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§ 206. Interested directors and shareholders; quorum

Purdon's Pennsylvania Statutes and Consolidated StatutesTitle 7 P.S. Banks and Banking

Purdon's Pennsylvania Statutes and Consolidated Statutes
Title 7 P.S. Banks and Banking (Refs & Annos)
Banking Code of 1965 (Refs & Annos)
Chapter 2. General Statement of Powers of Incorporated Institutions; By-Laws (Refs & Annos)
7 P.S. § 206
§ 206. Interested directors and shareholders; quorum
(a) Voting requirements--Any transaction authorized under Chapter 16 of this act1 between an institution or subsidiary thereof and a shareholder of such an institution, or any transaction authorized under section 18032 of this act in which a shareholder is treated differently from other shareholders of the same class (other than any dissenting shareholders under section 16073 of this act), shall require the affirmative vote of the shareholders entitled to cast at least a majority of the votes which all shareholders other than the interested shareholder are entitled to cast with respect to the transaction, without counting the vote of the interested shareholder. For the purposes of the preceding sentence, interested shareholder shall include the shareholder who is a party to the transaction or who is treated differently from other shareholders and any person, or group of persons, that is acting jointly or in concert with the interested shareholder and any person who, directly or indirectly, controls, is controlled by or is under common control with the interested shareholder. An interested shareholder shall not include any person who, in good faith and not for the purpose of circumventing this subsection, is an agent, bank, broker, nominee or trustee for one or more other persons, to the extent that such other person or persons are not interested shareholders.
(b) Exceptions--Subsection (a) shall not apply to a transaction:
(i) which has been approved by a majority vote of the board of directors or trustees without counting the vote of directors or trustees who:
(A) are directors, trustees or officers of, or have a material equity interest in, the interested shareholder; or
(B) were nominated for election as a director or trustee by the interested shareholder, and first elected as a director or trustee, within twenty-four months of the date of the vote on the proposed transaction; or
(ii) in which the consideration to be received by the shareholders for shares of any class of which shares are owned by the interested shareholder is not less than the highest amount paid by the interested shareholder in acquiring shares of the same class.
(c) Approvals required--The approvals required by this section shall be in addition to, and not in lieu of, any other approval required by this act, the articles of the institution, the bylaws of the institution or otherwise.

Credits

1965, Nov. 30, P.L. 847, No. 356, § 206, added 1986, Dec. 18, P.L. 1702, No. 205, § 3, effective in 60 days.

Footnotes

7 P.S. § 1601 et seq.
7 P.S. § 1803.
7 P.S. § 1607.
7 P.S. § 206, PA ST 7 P.S. § 206
Current through 2022 Regular Session Act 117. Some statute sections may be more current, see credits for details.
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