§ 6-1203 — Reorganization.

A. Standards of plan of reorganization. A plan of reorganization shall not be prescribed under this Code unless: (1) the plan is feasible and fair to all classes of depositors, creditors and stockholders. (2) the aggregate 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 claims 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 capital stock and, if necessary, debentures 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. (6) any merger or consolidation provided by the plan conforms to the requirements of this Code. B. Modification or elimination of plan of reorganization - Notice to Board. Whenever in the course of reorganization supervening conditions render the plan unfair or its execution impractical, the Commissioner may modify the plan or liquidate the institution. Any such action shall be taken by order of the Board upon appropriate notice.

Legislative History

Added by Laws 1965, c. 161, § 1203.