§ 17501. Acquisition of assets
(a) General. A Vermont financial institution may acquire the assets of, or assume the liabilities
of, any other financial institution authorized to do business in this State. When
the value of an acquisition or assumption is worth 25 percent or more of the assets
of the acquiring, assuming, or transferring entity, the transaction shall be subject
to and in accordance with the procedures, and subject to the conditions and limitations,
set forth in this subchapter.
(b) Adoption of plan. The governing body of the acquiring or assuming institution and the governing body
of the transferring institution shall adopt by majority vote a plan for acquisition,
assumption, or sale on terms that are mutually agreed upon. The plan shall include:
(1) the names and types of the institutions involved;
(2) a statement setting forth the material terms of the proposed acquisition, assumption,
or sale, including, if applicable, the plan for disposition of all assets and liabilities
not subject to the plan;
(3) a statement that the entire transaction is subject to written approval of the Commissioner
and, if the transaction involves all or substantially all of the assets or liabilities
of the transferring institution, the approval of the transferring institution’s investors
or mutual voters;
(4) if an investor-owned institution is the transferring institution and the proposed
sale is not for cash, a clear and concise statement that investors of the institution
voting against the proposed sale are entitled to rights set forth in subdivision 17101(c)(2) of this title; and
(5) the proposed effective date of the acquisition, assumption, or sale and all other
information and provisions that are necessary to execute the transaction or that are
required by the Commissioner.
(c) Commissioner’s approval. The Commissioner shall approve the plan of merger or consolidation in accordance with
subsection 17101(b) of this title.
(d) Vote of investors or mutual voters. If the transaction involves all or substantially all of the assets or liabilities
of the transferring institution or if the transferring institution’s organizational
documents require, the plan of acquisition, assumption, or sale shall be presented
to the investors or mutual voters of the transferring institution for their approval,
and their approval shall be obtained in accordance with subsection 17101(c) of this title. If the approval of investors is required, then investors dissenting to the transaction
have the rights set forth in subdivision 17101(c)(2) of this title.
(e) Executed plan; certificate; effective date.
(1) If the plan is approved by the investors or mutual voters of the transferring institution,
an executive officer and the secretary of such institution shall submit the executed
plan to the Commissioner, together with a copy of the resolution of the investors
or mutual voters approving it, each certified by these officers.
(2) Upon receipt of the items set forth in subdivision (1) of this subsection and evidence
that the participating institutions have complied with all applicable federal law
and regulations, the Commissioner shall certify, in writing, to the participants that
the plan has been approved and is in compliance with the provisions of this title.
(3) Notwithstanding approval of the investors or mutual voters or certification by the
Commissioner, the transferring institution’s governing body may, in its discretion,
abandon such a transaction without further action or approval by the investors or
mutual voters, subject to the rights of third parties under any contracts relating
to the transaction.
(f) National financial institution as participant. If one of the participants in a transaction under this section is a national financial
institution, all participants shall comply with such requirements as may be imposed
by federal law for such an acquisition, assumption, or sale and provide evidence of
such compliance to the Commissioner; provided that if the purchasing or assuming institution
is a national financial institution, approval by the Commissioner is not required.
(g) Investor-owned institution acquiring mutual or cooperative financial institution. A mutual or cooperative financial institution may not sell all or substantially all
of its assets to an investor-owned institution without prior approval by the Commissioner
of a plan that provides fair and equitable treatment of the depositors or members
in the sale of the assets and distribution of the proceeds.
(h) Applicability to transactions in ordinary course of business. This subchapter does not apply to a transfer of assets of a financial institution
in the ordinary course of business that does not include any assumption of deposit
liabilities.
(i) Authority for expedited acquisitions. Notwithstanding any other provision of law, or any organizational document of any
participating institution, the Commissioner may order that the acquisition of assets
and assumption of liabilities become effective immediately if the Commissioner determines
that the action is necessary for the protection of depositors or the public. This
action may be taken upon receipt of the following:
(1) certified copies of the authorizing resolutions adopted by the respective governing
bodies of the acquiring or assuming financial institution or financial institution
holding company and a copy of the plan of acquisition of assets and assumption of
liabilities approved by a majority vote of the governing bodies of the acquiring or
assuming financial institution or financial institution holding company and the transferring
institution; or
(2) notice, containing information required by the Commissioner, from any other person
of intent to acquire the assets and assume the liabilities of a financial institution
or financial institution holding company.
(j) The applicant in any acquisition application filed with another supervisory agency
by a financial institution holding company that controls a Vermont financial institution,
or by a person that intends to acquire a Vermont financial institution or financial
institution holding company shall file a copy of the application with the Commissioner
at the time the application is filed with the other supervisory agency. The applicant
shall notify the Commissioner of any amendments to the application by filing with
the Commissioner a copy of any amendments that are required to be filed with the other
supervisory agency. A copy of any acquisition approval issued by the other supervisory
agency shall be filed with the Commissioner by the applicant within 30 days of its
issuance. The Commissioner shall not disclose any information obtained pursuant to
this section that is treated as confidential by the other supervisory agency. (Added 1999, No. 153 (Adj. Sess.), § 2, eff. Jan. 1, 2001.)