N.Y. Banking Law § 627: Dividends to creditors; distributions to stockholders; dissolution; destruction of documents

§ 627. Dividends to creditors; distributions to stockholders;

dissolution; destruction of documents. 1. At any time after the date

fixed by the superintendent for the presentation of claims, the

superintendent may, upon an order of the supreme court, declare and pay

out of the funds remaining in his or her hands after the payment of

expenses, one or more dividends to creditors whose claims or accounts

payable have been accepted or otherwise duly established. If the

superintendent intends to declare and pay more than one dividend to

creditors, at the time he or she declares and pays out such first

dividend to creditors, the superintendent may pay in full those claims

and accounts payable that were accepted, or otherwise duly established,

in an amount that is less than one hundred dollars; provided, however,

that this sentence shall not be construed as a right to priority of

payment; and provided further, that if the superintendent will not be

able to satisfy in full all other creditors with accepted claims or

accounts payable either in the first or succeeding dividends, then such

payment may not be made. After a dividend or dividends aggregating one

hundred per centum of the principal amount of all such claims and

accounts payable shall have been paid or set apart, and if funds are

available therefor, a further dividend or dividends on account of

interest accruing, on such claims and accounts payable, subsequent to

the commencement of the liquidation may, at the sole discretion of the

superintendent, be paid to the creditors entitled thereto at a rate not

to exceed four per centum per annum, but nothing herein shall be deemed

to create any right to interest which would not otherwise accrue or be

payable. No creditor shall be entitled to receive nor be paid interest

on any dividend or dividends by reason of delay in payment of such

dividend or dividends. Dividends remaining unclaimed or unpaid in the

hands of the superintendent for six months after payment of a final

dividend, shall be deposited as provided in article two of this chapter

except that if, after payment of such a dividend, the liquidation is

continued in accordance with the provisions of subdivision two of this

section, then such dividends shall be so deposited simultaneously with

the like deposit of unclaimed or unpaid distributive amounts pursuant to

the provisions of such subdivision at the expiration of six months after

a final distribution.

2. Whenever the superintendent shall have (a) paid to, or set apart

for, each creditor of any stock corporation whose claim or account

payable has been accepted or otherwise duly established, a dividend or

dividends aggregating the full amount of such claim or account payable

together with interest thereon, and (b) set aside proper reserves for

claims and accounts payable in litigation and not finally determined and

for such other purposes as in the discretion of the superintendent shall

be necessary or desirable, and (c) paid all the expenses of liquidation,

the superintendent shall, if there be assets remaining in his or her

hands, continue the liquidation of the affairs of such corporation and

after paying the expenses thereof, distribute the proceeds, together

with any part of the foregoing reserves not finally necessary to pay

creditors and expenses in full, among the persons equitably entitled

thereto according to their respective rights and interests and in such

manner and upon such notice as may be directed by order of the supreme

court. Any such distributive amounts remaining unpaid or unclaimed in

the hands of the superintendent for six months after a final

distribution shall be deposited by the superintendent as provided in

article two of this chapter.

3. Upon the petition by the superintendent showing that the

liquidation of a corporate banking organization of which he has taken

possession has been completed and upon such notice as the supreme court

may prescribe, the court may, on such terms as justice requires, make an

order declaring such corporation dissolved and the corporate existence

thereof terminated. Upon the filing of a certified copy of such order in

the office of the superintendent, the existence of such corporation

shall cease and determine.

4. Any records, documents and correspondence of any banking

organization of which the superintendent has taken possession and any

records, documents and correspondence in the custody of the

superintendent relating to the liquidation of such banking organization

may be destroyed or otherwise disposed of at such time or times and in

such manner as the supreme court by order may authorize.