Statute: 1971 ACT AS AMENDED
Title: Title VII Restructuring of System Institutions
Subtitle: Subtitle B Mergers, Transfers of Assets, and Powers of Associations Within a District
Chapter Name: Chapter 2 Merger of Like and Unlike Associations
U.S. Code Citation: 12 U.S.C. 2279c-1
Chapter 2—Merger of Like and Unlike Associations
12 U.S.C. 2279c-1 SEC. 7.8. MERGER OF ASSOCIATIONS.
(a) IN GENERAL. Two or more associations within the same district, whether or not organized under the same title of this Act, may merge into a single entity (hereinafter in this title referred to as a "merged association") if the plan of merger is approved by—
(1) the Farm Credit Administration Board;
(2) the boards of directors of the associations;
(3) a majority of the shareholders of each association voting, in person or by proxy, at a duly authorized stockholders' meeting; and
(4) the Farm Credit Bank.
(b) POWERS, OBLIGATIONS, AND CONSOLIDATION.
(1) POWERS AND OBLIGATIONS. Except as otherwise provided by this title, a merged association shall—
(A) possess all powers granted under this Act to the associations forming the merged association; and
(B) be subject to all of the obligations imposed under this Act on the associations forming the merged association.
(2) CONSOLIDATION. The Farm Credit Administration shall issue regulations that establish the manner in which the powers and obligations of the associations that form the merged association are consolidated and, to the extent necessary, reconciled in the merged association.
(c) STOCK ISSUANCE.
(1) PLAN OF MERGER. Subject to section 4.3A, the number of shares of capital stock issued by a merged association to the stockholders of any association forming such merged association, and the rights and privileges of such shares (including voting power, preferences on liquidation, and the right to dividends), shall be determined by the plan of merger adopted by the merged associations.
(2) CAPITALIZATION. In accordance with section 4.3A, each merged association shall provide, through bylaws and subject to Farm Credit Administration regulations, for the capitalization of the association and the manner in which association stock shall be issued, held, transferred, and retired, and association earnings shall be distributed.
[FCA Home | FCA Handbook]