12 U.S.C. § 214a

Procedure for conversion, merger, or consolidation; vote of stockholders

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A national banking association may, by vote of the holders of at least two-thirds of each class of its capital stock, convert into, or merge or consolidate with, a State bank in the same State in which the national banking association is located, under a State charter, in the following manner:(a) Approval of board of directors; publication of notice of stockholders’ meeting; waiver of publication; notice by registered or certified mail

The plan of conversion, merger, or consolidation must be approved by a majority of the entire board of directors of the national banking association. The bank shall publish notice of the time, place, and object of the shareholders’ meeting to act upon the plan, in some newspaper with general circulation in the place where the principal office of the national banking association is located, at least once a week for four consecutive weeks: 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 ten 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 and prior written consent of the Comptroller of the Currency is obtained. The national banking association shall send such notice to each shareholder of record by registered mail or by certified mail at least ten days prior to the meeting, which notice may be waived specifically by any shareholder.

(b) Rights of dissenting stockholders

A shareholder of a national banking association who votes against the conversion, merger, or consolidation, or who has given notice in writing to the bank at or prior to such meeting that he dissents from the plan, 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 State bank at any time before thirty 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 majority vote of the dissenting shareholders entitled to receive the value of their shares, one by the directors of the resulting State 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 Comptroller of the Currency, 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 ninety 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 Comptroller 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 Comptroller in making the reappraisal, or the appraisal as the case may be, shall be paid by the resulting State bank. The plan of conversion, merger, or consolidation shall provide the manner of disposing of the shares of the resulting State bank not taken by the dissenting shareholders of the national banking association.

(Aug. 17, 1950, ch. 729, § 2, 64 Stat. 455; Pub. L. 86–507, § 1(10), June 11, 1960, 74 Stat. 200; Pub. L. 96–221, title VII, § 706, Mar. 31, 1980, 94 Stat. 188.)Editorial NotesAmendments

1980—Subsec. (b). Pub. L. 96–221 substituted “majority” for “unanimous”.

1960—Subsec. (a). Pub. L. 86–507 inserted “or by certified mail” after “registered mail”.

Notes of Decisions

Cited in 10 cases, 1963–1999 · leading case: Simonds v. Guar. Bank & Trust Co., 492 F. Supp. 1079 (D. Mass. 1980).

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Simonds v. Guar. Bank & Trust Co., 492 F. Supp. 1079 (D. Mass. 1980). · cites it 9× “Plaintiff’s shares in the bank were appraised by defendant Comptroller of the Currency pursuant to 12 U.S.C. § 214a. In finding a value of $358.”

United States v. Philadelphia Nat'l Bank, 374 U.S. 321 (1963). · cites it 2× “455 , as amended, 12 U. S. C. § 214a. [12] 64 Stat. 457 ; see 64 Stat.”

Gustav E. Beerly, Tr. of the Gustav E. Beerly Trust v. Dep't of the Treasury, 768 F.2d 942 (7th Cir. 1985). · cites it 2× “This appeal requires us to examine the meaning and constitutionality of the little-known statutory provisions for appraisal by the Comptroller of the Currency of shares owned by shareholders dissenting from (1) mergers, consolidations, or conversions of national banks into state…”

First Am. Bank v. Shivers, 629 A.2d 1334 (Md. Ct. Spec. App. 1993). “See 12 U.S.C. §§ 214a(a) & (b) (1988). Our attention so directed, we are unpersuaded that the alleged similarity between the merger provisions of federal law and Maryland law compels us to overlook the clear mandate of FI § 1-201.”

Simonds v. Guar. Bank & Trust Co., 480 F. Supp. 1257 (D. Mass. 1979). “The court cannot, even at the Comptroller’s invitation, exercise the discretionary function of appraisal that by statute — 12 U.S.C. § 214a — is committed exclusively to the Comptroller.”

Braun v. N. Ohio Bank, 430 F. Supp. 367 (N.D. Ohio 1977). “Indeed, under the tender offer’s own terms it could not even be known that the offering group would be able to guarantee the approval of the stockholders of Community, since the offer was for 51% or more of Community’s shares and, under federal law (see 12 U.S.C. § 214a),…”

Keeffe v. Citizens & N. Bank, 808 F.2d 246 (3rd Cir. 1986). “Keeffe, who held over 900 shares of Farmers stock, voted against the proposal and perfected her dissenter’s rights pursuant to 12 U.S.C. § 214a (1982) by surrendering her stock and requesting fair value for her shares.”

Vermont Bank & Trust Co. v. United States, 296 F. Supp. 682 (D. Vt. 1969). “Pursuant to 12 U.S.C. § 214a(b) (1964), the shareholders requested that their shares be valued for purposes of sale to the bank formed through the merger.”

Cheng v. California Pac. Bank, 99 Cal. Daily Op. Serv. 9075 (Cal. Ct. App. 1999). · cites it 2× “” (12 U.S.C.A. § 214a(b).) The Bank’s plan provides that the shares of the *281 new state bank that are not taken by dissenting shareholders shall be offered for sale, first to other shareholders, then to outsiders.”

United States v. Cent. Nat'l Bank, 705 F. Supp. 336 (S.D. Tex. 1988). “The Federal Statutes that compare to this Texas Statute are 12 U.S.C. § 214a which allows the merger, and 12 U.”

— 12 U.S.C. § 214a(a) — 1 case

— 12 U.S.C. § 214a(b) — 3 cases

Gustav E. Beerly, Tr. of the Gustav E. Beerly Trust v. Dep't of the Treasury, 768 F.2d 942 (7th Cir. 1985). “This appeal requires us to examine the meaning and constitutionality of the little-known statutory provisions for appraisal by the Comptroller of the Currency of shares owned by shareholders dissenting from (1) mergers, consolidations, or conversions of national banks into state…”

Cheng v. California Pac. Bank, 99 Cal. Daily Op. Serv. 9075 (Cal. Ct. App. 1999). “” (12 U.S.C.A. § 214a(b).) The Bank’s plan provides that the shares of the *281 new state bank that are not taken by dissenting shareholders shall be offered for sale, first to other shareholders, then to outsiders.”

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