§ 54C-33. Conversion of mutual to stock savings bank. - North Carolina Statutes

§ 54C‑33.  Conversion ofmutual to stock savings bank.

(a)        A mutual savingsbank may convert from mutual to the stock form of ownership as provided in thissection.

(b)        A mutual savingsbank may apply to the Commissioner of Banks for permission to convert to astock savings bank and for certification of appropriate amendments to thesavings bank's certificate of incorporation. Upon receipt of an application toconvert from mutual to stock form the Commissioner of Banks shall examine allfacts connected with the requested conversion. The savings bank applying forpermission to convert shall pay all expenses and cost of the examination,monitoring, and supervision.

(c)        The savings bankshall submit a plan of conversion as a part of the application to the Commissionerof Banks. The Commissioner of Banks may approve it with or without amendment,if it appears that:

(1)        After conversion thesavings bank will be in sound financial condition and will be soundly managed;

(2)        The conversion willnot impair the capital of the savings bank nor adversely affect the savingsbank's operations;

(3)        The conversion willbe fair and equitable to the members of the savings bank and no person whethermember, employee, or otherwise, will receive any inequitable gain or advantageby reason of the conversion;

(4)        The savings bankservices provided to the public by the savings bank will not be adverselyaffected by the conversion;

(5)        The substance of theplan has been approved by a vote of two‑thirds of the board of directorsof the savings bank;

(6)        All shares of stockissued in connection with the conversion are offered first to the members ofthe savings bank; except that any one or more tax qualified employee stockbenefit plans may first purchase in the aggregate not more than ten percent(10%) of the total offering of shares;

(7)        All stock shall beoffered to members of the savings bank and others in prescribed amounts andotherwise under a formula and procedure that is fair and equitable and will befairly disclosed to all interested persons; and

(8)        The plan provides astatement as to whether stockholders shall have preemptive rights to acquireadditional or treasury shares of the savings bank.

If the Commissioner of Banksapproves the plan, then the plan shall be submitted to the members as providedin subsection (d) of this section. If the Commissioner of Banks refuses toapprove the plan, the Commissioner of Banks shall state the objections inwriting and give the converting savings bank an opportunity to amend the planto obviate the objections or to appeal the Commissioner of Banks' decision tothe Commission.

(d)        After lawful noticeto the members of the savings bank and full and fair disclosure, the substanceof the plan shall be approved by a majority of the total votes that members ofthe savings bank are eligible and entitled to cast. The vote by the members maybe in person or by proxy. Following the vote of the members, the results of thevote certified by an appropriate officer of the savings bank shall be filedwith the Commissioner of Banks. The Commissioner of Banks shall then eitherapprove or disapprove the requested conversion. After approval of theconversion, the Commissioner of Banks shall supervise and monitor theconversion process and shall ensure that the conversion is conducted lawfullyand under the savings bank's approved plan of conversion.

(e)        Any rules that theCommissioner of Banks may adopt to govern conversions shall equal or exceed therequirements for conversion, if any, imposed by the federal insurer of depositaccounts. (1991,c. 680, s. 1; 1991 (Reg. Sess., 1992), c. 829, s. 8; 2001‑193, s. 16.)