(a) Applications for conversion from a mutual to stock form of ownership shall be filed with the commissioner on forms approved by the commissioner. The application for mutual to stock conversion shall include: (1) a plan of conversion; (2) amendments to the savings bank's articles of incorporation and bylaws; (3) a copy of the proxy and soliciting materials to be used; and (4) such other information the commissioner may require. (b) The plan of conversion shall provide: (1) a comprehensive description of the nontransferable subscription rights received each eligible accountholder, including details on oversubscriptions; (2) that the shares of the converting savings bank be offered to persons with subscription rights and management, in that order, and that any remaining shares shall be sold either in a public offering through an
underwriter or directly by the converting savings bank in a direct community offering; (3) that a direct community offering by the converting savings bank shall give a preference to natural persons residing in the counties in which the savings bank has an office; (4) that the sale price of the shares of capital stock to be sold in the conversion shall be a uniform price determined in accordance with paragraph (1) of this subsection, and shall specify the underwriting and/or other marketing arrangements to be made; (5) that the conversion must be completed within 24 months from the date the savings bank members approve the plan of conversion; (6) that each savings accountholder of the converting savings bank shall receive, without payment, a withdrawable savings account or accounts in the converted savings bank equal in withdrawable amount to the withdrawal value of such accountholder's savings account or
accounts in the converting savings bank; (7) for an eligibility record date; (8) that expenses incurred in the conversion shall be reasonable; (9) that the converting savings bank shall not loan funds or otherwise extend credit to any person to purchase the capital stock of the savings bank; (10) that the proxies held with respect to voting rights in the savings bank will not be voted regarding the conversion, and that new proxies will be solicited for voting on the proposed plan of conversion; and (11) the amount of the deposit of an accountholder shall be the total of the deposit balances in the accountholder's savings accounts in the converting savings bank as of the close of business on the eligibility record date. The plan of conversion may provide that the total deposit balances of less than $50 (or any lesser amounts) shall not be considered for purposes of paragraph (6) of this
subsection. (c) A plan of conversion shall be adopted by not less than two-thirds of the savings bank's board of directors. (d) Upon determining that an application for conversion is properly executed and is not materially incomplete, the commissioner will advise the savings bank, in writing, to publish a notice of the filing of the application. Promptly after receipt of the advice, the savings bank shall prominently post the notice in each of its offices and publish the notice in a newspaper printed in the English language and having general circulation in each community in which an office of the savings bank is located, as follows.Attached Graphic (e) Promptly after publication of the notice or notices prescribed in subsection (d) of this section, the savings bank shall file one copy of the notice together with an affidavit of publication from each publisher with the commissioner.
(f) Following approval of the application for conversion by the commissioner, the plan of conversion shall be submitted to the members at an annual or special meeting and the plan shall be approved, in person or by proxy, by at least a majority of the total outstanding votes of the members of the savings bank. (g) No offer to sell securities of a savings bank pursuant to a plan of conversion may be made prior to commissioner's approval of the: (1) application for conversion; (2) proxy statement; and (3) offering circular. (h) Within 45 days: (1) of the date of the mailing of the subscription form, the subscription rights must be exercised; (2) after the last day of the subscription period, the sale of all shares of capital stock of the converting savings bank to be made under the plan of conversion, including any sale in a
public offering or direct community marketing, shall be completed. (i) The converting savings bank shall pay interest at not less than the passbook rate on all amounts paid in cash or by check or money order to the savings bank to purchase shares of capital stock in the subscription offering or direct community offering from the date payment is received by the savings bank until the conversion is completed or terminated. (j) For the purpose of this rule, the public offering and a direct community offering shall be deemed to commence upon the declaration of effectiveness by the commissioner of the final offering circular. (k) The commissioner may grant a written waiver from any requirement for this rule. (l) For the purposes of this rule: (1) the term "control" means the possession, directly or indirectly, of the power to direct or cause direction of the management and polices of a person,
whether through the ownership of voting securities, by contract, or otherwise; (2) the term "person" includes an individual, a group acting in concert, a corporation, a partnership, a savings bank, a trust, any unincorporated organization, or a government or political subdivision thereof.
Source Note: The provisions of this §75.91 adopted to be effective September 23, 1993, 18 TexReg 6094.