NY Banking L § 519 (2021)
2021 New York Laws BNK - Banking Article 12 519 - Acquisition of Control of Investment Companies.

§ 519.  Acquisition  of control of investment companies. 1. Subject to   such regulations as the  superintendent  may  prescribe,  prior  to  the   acquisition  of  control  of  an  investment  company  by  means  of the   acquisition of the capital stock or equity interests in such  investment   company  or  in  any  company which directly or indirectly controls such   investment company, the acquiring company shall make written application   to the superintendent for  permission  to  acquire  such  control.  Such   application  shall be in such form and shall contain such information as   the superintendent may require and such applicant, at the time of making   such application, shall pay to the superintendent an  investigation  fee   as prescribed pursuant to section eighteen-a of this chapter.The  superintendent  shall disapprove the proposed exercise of control   of an investment company if, after notice to and an  opportunity  to  be   heard  by  the  applicant  and  such  investment  company,  he finds the   acquisition of control  therein  contrary  to  law  or  determines  that   disapproval  is  reasonably  necessary  to  protect the interests of the   people of this state. In making such determination,  the  superintendent   shall  only  consider  (a)  whether  the  character,  responsibility and   general fitness of the company which seeks to  control  such  investment   company  are  such  as to command confidence and warrant belief that the   business of such investment company will  be  honestly  and  efficiently   conducted in a manner consistent with the public interest, the interests   of  depositors and creditors of such investment company, and (b) whether   the exercise of control may impair the safe and  sound  conduct  of  the   business  of  such investment company, the conservation of its assets or   public confidence in its business. Unless the superintendent shall  have   denied  such  application  in  writing  within ninety days of the filing   thereof, or shall have advised  the  applicant  in  writing  before  the   expiration  of ninety days of his determination to extend such period an   additional sixty days, such application shall be deemed approved.As used  in  this  subdivision  one,  the  term  "control"  means  the   possession,  directly or indirectly, of the power to direct or cause the   direction of the management and policies of a person, whether  by  means   of  the ownership of the voting stock or equity interests of such person   or of one or more  persons  controlling  such  person,  by  means  of  a   contractual  arrangement,  or  otherwise.  Control  shall be presumed to   exist if any company, directly or indirectly, owns,  controls  or  holds   with the power to vote ten per centum or more of the voting stock of any   investment  company or of any company which owns, controls or holds with   power to vote ten per centum  or  more  of  the  voting  stock  of  such   investment  company,  but  no  person  shall  be  deemed  to  control an   investment company solely by reason of his being an officer or  director   of  such  investment  company. The superintendent may in his discretion,   upon the application of an investment  company  or  any  company  which,   directly  or  indirectly,  owns, controls or holds with power to vote or   seeks to own, control or hold with power to vote  any  voting  stock  of   such investment company, determine whether or not the ownership, control   or  holding of such voting stock constitutes or would constitute control   of such investment company for purposes of this section.The provisions of this subdivision shall not apply to  (1)  a  company   which has submitted a plan of acquisition to the superintendent pursuant   to  subdivision  two of this section or (2) any action taken pursuant to   article thirteen of this chapter.2. Any company, whether or not it is in control of the business of  an   investment company as provided in subdivision one of this section, which   desires  to acquire all, or substantially all of the capital stock of an   investment company shall, together with such investment company,  submit   in duplicate to the superintendent a written plan of acquisition of such    stock  together  with  such  other information as the superintendent may   determine.  Such  plan  shall   be   in   form   satisfactory   to   the   superintendent, shall specify each investment company the stock of which   is  to  be  acquired  by  the  company and shall prescribe the terms and   conditions of the acquisition and the mode of carrying it  into  effect,   including  the manner of exchanging the shares of the investment company   for shares or other securities or cash of the company. Any such plan may   provide for the payment of cash in lieu of the  issuance  of  fractional   shares of the company.At the time of submission to the superintendent of the written plan of   acquisition  of  stock,  an  investigation fee as prescribed pursuant to   section eighteen-a of this chapter shall be paid to the superintendent.There shall be submitted, in duplicate, to the superintendent with the   plan of  acquisition  of  stock,  a  certificate  of  the  president  or   secretary of the company, certifying that such plan has been approved by   the  board  of  directors  or  other  governing body of his company by a   majority vote of all the members  thereof,  and  a  certificate  of  the   president,   secretary   or  cashier  of  the  investment  company,  the   acquisition  of  all  the  capital  stock  of  which  is  provided  for,   certifying that such plan has been approved by the board of directors of   his  corporation by a majority vote of all the members thereof, and that   such  plan  was  thereafter  submitted  to  the  stockholders  of   such   corporation  at  a  meeting thereof held upon notice of at least fifteen   days, specifying  the  time,  place  and  object  of  such  meeting  and   addressed to each stockholder at the address appearing upon the books of   the  corporation  and  published at least once a week for two successive   weeks in one newspaper in the county in which such corporation  has  its   principal place of business and that such plan has been approved at such   meeting  by  the  vote of the stockholders owning at least two-thirds in   amount of the stock of such corporation.The superintendent shall approve or disapprove of a proposed  plan  of   acquisition  within one hundred twenty days after the submission of such   plan of acquisition to him, and in determining whether or not to approve   any such plan the  superintendent  shall  take  into  consideration  the   declaration  of  policy contained in section ten of this chapter. If the   superintendent   shall   approve   such   plan   of   acquisition,   the   superintendent  shall file the plan, together with such certificates and   the original of the approval of the superintendent, in the office of the   superintendent. Upon such filing in the office of the superintendent the   plan, and the acquisitions provided for therein, shall become effective,   unless a later date is specified in the plan, in which  event  the  plan   and such acquisitions shall become effective upon such later date.Any stockholder of any such corporation, entitled to vote on such plan   of  acquisition,  who  does  not assent thereto shall, subject to and by   complying with section six thousand twenty-two of this chapter, have the   right to receive payment of the fair value of his shares and  the  other   rights and benefits provided by such section.The provisions of this subdivision shall not apply to any action taken   pursuant to article thirteen of this chapter.3.  For  a period of six months from the date of qualification thereof   and for such  additional  period  of  time  as  the  superintendent  may   prescribe  in writing, the provisions of this section shall not apply to   a transfer of control by operation of law to the  legal  representative,   as hereinafter defined, of one who has control of an investment company.   Thereafter,  such  legal representative shall comply with the provisions   of subdivision one of this section. The provisions of subdivision one of   this section shall be applicable  to  an  application  made  under  such   section by a legal representative. The  term  "legal  representative,"  for the purposes of this section,   shall mean one duly appointed by a court of  competent  jurisdiction  to   act  as  executor,  administrator,  trustee,  committee,  conservator or   receiver, including one who succeeds  a  legal  representative  and  one   acting   in  an  ancillary  capacity  thereto  in  accordance  with  the   provisions of such court appointment.4. For purposes of this section the term "company" shall be given  the   same  meaning  as  is contained in its definition in section one hundred   forty-one of this chapter.5. Notwithstanding the provisions  of  subdivision  three  of  section   two-a  of  this chapter, when applying this section to limited liability   investment companies, the term "capital stock"  shall  mean  the  equity   interest  of  a  member  as  set  forth  in  the  company's  articles of   organization or, in the absence of such a provision, the equity interest   represented by a member's right to a proportionate share of the  profits   of the company.