SB2338eng 95TH GENERAL ASSEMBLY

SB2338 Engrossed LRB095 16921 MJR 42966 b

AN ACT concerning regulation.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Banking Act is amended by changing Section 15 as follows:

(205 ILCS 5/15) (from Ch. 17, par. 322)

Sec. 15. Stock and stockholders. Unless otherwise provided for in this Act, provisions of general application to capital stock, preferred stock, and stockholders of a State bank shall be as follows:

(1) There shall be an annual meeting of the stockholders for the election of directors each year on the first business day in January, unless some other date shall be fixed by the by-laws. A special meeting of the stockholders may be called at any time by the board of directors, and otherwise as may be provided in the bylaws.

(2) Written or printed notice stating the place, day, and hour of the meeting, and in case of a special meeting, the purpose or purposes for which the meeting is called, shall be delivered not less than 10 nor more than 40 days before the date of the meeting either personally or by mail, by or at the direction of the president, or the secretary, or the officer or persons calling the meeting, to each stockholder of record entitled to vote at the meeting. If mailed, the notice shall be deemed to be delivered when deposited in the United States mail with postage thereon prepaid addressed to the stockholder at his address as it appears on the records of the bank.

(3) Except as provided below in this paragraph (3), each outstanding share shall be entitled to one vote on each matter submitted to a vote at a meeting of stockholders. Shares of its own stock belonging to a bank shall not be voted, directly or indirectly, at any meeting and shall not be counted in determining the total number of outstanding shares at any given time, but shares of its own stock held by it in a fiduciary capacity may be voted and shall be counted in determining the total number of outstanding shares at any given time. A stockholder may vote either in person or by proxy executed in writing by the stockholder or by his duly authorized attorney-in-fact. No proxy shall be valid after 11 months from the date of its execution, unless otherwise provided in the proxy. Except as provided below in this paragraph (3), in all elections for directors every stockholder (or subscriber to the stock prior to the issuance of a charter) shall have the right to vote, in person or by proxy, for the number of shares of stock owned by him, for as many persons as there are directors to be elected, or to cumulate the shares and give one candidate as many votes as the number of directors multiplied by the number of his or her shares of stock shall equal, or to distribute them on the same principle among as many candidates as he or she shall think fit. The bank charter of any bank organized on or after January 1, 1984 may limit or eliminate cumulative voting rights in all or specified circumstances, or may eliminate voting rights entirely, as to any class or classes or series of stock of the bank; provided that one class of shares or series thereof shall always have voting rights in respect of all matters in the bank. A bank organized prior to January 1, 1984 may amend its charter to eliminate cumulative voting rights under all or specified circumstances, or to eliminate voting rights entirely, as to any class or classes or series of stock of the bank; provided that one class of shares or series thereof shall always have voting rights in respect of all matters in the bank, and provided further that the proposal to eliminate the voting rights receives the approval of the holders of 70% of the outstanding shares of stock entitled to vote as provided in paragraph (b) (7) of Section 17. A majority of the outstanding shares represented in person or by proxy shall constitute a quorum at a meeting of stockholders. In the absence of a quorum a meeting may be adjourned from time to time without notice to the stockholders.

(4) Whenever additional stock of a class is offered for sale, stockholders of record of the same class on the date of the offer shall have the right to subscribe to the proportion of the shares as the stock of the class held by them bears to the total of the outstanding stock of the class, and the price thereof may be in excess of par value. This right shall be transferable but shall terminate if not exercised within 60 days of the offer, unless the Commissioner shall authorize a shorter time. If the right is not exercised, the stock shall not be re-offered for sale to others at a lower price without the stockholders of the same class again being accorded a preemptive right to subscribe at the lower price. Notwithstanding any of the provisions of this paragraph (4) or any other provision of law, stockholders shall not have any preemptive or other right to subscribe for or to purchase or acquire shares of capital stock issued or to be issued under a stock-option plan or upon conversion of preferred stock or convertible debentures or other convertible indebtedness that has been approved by stockholders in the manner required by the provisions of subsection (5) of Section 14 hereof or to treasury stock acquired pursuant to subsection (6) of Section 14.

(5) For the purpose of determining stockholders entitled to notice of or to vote at any meeting of stockholders, or stockholders entitled to receive payment of any dividend, or in order to make a determination of stockholders for any other proper purpose, the board of directors of a bank may provide that the stock transfer books shall be closed for a stated period not to exceed, in any case, 40 days. In lieu of closing the stock transfer books, the board of directors may fix in advance a date as the record date for any determination of stockholders, the date in any case to be not more than 40 days, and in case of a meeting of stockholders, not less than 10 days prior to the date on which the particular action, requiring the determination of stockholders, is to be taken. If the stock transfer books are not closed and no record date is fixed for the determination of stockholders entitled to notice of or to vote at a meeting of stockholders, or stockholders entitled to receive payment of a dividend, the date on which notice of a meeting is mailed or the date on which the resolution of the board of directors declaring the dividend is adopted, as the case may be, shall be the record date for the determination of stockholders.

(6) Stock standing in the name of another corporation, domestic or foreign, may be voted by the officer, agent, or proxy as the by-laws of the corporation may prescribe, or, in the absence of such provision, as the board of directors of the corporation may determine. Stock standing in the name of a deceased person may be voted by his or her administrator or executor, either in person or by proxy. Stock standing in the name of a guardian or trustee may be voted by that fiduciary either in person or by proxy. Shares standing in the name of a receiver may be voted by the receiver, and shares held by or under control of a receiver may be voted by the receiver without the transfer thereof into his or her name if authority so to do be contained in an appropriate order of the court by which the receiver was appointed. A stockholder whose shares of stock are pledged shall be entitled to vote those shares until the shares have been transferred into the name of the pledgee, and thereafter the pledgee shall be entitled to vote the shares so transferred.

(7) Shares of stock shall be transferable in accordance with the general laws of this State governing the transfer of corporate shares.

(8) The president and any other officer designated by the board of directors and cashier of every State bank shall cause to be kept at all times a full and correct list of the names and residences of all the shareholders in the State bank and the number of shares held by each in the office where its business is transacted. The list shall be subject to the inspection of all the shareholders of the State bank and the officers authorized to assess taxes under State authority during business hours of each day in which business may be legally transacted. A copy of the list, verified by the oath of the president or cashier, shall be transmitted to the Commissioner of Banks and Real Estate within 10 days of any demand therefor made by the Commissioner.

(9) Any number of shareholders of a bank may create a voting trust for the purpose of conferring upon a trustee or trustees the right to vote or otherwise represent their shares for a period of not to exceed 10 years by entering into a written voting trust agreement specifying the terms and conditions of the voting trust and by transferring their shares to the trustee or trustees for the purposes of the agreement. The trust agreement shall not become effective until a counterpart of the agreement is deposited with the bank at its main banking premises. The counterpart of the voting trust agreement so deposited with the bank shall be subject to the same right of examination by a shareholder of the bank, in person or by agent or attorney, as is the record of shareholders of the bank and shall be subject to examination by any holder of a beneficial interest in the voting trust, either in person or by agent or attorney, at any reasonable time for any proper purpose.

(10) Voting agreements. Shareholders may provide for the voting of their shares by signing an agreement for that purpose. A voting agreement created under this paragraph is not subject to the provisions of paragraph (9).

A voting agreement created under this paragraph is specifically enforceable in accordance with the principles of equity.

(Source: P.A. 92-483, eff. 8-23-01.)

Section 99. Effective date. This Act takes effect upon becoming law.