Whenever the board of directors or a majority of the stockholders of any bank shall request the superintendent to cooperate in a reorganization of such bank, because of a substantial impairment of the capital of such bank, the superintendent is authorized to do the following:
(1) To make or have made a careful appraisement of the assets of the bank;
(2) If the appraisement shows the capital to be impaired, to charge the stock down to its actual value, if it has any, and if the appraisement shows the stock has no value, to charge off all capital, surplus and undivided profits and thereafter the rights and interests of such stockholders in any of the assets of the bank shall be subordinate to those of the creditors of the bank and the secured depositors to the extent of such security so held by such secured depositor;
(3) If the capital, surplus and undivided profits are not sufficient to take care of all losses, to prorate the remainder of the losses among the various depositors or common creditors;
(4) If found necessary, to set aside such portion of the assets of such bank to be either liquidated or delivered to creditors or depositors who may be disqualified under the law to participate in a reorganization, such portion to be the pro rata share of the assets which such disqualified creditors or depositors would be entitled to receive from the assets of the bank if the same were liquidated;
(5) To prepare a plan for the reorganization of such bank, including provisions for obtaining sufficient funds for capital purposes by the issuance of stock, such stock if necessary to be of different classes; and
(6) To submit such plan of reorganization, when prepared, to the board of directors of such bank which has made request for the cooperation of the superintendent for a reorganization.
After such plan for reorganization has been submitted to the board of directors of the bank so making such request for a reorganization, the directors of such bank by and with the consent of 75 percent in value of the stockholders and 75 percent in value of the common creditors are authorized and empowered to make a report of such plan to the circuit court of the county in which the principal business office of the bank is located, such report to be accompanied by a petition for its confirmation and approval.
Upon the filing of such report and petition, the court shall order notice to be given to all parties in interest by publication in some newspaper published in the county where the principal business office of such bank is located once a week for two consecutive weeks, which notice shall set forth substantially the plan of such reorganization and require all parties in interest to appear at a specified time either to consent to or protest against the plan for such reorganization.
At the time of the hearing of the petition, the court shall hear such legal evidence as may be submitted for and against such petition and plan for reorganization, and if the court is of the opinion it is for the best interest of all parties interested in such bank that the bank be reorganized in accordance with the plan set forth and submitted or in accordance with any modification of such plan determined upon by the court, such court shall so adjudge and enter a judgment fixing the rights of the parties in interest and adjudging that said plan or modification thereof be adopted and confirmed and that said bank be reorganized under and in conformity with such plan or modification thereof.
If any stockholder, depositor or creditor shall not be satisfied with such judgment, he may file a notice of appeal to the Supreme Court of Alabama within 42 days from the day of entry of such judgment, provided he shall give security for cost of such appeal and indemnity in an amount to be fixed by the court, conditioned to pay such damages as the stockholders, depositors or creditors may sustain for a wrongful appeal or delay. Any such appeal shall be a preferred case in the Supreme Court and shall be set for hearing at the earliest possible date. If no such appeal is taken, the judgment of the circuit court shall be final, and said bank may lawfully be reorganized in accordance with the plan approved by the court.
The plan for reorganization of a bank or banks as provided in this chapter shall not be exclusive and shall not be construed to prohibit or prevent a reorganization of a bank as now permitted under existing laws.