NY Banking L § 6022 (2021)
2021 New York Laws BNK - Banking Article 15 - General Provisions Applicable to Banking Stock Corporations, Limited Liability Investment Companies, and Limited Liability Trust Companies Title 6 - Stockholders 6022 - Procedure to Enforce Stockholder's Right to Receive Payment for Shares.

§ 6022.  Procedure  to  enforce stockholder's right to receive payment for shares. 1. A stockholder intending to  enforce  his  right  under  a section  of  this  chapter  to  receive  payment  for  his shares if the proposed corporate action referred to therein is taken shall  file  with the  corporation, before the meeting of stockholders at which the action is submitted to a vote, or at such meeting but before the vote,  written objection to the action. The objection shall include a statement that he intends  to  demand  payment for his shares if the action is taken. Such objection is not required from any stockholder to whom  the  corporation did  not  give notice of such meeting in accordance with this chapter or where  the  proposed  action  is  authorized  by  written   consent   of stockholders without a meeting.   2.  Within  ten days after the stockholders' authorization date, which term as used in this section means the date on which  the  stockholders' vote  authorizing  such  action  was  taken,  or  the date on which such consent without a meeting was obtained from the requisite  stockholders, the  corporation  shall  give  written  notice  of such authorization or consent by  registered  mail  to  each  stockholder  who  filed  written objection or from whom written objection was not required, excepting any who voted for or consented in writing to the proposed action.   3.  Within  twenty  days  after  the  giving  of  notice  to  him, any stockholder to whom the corporation was required to give such notice and who elects to dissent shall file with the corporation a  written  notice of such election, stating his name and residence address, the number and classes  of  shares  as to which he dissents and a demand for payment of the fair value of his shares.   4. A stockholder may not dissent as to less than all  of  the  shares, held by him of record, that he owns beneficially. A nominee or fiduciary may not dissent on behalf of any beneficial owner as to less than all of the shares of such owner held of record by such nominee or fiduciary.   5.  Upon filing a notice of election to dissent, the stockholder shall cease to have any of the rights of a stockholder except the right to  be paid  the  fair  value  of  his  shares  and any other rights under this section.  Withdrawal of a notice of election shall require  the  written consent of the corporation. If a notice of election is withdrawn, or the proposed  corporate  action  is abandoned or rescinded, or a court shall determine that the stockholder is not entitled to  receive  payment  for his  shares,  or  the  stockholder  shall otherwise lose his dissenter's rights, he shall not have the right to receive payment  for  his  shares and  he shall be reinstated to all his rights as a stockholder as of the filing of his notice of election, including any  intervening  preemptive rights  and  the  right  to payment of any intervening dividend or other distribution or, if any such rights have expired or any such dividend or distribution other than in cash has been completed, in lieu thereof,  at the  election  of  the  corporation,  the  fair value thereof in cash as determined by the board as of the time of such expiration or completion, but without prejudice otherwise to any corporate  proceedings  that  may have been taken in the interim.   6.  At  the time of filing the notice of election to dissent or within one month thereafter  the  stockholder  shall  submit  the  certificates representing  his  shares  to the corporation, or to its transfer agent, which shall forthwith  note  conspicuously  thereon  that  a  notice  of election  has  been  filed  and  shall  return  the  certificates to the stockholder or other person  who  submitted  them  on  his  behalf.  Any stockholder  who  fails  to submit his certificates for such notation as herein specified shall, at the option of the  corporation  exercised  by written  notice to him within forty-five days from the date of filing of such notice of election to dissent, lose his dissenter's rights unless a  court, for good cause shown, shall otherwise direct. Upon transfer of  a certificate  bearing such notation, each new certificate issued therefor shall bear a similar notation together with the  name  of  the  original dissenting holder of the shares and a transferee shall acquire no rights in   the   corporation   except  those  which  the  original  dissenting stockholder had after filing his notice of election.   7. Within seven days after the expiration of the period  within  which stockholders  may  file  their notices of election to dissent, or within seven days after the proposed corporate action is consummated, whichever is later, the corporation or, in the case of  a  merger,  the  receiving corporation,  shall  make  a  written  offer  by registered mail to each stockholder who has filed such notice of election to pay for his  shares at  a  specified  price which the corporation considers to be their fair value. Such offer shall be made at the  same  price  per  share  to  all dissenting stockholders of the same class, or if divided into series, of the  same  series  and  shall  be  accompanied by a balance sheet of the corporation whose shares the dissenting  stockholder  holds  as  of  the latest  available  date,  which  shall not be earlier than twelve months before the making of such offer, and a  profit  and  loss  statement  or statements  for not less than a twelve month period ended on the date of such  balance  sheet  or,  if  the  corporation  was  not  in  existence throughout  such  twelve  month  period,  for the portion thereof during which it was in existence.  If within thirty days after  the  making  of such  offer,  the corporation making the offer and any stockholder agree upon the price to be paid for his shares, payment therefor shall be made within sixty days after the making of such offer upon the  surrender  of the certificates representing such shares.   8.  The  following  procedure  shall apply if the corporation fails to make such offer within such period of seven days, or  if  it  makes  the offer  and any dissenting stockholder or stockholders fail to agree with it within the period of thirty days thereafter upon the price to be paid for their shares:  (a) The corporation or,  in  the  case  of  a  merger,  the  receiving corporation  shall, within twenty days after the expiration of whichever is applicable of the two periods last  mentioned,  institute  a  special proceeding  in  the  supreme court in the judicial district in which the office of  the  corporation  is  located  to  determine  the  rights  of dissenting stockholders and to fix the fair value of their shares.  (b)  If the corporation fails to institute such proceeding within such period of twenty days, any dissenting  stockholder  may  institute  such proceeding  for  the  same  purpose not later than thirty days after the expiration of  such  twenty  day  period.  If  such  proceeding  is  not instituted  within  such thirty day period, all dissenter's rights shall be lost unless the supreme court, for good cause shown, shall  otherwise direct.  (c)  All  dissenting stockholders, excepting those who, as provided in subdivision seven, have agreed with the corporation upon the price to be paid for their shares, shall be made parties to such  proceeding,  which shall  have  the  effect of an action quasi in rem against their shares. The corporation shall serve a copy of the petition  in  such  proceeding upon  each dissenting stockholder who is a resident of this state in the manner provided by law for the service  of  a  summons,  and  upon  each nonresident   dissenting  stockholder  either  by  registered  mail  and publication, or in such  other  manner  as  is  permitted  by  law.  The jurisdiction of the court shall be plenary and exclusive.  (d)  The court shall determine whether each dissenting stockholder, as to whom the corporation requests the court to make  such  determination, is  entitled  to receive payment for his shares. If the corporation does  not request any such determination  or  if  the  court  finds  that  any dissenting stockholder is so entitled, it shall proceed to fix the value of  the  shares,  which,  for the purposes of this section, shall be the fair  value  as  of  the  close  of  business  on  the  day prior to the stockholders'  authorization  date,  excluding   any   appreciation   or depreciation  directly or indirectly induced by such corporate action or its proposal. The court may, if it so elects, appoint  an  appraiser  to receive evidence and recommend a decision on the question of fair value. Such  appraiser  shall have the power, authority and duties specified in the order appointing him, or any amendment thereof.  (e) The final order in the proceeding shall  be  entered  against  the corporation  in  favor  of each dissenting stockholder who is a party to the proceeding and is entitled thereto for the value of  his  shares  so determined.  (f)  The  final  order shall include an allowance for interest at such rate as  the  court  finds  to  be  equitable,  from  the  stockholders' authorization  date  to the date of payment. If the court finds that the refusal of any stockholder to accept the corporate offer of payment  for his  shares  was arbitrary, vexatious or otherwise not in good faith, no interest shall be allowed to him.  (g) The costs and expenses of such proceeding shall be  determined  by the court and shall be assessed against the corporation, or, in the case of  a  merger, the receiving corporation, except that all or any part of such costs and expenses may be apportioned and assessed,  as  the  court may determine, against any or all of the dissenting stockholders who are parties  to  the  proceeding  if  the  court finds that their refusal to accept the corporate offer was arbitrary, vexatious or otherwise not  in good  faith. Such expenses shall include reasonable compensation for and the reasonable expenses of the appraiser, but shall exclude the fees and expenses of counsel for and experts employed by  any  party  unless  the court,  in  its discretion, awards such fees and expenses. In exercising such discretion, the court shall consider any of  the  following:  (A) that  the  fair value of the shares as determined materially exceeds the amount which such corporation offered to pay; (B) that no offer was made by such corporation; and (C) that such corporation failed  to  institute the special proceeding within the period specified therefor.  (h) Within sixty days after final determination of the proceeding, the corporation or, in the case of a merger, the receiving corporation shall pay  to each dissenting stockholder the amount found to be due him, upon surrender of the certificates representing his shares.   9. Shares acquired by the corporation upon the payment of  the  agreed value  therefor  or of the amount due under the final order, as provided in this section, shall  be  dealt  with  as  provided  in  section  five thousand  fourteen,  except that, in the case of a merger, they shall be disposed of as provided in the plan of merger or consolidation.   10. The enforcement by a stockholder of his right to  receive  payment for  his  shares  in  the  manner  provided  herein  shall  exclude  the enforcement by such stockholder of any other right  to  which  he  might otherwise  be  entitled by virtue of share ownership, except as provided in subdivision five, and except that this section shall not exclude  the right  of such stockholder to bring or maintain an appropriate action to obtain relief on the ground that such corporate action  will  be  or  is illegal or fraudulent as to him.   11. Except as otherwise expressly provided in this section, any notice to  be  given by a corporation to a stockholder under this section shall be given in the manner provided in section six thousand five.