| (a) Scope. This section governs an application for
merger or share exchange pursuant to the Finance Code, §§32.301-32.303
and 32.008, or §203.001(b). This section does not apply to a
merger, reorganization, or conversion of a state bank into another
form of financial institution pursuant to the Finance Code, §32.501,
governed by §15.107 of this title (relating to Notice of Merger,
Reorganization, or Conversion of a State Bank into Another Form of
Financial Institution).
(b) Form of application. The applicant must submit
a fully completed, verified application on a form prescribed by the
banking commissioner and simultaneously tender the required filing
fee pursuant to §15.2 of this title (relating to Filing and Investigation
Fees). The Interagency Bank Merger Act application may be used in
lieu of the commissioner prescribed form if it is accompanied by the
signature page and supplemental page of the commissioner prescribed
form. The application must, except to the extent waived by the banking
commissioner, include:
(1) a summary of the proposed transaction;
(2) a copy of all agreements related to the proposed
transaction executed by an authorized representative of each party
to the merger or share exchange;
(3) certificate and plan of merger or share exchange
in accordance with the Texas Business Organizations Code, which must
include:
(A) a current draft of the certificate of merger or
share exchange, and additional copies equal to the number of surviving,
new, or acquired entities, executed and acknowledged by an authorized
officer for each party to the merger or share exchange;
(B) the plan of merger or share exchange;
(C) the restated certificate of formation of each resulting
state bank;
(D) the restated certificate of formation, or other
constitutive documents, of each surviving entity other than the resulting
state bank;
(E) the certificate of formation, or other constitutive
documents, of each new resulting entity;
(F) if a party to a merger is an entity required to
file documents with the Texas secretary of state before the transaction
can be legally consummated, a provision in the certificate of merger
conditioning the merger upon the approval of the banking commissioner,
containing wording substantially as follows, as applicable: This merger
will become effective upon the final approval and filing of the certificate
of merger by the Secretary of State of Texas and with the Banking
Commissioner of Texas which must be on or before ________ (date),
which is the 90th day after the date of filing of the certificate
of merger with the Secretary of State;
(4) for each party to the merger or share exchange,
a certified copy of those portions of the minutes of board meetings
and shareholder or participant meetings at which action was taken
regarding approval of the merger or share exchange, or a certificate
of an officer verifying the action taken by the board of directors
and the shareholders or participants approving the merger or share
exchange, or an explanation of the basis for concluding that this
action was not required;
(5) for each resulting state bank, an assessment of
its future prospects, proposed officers and directors, and proposed
branches and other locations;
(6) an assessment of the current regulatory and financial
condition of each party to the transaction;
(7) if a merger or share exchange will change the existing
CRA delineated community of a resulting state bank, a copy of a map
depicting the proposed delineated community of the resulting state
bank;
(8) a copy of current financial statements for each
entity involved in the proposed transaction, accompanied by an affidavit
of no material change dated no earlier than 30 days prior to the date
of submission of the application;
(9) a copy of the latest annual report for each financial
institution and bank holding company involved in the proposed transaction;
(10) a copy of that portion of the most recent watch
list for each financial institution involved in the proposed transaction
that identifies low-quality assets;
(11) a description of the due diligence review conducted
by or for a state bank that is a party to the transaction and a summary
of findings;
(12) a description of all material legal or administrative
proceedings involving any party to the merger or share exchange;
(13) an opinion of legal counsel that conforms with §15.109
of this title (relating to Opinion of Legal Counsel), concluding:
(A) the merger or share exchange has been duly authorized
by the board and shareholders or participants of each participating
state bank in accordance with the Finance Code, §32.301, and
the Texas Business Organizations Code;
(B) the merger or share exchange will not cause or
result in a material violation of the laws of this state relative
to the organization and operation of state banks;
(C) all deposit and other liabilities of every state
bank that is a party to the merger or share exchange will be discharged
or otherwise assumed or retained by a financial institution that is
authorized by law to do so;
(D) each surviving, new, or acquiring entity that is
not a financial institution will not be engaged in the unauthorized
business of banking, and each resulting state bank will not be engaged
in a business other than banking or a business incidental to banking;
and
(E) all conditions with respect to the merger or share
exchange that have been imposed by the banking commissioner have been
satisfied or otherwise resolved or, to the best knowledge of legal
counsel, no conditions have been imposed;
(14) a copy of each filing or application regarding
the proposed merger or share exchange required by another governmental
authority, complete with all related attachments, exhibits, and correspondence;
(15) a current pro forma balance sheet and income statement
for each party to the transaction, with adjustments, reflecting the
proposed merger or share exchange as of the most recent quarter ended
immediately prior to the filing of the application;
(16) a copy of the strategic plan that complies with
the department's Memorandum 1009, including projections of the balance
sheet and income statement of each resulting state bank as of the
quarter ending one year from the date of the pro forma financial statement
required by paragraph (15) of this subsection;
(17) an explanation of compliance with or nonapplicability
of provisions of governing law relating to rights of dissenting shareholders
or participants to the merger or share exchange;
(18) a copy of all securities offering documents, proxy
statements, or other disclosure materials delivered or to be delivered
to shareholders or participants of a party concerning the merger or
share exchange;
(19) an explanation of the manner and basis of converting
or exchanging any of the shares or other evidences of ownership of
an entity that is a party to the merger or share exchange into shares,
obligations, evidences of ownership, rights to purchase securities,
or other securities of one or more of the surviving, acquiring, or
new entities, into cash or other property, including shares, obligations,
evidences of ownership, rights to purchase securities, or other securities
of another person or entity, or into a combination of the foregoing;
(20) for antitrust purposes, an analysis of the anticipated
competitive effect of the proposed transaction in the affected markets
and a statement of the basis of the analysis of the competitive effects,
or alternatively, a copy of the analysis of competitive effects of
the proposed transaction addressed in the companion federal regulatory
agency application;
(21) other information that the banking commissioner,
in the exercise of discretion, considers necessary to make an informed
decision to approve or deny the proposed merger or share exchange;
and
(22) in addition to all other requirements of this
subsection, with respect to an interstate merger transaction:
(A) any additional opinions and information the applicant,
by contacting the department, determines the banking commissioner
requires; and
(B) information regarding applicable host state law
and evidence of compliance with the law.
(c) Applicant's duty to disclose. The applicant must
supply all material information necessary for the banking commissioner
to make a fully informed decision on the application.
Cont'd... |
