§ 30

Illinois § 30

• Jurisdiction: Illinois
• Topic: REGULATION
• Ch. 205: FINANCIAL REGULATION
• Act 205 ILCS 5/: Illinois Banking Act.

Text

Conversion; merger with trust company or special purpose trust company. Upon approval by the Commissioner a trust company having power so to do under the law under which it is organized may convert into a state bank or may merge into a state bank as prescribed by this Act; except that the action by a trust company shall be taken in the manner prescribed by and shall be subject to limitations and requirements imposed by the law under which it is organized which law shall also govern the rights of its dissenting stockholders. The rights of dissenting stockholders of a state bank shall be governed by Section 29 of this Act. The conversion or merger procedure shall be: (1) In the case of a merger, the board of directors of both the merging trust company and the merging bank by a majority of the entire board in each case shall approve a merger agreement which shall contain: (a) The name and location of the merging bank and of the merging trust company and a list of the stockholders of each as of the date of the merger agreement; (b) With respect to the resulting bank (i) its name and place of business; (ii) the amount of capital, surplus and reserve for operating expenses; (iii) the classes and the number of shares of stock and the par value of each share; (iv) the charter which is to be the charter of the resulting bank, together with the amendments to the continuing charter and to the continuing by-laws; and (v) a detailed financial statement showing the assets and liabilities after the proposed merger; (c) Provisions governing the manner of converting the shares of the merging bank and of the merging trust company into shares of the resulting bank; (d) A statement that the merger agreement is subject to approval by the Commissioner and by the stockholders of the merging bank and the merging trust company, and that whether approved or disapproved, the parties thereto will pay the Commissioner's expenses of examination; (e) Provisions governing the manner of disposing of the shares of the resulting bank not taken by the dissenting stockholders of the merging trust company; and (f) Such other provisions as the Commissioner may reasonably require to enable him to discharge his duties with respect to the merger. (2) After approval by the board of directors of the merging bank and of the merging trust company, the merger agreement shall be submitted to the Commissioner for approval together with the certified copies of the authorizing resolution of each board of directors showing approval by a majority of each board. (3) After receipt by the Commissioner of the papers specified in subsection (2), he shall approve or disapprove the merger agreement. The Commissioner shall not approve the agreement unless he shall be of the opinion and finds: (a) That the resulting bank meets the requirements of this Act for the formation of a new bank at the proposed place of business of the resulting bank; (b) That the same matters exist in respect of the resulting bank which would have been required under Section 10 of this Act for the organization of a new bank; and (c) That the merger agreement is fair to all persons affected. If the Commissioner disapproves the merger agreement, he shall state his objections in writing and give an opportunity to the merging bank and the merging trust company to obviate such objections. (4) To be effective, if approved by the Commissioner, a merger of a bank and a trust company where there is to be a resulting bank must be approved by the affirmative vote of the holders of at least two-thirds of the outstanding shares of stock of the merging bank entitled to vote at a meeting called to consider such action, unless holders of preferred stock are entitled to vote as a class in respect thereof, in which event the proposed merger shall be adopted upon receiving the affirmative vote of the holders of at least two-thirds of the outstanding shares of each class of shares entitled to vote as a class in respect thereof and of the total outstanding shares entitled to vote at such meeting and must be approved by the stockholders of the merging trust company as provided by the Act under which it is organized. The prescribed vote by the merging bank and the merging trust company shall constitute the adoption of the charter and by-laws of the continuing bank, including the amendments in the merger agreement, as the charter and by-laws of the resulting bank. Written or printed notice of the meeting of the stockholders of the merging bank shall be given to each stockholder of record entitled to vote at such meeting at least thirty days before such meeting and in the manner provided in this Act for the giving of notice of meetings of stockholders. The notice shall state that dissenting stockholders of the merging trust company will be entitled to payment of the value of those shares which are voted against approval of the merger, if a proper demand is made on the resulting bank and the requirements of the Act under which the merging trust company is organized are satisfied. (5) Unless a later date is specified in the merger agreement, the merger shall become effective upon the filing with the Commissioner of the executed merger agreement, together with copies of the resolutions of the stockholders of the merging bank and the merging trust company approving it, certified by the president or a vice-president or, the cashier and also by the secretary or other officer charged with keeping the records. The charter of the merging trust company shall thereupon automatically terminate. The Commissioner shall thereupon issue to the continuing bank a certificate of merger which shall specify the name of the merging trust company, the name of the continuing bank and the amendments to the charter of the continuing bank provided for by the merger agreement. Such certificate shall be conclusive evidence of the merger and of the correctness of all proceedings therefor in all courts and places including the office of the Secretary of State, and said certificate shall be recorded. (6) In the case of a conversion, a trust company shall apply for a charter by filing with the Commissioner: (a) A certificate signed by its president, or a vice-president, and by a majority of the entire board of directors setting forth the corporate action taken in compliance with the provisions of the Act under which it is organized governing the conversion of a trust company to a bank or governing the merger of a trust company into another corporation; (b) The plan of conversion and the proposed charter approved by the stockholders for the operation of the trust company as a bank. The plan of conversion shall contain (i) the name and location proposed for the converting trust company; (ii) a list of its stockholders as of the date of the stockholders' approval of the plan of conversion; (iii) the amount of its capital, surplus and reserve for operating expenses; (iv) the classes and the number of shares of stock and the par value of each share; (v) the charter which is to be the charter of the resulting bank; and (vi) a detailed financial statement showing the assets and liabilities of the converting trust company; (c) A statement that the plan of conversion is subject to approval by the Commissioner and that, whether approved or disapproved, the converting trust company will pay the Commissioner's expenses of examination; and (d) Such other instruments as the Commissioner may reasonably require to enable him to discharge his duties with respect to the conversion. (7) After receipt by the Commissioner of the papers specified in subsection (6), he shall approve or disapprove the plan of conversion. The Commissioner shall not approve the plan of conversion unless he shall be of the opinion and finds: (a) That the resulting bank meets the requirements of this Act for the formation of a new bank at the proposed place of business of the resulting bank; (b) That the same matters exist in respect of the resulting bank which would have been required under Section 10 of this Act for the organization of a new bank; and (c) That the plan of conversion is fair to all persons affected. If the commissioner disapproves the plan of conversion, he shall state his objections in writing and give an opportunity to the converting trust company to obviate such objections. (8) Unless a later date is specified in the plan of conversion, the conversion shall become effective upon the Commissioner's approval, and the charter proposed in the plan of conversion shall constitute the charter of the resulting bank. The Commissioner shall issue a certificate of conversion which shall specify the name of the converting trust company, the name of the resulting bank and the charter provided for by said plan of conversion. Such certificate shall be conclusive evidence of the conversion and of the correctness of all proceedings therefor in all courts and places including the office of the Secretary of State, and such certificate shall be recorded. (8.5) A special purpose trust company under Article IIA of the Corporate Fiduciary Act may merge with a State bank or convert to a State bank as if the special purpose trust company were a trust company under Article II of the Corporate Fiduciary Act, subject to rules adopted by the Department. (9) In the case of either a merger or a conversion under this Section 30, the resulting bank shall be considered the same business and corporate entity as each merging bank and merging trust company or as the converting trust company with all the property, rights, powers, duties and obligations of each as specified in Section 28 of this Act.

Legislative History

(Source: P.A. 104-428, eff. 8-18-25.)