N.Y. Banking Law § 114: Assessment of stockholders to make good impairment of capital stock; sale of stock

§ 114. Assessment of stockholders to make good impairment of capital

stock; sale of stock.

Whenever the superintendent shall have made requisition upon any bank

or trust company pursuant to the provisions of article two of this

chapter to make good the amount of an impairment of its capital stock,

the directors of the bank or trust company shall immediately give notice

of such requisition to each stockholder and of the amount of the

assessment which he must pay for the purpose of making good such

deficiency, by a written or printed notice mailed to such stockholder at

his last address appearing upon the records of the bank or trust

company, or served personally upon him. If any stockholder shall refuse

or neglect to pay the assessment specified in such notice within sixty

days from the date thereof, the directors of such bank or trust company

shall have the right to sell to the highest bidder at public auction the

stock of such stockholder, after giving previous notice of such sale

once a week for two successive weeks in a newspaper of general

circulation in the county where the principal office of such bank or

trust company is located; or such stock may be sold at private sale, and

without such published notice, provided, however, that before making a

private sale thereof an offer in writing to purchase such stock shall

first be obtained, and a copy thereof served upon the owner of record of

the stock sought to be sold either personally or by mailing a copy of

such offer to such owner at his last address appearing upon the records

of the bank or trust company; and if, after service of such offer, such

owner shall still refuse or neglect to pay such assessment within two

weeks from the time of service of such offer, the said directors may

accept such offer and sell such stock to the person or persons making

such offer, or to any other person or persons making a larger offer than

the amount named in the offer submitted to such stockholder; but said

stock shall in no event be sold for a smaller sum than the amount of the

assessment called for and the necessary costs of sale. Out of the

avails of the stock sold the directors shall pay the necessary costs of

sale and the amount of the assessment called for thereon. The balance,

if any, shall be paid to the person or persons whose stock has been thus

sold. A sale of stock as herein provided shall effect an absolute

cancellation of the outstanding certificate or certificates evidencing

the stock so sold, and shall render the same null and void and a new

certificate or certificates shall be issued to the purchaser or

purchasers of said stock.