2023 Rhode Island General Laws › Title 19 - Financial Institutions › Chapter 19-7 - Interstate Banking, Interstate Branching and Bank Holding Company Mergers and Acquisitions › Section 19-7-3. - Interstate mergers of stock financial institutions.

§ 19-7-3. Interstate mergers of stock financial institutions.
(a)
Any financial institution organized with capital stock may, subject to the approval of the director, or the director’s designee, merge or consolidate with one or more banks:
(1)
Each of which is organized with capital stock and is either a financial institution or an out-of-state bank; and
(2)
At least one of which is an out-of-state bank, pursuant to a plan of merger or consolidation complying with the provisions of this section; provided, however, that the following conditions shall apply prior to June 1, 1997, to the extent consistent with, and not preempted by, federal laws:
(i)
The law of the state in which each of these out-of-state banks has its principal office permits this type of merger or consolidation; and
(ii)
The law of the state in which each of these out-of-state banks has its principal office authorizes, under conditions not substantially more restrictive than those imposed by the laws of this state, as determined by the director, or the director’s designee, a financial institution organized with capital stock to be the successor bank of the merger or consolidation.
(b)
The plan of merger or consolidation shall conform to the provisions of § 7-1.2-1001 and to any other requirements that may be imposed by the laws applicable to each bank not organized under the laws of this state.
(c)
The plan of merger or consolidation shall require approval as follows:
(1)
With respect to each financial institution, by the board of directors and shareholder of that financial institution pursuant to the applicable provisions of §§ 7-1.2-1001 — 7-1.2-1002, except that a plan of merger or consolidation must receive the affirmative vote of the holders of two thirds (⅔) or more of the shares entitled to vote thereon; and
(2)
With respect to each bank not organized under the laws of this state, in accordance with the applicable provisions imposed by the laws under which it is organized. Thereafter, articles of merger or consolidation complying with the applicable provisions of § 7-1.2-1003 and the applicable provisions of the laws under which each bank not organized under the laws of this state is organized shall be executed in accordance with the applicable provisions and presented to the director, or the director’s designee, for approval, by filing three (3) originals with the director, or the director’s designee.
(d)
Upon receipt of the articles of merger or consolidation, the director, or the director’s designee, shall furnish the applicant a form of notice specifying the names of the constituent banks and assigning a date and place for public hearing on the plan of merger or consolidation. The applicant shall publish the notice at least once a week, for three (3) successive weeks, in one or more newspapers designated by the director, or the director’s designee. Upon a finding that the public interest so requires, the director, or the director’s designee, may lessen the period and the manner prescribed for giving notice. In determining whether to approve a proposed merger or consolidation, the director, or the director’s designee, shall consider whether the merger or consolidation is consistent with the safety and soundness of, and the needs and convenience of the communities served by, each financial institution. The procedures for conducting hearings by the director, or the director’s designee, and the rights of appeal from decisions of the director, or the director’s designee, shall be governed by the applicable provisions of this title.
(e)
If the director, or the director’s designee, approves the merger or consolidation in accordance with subsection (d), he or she shall endorse approval upon each original of the articles of merger or articles of consolidation and shall deliver the articles to the applicant. One original of the articles of merger or articles of consolidation bearing the approval in writing shall be filed with the director, or the director’s designee, and two (2) originals shall be filed with the secretary of state, who shall, upon payment to the director, or the director’s designee, of twenty-five dollars ($25.00), issue a certificate of merger or certificate of consolidation pursuant to the provisions of § 7-1.2-1003. Upon the issuance of the certificate or upon a later date, not more than thirty (30) days after the filing with the secretary of state of the articles of merger or articles of consolidation, that may be set forth in the plan, the merger or consolidation shall be effected pursuant to the provisions of this chapter with the effects set forth therein. At any time prior to the filing of the articles of merger or articles of consolidation with the secretary of state, the merger or consolidation may be abandoned pursuant to the provisions therefor, if any, set forth in the plan of merger or consolidation.
(f)
Any shareholder of a financial institution that is a party to a plan of merger or consolidation under this section shall have the right to dissent from the corporate action involved in accordance with the provisions of § 7-1.2-1201 and on the terms and conditions set forth in § 7-1.2-1202.
(g)
If the successor institution of a merger or consolidation under this chapter is to be organized under laws other than the laws of this state, it shall file the following with the director, or the director’s designee, contemporaneously with the application for approval of the merger or consolidation:
(1)
An agreement that it may be served with process in this state in any proceeding for the enforcement of any obligation arising out of its business transacted in this state and any obligation of any of its predecessor financial institutions, including the enforcement of the rights of a dissenting shareholder of any predecessor financial institution;
(2)
An irrevocable appointment of the director as its agent to accept service of process in any proceeding in the courts of this state or the courts of the United States situated in this state; and
(3)
An agreement that it will promptly pay to the dissenting shareholder of any predecessor financial institution the amount, if any, to which they shall be entitled.
History of Section.
P.L. 1995, ch. 82, § 45; P.L. 2005, ch. 36, § 17; P.L. 2005, ch. 72, § 17.