KRS § 272.321 — KY Code / Title XXIII / Chapter 272 / Section 272.321
272.321 Member objecting to merger or consolidation to be paid for stock -- Value, how fixed -- Disposal of shares
Status: in_force

272.321 Member objecting to merger or consolidation to be paid for stock -- Value,

how fixed -- Disposal of shares.

(1) A member of a constituent association to be affected by a merger or consolidation

may give to the association prior to or at the meeting of its members to which the

proposal of merger or consolidation is submitted to a vote, written notice that he

objects to such proposal. Within twenty (20) days after the date on which the vote

was taken, such member may, unless he votes in favor of the proposal, make written

demand on the association for payment of the fair market value of his stock or other

property rights or interest in the association. Such demands shall state the number

and class of shares of stock owned by him or the nature and amount of other

property rights or interest owned by him in the association. In addition to any other

right he may have in law or equity, a member giving such notice shall be entitled, if

and when the merger or consolidation is effected, to be paid by the surviving

association, or new association, the fair market value of such stock, or other

property rights or interests, as of the day prior to the date on which the vote was

taken, subject only to the surrender by him of the certificate, or certificates of such

stock or other evidence of ownership or other property rights or interests.

(2) If within thirty (30) days after the date upon which the objecting member tendered

his written demand for payment of his stock or other property rights or interest, the

fair market value of such stock or other property rights or interests is agreed upon

between the member and the surviving association, the payment therefor shall be

made within sixty (60) days after the date of such agreement, upon surrender of the

certificate or other evidence of such property rights or interests, whereupon the

member shall cease to have any interest in such stock or other property rights or

interest in the association.

(3) If, during the thirty (30) day period mentioned in the preceding subsection, the

member and the surviving association or new association do not agree as to the fair

market value of such stock or other property rights or interests, the member may,

within sixty (60) days thereafter, file a petition in the Circuit Court of the county in

which the surviving association or new association has its registered office or

principal place of business asking for the appointment of three (3) disinterested

appraisers to appraise the fair market value of his stock or other property rights or

interests. A summons, together with a copy of the petition, shall be served on the

surviving association or new association at least twenty (20) days prior to a hearing

on the petition by the court. The award of the appraisers, or a majority of them, if no

exceptions be filed thereto within ten (10) days after the award has been filed in

court, shall be confirmed by the court, and when confirmed shall be final and

conclusive, and the member, upon depositing with the court the proper stock

certificates or other evidence of such property rights or interests, shall be entitled to

judgment against the association for the appraised value thereof as of the day prior

to the date on which the vote was taken. If either party files exceptions to the award

of the appraisers within ten (10) days after the award has been filed in court, the

case shall be transferred to the civil issue docket of the Circuit Court for trial and

shall be there tried in the same manner, as near as may be practicable, as is provided

for the trial of cases under the eminent domain law of this state, and with the same

right of appeal to the Court of Appeals. The court shall assess the cost of the

proceedings as it deems equitable. Upon payment of the judgment, the surviving

association or new association is entitled to have the member's stock certificates or

other evidence of such property rights or interests surrendered to it by the clerk of

the court. Unless the member files such a petition within the time prescribed, he, his

assigns and heirs claiming under him shall have no right to payment hereunder, but

in that event nothing herein shall impair his status as a member.

(4) If the notices sent to members in connection with any meeting to vote upon a

proposed merger or consolidation make no reference to the provisions of subsection

(1) of this section, a member entitled to but through lack of actual knowledge did

not avail himself of the provisions of this section, unless he voted for the proposal,

is entitled, if he so demands in writing within one (1) year after the date on which

the vote was taken on the proposed merger or consolidation, to recover from the

surviving association or new association any actual damage which he suffered from

failure of the association of which he was a member to make such reference.

(5) The liability to pay for stock or other property rights or interests or to pay damages

imposed by subsection (4) of this section on an association extends to the surviving

association or new association.

(6) Shares of stock acquired by an association, a surviving association, or a new

association pursuant to the payment of an agreed fair market value thereof or to

payment of a judgment entered therefor may be held and disposed of by such

association as in the case of other treasury shares.

(7) This section does not apply to a merger if on the date of the filing of the articles of

merger the surviving association is the owner of all outstanding shares of the other

association or associations, domestic or foreign, participating in the merger and if

the merger makes no changes in the relative rights of the members of the surviving

association.

(8) No member of a constituent association to be affected by a merger or consolidation,

who objects thereto and makes written demand for payment of the fair market value

of his stock or other property rights or interests in the association, as provided in

this section, is entitled to payment at any time prior to the time that he would

otherwise be entitled to payment pursuant to valid provisions of such stock, or valid

provisions of the articles of incorporation or bylaws of the association, in effect on

the date of the vote for such merger or consolidation.