Guam § 146102 - Reorganization by Commissioner.

§ 146102. Reorganization by Commissioner.

As a condition to restoration of possession and resumption of

business pursuant to Section 141107 of this act, the commissioner may

require an association, the business, property and assets of which are in

his possession, to adopt and agree to carry out a plan of reorganization

proposed by the commissioner.

A. Proposal of Plan. The commissioner, upon proposing a plan

of reorganization pursuant to this section, shall file such plan in his

office and shall fix a time and place for a hearing before him on

such plan, and shall give at least 30 day’s notice to investors and

creditors of such hearing, which notice shall include a copy or

summary of such plan. Such hearing shall be held in the

municipality in which such association maintains its principal

office.

B. Hearing. At the time and place fixed for such hearing, or at

the time and place to which such hearing may be continued by the

commissioner, the commissioner shall hear the parties interested

therein and, if he deems it necessary, may take testimony and/or

may receive depositions relative thereto. If at the time fixed for

Such hearing written dissents from such plan (other than dissents, if

any, withdrawn after the filing thereof) shall have been filed by

holders or more than one-third in value of the investment certificates

of such association then outstanding, or by holders of more than

one-third in value of the shares of such association then outstanding,

or by holders of more than one-half of the stock of such association

then outstanding, then such hearing shall not be held, such plan shall

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not be approved by the commissioner, and no further proceedings

shall be taken in respect of such plan.

After the completion of such hearing the commissioner shall

approve or disapprove such plan, and it he disapproves such plan he

may modify such plan and propose it as modified or propose a

different plan. If he proposes such plan as modified or a different

plan, the provisions of this section (including among other

provisions, the provisions of Subsections A and B thereof) shall

apply to such modified or different plan in same manner and with

the same effect as if it had been the original plan proposed by the

commissioner.

Notwithstanding anything to the contrary contained in this

Subsection B, dissents of shareholders shall have no effect if the

value of the assets of such association shall be less than the

liabilities of such association, including the value of its investment

certificates but not including the value of its shares; and dissents of

stockholders shall have no effect if the value of the assets of such

association shall be less than the liabilities thereof, including the

value of all outstanding shares and investment certificates.

C. Conditions of Approval. No plan shall be approved by the

commissioner unless he is satisfied that the plan is fair and

equitable, and feasible.

D. Effect of Approval. When any plan under this section shall

have been approved by the commissioner, such plan shall be

binding upon the commissioner, such association and all of the

investors and creditors of such association, other than investors and

creditors who shall have filed with the commissioner written

dissents from such plan within the time specified in Subsection B of

this section and shall not have withdrawn such dissents. Thereupon

such steps shall be taken by the commissioner, such association and

all other persons affected by such plan, and all acts shall be done, all

instruments executed and all securities issued, as may be required

by such plan so approved and as may be necessary or desirable for

the consummation of such plan. The commissioner shall supervise

and direct the consummation of such plan.

E. Rights of Dissenters. No investor or creditor who shall have

filed with the commissioner his written dissent from such plan

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within the time specified in Subsection B of this section, shall be

entitled to receive any securities or other participation under such

plan (except from payments to the commissioner pursuant to

provisions of the plan referred to in the next paragraph) unless such

dissent shall be withdrawn, but the commissioner shall set apart and

shall thereafter liquidate for such dissenters that part of the assets of

such association which in value shall bear the same proportion to all

of the assets of such association (due provision being made for any

liens, charges, liabilities and expenses entitled to payment in

preference to certificate holders and unsecured creditors) as the

value of investment certificates in respect of which dissents have

been duly filed plus the amount of claims of unsecured creditors in

respect of which dissents shall have been duly filed bears to the total

sum of the value of all investment certificates of such association

plus the amount of all unsecured creditor’s claims against such

association (such proportion being hereinafter referred to as the

"proportion of dissenting certificate holders and, unsecured

creditors"); provided, that in all cases the assets so set apart for

liquidation shall be of such amount and value that the probable

result of the liquidation of such assets for the benefit of the

dissenting investors and creditors and of any payments to the

commissioner pursuant to the provisions of the plan referred to in

the next paragraph shall be not less favorable to the dissenting

investors and creditors than the probable result of a liquidation, in

the absence of a plan, of all the assets for the benefit of all investors

and creditors.

It is recognized that the proportion of dissenting certificate

holders and unsecured creditors may not be the same proportion

which the value of shares in respect of which dissents have been

duly filed bears to the total value of all shares of such association

(hereinafter referred to as the "proportion of dissenting

shareholders") or as the proportion which the value of stock in

respect of which dissents have been duly filed bears to the total

stock of such association (hereinafter referred to as the "proportion

of dissenting stockholders"). Accordingly any plan approved under

this section shall provide that if the liquidation of assets set apart

pursuant to this Subsection E shall result in the distribution to

dissenting certificate holders and unsecured creditors of the full

amounts to which they are entitled and leave additional amounts

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available for distribution to shareholders or stockholders such

additional amounts shall be either (a) increased (in the event the

proportion of dissenting shareholders or the proportion of dissenting

stockholders shall be greater than the proportion of dissenting

certificate holders and unsecured creditors) by payments from the

association, or from a corporation or trustee to whom assets of such

association are to be transferred pursuant to such plan to the

commissioner for distribution to dissenting shareholders or

dissenting stockholders or (b) decreased (in the event the proportion

of dissenting shareholders or the proportion of dissenting

stockholders shall be less than the proportion of dissenting

certificate holders and unsecured creditors), by payments from the

commissioner to the association, or to a corporation or trustee to

whom assets of such association are to be transferred pursuant to

such plan. In either case the amounts to be so paid shall be

determined by the amounts available for distribution to shareholders

or stockholders, respectively, as the result of liquidation by the

commissioner of the assets set apart pursuant to this Subsection E

and shall be such as to overcome any inequity which would exist in

the absence of such payment by reason of the differences between

the proportion of dissenting certificate holders and unsecured

creditors, the proportion of dissenting shareholders, and the

proportion of dissenting Stockholders.

Upon approving a plan of reorganization the commissioner

shall determine what assets shall be set apart pursuant to this

Subsection E and shall cause a written statement of such

determination including a description of the properties to be so set

apart, to be filed in his office. Thereupon the commissioner shall

cause notice of the fact that he has made such determination (which

notice shall include in general terms a statement of the properties to

be so set apart) to be given as follows: Such notice shall be posted

in three public places in the territory in which such association

maintains its office, shall be published at least once in a newspaper

of general circulation, and shall be mailed to all investors and

creditors whose respective addresses appear on the books of such

association.

F. Action in District Court. Within 30 days after such notice

shall have been posted, published and mailed as aforesaid any

investor or creditor may apply to the District Court of the territory

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of Guam for a determination as to whether the assets set apart

pursuant to Subsection E of this section are sufficient in amount and

value to conform to the" requirement of such subsection. Thereafter

such application or applications shall be sent for hearing. At least 30

day’s notice of such hearing shall be given by posting in three

public places in said territory, and, if the court shall so require,

notice shall also be given by publication and/or mailing at such time

or times and in such manner as the court shall prescribe. At such

hearing the written statement of the commissioner of his

determination as to the assets to be set apart shall be received and

shall be prima facie evidence of the correctness of such

determination, but the commissioner, the association and any

investor or creditor (whether or not dissenting) may introduce

evidence in support or in opposition to the commissioner’s

determination. After the conclusion of such hearing the court shall

make its order either approving or disapproving such determination

by the commissioner, and if the court shall disapprove such

determination, the court shall determine and specify in such order

the assets to be set apart pursuant to Subsection E of this section.

G. Appeals. No appeal from such order of court shall stay or

postpone the consummation of the plan, unless such court shall

deem it necessary to delay such consummation for the proper

protection of the appellant or appellants, but in lieu of requiring the

consummation of the plan to be delayed such court may restrain the

sale, transfer or other disposition by the commissioner, the

association or a corporation or trustee to whom assets are to be

transferred of any assets specified by the court, if the retention of

such assets is found by the court necessary or advisable to protect

the rights of the appellant or appellants.