§ 197. — Shareholders' meeting; continuance of receivership; appointment of agent; winding up business; distribution of assets.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 12USC197]
TITLE 12--BANKS AND BANKING
CHAPTER 2--NATIONAL BANKS
SUBCHAPTER XIII--RECEIVERSHIP
Sec. 197. Shareholders' meeting; continuance of receivership;
appointment of agent; winding up business; distribution of
assets
(a) Whenever any national banking association shall have been or
shall be placed in the hands of a receiver, as provided in section
fifty-two hundred and thirty-four [12 U.S.C. 192] and other sections of
the Revised Statutes of the United States and section 1821(c) of this
title, and when, as provided in section 194 of this title, there has
been paid to each and every creditor of such association whose claim or
claims as such creditor shall have been proved or allowed as therein
prescribed, the full amount of such claims, and all expenses of the
receivership, the Comptroller of the Currency or the Federal Deposit
Insurance Corporation, where that Corporation has been appointed
receiver of the bank, shall call a meeting of the shareholders of the
association by giving notice thereof for thirty days in a newspaper
published in the town, city, or county where the business of the
association was carried on, or if no newspaper is there published, in
the newspaper published nearest thereto. At such meeting the
shareholders shall determine whether the receiver shall be continued and
shall wind up the affairs of the association, or whether an agent shall
be elected for that purpose, and in so determining the shareholders
shall vote by ballot, in person or by proxy, each share of stock
entitling the holder to one vote, and the majority of the stock in
number of shares shall be necessary to determine whether the receiver
shall be continued, or whether an agent shall be elected. In case such
majority shall determine that the receiver shall be continued, the
receiver shall thereupon proceed with the execution of the trust, and
shall sell, dispose of, or otherwise collect the assets of the
association, and shall possess all the powers and authority, and be
subject to all the duties and liabilities originally conferred or
imposed upon such receiver so far as they remain applicable. In case
such meeting shall, by the vote of a majority of the stock in number of
shares, determine that an agent shall be elected, the meeting shall
thereupon proceed to elect an agent, voting by ballot, in person or by
proxy, each share of stock entitling the holder to one vote, and the
person who shall receive votes representing at least a majority of stock
in number of shares shall be declared the agent for the purposes
hereinafter provided; and when such agent shall have executed a bond to
the shareholders conditioned for the payment and discharge in full or,
to the extent possible from the remaining assets of the association, of
each and every claim that may thereafter be proved and allowed by and
before a competent court and for the faithful performance of his duties,
in the penalty fixed by the shareholders at such meeting, with a surety
or sureties to be approved by the district court of the United States
for the district where the business of the association was carried on,
and shall have filed such bond in the office of the clerk of such court,
the Comptroller and the receiver, or the Federal Deposit Insurance
Corporation, where that Corporation has been appointed receiver of the
bank, shall thereupon transfer and deliver to such agent all the
uncollected or other assets of the association then remaining in the
hands or subject to the order and control of the Comptroller and such
receiver, or either of them, or the Federal Deposit Insurance
Corporation; and for this purpose the Comptroller and such receiver, or
the Federal Deposit Insurance Corporation, as the case may be, are
severally empowered and directed to execute any deed, assignment,
transfer, or other instrument in writing that may be necessary and
proper; and upon the execution and delivery of such instrument to such
agent the Comptroller and such receiver or the Federal Deposit Insurance
Corporation shall by virtue of this Act be discharged from any and all
liabilities to the association and to each and all the creditors and
shareholders thereof.
(b) Upon receiving such deed, assignment, transfer, or other
instrument the person elected such agent shall hold, control, and
dispose of the assets and property of the association which he may
receive under the terms hereof for the benefit of the shareholders of
the association, and he may in his own name, or in the name of the
association, sue and be sued and do all other lawful acts and things
necessary to finally settle and distribute the assets and property in
his hands, and may sell, compromise, or compound the debts due to the
association, with the consent and approval of the district court of the
United States for the district where the business of the association was
carried on, and shall at the conclusion of his trust render to such
district court a full account of all his proceedings, receipts, and
expenditures as such agent, which court shall, upon due notice, settle
and adjust such accounts and discharge such agent and sureties upon such
bond. In case any such agent so elected shall die, resign, or be
removed, any shareholder may call a meeting of the shareholders of the
association in the town, city, or village where the business of the
association was carried on, by giving notice thereof for thirty days in
a newspaper published in such town, city, or village, or if no newspaper
is there published, in the newspaper published nearest thereto, at which
meeting the shareholders shall elect an agent, voting by ballot, in
person or by proxy, each share of stock entitling the holder to one
vote, and when such agent shall have received votes representing at
least a majority of the stock in number of shares, and shall have
executed a bond to the shareholders conditioned for the payment and
discharge in full or, to the extent possible from the remaining assets
of the association, of each and every claim that may thereafter be
proved and allowed by and before a competent court and for the faithful
performance of his duties, in the penalty fixed by the shareholders at
such meeting, with a surety or sureties, to be approved by such court,
and file such bond in the office of the clerk of that court, he shall
have all the rights, powers, and duties of the agent first elected as
hereinbefore provided. At any meeting held as hereinbefore provided
administrators or executors of deceased shareholders may act and sign as
the decedent might have done if living, and guardians of minors and
trustees of other persons may so act and sign for their ward or wards or
cestui que trust. The proceeds of the assets or property of any such
association which may be undistributed at the time of such meeting or
may be subsequently received shall be distributed as follows:
First. To pay the expenses of the execution of the trust to the
date of such payment.
Second. To repay any amount or amounts which have been paid in
by any shareholder or shareholders of the association upon and by
reason of any and all assessments made upon the stock of the
association by order of the Comptroller of the Currency in
accordance with the provisions of the statutes of the United States.
Third. To pay the balance ratably among such stockholders, in
proportion to the number of shares held and owned by each. Such
distribution shall be made from time to time as the proceeds shall
be received and as shall be deemed advisable by the Comptroller of
the Currency, or the Federal Deposit Insurance Corporation if
continued as receiver of the bank under subsection (a) of this
section, or such agent, as the case may be.
(June 30, 1876, ch. 156, Sec. 3, 19 Stat. 63; Aug. 3, 1892, ch. 360, 27
Stat. 345; Mar. 2, 1897, ch. 354, 29 Stat. 600; Mar. 3, 1911, ch. 231,
Sec. 291, 36 Stat. 1167; Pub. L. 86-230, Sec. 18, Sept. 8, 1959, 73
Stat. 458.)
References in Text
Section fifty-two hundred and thirty-four and other sections of the
Revised Statutes of the United States, referred to in subsec. (a), are
classified to section 192 of this title and other sections of the Code.
See Tables.
This Act, referred to in subsec. (a), is act June 30, 1876, ch. 156,
19 Stat. 63, as amended, sections 1, 3, and 4 of which are classified to
this section and sections 55 and 191 of this title, respectively.
Section 2 of the Act, which was classified to section 65 of this title,
was repealed by Pub. L. 86-230, Sec. 8, Sept. 8, 1959, 73 Stat. 457.
Section 5 of the Act, which was classified to section 424 of former
Title 31, was repealed and reenacted as section 5153 of Title 31, Money
and Finance, by Pub. L. 97-258, Sept. 13, 1982, 96 Stat. 877.
Amendments
1959--Subsec. (a). Pub. L. 86-230 designated former first par., less
last sentence, as subsec. (a), and incorporated references to Federal
Deposit Insurance Corporation respecting receiverships under section
1821(c) of this title, convocation of shareholders, transfer of assets,
execution of instruments and discharge from liability, omitted provision
for deposit of money with the Treasurer of the United States for the
redemption of the circulating notes of the association, and for the
value of shares as a test to determine whether a majority vote has been
cast in a stockholders' meeting, required the windup agent to file a
bond to the shareholders in an amount satisfactory to them with sureties
approved by appropriate district court instead of a bond from the
shareholders satisfactory to the Comptroller and to condition the bond
to payment of proved claims to the extent possible from the remaining
instead of payment of the claims in full, only.
Subsec. (b). Pub. L. 86-230 designated former last sentence of first
par. and second par., as subsec. (b), and omitted provisions which
related to refusal of agent to serve as a ground for the calling of an
election of another agent, to the value of shares as a test to determine
whether a majority vote has been cast in a stockholders' meeting,
required the bond of the windup agent to be conditioned for payment of
proved claims to the extent possible from the remaining assets instead
of payment of the claims in full, only, and provided for the
distribution of the balance as shall be deemed advisable by the Federal
Deposit Insurance Corporation.
Transfer of Functions
For transfer of functions to Secretary of the Treasury, see note set
out under section 121 of this title.
Act Mar. 3, 1911, conferred upon the district courts all powers
formerly vested in the former circuit courts.
Application to District of Columbia
Provisions of this section were made applicable to banks, etc., in
the District of Columbia by act Mar. 4, 1933, ch. 274, Sec. 4, 47 Stat.
1567.
