits of the resulting bank.
(7) Upon receipt of written notice of commitment for insurance from the Federal Deposit Insurance Corporation, and further provided all other requirements herein have been met, the superintendent shall issue to the savings institution his final approval of the application for conversion and a permit authorizing it to transact business pursuant to applicable law. The plan of conversion shall not take effect until such final approval and permit have been issued by the superintendent.
Except insofar as the superintendent requires the converting savings institution to terminate certain activities and dispose of certain assets in order to meet the requirements applicable to state chartered banks, upon the conversion of any savings institution into a state chartered bank, the corporate existence of such savings institution shall not terminate, but such resulting bank shall be deemed to be a continuation of the savings institution so converted, and all property of the converted savings institution including its rights, titles and interests in and to all property of whatsoever kind, character or description, whether real, personal or mixed, and things in action and every right, privilege, interest and asset of any conceivable value or benefit, and all obligations, liabilities, charges, liens, encumbrances, judgments, and claims then existing or pertaining to it or which would inure to or against it, shall immediately by operation of law and without the necessity of any conveyance or transfer and without the necessity of any further act or deed remain and be vested in and continue to be the property or obligation of such resulting bank into which the savings institution has converted. Subject to the laws, provisions and regulations applicable to state chartered banks, such resulting bank shall have, hold, enjoy and be obligated the same in its own right as fully and to the same extent as the same was possessed, held, enjoyed and encumbered by the converting savings institution. All pending actions, and other judicial or administrative proceedings to which the converting savings institution is a party shall not be deemed to have abated or to have been discontinued by reason of such conversion, but may be prosecuted to final judgment or order in the same manner as if such conversion had not occurred, and the resulting bank may continue such action in its corporate name as a state chartered bank, and any judgment or order may be entered for or against it in such corporate name.
Following the conversion of a savings institution to a state chartered bank pursuant to this article, the resulting bank may continue to maintain and operate as banking offices all offices maintained and operated by the savings institution at the time of such conversion.
Except as provided in Section 5-7A-64, nothing in this article is to be construed, interpreted or applied to allow any existing state chartered bank, any resulting bank or any state chartered bank resulting from a plan of conversion under this article to expand or branch into any place in any manner or by any method not available to state chartered banks prior to enactment of this article.