7.2023—Reverse stock splits.

(a) Authority to engage in reverse stock splits. A national bank may engage in a reverse stock split if the transaction serves a legitimate corporate purpose and provides adequate dissenting shareholders' rights.

(b) Legitimate corporate purpose. Examples of legitimate corporate purposes include a reverse stock split to:

(1) Reduce the number of shareholders in order to qualify as a Subchapter S corporation; and

(2) Reduce costs associated with shareholder communications and meetings.

Code of Federal Regulations

[64 FR 60099, Nov. 4, 1999]

CFR

7.2023—Reverse stock splits.

Code of Federal Regulations