SUBCHAPTER 16G ‑ MUTUAL TO STOCK CONVERSIONS
SECTION .0100 ‑ SCOPE
04 NCAC 16G .0101 GENERAL
04 NCAC 16G .0102 PROVISIONS OF PRESCRIBED FORMS
History Note: Authority G.S. 54B‑33;
Eff. January 1, 1980;
Transferred From 4 NCAC 9I Eff. August 31, 1981;
Amended Eff. September 1, 1983;
Repealed Eff. January 1, 1986.
04 NCAC 16G .0103 DEFINITIONS
As used in this Subchapter and in the forms prescribed under
this Subchapter, the words and phrases defined by G.S. 54C‑4 and the
following definitions apply, unless the context otherwise requires:
(1) "Affiliate," "an affiliate of,"
or "a person affiliated with" used in connection with another
specified person shall mean a person that directly, or indirectly through one
or more intermediaries, controls or is under common control with, the person
specified.
(2) "Amount," when used in regard to
securities, shall mean the principal amount if relating to evidences of
indebtedness, the number of shares if relating to shares of stock, and the
number of units if relating to any other kind of security.
(3) "Applicant" shall mean a savings bank
which has applied to convert to stock ownership pursuant to this Subchapter.
(4) "Broker" shall mean any person engaged in
the business of effecting transactions in securities for the account of others.
(5) "Capital stock" shall mean common stock,
permanent stock, guaranty stock, permanent reserve stock, or any similar
certificate evidencing nonwithdrawable capital.
(6) "Dealer" shall mean any person who
engages either for all or part of his time, directly or indirectly, as agent,
broker, or principal, in the business of offering, buying, selling, or
otherwise dealing or trading in securities issued by another person.
(7) "Deposit account" shall mean that part of
the liability of the savings bank which is credited to the account of the
holder thereof, including certificates of deposit.
(8) "Eligibility record date" shall mean the
record date for determining eligible account holders of a converting savings
bank.
(9) "Eligible account holder" shall mean any
person holding a qualifying deposit as determined in accordance with Rule .0313
of this Subchapter.
(10) "Employee" shall not mean a director or
executive officer of a savings bank.
(11) "Equity security" shall mean any stock or
similar security, or any security convertible, with or without considerations,
into such security, or carrying any warrant or right to subscribe to or
purchase such security, or any such warrant or right.
(12) "Executive Officer" shall mean any person
performing a policy making function with respect to any organization whether
incorporated or unincorporated.
(13) "Investment representative" shall mean a
professional investment advisor acting as agent for the purchaser and
independent of the seller and not acting on behalf of the seller in connection
with the transaction.
(14) "Market maker" shall mean a dealer who,
with respect to a particular security:
(a) regularly publishes a bona fide, competitive
bid and offer quotations in a recognized inter‑dealer quotation system;
or furnishes bona fide competitive bid and offer quotations on request; and
(b) is ready, willing and able to effect
transactions in reasonable quantities at his quoted prices with other brokers
or dealers.
(15) "Material," when used to qualify a
requirement for the furnishing of information as to any subject, limits the
information required to those matters as to which an average prudent investor
ought reasonably to be informed before purchasing an equity security of the
applicant, or matters as to which an average prudent savings bank member ought
reasonably to be informed in voting upon the plan of conversion of the
applicant.
(16) "Negotiated transactions" shall mean
transactions in which the securities are offered and the terms and arrangements
relating to any sale of the securities are arrived at through direct
communications between the seller or any person acting in its behalf, and the
purchaser or his investment representative.
(17) "Offer," "offer to sell," or
"offer of sale" shall mean every attempt or offer to dispose of, or
solicitation of an offer to buy, a security or interest in a security, for
value. These terms shall not include preliminary negotiations or agreements
between an applicant and any underwriter or among underwriters who are or will
be in privity of contract with an applicant.
(18) "Person" includes an individual and entity
as defined in G.S. 55‑1‑40.
(19) "Proxy" shall mean every form of
authorization by which a person is, or may be deemed to be, designated to act
for a savings bank member in the exercise of his voting rights in the affairs
of a savings bank. Such an authorization may take the form of failure to
dissent or object.
(20) "Purchase" and "buy" shall mean
every contract to purchase, buy, or otherwise acquire a security or interest in
a security for value.
(21) "Sale" and "sell" shall mean
every contract to sell or otherwise dispose of a security or interest in a
security for value.
(22) "Security" shall mean any note, stock,
treasury stock, bond, debenture, transferable share, investment contract,
voting‑trust certificate, or in general, any instrument commonly known as
a "security". It shall also include any certificate of interest or
participation in, temporary or interim certificate for, receipt for, or warrant
or right to subscribe to or purchase, any of the forgoing.
(23) "Solicitation" and "solicit"
shall mean:
(a) any request for a proxy whether or not
accompanied by or included in a form of proxy;
(b) any request to execute, not execute, or
revoke a proxy; or
(c) the furnishing of a form of proxy or other communication
to savings bank members under circumstances reasonably calculated to result in
the procurement, withholding, or revocation of a proxy. The terms do not
apply, however, to the furnishing of a form of proxy to a savings bank member
upon the unsolicited request of the member, the performance of acts required by
Rule .0514 of this Subchapter, or to the performance by any person of
ministerial acts on behalf of a person soliciting a proxy.
(24) "Subscription offering" shall mean the
offering of shares of capital stock, through nontransferable subscription
rights issued to:
(a) eligible account holders as required by Rule
.0311(2) of this Subchapter;
(b) supplemental eligible account holders as
required by Rule .0311(4) of this Subchapter;
(c) members entitled to vote at the meeting
called to consider the conversion as required by Rule .0311(5) of this
Subchapter;
(d) directors, executive officers, and
employees, as permitted by Rule .0312(2) of this Subchapter; and
(e) eligible account holders, supplemental
eligible account holders, and voting members as permitted by Rule .0312(3) of
this Subchapter.
(25) "Subsidiary" of a specified person shall
mean a person controlled, directly or indirectly, through one or more
intermediaries by the specified person.
(26) "Supplemental eligible account holder"
shall mean any person holding a qualifying deposit, except executive officers,
directors, and their associates, as of the supplemental eligibility record date
required by Rule .0311 of this Subchapter.
(27) "Underwriter" shall mean any person who
has purchased from an applicant with a view to, or offers or sells for an
applicant in connection with, the distribution of any security; or participates
or has a direct or indirect participation in the direct or indirect
underwriting of any such undertaking. Such term shall not include a person
whose interest is limited to a commission from an underwriter or dealer not in
excess of the usual and customary distributors' or sellers' commission. The
term "principal underwriter" shall mean an underwriter in privity of
contract with the applicant or other issuer of securities as to which he is the
underwriter.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0104 GENERAL REQUIREMENTS
(a) No application for conversion shall be approved by the
administrator unless:
(1) The conversion will be conducted as
provided by law and this Subchapter and pursuant to a plan of conversion
approved by the administrator.
(2) The conversion will not result in a taxable
reorganization under the Internal Revenue Code.
(b) The corporate existence of a mutual savings bank
converting to stock ownership shall not terminate. The converted savings bank
shall be deemed to be a continuation of the savings bank so converted.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0105 APPLICATION FOR CONVERSION
An applicant that desires to convert in accordance with this
Subchapter shall file a copy of an Application To Convert A Mutual Savings Bank
Into A Stock Owned Savings Bank. This form can be obtained from the Division
at its mailing address.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0106 CONFIDENTIAL INFORMATION
Should the applicant desire to submit any information it
deems to be of a confidential nature regarding the answer to any item or a part
of any exhibit included in the Application for Conversion, such information
pertaining to such item or exhibit shall be separately bound and labeled
"confidential," and a statement shall be submitted therewith briefly
setting forth the grounds on which such information should be treated as
confidential under G.S. 54C‑60. Only general reference thereto need be
made in that portion of the application which the applicant deems not to be
confidential. Applications under this Subchapter shall be made available for
inspection by the public, except for portions which are bound and labeled
"confidential" and which the administrator determine to be of a
confidential nature under G.S. 54C‑60. The administrator will withhold
the public availability of preliminary copies of proxy soliciting materials
without the necessity of their being bound and labeled as
"confidential". The applicant will be advised of any decision by the
administrator to make public information designated as "confidential"
by the applicant. Even though sections of the application are considered "confidential"
as far as public inspection thereof is concerned, the administrator, to the
extent permitted by G.S. 54C‑60, may comment on such confidential
submissions in any public statement in connection with any decision on the
application without prior notice to the applicant.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. January 15, 1992.
SECTION .0200 ‑ DEFINITIONS
04 NCAC 16G .0201 DEFINITIONS
04 NCAC 16G .0202 OTHER TERMS
History Note: Authority G.S. 54B‑33;
Eff. January 1, 1980;
Transferred With Change From 4 NCAC 9I Eff. August 31,
1981;
Amended Eff. September 1, 1983; October 1, 1982;
Repealed Eff. January 1, 1986.
SECTION .0300 ‑ GENERAL PRINCIPLES FOR CONVERSIONS
04 NCAC 16G .0301 GENERAL REQUIREMENTS
04 NCAC 16G .0302 REQUIRED PROVISIONS IN PLAN OF
CONVERSION
04 NCAC 16G .0303 OPTIONAL PROVISIONS IN PLAN OF
CONVERSION
04 NCAC 16G .0304 AMOUNT OF DEPOSIT: PREDECESSOR AND
SUCCESSOR ACCOUNTS
04 NCAC 16G .0305 LIQUIDATION ACCOUNT
04 NCAC 16G .0306 RESTRICTIONS: REPURCHASE OF STOCK:
PAYMENT OF DIVIDENDS
04 NCAC 16G .0307 MANIPULATIVE AND DECEPTIVE DEVICES
History Note: Authority G.S. 54B‑33;
Eff. January 1, 1980;
Transferred With Change From 4 NCAC 9I Eff. August 31,
1981;
Amended Eff. September 1, 1983; February 1, 1983; October
1, 1982; July 1, 1982;
Repealed Eff. January 1, 1986.
04 NCAC 16G .0308 ACQUISITION OF CONVERTED ASSOCIATION
History Note: Authority G.S. 54‑24; 54‑24.1;
54‑33.2; 54A‑13; 150A‑12;
Eff. January 1, 1980;
Transferred From 4 NCAC 9I Eff. August 31, 1981;
Repealed Eff. October 1, 1982.
04 NCAC 16G .0309 MERGER OF CONVERTED ASSOCIATIONS
History Note: Authority G.S. 54B‑33;
Eff. December 15, 1980;
Amended Eff. January 14, 1981;
Transferred From 4 NCAC 9I Eff. August 31, 1981;
Amended Eff. September 1, 1983;
Repealed Eff. January 1, 1986.
04 NCAC 16G .0310 ACQUISITION/SECURITIES:
CONVERTING/CONVERTED ASSOCIATION
History Note: Authority G.S. 54B‑33;
Eff. October 1, 1982;
Repealed Eff. September 1, 1983.
04 NCAC 16G .0311 REQUIRED PROVISIONS IN PLAN OF
CONVERSION
The plan of conversion shall:
(1) Provide that the converting savings bank shall
issue and sell its capital stock at a total price equal to the estimated pro
forma market value of such stock in the converted savings bank, based on an
independent valuation, as provided in Rule .0717 of this Subchapter.
(2) Provide that each eligible account holder shall
receive without payment, nontransferable subscription rights to purchase
capital stock. Subscription rights shall be allocated among the eligible
account holders on an equitable basis in an amount not greater than the maximum
purchase limitation established for the public offering or the direct community
offering. The plan of conversion shall provide a comprehensive description of
this allocation including a detailed description of the allocation in the event
of an oversubscription of the capital stock. In the event of an
oversubscription, shares shall be allocated on an equitable basis that is related
to the amount of the subscriber's qualifying deposits.
(3) Provide that nontransferable subscription rights to
purchase capital stock received by executive officers and directors of the
applicant and their associates based on their increased deposits in the
applicant savings bank in the one‑year period preceding the eligibility
record date shall be subordinated to all other subscriptions involving the
exercise of nontransferable subscription rights to purchase shares pursuant to
Paragraph (2) of this Rule.
(4) Provide that, in plans involving an eligibility
record date that is more than 15 months prior to the date of the latest
amendment to the application for conversion filed prior to the administrator's
approval, a supplemental eligibility record date shall be determined whereby
each supplemental eligible account holder of the applicant shall receive
without payment, nontransferable subscription rights to purchase capital stock
in an amount related to his/her respective qualifying deposits.
(a) Subscription rights received pursuant to
Paragraph (4) of this Rule shall be subordinated to all rights received by
eligible account holders to purchase shares pursuant to Paragraphs (2) and (3)
of this Rule.
(b) Any nontransferable subscription rights to
purchase shares received by an eligible account holder in accordance with
Paragraph (2) of this Rule shall be applied in partial satisfaction of the
subscription rights to be distributed pursuant to this Paragraph.
(c) In the event of an oversubscription for supplemental
shares pursuant to this Paragraph, shares shall be allocated among the
subscribing supplemental eligible account holders on such equitable basis,
related to the amounts of their respective qualifying deposits, as may be
provided in the plan of conversion.
(5) Provide that voting members who are not either
eligible account holders or supplemental eligible account holders shall
receive, without payment, nontransferable subscription rights to purchase
capital stock on an equitable basis defined in the plan of conversion.
Subscription rights received pursuant to this Paragraph shall be subordinated
to all rights received by eligible account holders and supplemental eligible
account holders to purchase shares pursuant to Paragraphs (2), (3), and (4) of
this Rule. In the event of an oversubscription of capital stock pursuant to
this Paragraph, shares shall be allocated among the subscribing voting members
on such equitable basis as may be provided in detail in the plan of conversion.
(6) Provide that any shares of the applicant not sold
to persons with subscription rights shall either be sold in a public offering
through an underwriter or directly by the applicant in a direct community
offering, subject to the applicant demonstrating to the administrator the
feasibility of the method of sale and to such conditions as may be provided in
the plan of conversion. Such conditions shall include, but not be limited to:
(a) A condition limiting purchases in the public
offering or the direct community offering by any person together with any
associate or group of persons acting in concert to a percentage of the total
offering of shares not exceeding five percent; except that any one or more tax‑qualified
employee stock benefit plans of the applicant may purchase in the aggregate not
more than ten percent of the total offering of shares and shall be entitled to
purchase such amount regardless of the number of shares to be purchased by
other parties, and that shares held by one or more tax‑qualified employee
stock benefit plans and attributed to a person shall not be aggregated with
other shares purchased directly by or otherwise attributable to that person.
(b) A condition requiring that orders for stock
in any public offering or direct community offering shall first be filled up to
a maximum of two percent of the conversion stock per order and thereafter
remaining shares shall be allocated on an equal number of shares basis per
order until all orders have been filled.
(c) A condition requiring the stock to be
offered and sold in the public offering or the direct community offering to be
offered and sold in a manner that will achieve the widest distribution of the
stock.
(d) A condition that any direct community
offering by the applicant shall give a preference to natural persons residing
in the counties in which the applicant has an office.
(7) Provide that the number of shares which any person
together with any associate or group of persons acting in concert may subscribe
or purchase in the conversion shall not exceed five percent of the total
offering of shares; except that any one or more tax‑qualified employee
stock benefit plans of the applicant may purchase in the aggregate not more
than 10 percent of the total offering of shares. Shares held by one or more
tax‑qualified or non‑tax‑qualified employee stock benefit
plans and attributed to a person shall not be aggregated with shares purchased
directly by or otherwise attributable to that person. For purpose of this
Paragraph, the members of the converting savings bank's board of directors
shall not be deemed to be associates or a group of persons acting in concert
solely as a result of their board membership.
(8) Provide that for a period of three years following
the conversion no executive officer or director or any associate of an
executive officer or director shall purchase without the prior written approval
of the administrator the capital stock of the converted savings bank except
from a broker or dealer registered with the Secretary of State of North Carolina
and/or the Securities and Exchange Commission. This provision shall not apply
to negotiated transactions involving more than one percent of the outstanding
capital stock of the converted savings bank or to purchases of stock made by
and held by any one or more tax qualified or non‑tax‑qualified
employee stock benefit plans of the applicant which may be attributable to
executive officers or directors.
(9) Provide that the sales price of the shares of
capital stock to be sold in the conversion shall be a uniform price determined
in accordance with Rule .0714 of this Subchapter and specify the underwriting
and other marketing arrangements to be made to assure the sale of any shares
not sold in the subscription offering.
(10) Provide that each deposit account holder of the
converting savings bank shall receive, without payment, a deposit account or
accounts in the converted savings bank equal in amount to the value of such
account holder's deposit account or accounts in the converting savings bank.
(11) Provide for the establishment and maintenance of a
liquidation account for the benefit of eligible account holders and
supplemental eligible account holders in the event of a subsequent complete
liquidation of the converted savings bank, in accordance with the provisions of
Rule .0314 of this Section.
(12) Provide for an eligibility record date which shall
be not less than 90 days prior to the date of adoption of the plan by the
converting savings bank's board of directors.
(13) Provide that the holders of the capital stock of the
converted savings bank shall have exclusive voting rights.
(14) Provide that the plan of conversion adopted by the
applicant's board of directors may be substantively amended by such board of
directors prior to the solicitation of proxies from members to vote on the plan
and at any time thereafter with the concurrence of the administrator; and that
the conversion may be terminated by the board of directors at any time prior to
the meeting of members called to consider the plan of conversion and at any
time thereafter with the concurrence of the administrator.
(15) Establish a time period within which the conversion
must be completed prior to termination. This time period shall be not more
than 12 months from the date the members approve the plan of conversion. This
time period may be extended an additional 12 months by a plan amendment.
(16) Provide that all shares of capital stock purchased
by directors and executive officers on original issue in the conversion either
directly from the applicant (by subscription or otherwise) or from an
underwriter of such shares, shall be subject to the restriction that such
shares shall not be sold for a period of not less than one year following the
date of purchase, except in the event of death of the director or executive
officer. The administrator may grant permission for the transfer of restricted
stock upon a determination that the restriction imposes a substantial personal
financial hardship on such individual due to changed unforeseeable circumstances
outside the control of such individual.
(17) Provide that, in connection with shares of capital
stock subject to restriction on sale under Paragraph (16) of this Rule:
(a) Each certificate for such stock shall bear a
legend giving appropriate notice of the applicable restrictions;
(b) Appropriate instructions shall be issued to
the transfer agent for the converted savings bank's capital stock with respect
to applicable restrictions on transfer of any restricted stock; and
(c) Any shares issued as a stock dividend, stock
split or otherwise with respect to any restricted stock shall be subject to the
same restrictions as may apply to the restricted stock.
(18) Provide that the converting savings bank shall:
(a) use its best efforts to encourage and assist
a market maker to establish and maintain a market for the securities issued in
connection with the conversion; and
(b) use its best efforts to list those shares
issued in connection with the conversion on a national or regional securities
exchange or on the NASDAQ system.
(19) Provide that the expenses incurred in the conversion
shall be reasonable.
(20) Contain no provision which the administrator may
determine to be inequitable or detrimental to the applicant, its account
holders or other savings banks or to be contrary to the public interest.
(21) Contain no provision which the administrator finds
will harm the community and public served by the savings bank.
(22) Provide that the converting savings bank shall not
loan funds or otherwise extend credit on an unsecured basis or upon the
security of the savings bank's capital stock to any person to purchase the
capital stock of the converting savings bank.
(23) Provide that the savings bank may make scheduled
discretionary contributions to a tax‑qualified employee stock benefit
plan provided such contributions do not cause the savings bank to fail to meet
its net worth requirements.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992;
Amended Eff. May 3, 1993.
04 NCAC 16G .0312 OPTIONAL PROVISION IN PLAN OF
CONVERSION
The plan of conversion may provide any or all of the
following:
(1) That the applicant may commence the direct
community offering or the public offering, or both, concurrently with or at any
time during the subscription offering. The subscription offering may be
commenced concurrently with or at any time after the mailing to members
pursuant to Rule .0607 of this Subchapter of the proxy statement authorized for
use by the administrator. The subscription offering may be closed before the
meeting of the members held to vote on the plan of conversion, provided that
the offer and sale of capital stock shall be conditioned upon the approval of
the plan of conversion by the members as provided in Section .0600 of this
Subchapter.
(2) That directors, executive officers, and employees
of the converting savings bank shall receive, without payment, nontransferable
subscription rights to purchase shares of capital stock, to the extent that
shares are available after satisfying the subscriptions of eligible account
holders, supplemental eligible account holders, and voting members provided for
under Paragraphs (2), (4) and (5) of Rule .0311 of this Section. The shares
shall be allocated among directors, officers, and employees on an equitable
basis such as by giving weight to length of service, compensation, and
position, subject to the limitation in Paragraph (7) of Rule .0311 of this
Section on the amount of shares which may be purchased by any person, associate
thereof, or group of affiliated persons or group of persons otherwise acting in
concert.
(3) That any account holder receiving rights to
purchase stock in the subscription offering shall also receive, without
payment, nontransferable subscription rights to purchase up to one percent of
the total offering of shares of capital stock, to the extent that such shares
are available after satisfying the subscriptions provided for under Paragraphs
(2), (4), and (5) of Rule .0311 of this Section, subject to such conditions as
may be provided in the plan of conversion. In the event of an oversubscription
for such additional shares, the shares available shall be allocated among the
subscribing eligible account holders, supplemental eligible account holders,
and voting members on such equitable basis, related to the amounts of their
respective subscriptions, as may be provided in the plan of conversion.
(4) That the applicant may require members to return by
a reasonable date certain a postage‑paid written communication provided
by the applicant requesting receipt of a subscription offering circular, or a
preliminary or final offering circular in an offering pursuant to Paragraph
(10) of this Rule, in order to be entitled to receive an offering circular from
the applicant; provided, that the subscription offering or the offering
pursuant to Paragraph (10) of this Rule shall not be closed until 30 days after
the mailing by the applicant to members of the postage‑paid written
communication. If the subscription offering or the offering pursuant to
Paragraph (10) of this Rule is not commenced within 45 days after the meeting
of members, any converting savings bank adopting this optional provision shall
transmit not more than 30 days prior to the commencement of the subscription
offering or the offering pursuant to Paragraph (10) of this Rule to each member
who had been furnished with proxy solicitation materials, written notice of the
commencement of the offering which notice shall state that the converting
savings bank is not required to furnish an offering circular to a member unless
the member returns by a reasonable date certain the postage‑paid written
communication provided by the converting savings bank requesting receipt of an
offering circular.
(5) That the applicant may require eligible account
holders and supplemental eligible account holders who are not voting members
pursuant to Rule .0608 of this Subchapter to return by a reasonable date
certain a postage‑paid written communication in accordance with the
procedure established in Paragraph (4) of this Rule.
(6) That any insignificant residue of shares of the
converting savings bank not sold in the subscription offering or in a public
offering or direct community offering may be sold in such other manner as provided
in the plan of conversion with the written consent of the administrator.
(7) That the number of shares which any person or group
of persons affiliated with each other or otherwise acting in concert may
subscribe for in the subscription offering may be made subject to a limit of
not less than one percent of the total offering of the shares.
(8) That any person exercising subscription rights to
purchase capital stock shall be required to purchase a minimum number of shares
but the aggregate price for any minimum share purchase shall not exceed five
hundred dollars ($500.00).
(9) That the converted savings bank shall issue and
sell, in lieu of shares of its capital stock, units of securities consisting of
capital stock and long‑term warrants or other equity securities, in which
event any reference in the provisions of this Subchapter to capital stock shall
apply to such units of equity securities unless the context otherwise requires.
(10) That, instead of a separate subscription offering,
all subscription rights issued in connection with the conversion shall be
exercisable by delivery of properly completed and executed order forms to the
underwriters or selling group for the public offering or pursuant to any other
procedure, subject to the applicant demonstrating to the administrator the
feasibility of the method of exercising such right and to such conditions as
shall be provided in the plan of conversion.
(11) That the administrator may approve such other
equitable provisions as necessary to avert imminent injury to the converting
savings bank.
(12) That the proxy statement required by Rule .0607 of
this Subchapter may be in summary form, provided:
(a) A statement is made in bold‑faced type
on the summary proxy statement that a more detailed description of the proposed
transaction may be obtained by returning an attached postage‑paid
postcard or other written communication requesting a supplemental information
statement which, together with the summary proxy statement, complies with the
requirements of Form PS contained in the Application for Conversion.
(b) The date on which the summary proxy
statement is mailed to members will be deemed the date on which notice is given
for purposes of Rule .0607 of this Subchapter. Without the prior written
consent of the administrator, the meeting of members shall not be held less
than 20 days after the date on which the supplemental information statement is
mailed to requesting members.
(c) The supplemental information statement
required to be furnished to members pursuant to Subparagraph (a) of this
Paragraph may be combined with Form OC, if the subscription offering is
commenced concurrently with or during the proxy solicitation period pursuant to
Paragraph (1) of this Rule.
(d) The form of the summary proxy statement has
been approved by the administrator.
(13) That, in the event that the converting institution
is establishing a tax‑qualified employee stock ownership plan (ESOP) for
the benefit of its employees, then notwithstanding the priorities established
under Subparagraphs (2), (4), and (5) of Rule .0311 of this Section, the plan
of conversion may provide that such ESOP may purchase up to 10 percent of the
aggregate shares offered in the conversion prior to offering any shares to
eligible account holders, supplemental eligible account holders or other voting
members.
(14) That eligible accountholders shall be divided into
two subcategories for purposes of determining the aggregate number of shares of
conversion stock allocated to be purchased by such accountholders in each
subcategory: those whose permanent residence is within the market area of the
converting institution and those whose permanent residence is outside the
market area of the converting institution. The plan of conversion shall
provide:
(a) That each eligible accountholder who resides
within the applicant's market area shall receive nontransferable subscription
rights to purchase a number of shares based on such accountholder's qualifying
deposit balance up to the maximum purchase limitation established pursuant to
Rule .0311(7) of this Section; provided that the aggregate number of shares of
conversion stock to be allocated for purchase by eligible accountholders within
the converting institution's market area shall equal that number of shares
(rounded to the nearest whole number) determined by multiplying the total
number of shares of stock to be sold in the offering times a fraction the
numerator of which is the sum of qualifying deposits held by eligible
accountholders residing inside the market area and the denominator of which is
the sum of all qualifying deposits.
(b) That each eligible accountholder who resides
outside the applicant's market area shall receive nontransferable subscription
rights to purchase a number of shares based on such accountholder's qualifying
deposit balance up to the maximum purchase limitations established pursuant to
Rule .0311(7) of this Section; provided that the aggregate number of shares of
conversion stock to be allocated for purchase by eligible accountholders outside
the converting institution's market area shall equal that number of shares
(rounded to the nearest whole number) determined by multiplying the total
number of shares to be sold in the offering times a fraction the numerator of
which is the sum of qualifying deposits held by eligible accountholders
residing outside the converting institution's market area and the denominator
of which is the sum of all qualifying deposits.
(c) Within each subcategory, a formula to be
used in the event of an oversubscription for the equitable allocation of shares
of stock within such subcategory which relates to an eligible accountholder's
qualifying deposit balance.
(d) For the purposes of this Paragraph, a
converting institution shall define its "market area" to include each
county in which it has an office and may include such additional counties
contiguous to those counties in which it maintains an office (regardless of
whether such counties are in the State of North Carolina) as it may designate
to be part of its "market area" in its plan of conversion.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992;
Amended Eff. September 1, 1993; April 15, 1993.
04 NCAC 16G .0313 RECORD DATES FOR QUALIFYING DEPOSITS
Unless otherwise provided in the plan of conversion, for the
purposes of this Section, the amount of the qualifying deposit of an eligible
account holder or supplemental eligible account holder shall be the total of
the deposit balances in the eligible account holder's or supplemental eligible
account holder's deposit accounts in the converting savings bank as of the
close of business on the eligibility record date or supplemental eligibility
record date. However, the plan of conversion may provide that any deposit
accounts with total deposit balances of less than fifty dollars ($50.00) or any
lesser amount shall not constitute a qualifying deposit.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0314 LIQUIDATION ACCOUNT
(a) Each converted savings bank shall, at the time of
conversion, establish a liquidation account in an amount equal to the amount of
net worth of the converting savings bank as of the latest practicable date
prior to conversion. For the purpose of this Rule, the savings bank shall use
the net worth figure set forth in its latest statement of financial condition
contained in the final offering circular. The function of the liquidation
account is to establish a priority on liquidation and, except as provided in
Paragraph (f) of this Rule, the existence of the liquidation account shall not
operate to restrict the use or application of any of the net worth of the
converted savings bank.
(b) The liquidation account shall be maintained by the
converted savings bank for the benefit of eligible account holders and
supplemental eligible account holders who maintain their deposit accounts in
the savings bank. Each eligible account holder and supplemental eligible
account holder shall, with respect to each deposit account held, have a related
inchoate interest in a portion of the liquidation account balance
("subaccount").
(c) In the event of a complete liquidation of the converted
savings bank and only in such event, each eligible account holder and
supplemental eligible account holder shall be entitled to receive a liquidation
distribution from the liquidation account, in the amount of the then current
adjusted subaccount balances for deposit accounts then held, before any liquidation
distribution may be made with respect to capital stock, except with respect to
preferred stock issued in exchange for the surrender at the time of the
conversion of mutual capital certificates issued by the savings bank prior to
conversion. Preferred stock issued in exchange for mutual capital certificates
may receive distributions in liquidation prior to those with respect to the
liquidation account to the same extent that the holders of the mutual capital
certificates would have been entitled to priority over the residual rights of
depositors had the savings bank not been converted as of the date of
liquidation. No merger, consolidation, purchase of bulk assets with assumption
of deposit accounts and other liabilities, or similar transactions in which
the converted savings bank is not the surviving depository institution is
considered to be a complete liquidation for this purpose. In such transactions
the liquidation account shall be assumed by the surviving depository
institution.
(d) The initial subaccount balance for a deposit account
held by an eligible account holder or supplemental eligible account holder
shall be determined by multiplying the opening balance in the liquidation
account by a fraction of which the numerator is the greater of the amount of
qualifying deposits in such deposit account on the eligibility record date
and/or the supplemental eligibility record date and the denominator is the
total amount of qualifying deposits for all eligible account holders and
supplemental eligible account holders in the converted savings bank. Such
initial subaccount balance shall not be increased and shall be subject to
downward adjustment as provided in Paragraph (e) of this Rule.
(e) If the balance in any qualifying deposit account of an
eligible account holder or supplemental eligible account holder at the close of
business on any annual closing date subsequent to the date of conversion is
less than the lesser of the deposit balance in the savings account at the close
of business on any other annual closing date subsequent to the conversion date
or the amount of qualifying deposit as of the eligibility record date or the
supplemental eligibility record date, the subaccount balance for the savings
account shall be adjusted by reducing the subaccount balance in an amount
appropriate to the reduction in the deposit balance. In the event of a
downward adjustment, the subaccount balance shall not be subsequently
increased, notwithstanding any increase in the deposit balance of the related savings
account. The converted savings bank shall not be required to recompute the
liquidation account and subaccount balances provided the converted savings bank
maintains records sufficient to make necessary computations in the event of a
complete liquidation or such other events as may require a computation of the
balance of the liquidation account. The liquidation subaccount of an account
holder shall be maintained for as long as the account holder maintains an
account with the same Social Security number.
(f) No converted saving bank shall declare or pay a cash
dividend on, or repurchase any of, its capital stock if the effect thereof
would cause the net worth of the converted savings bank to be reduced below the
amount required for the liquidation account.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0315 MANIPULATIVE AND DECEPTIVE DEVICES
In the offer, sale, or purchase of securities issued
incident to its conversion, no savings bank, or any director, executive
officer, attorney, agent or employee thereof shall:
(1) employ any device, scheme, or artifice to defraud;
or
(2) obtain money or property by means of any untrue
statement of a material fact or any omission to state a material fact necessary
in order to make the statements made, in the light of the circumstances under
which they were made, not misleading; or
(3) engage in any act, transaction, practice, or course
of business which operates or would operate as a fraud or deceit upon a
purchaser or seller.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0316 MERGER OF CONVERTED SAVINGS BANKS
When a converted savings bank merges with an existing stock
savings institution the resulting savings institution will be treated as a
converted savings institution and must comply with the provisions of Rules
.0314 and .0315 of this Section and 4 NCAC 16A .0105.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
SECTION .0400 ‑ NOTICE OF FILING: PUBLIC STATEMENTS:
CONFIDENTIALITY
04 NCAC 16G .0401 INFORMATION PRIOR TO APPROVAL OF PLAN
OF CONVERSION
04 NCAC 16G .0402 NOTICE OF FILING
04 NCAC 16G .0403 CONFIDENTIAL INFORMATION
History Note: Authority G.S. 54B‑33;
Eff. January 1, 1980;
Transferred With Change From 4 NCAC 9I Eff. August 31,
1981;
Amended Eff. October 1, 1982;
Repealed Eff. January 1, 1986.
04 NCAC 16G .0404 INFORMATION PRIOR TO APPROVAL OF PLAN
OF CONVERSION
(a) A savings bank which is considering converting pursuant
to this Subchapter and its directors, executive officers, and employees shall
keep such consideration confidential and shall only discuss the potential
conversion as would be consistent with the need to prepare information for
filing an application for conversion. Should this confidence be breached the
administrator may require remedial measures including:
(1) a public statement by the savings bank that
its board of directors is currently considering converting pursuant to this
Subchapter;
(2) providing for an eligibility record date
which shall be as of such a date prior to the adoption of the plan by the
converting association's board of directors as to assure the equitability of
the conversion;
(3) limitation of the subscription rights of
any person violating or aiding the violation of this Section to an amount
deemed appropriate by the administrator; and
(4) any other action the administrator may deem
appropriate and necessary to assure the fairness and equitability of the
conversion.
(b) If it should become essential as a result of rumors
prior to the adoption of a plan of conversion by the applicant's board of
directors, a public statement limited to that purpose may be made by the
applicant.
(c) Promptly after the adoption of a plan of conversion by
not less than two‑thirds of its board of directors, the savings bank
shall:
(1) Notify its members of such action by
publishing a statement in a newspaper having general circulation in each
community in which an office of the savings bank is located or by mailing a
letter to each of its members; and
(2) Have copies of the adopted plan of
conversion available for inspection by its members at each office of the
savings bank. The savings bank may also issue a press release with respect to
such action. Copies of the statement, letter, and press release shall be filed
with the administrator as a part of the application for conversion.
(d) The statement, letter, and press release, unless
otherwise authorized by the administrator upon a showing that fairness or
accuracy requires additional disclosures, shall be limited to, but need not
contain all of, the following:
(1) a statement that at least two‑thirds
of the board of directors has adopted a proposed plan to convert the savings
bank from mutual to stock ownership;
(2) a statement that the proposed plan of
conversion must be approved by at least a majority of the votes eligible to be
cast either in person or by proxy by members at a meeting at which the plan
will be submitted for their approval;
(3) a statement that new proxies will be
solicited for voting on the proposed plan of conversion;
(4) a statement that a proxy statement setting
forth more detailed information with respect to the proposed plan of conversion
will be sent to members prior to the meeting of members;
(5) a statement that the proposed plan of
conversion is subject to approval by the administrator before such plan can
become effective and that members of the applicant will have an opportunity to
file written comments with the administrator, including any objections and
materials supporting such objections;
(6) a statement that the proposed plan of
conversion is contingent upon obtaining favorable tax rulings or opinions;
(7) a statement that there is no assurance that
the approval of the administrator will be obtained, and also no assurance that
favorable tax rulings or tax opinions will be received;
(8) the proposed record date for determining
the eligible account holders entitled to receive nontransferable subscription
rights to purchase capital stock of the applicant;
(9) a brief statement describing the
circumstances that would require supplemental eligible account holders to
receive nontransferable subscription rights to purchase capital stock of the
applicant;
(10) a brief statement as to the extent to which
voting members will participate in the conversion;
(11) a brief description of the proposed plan of
conversion;
(12) the approximate number of shares of capital
stock to be issued and sold under the proposed plan of conversion;
(13) a brief statement as to the extent to which
directors, officers, and employees will participate in the conversion;
(14) a statement that savings account holders
will continue to hold accounts in the converted savings bank identical as to
dollar amount, rate of return, and general terms, and that their accounts will
continue to be insured by the Federal Deposit Insurance Corporation;
(15) a statement that borrower's loans will be
unaffected by conversion, and that the amount, rate, maturity, security and
other conditions will remain contractually as they existed prior to conversion;
(16) a statement that the normal business of the
savings bank in accepting deposits and making loans will continue without
interruption; that the converted savings bank will continue after conversion to
conduct its present services to savings account holders and borrowers under
current policies to be carried on in existing offices and by the present
management and staff;
(17) a statement that the proposed plan of
conversion may be substantively amended by the board of directors as a result
of comments from the regulatory authorities or otherwise prior to the meeting,
and that the proposed plan may also be terminated by the board of directors;
and
(18) a statement that questions of members will
be answered in the proxy material to be sent after the regulatory approvals of
the proposed plan of conversion have been obtained and that any questions at
this time may be answered by telephoning or writing to the savings bank.
(e) Such statement, letter, and press release shall not in
any manner solicit proxies, include financial statements, or describe the
benefits of conversion or the value of the capital stock of the savings bank
upon conversion. In replying to inquiries, the savings bank shall limit its
answers to the matters listed in Paragraph (d) of this Rule.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0405 NOTICE OF FILING
(a) Upon determination that an application for conversion
is properly executed and is not materially incomplete, the administrator will
advise the applicant, in writing, to publish a notice of the filing of the application.
Promptly after receipt of such advice, the applicant shall prominently post the
notice in each of its offices and publish a notice of such filing in a
newspaper having general circulation in each community in which an office of
the applicant is located, as follows:
NOTICE OF FILING OF
AN APPLICATION FOR CONVERSION
TO A STOCK SAVINGS
BANK
Notice is hereby given that, pursuant to General Statute 54C‑33,
_________________________________________________________
(fill in name of
applicant)
has filed an application with the administrator of the
Savings Institutions Division for approval to convert to the stock form of
organization. Copies of the application have been delivered to the Savings
Institutions Division, 1110 Navaho Drive, Suite 301, Raleigh, North Carolina,
27609.
Written comments, including any objections to the plan of
conversion and materials supporting such objections, from any member of the
applicant or any aggrieved person will be considered by the administrator if
filed within 10 business days after the date of this notice. Failure to make
such written comments or objections may preclude the pursuit of any
administrative or judicial remedies. Any comments or objections shall be sent
to the administrator at the address noted above. The proposed plan of
conversion and any comments thereon will be available for inspection by any
member of the applicant at the office of the administrator. A copy of the plan
may also be inspected at each office of the applicant.
(b) If a significant number of the applicant's members only
speak a language other than English and a newspaper in that language is
published in the area served by the applicant, an appropriate translation of
the notice shall also be published in that newspaper.
(c) Promptly after publication of the notice prescribed in
Paragraph (a) of this Rule, the applicant shall file a copy of the notice with
the administrator. The applicant shall also file a copy of an affidavit of
publication from each newspaper publisher.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
SECTION .0500 ‑ SOLICITATION OF PROXIES: PROXY STATEMENT
04 NCAC 16G .0501 SOLICITATIONS TO WHICH RULES APPLY
04 NCAC 16G .0502 USE OF PROXY SOLICITING MATERIAL TO BE
AUTHORIZED
04 NCAC 16G .0503 INFORMATION TO BE FURNISHED
ASSOCIATION MEMBERS
04 NCAC 16G .0504 REQUIREMENTS AS TO PROXY
04 NCAC 16G .0505 MATERIAL REQUIRED TO BE FILED
04 NCAC 16G .0506 MAILING COMMUNICATIONS FOR
ASSOCIATIONS MEMBERS
04 NCAC 16G .0507 FALSE OR MISLEADING STATEMENTS
04 NCAC 16G .0508 PROHIBITION OF CERTAIN SOLICITATIONS
History Note: Authority G.S. 54B‑33;
Eff. January 1, 1980;
Transferred From With Change 4 NCAC 9I Eff. August 31,
1981;
Amended Eff. September 1, 1983;
Repealed Eff. January 1, 1986.
04 NCAC 16G .0509 SOLICITATIONS TO WHICH RULES APPLY
This Section applies to every solicitation of a proxy from a
member of a savings bank for the meeting at which a plan of conversion will be
voted upon, except the following:
(1) any solicitation made otherwise than on behalf of
the management of the savings bank where the total number of persons solicited
is not more than 50;
(2) any solicitation through the medium of a newspaper
advertisement which informs members, following approval of the plan of conversion,
of a source from which they may obtain copies of a proxy statement, form of
proxy, or any other solicitation material and does no more than:
(a) name the savings bank,
(b) state the reason for the advertisement,
(c) identify the proposal or proposals to be
acted upon by members, and
(d) urge members to vote at the meeting.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0510 USE OF PROXY SOLICITING MATERIAL TO BE
AUTHORIZED
No proxy solicitation material required to be filed with the
administrator prior to use shall be furnished to members or otherwise released
for distribution until the use of such material has been authorized in writing
by the administrator. Proxy material authorized for use by the administrator
shall be mailed to the members within 10 days of such authorization or within
10 days of the date such material is declared effective by the Securities and
Exchange Commission, if applicable, whichever is later. The administrator may
extend such date upon a showing that adherence to the 10 day rule would work a
hardship upon the savings institution and that the delay, if approved in
writing, would not be disadvantageous to any interested party.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992;
Amended Eff. April 15, 1993.
04 NCAC 16G .0511 INFORMATION TO BE FURNISHED MEMBERS
No solicitation shall be made unless each person solicited
is concurrently furnished, or has previously been furnished, a written proxy
statement the use of which has been authorized in writing by the administrator.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0512 REQUIREMENTS AS TO PROXY
(a) The form of proxy shall:
(1) indicate in bold face type whether the
proxy is solicited on behalf of management;
(2) provide specifically designated blank
spaces for dating and signing the proxy;
(3) identify clearly and impartially each
matter or group of related matters intended to be acted upon;
(4) be clearly labeled "Revocable
Proxy" in bold face type of at least 18 point;
(5) describe any charter or state law
requirement restricting or conditioning voting by proxy;
(6) contain an acknowledgement by the person
giving the proxy that the person has received a proxy statement prior to
signing the form of proxy;
(7) contain the date, time, and place of
meeting, if practicable;
(8) provide, by a box or otherwise, a means
whereby the person solicited is afforded an opportunity to specify by ballot a
choice between approval or disapproval of each matter intended to be acted
upon; and
(9) indicate in bold face type how the proxy
shall be voted on each such matter if no choice is specified.
(b) No proxy obtained pursuant to the conversion shall
confer authority to vote at any meeting other than the meeting, or any
adjournment thereof, to vote on the plan of conversion. A proxy may be deemed
to confer authority to vote with respect to matters incident to the conduct of
such meeting. If the plan of conversion is considered at an annual meeting,
existing proxies may be voted with respect to matters not related to the plan
of conversion or in accordance with Paragraph (d) of this Rule.
(c) The proxy statement or form of proxy shall provide that
the votes represented by the proxy will be voted. Where the person solicited
specifies by means of a ballot provided pursuant to Subsection (a)(8) of this
Rule a choice with respect to any matter to be acted upon, the votes will be
voted in accordance with the specifications. If no choice is specified, the
votes will be cast as indicated in bold face type on the form of proxy.
(d) Notwithstanding any other provisions of this Rule, the
proxy may be in a form previously obtained from a voting member and conferring
general authority to vote on any and all matters at any meeting of the members
or other authority to vote on matters to be presented at the special meeting;
provided, that such voting member has been furnished a proxy statement and the
voting member does not grant a later‑dated proxy to vote at the meeting
to consider the plan of conversion or attend the meeting and vote in person.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0513 MATERIAL REQUIRED TO BE FILED
(a) An applicant shall file a preliminary copy of the proxy
materials to be used by such applicant as a part of the application for
conversion filed with the administrator.
(b) A preliminary copy of any additional solicitation
material, including press releases and radio or television scripts, to be used
or furnished to members subsequent to furnishing the proxy statement, shall be
filed with the administrator at least five business days prior to the date on
which the administrator is requested to authorize the use of such material.
Speeches may, but need not, be filed with the administrator prior to use.
(c) A copy of the proxy statement and a copy of the form of
proxy and all other solicitation material, in the form in which such material
is furnished to members, shall be filed with or mailed for filing to the
administrator not later than the date such material is first sent or given to
members. All materials filed pursuant to this Paragraph shall be accompanied
by a statement of the date on which copies of such materials are to be released
to members.
(d) If the solicitation is to be made in whole or in part
by personal solicitation, a preliminary copy of all written instructions or
other material which discusses, reviews or comments upon the merits of any
matter to be acted upon and which is to be furnished to the individuals making
the actual solicitation for their use directly or indirectly in connection with
the solicitation shall be filed with the administrator at least five business
days prior to the date on which the administrator is requested to authorize the
use of such material.
(e) All preliminary copies of material filed pursuant to
Paragraphs (a), (b), and (d) of this Rule shall be clearly marked on the cover
page "Preliminary Copy." Such preliminary copies shall be for the
information of the administrator only and shall not be deemed available for
public inspection except that such material may be disclosed to any department
or agency of the United States, this State, or any other state, that has
concurrent jurisdiction over the applicant. The administrator may make such
inquiries or investigation in regard to the material as may be necessary for an
adequate review.
(f) Unless requested by the administrator, copies of
replies to inquiries from members and copies of communications which do no more
than request that forms of proxy theretofore solicited be signed and returned
need not be filed pursuant to this Rule.
(g) Where any proxy statement, form of proxy or other
material filed pursuant to this Rule is amended or revised, a copy of such
amended or revised material filed with the administrator shall be marked to
indicate clearly and precisely the changes effected subsequent to the previous
filing.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992;
Amended Eff. April 15, 1993.
04 NCAC 16G .0514 MAILING COMMUNICATIONS FOR MEMBERS
If the applicant has adopted a plan of conversion, the
applicant shall perform such of the following acts as may be duly requested in
writing with respect to a matter to be considered at the meeting to vote on the
plan of conversion by any member who will defray the reasonable expenses to be
incurred by the applicant in the performance of the act or acts requested:
(1) The applicant shall mail or otherwise furnish to
such member the following information as promptly as practicable after the
receipt of such request:
(a) a statement of the approximate number of
members who have been or are to be solicited on behalf of management, or any
group of members which the member shall designate;
(b) an estimate of the cost of mailing a
specified proxy statement, form of proxy, or other communication to such
members.
(2) Copies of any proxy statement, form of proxy, or
other communication furnished by the member and as approved by the
administrator shall be mailed by the applicant to such of the members specified
in Paragraph (1)(a) of this Rule as the member may designate.
(3) Any such material which is furnished by the member
shall be mailed with reasonable promptness by the applicant after receipt of
the material to be mailed, including envelopes or other containers, and the
appropriate postage or payment for postage.
(4) Neither management nor the applicant shall be
responsible for such proxy statement, form of proxy, or other communication.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0515 FALSE OR MISLEADING STATEMENTS
(a) No solicitation of a proxy by the applicant, its
management, or any other person for the meeting to vote on the plan of
conversion shall be made by means of any proxy statement, form of proxy, notice
of meeting, or other communication, written or oral, containing any statement
which, at the time and in the light of the circumstances under which it is
made, is false or misleading with respect to any material fact, or which omits
to state any material fact necessary in order to make the statements therein
not false or misleading or necessary to correct any statement in any earlier
communication with respect to the solicitation of a proxy for the meeting which
has become false or misleading.
(b) The fact that a proxy statement, form of proxy, or
other solicitation material has been filed with or examined by the
administrator and authorized for use shall not be deemed a finding by the
Administrator that such material is accurate or complete or not false or misleading,
or that the administrator has passed upon the merits of or approved any
proposal contained therein. No representation to the contrary shall be made by
any person.
(c) If a solicitation by management violates any provision
of this Rule, the administrator may require remedial measures including:
(1) correction of any such violation by means
of a retraction and new solicitation,
(2) rescheduling of the meeting for a vote on
the plan of conversion, and
(3) any other actions the administrator may deem
appropriate under the circumstances in order to ensure a fair vote.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0516 PROHIBITION OF CERTAIN SOLICITATIONS
No person soliciting a proxy from a member for the meeting
to vote on the plan of conversion shall solicit:
(1) any updated or post‑dated proxy; or
(2) any proxy which provides that it shall be deemed to
be dated as of any date subsequent to the date on which it is signed by the
members; or
(3) any proxy which is not revocable at will by the
member giving it; or
(4) any proxy which is part of any other document or
instrument, such as an account card.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
SECTION .0600 ‑ VOTE BY MEMBERS
04 NCAC 16G .0601 VOTE AT SPECIAL MEETING
04 NCAC 16G .0602 DETERMINING MEMBERS ELIGIBLE TO VOTE
04 NCAC 16G .0603 NOTICE TO MEMBERS
04 NCAC 16G .0604 REQUIRED VOTE
History Note: Authority G.S. 54B‑33;
Eff. January 1, 1980;
Transferred From 4 NCAC 9I Eff. August 31, 1981;
Amended Eff. September 1, 1983;
Repealed Eff. January 1, 1986.
04 NCAC 16G .0605 NOTICE TO ELIGIBLE AND SUPPLEMENTAL
ACCOUNT HOLDERS
History Note: Authority G.S. 54B‑33;
Eff. October 1, 1982;
Repealed Eff. January 1, 1986.
04 NCAC 16G .0606 VOTE AT MEMBERS MEETING
Following approval of the plan of conversion by the
administrator, the plan of conversion shall be submitted for consideration to
an annual or special meeting of members.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0607 NOTICE TO MEMBERS
Notice of the meeting to consider a plan of conversion shall
be given by means of the proxy statement authorized for use by the
administrator.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0608 ELECTIVE NOTICE TO NON‑VOTING
ACCOUNT HOLDERS
The applicant may give notice in accordance with this
Subchapter of the proposed conversion and the meeting of the members by letter
or other written communication authorized for use by the administrator to
eligible account holders and supplemental account holders who are not voting
members.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
SECTION .0700 ‑ PRICING AND SALE OF SECURITIES
04 NCAC 16G .0701 GENERAL
04 NCAC 16G .0702 DISTRIBUTION OF OFFERING MATERIALS
04 NCAC 16G .0703 ESTIMATED PRICE INFORMATION: PROXY
STATEMENTS
04 NCAC 16G .0704 PROHIBITED REPRESENTATIONS
04 NCAC 16G .0705 UNDERWRITING EXPENSES
04 NCAC 16G .0706 PRICING MATERIALS
04 NCAC 16G .0707 ORDER FORMS FOR PURCHASE OF CAPITAL
STOCK
04 NCAC 16G .0708 WITHDRAWAL FROM CERTIFICATE ACCOUNTS
04 NCAC 16G .0709 PERIOD FOR COMPLETION OF SALE
History Note: Authority G.S. 54B‑33;
Eff. January 1, 1980;
Transferred With Change From 4 NCAC 9I Eff. August 31,
1981;
Amended Eff. September 1, 1983; October 1, 1982;
Repealed Eff. January 1, 1986.
04 NCAC 16G .0710 INTEREST/SUBSCRIPTION/COMMUNITY
PURCHASE ORDERS
04 NCAC 16G .0711 EXTENSIONS OF TIME TO COMPLETE
OFFERINGS
History Note: Authority G.S. 54B‑33;
Eff. October 1, 1982;
Amended Eff. September 1, 1983;
Repealed Eff. January 1, 1986.
04 NCAC 16G .0712 GENERAL
(a) No offer to sell securities of an applicant pursuant to
a plan of conversion may be made prior to approval by the administrator of the
plan of conversion and until the proxy statement has been authorized for use by
the administrator. No sale of securities may be made except by means of a
final offering circular which meets the requirements of this Section and which
has been declared effective by the administrator. The provisions of this Rule
shall not apply to preliminary negotiations or agreements between an applicant
and any underwriter or among underwriters who are to be in privity of contract
with the applicant.
(b) If the financial statements in a filing are in excess
of 135 days prior to the date of the administrator's approval of the plan of
conversion, an interim financial statement as of a date within 135 days of such
approval shall be furnished. This interim financial statement shall be at
least as current as the most recent quarterly financial statement filed with
the administrator. This interim financial statement may be unaudited.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0713 DISTRIBUTION OF OFFERING MATERIALS
Any preliminary offering circular which has been filed with
the administrator may be distributed in connection with the offering at the
same time as or after the proxy statement is mailed to members pursuant to Rule
.0607 of this Subchapter. No final offering circular shall be distributed
until it has been declared effective by the administrator. The declaration of
the effectiveness of the final offering circular by the administrator shall not
extend beyond the maximum time period specified for the completion of the sale
of all the capital stock in Rule .0720 of this Section, or beyond such period
of time the administrator shall establish upon a subsequent declaration of
effectiveness in the event of the granting of an extension of time under Rule
.0722 of this Section.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0714 ESTIMATED PRICE INFORMATION: PROXY
STATEMENTS
If the offering is to commence prior to the meeting of the
members held to vote on the plan of conversion, the proxy statement authorized
for use by the administrator shall set forth the estimated price range. Any
preliminary offering circular shall set forth the estimated price range. The
maximum of such price range shall be not more than fifty dollars ($50.00) per
share or 15 percent above the average of the minimum and maximum of such price
range and the minimum shall be no less than five dollars ($5.00) per share or
no more than 15 percent below such average. The administrator may approve a
price range outside these maximums and minimums upon a showing that such price
range enhances or does not discourage a broad dispersion of ownership and is
not manipulative of the conversion process.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0715 PROHIBITED REPRESENTATIONS
The administrator will review the price information required
under this Section in determining whether to give approval to the plan of
conversion when the offering is to commence prior to the meeting of the members,
and the administrator will review the information in determining whether to
declare a final offering circular effective. No representations may be made in
any manner that the price information has been approved by the administrator or
that the shares of capital stock sold pursuant to the plan of conversion have
been approved or disapproved by the administrator or that the administrator has
passed upon the accuracy or adequacy of any offering circular covering such
shares.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0716 UNDERWRITING EXPENSES
Underwriting commissions shall not exceed an amount or
percentage per share accepted as reasonable by the administrator. The term
"underwriting commissions" includes underwriting discounts.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0717 PRICING MATERIALS
(a) In considering the pricing information required under
Rule .0714 of this Section, the administrator will apply the following
guidelines:
(1) The materials shall be prepared by persons
independent of the applicant who are experienced and expert in the area of
corporate appraisal.
(2) The materials shall contain a brief summary
of data that is sufficient to support the conclusions reached therein.
(3) To the extent that the appraisal is based
on the capitalization of the pro forma income of the converted savings bank,
the materials must indicate the basis for determination of the income to be
derived from the proceeds of the sale of stock and demonstrate the
appropriateness of the earnings multiple used, including assumptions made as to
future earnings growth. To the extent that the appraisal is based on a
comparison of the capital stock of the applicant with the outstanding capital
stock of existing stock savings banks, the existing stock savings banks must be
reasonably comparable to the applicant in terms of such factors as size, market
area, competitive conditions, profit history, and expected future earnings.
(b) In addition to the information required in Paragraph
(a) of this Rule, the applicant shall submit information demonstrating to the
satisfaction of the administrator the independence and expertise of any person
preparing materials under this Rule and the person must be acceptable in these
respects to the administrator. A person will not be considered as lacking
independence for the reason that such person will participate in effecting a
sale of capital stock under the plan of conversion or will receive a fee from
the applicant for services rendered in connection with such appraisal.
(c) In addition to the information required in Paragraphs
(a) and (b) of this Rule, the applicant shall file with the administrator such
additional information with respect to the pricing of the capital stock of the
applicant as the administrator may request, including, without limitation, a
full appraisal.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0718 ORDER FORMS FOR PURCHASE OF CAPITAL
STOCK
(a) Promptly after the administrator has declared effective
the offering circular for the subscription offering, the applicant shall
distribute order forms for the purchase of shares of capital stock in the
offering to all eligible account holders, supplemental eligible account holders
(if applicable), voting members and other persons who may subscribe for such
shares of capital stock under the plan of conversion. If the applicant has
adopted in its plan of conversion the optional provisions set forth in
Paragraphs (4), (5) or (10) of Rule .0312 of this Subchapter, the applicant
shall deliver order forms to the eligible account holders, supplemental
eligible account holders and voting members who requested receipt of the
offering circular.
(b) Each order form shall be accompanied or preceded by the
final offering circular for the subscription offering or the public offering,
as the case may be, and a set of detailed instructions explaining how to
properly complete the order forms. The offering circular and order form
instructions may be included in the same document.
(c) The maximum subscription price stated on each order
form shall be the amount to be paid when the order form is returned. The maximum
subscription price and the actual subscription price shall be within the
subscription price range stated in the administrator's approval and the
offering circular. If either the maximum subscription price or the actual
subscription price is not within such subscription price range, the applicant
must obtain the written consent of the administrator. If appropriate, the
administrator will condition the amended approval by requiring a resolicitation
of proxies or order forms or both. If the actual public offering price is less
than the maximum subscription price stated on the order form, the actual
subscription price shall be correspondingly reduced and the difference shall be
refunded to those who have paid the maximum subscription price, unless the
subscribers affirmatively elect to have the difference applied to the purchase
of additional shares of capital stock.
(d) Each order form shall be prepared so as to indicate to
the person receiving it, in as simple, clear, and intelligible a manner as possible,
the actions which are required or available to him with respect to the form and
the capital stock offered for purchase thereby. Specifically, each order form
shall:
(1) indicate the maximum number of shares which
may be purchased pursuant to the subscription offering;
(2) indicate the period of time within which
the subscription rights must be exercised, which period of time shall not be
less than 20 days and no more than 45 days following the date of the mailing of
the subscription offering order form;
(3) state the maximum subscription price per
share of capital stock;
(4) indicate any requirements as to the minimum
number of shares of capital stock which must be purchased;
(5) provide a specifically designated blank
space or spaces for indicating the number of shares of capital stock which the
eligible account holder or other person wishes to purchase;
(6) indicate the manner of required payment
and, if such payment may be made by withdrawal from a certificate of deposit,
indicate that such withdrawal may be made without penalty. If payment is to be
made by a withdrawal from a deposit account or certificate of deposit, a box to
check shall be provided;
(7) provide specifically designated blank
spaces for dating and signing the order form;
(8) contain an acknowledgement by the account
holder or other person signing the order form that the person has received the
final offering circular for the subscription offering prior to signing the
order form; and
(9) indicate the consequences of failing to
properly complete and return the order form, including a statement that the
subscription rights are nontransferable and will become void at the end of the
subscription period. The order form may, and the set of instructions shall,
indicate the place or places to which the order forms are to be returned and
when the order forms shall be deemed to be received.
(e) The order form may provide that it may not be modified
without the applicant's consent after the order form has been returned to the
applicant. If payment is to be made by withdrawal from a deposit account or
certificate of deposit, the applicant may, but need not, cause such withdrawal
to be made upon receipt of the order form. If such withdrawal is made at any
time prior to the closing date of the public offering, the applicant shall pay
interest to the account holder on the amount withdrawn as if such amount had
remained in the account from which it was withdrawn until the closing date.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0719 WITHDRAWAL FROM CERTIFICATE ACCOUNTS
Notwithstanding any regulatory provision regarding penalties
for early withdrawal from certificate accounts, the applicant may allow payment
for capital stock pursuant to the exercise of subscription rights by withdrawal
from a certificate account without the assessment of such penalties. In the
case of early withdrawal of only a portion of such account, the certificate
evidencing such account shall be cancelled if the applicable minimum balance
requirement ceases to be met. The remaining balance will earn interest at the
passbook rate.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0720 PERIOD FOR COMPLETION OF SALE
The sale of all shares of capital stock of the applicant to
be made under the plan of conversion, including any sale in a public offering
or direct community marketing, shall be completed as promptly as possible. The
applicant shall obtain the prior written approval of the administrator to sell
shares of stock more than 45 days after the last day of the subscription
period.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0721 INTEREST: SUBSCRIPTION/COMMUNITY
PURCHASE ORDERS
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992;
Repealed Eff. April 15, 1993.
04 NCAC 16G .0722 EXTENSIONS OF TIME TO COMPLETE
OFFERINGS
(a) The administrator may grant one or more extensions of
time required to complete the sale of all shares of capital stock under Rule
.0720 of this Section, provided that no single extension of time shall exceed
90 days. No such extension shall be granted unless the savings institution
shows that the circumstances leading to the request for an extension were
beyond the control of the savings institution and that the investors who
purchased stock during the initial subscription period will not be
disadvantaged by the extension.
(b) Immediately upon the granting of an extension of time
pursuant to Paragraph (a) of this Rule, the applicant shall distribute to each
subscriber in the offering, and, if applicable, each person who has ordered
stock in the direct community offering, a post‑effective amendment to the
offering circular filed under an amendment to the application for conversion
and declared effective by the administrator pursuant to Paragraph (d) of this
Rule which shall notify each subscriber and each ordering person of the
granting of the extension of time, and of the right of each subscriber and each
ordering person to increase, decrease, or rescind his subscription either at
any time prior to 20 days before the end of the extension period or at any time
prior to the date of the commencement of the public offering or the direct
community offering, provided that if the public offering or the direct
community offering is not completed within 20 days after its commencement, all
instructions from subscribers and ordering persons to increase, decrease or
rescind their subscriptions or orders received during the 20‑day offering
period shall be honored by the applicant.
(c) For the purpose of this Rule, the public offering shall
be deemed to commence upon the filing with the administrator of the preliminary
offering circular for the public offering. The direct community offering shall
be deemed to commence upon the declaration of effectiveness by the
administrator of the final offering circular.
(d) After the expiration of the subscription rights, the
converting savings bank shall file with and have declared effective by the
administrator a post‑effective amendment to the offering circular upon the
occurrence of any event, circumstance, or change of circumstance which would be
material to the investment decision of a subscriber or, if applicable, a person
who has ordered capital stock in the direct community offering.
(e) Any post‑effective amendment to an offering
circular shall be distributed by the converting savings bank immediately after
the declaration of effectiveness. It shall be distributed to each subscriber,
and, if applicable, each person who has ordered stock in the direct community offering.
The converting savings bank shall grant to each subscriber and ordering person
the right to increase, decrease, or rescind his subscription or order for a
period which shall be the greater of 10 days from the date of the mailing of
the post‑effective amendment or the period remaining in an extension of
time granted by the administrator pursuant to the provisions of Paragraph (b)
of this Rule.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
SECTION .0800 ‑ PROCEDURAL REQUIREMENTS
04 NCAC 16G .0801 FILING AN APPLICATION FOR CONVERSION
04 NCAC 16G .0802 IMPROPERLY EXECUTED OR MATERIALLY
INCOMPLETE FILINGS
04 NCAC 16G .0803 ADDITIONAL FILING REQUIREMENTS
04 NCAC 16G .0804 NUMBER OF COPIES: PLACE OF FILING:
BINDING: SIGNATURES
04 NCAC 16G .0805 REQUIREMENTS AS TO PAPER AND PRINTING
04 NCAC 16G .0806 METHOD OF PREPARATION
04 NCAC 16G .0807 INTERPRETATION OF REQUIREMENTS
04 NCAC 16G .0808 ADDITIONAL INFORMATION
04 NCAC 16G .0809 INFORMATION UNKNOWN OR NOT REASONABLY
AVAILABLE
04 NCAC 16G .0810 INCORPORATION OF CERTAIN INFORMATION
BY REFERENCE
04 NCAC 16G .0811 SUMMARIES OR OUTLINES OF DOCUMENTS
04 NCAC 16G .0812 LEGIBILITY OF MATERIALS
04 NCAC 16G .0813 PRESENTATION OF INFORMATION
04 NCAC 16G .0814 APPLICATION OF AMENDMENTS TO
REGULATIONS AND FORMS
04 NCAC 16G .0815 CONSENTS OF EXPERTS
04 NCAC 16G .0816 CONSENTS OF PERSONS ABOUT TO BECOME
DIRECTORS
04 NCAC 16G .0817 DATE OF FILING
04 NCAC 16G .0818 AMENDMENTS
04 NCAC 16G .0819 PRE‑FILING CONFERENCES WITH
APPLICANTS
04 NCAC 16G .0820 REVIEW OF THE COMMISSION ACTION
04 NCAC 16G .0821 POST‑CONVERSION REPORTS
History Note: Authority G.S. 54B‑33;
Eff. January 1, 1980;
Transferred From 4 NCAC 9I Eff. August 31, 1981;
Amended Eff. September 1, 1983; October 1, 1982;
Repealed Eff. January 1, 1986.
04 NCAC 16G .0822 IMPROPERLY EXECUTED OR MATERIALLY
INCOMPLETE FILINGS
(a) Any application for conversion that is improperly
executed shall not be accepted for filing and shall be returned to the
applicant.
(b) Subject to the provisions of Paragraph (c) of this
Rule, any application for conversion that does not contain copies of a plan of
conversion, a preliminary proxy statement with signed financial statements, and
a preliminary form of proxy, shall not be accepted for filing and shall be
returned to the applicant. Any application for conversion containing a
materially incomplete plan of conversion, proxy statement, or form of proxy may
not be accepted for filing and if not accepted for filing, shall be returned to
the applicant.
(c) Any application for conversion which contains, at a
minimum, a materially complete plan of conversion shall be accepted for filing
if the application is accompanied by the written request of the applicant that
the application not be reviewed by the administrator until the applicant
requests and the administrator consents to the filing of the additional
materials set forth in Paragraph (b) of this Rule.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0823 ADDITIONAL FILING REQUIREMENTS
An applicant whose plan of conversion has been approved by
the administrator shall fulfill the following requirements:
(1) The applicant shall file with the administrator
promptly after the meeting of members called to consider the plan of conversion
a certified copy of each resolution adopted at the meeting relating to the plan
of conversion, together with the following information:
(a) the total number of votes eligible to be
cast,
(b) the total number of votes represented in
person or by proxy at the meeting,
(c) the total number of votes cast in favor of
and against each such matter, and
(d) the percentage of votes necessary to approve
each such matter.
The compilation of the votes cast at the meeting may be
prepared by an independent public accountant or by an independent transfer
agent.
(2) The applicant shall file with the administrator,
promptly after the meeting of members called to consider the plan of
conversion, an opinion of counsel to the effect that:
(a) the meeting of members was duly held in
accordance with all requirements of applicable state and federal law and
regulation;
(b) all requirements of state and federal law
applicable to the conversion have been complied with; and
(c) if the savings bank has used proxies
executed prior to the proxy solicitation required by Rule .0511 of this
Subchapter, the authority conferred by such proxies includes authority to vote
on this plan of conversion.
(3) Each offering circular for the offering shall be
prepared in compliance with this Subchapter. The applicant shall file with the
administrator a copy of each preliminary offering circular and a copy of each
final offering circular.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0824 APPLICATION SIGNATURES
(a) Every application and every amendment thereto filed
shall be manually signed by:
(1) a duly authorized representative of the
applicant on its behalf,
(2) its principal executive officer,
(3) its principal financial officer,
(4) its principal accounting officer, and
(5) at least two‑thirds of its directors.
(b) If any name is signed to an application or any
amendment thereto pursuant to a power of attorney, a manually signed copy of
such power of attorney shall be filed with the application.
(c) Except as provided in Paragraph (d) of this Rule, the
filing of any application or amendment thereto under this Subchapter shall
constitute a representation of the applicant by its duly authorized
representative, the applicant's principal executive officer, the applicant's
principal financial officer, and the applicant's principal accounting officer,
and each member of the applicant's board of directors (whether or not such
directors has signed the application or any amendment thereto) severally that:
(1) He or she has read such application or
amendment;
(2) In the opinion of each such person, he or
she has made such examination and investigation as is necessary to enable him
or her to express an informed opinion that such application or amendment
complies, to the best of his or knowledge and belief, with the applicable
requirements of this Subchapter and forms prescribed hereunder; and
(3) Each such person holds such informed
opinion.
(d) The representations specified in Paragraph (c) of this
Rule shall not be deemed to have been made by any director of the applicant who
did not sign the application or any amendment thereto, if and only to the
extent that such director files with the administrator within 10 business days
after the filing of the application or amendment a statement describing those
portions of any filing with which there is no such representation.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0825 REQUIREMENTS AS TO PAPER AND PRINTING
(a) Applications shall be filed on unglazed, white paper 8‑
by 13 or 8‑ by 11 inches in size, insofar as practicable.
However, tables, charts, maps, and financial statements may be on larger paper
if folded to such sizes. Plan of conversion, proxy statement, and offering
circular may be on smaller paper if the applicant so desires.
(b) Applications and, insofar as practicable, all papers
and documents filed as part thereof shall be printed, lithographed,
mimeographed, or typewritten. However, applications or any portion thereof may
be prepared by any similar process which, in the opinion of the administrator,
produces copies suitable for a permanent record. Irrespective of the process
used, all copies of any such material shall be clear, easily readable, and
suitable for repeated photocopying. Debits in credit categories and credits in
debit categories shall be designated so as to be clearly distinguishable as
such on photocopies.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0826 METHOD OF PREPARATION
Every application shall furnish information in item‑and‑answer
form in response to the items of the appropriate form and shall include the
captions of the form but omit the text of all items and instructions. Every
proxy statement and offering circular shall present information as provided in
Rule .0829 of this Section in response to the items of the appropriate form in
lieu of furnishing the information in item‑and‑answer form and
shall omit the captions and text of all items and instructions. Every
application shall include a cross reference sheet showing the location in the
proxy statement and offering circular of the response to the items of the
appropriate form. If any such item is inapplicable or the answer thereto is in
the negative and is omitted, a statement to that effect shall be made in the
cross reference sheet.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0827 INFORMATION UNKNOWN OR NOT REASONABLY
AVAILABLE
Required information need be given only insofar as it is
known or reasonably available to the applicant. If any required information is
unknown and not reasonably available to the applicant, either because obtaining
it would involve unreasonable effort or expense, or because it rests peculiarly
within the knowledge of another person not affiliated with the applicant, the
information may be omitted, subject to the following conditions:
(1) The applicant shall give such information on the
subject as it possesses or can acquire without unreasonable effort or expense,
together with the source thereof; or
(2) The applicant shall include a statement either
showing that unreasonable effort or expense would be involved or indicating the
absence of any affiliation with the person within whose knowledge the
information rests and stating the result of a request made to such person for
the information.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0828 INCORPORATION OF CERTAIN INFORMATION
BY REFERENCE
(a) Where an item in an application calls for information
not required to be included in the proxy statement or offering circular, matter
contained in any part of the application, including exhibits, may be
incorporated by reference in answer, or partial answer, to such items. No
information may be incorporated by reference in a proxy statement or offering
circular, unless the document containing such information is attached thereto
or is summarized or outlined. However, an offering circular may incorporate by
reference the information contained in a proxy statement previously delivered
without need of summary or outline.
(b) Material incorporated by reference shall be clearly identified
in the reference. An express statement that the specified matter is
incorporated by reference shall be made at the particular place in the
application where the information is required. Matter shall not be
incorporated by reference in any case where such incorporation would render the
statement incomplete, unclear, or confusing.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0829 PRESENTATION OF INFORMATION
(a) The information required in a proxy statement or
offering circular need not follow the order of the items or other requirements
in the appropriate form. Such information shall not, however, be set forth in
any fashion which obscures any of the required information or any information
necessary to keep the required information from being incomplete or
misleading. Where an item requires information to be given in tabular form, it
shall be given in substantially the tabular form specified in the item.
(b) All information contained in a plan of conversion,
proxy statement, or offering circular shall be set forth under appropriate
captions or headings reasonably indicative of the principal subject matters set
forth thereunder. Except as to financial statements and other tabular data,
all information set forth in any form under this Subchapter shall be divided
into reasonably short paragraphs or sections.
(c) Every proxy statement and offering circular shall include
in the forepart a reasonably detailed table of contents showing the subject
matter of its various sections or subdivisions and the page number on which
each such section or subdivision begins.
(d) All information required to be included in a proxy statement
or offering circular shall be clearly understandable without the necessity of
referring to the particular form or to the regulations under this Subchapter.
Except as to financial statements and information required in tabular form, the
information set forth in a proxy statement or offering circular may be
expressed in condensed or summarized form.
(e) Financial statements are to be set forth in comparative
form and shall include the notes thereto and the accountant's certificate or
certificates.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0830 CONSENTS OF EXPERTS
(a) If any accountant, attorney, investment banker,
appraiser, or other persons whose professions give authority to a statement
made in any application under this Subchapter is named as having prepared,
received, passed upon, or certified any part thereof, or any report or
valuation for use in connection therewith, the written consent of such person
shall be filed with the application. If any portion of a report of an expert
is quoted or summarized as such in any filing under this Subchapter, the
written consent of the expert shall expressly state that the expert consents to
such quotation or summarization.
(b) All written consents filed pursuant to this Rule shall
be dated and signed manually. A list of such consents shall be filed with the
application. Where the consent of the expert is contained in the report, a
reference shall be made in the list to the report containing such consent.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0831 CONSENTS OF PERSONS ABOUT TO BECOME
DIRECTORS
If any person who has not signed an application is named in
the proxy statement or offering circular as a potential director, the written
consent of such person shall be filed with the appropriate form.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0832 AMENDMENTS
All amendments to any application under this Subchapter
shall be filed under cover of an appropriate facing sheet, shall be numbered
consecutively in the order in which they are filed, and shall conform to all
pertinent regulations applicable to the type of application which they amend.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0833 POST‑CONVERSION REPORTS
The applicant shall file such post‑conversion reports
concerning its conversion as the administrator may require.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
SECTION .0900 ‑ ACQUISITIONS OF SECURITIES OF CONVERTED
ASSOCIATIONS
04 NCAC 16G .0901 DEFINITIONS
04 NCAC 16G .0902 PROHIBITED TRANSFERS
04 NCAC 16G .0903 PROHIBITION OF OFFERS AND CERTAIN
ACQUISITIONS
04 NCAC 16G .0904 PROHIBITION OF OFFERS TO ACQUIRE AND
ACQUISITIONS OF STOCK
04 NCAC 16G .0905 EXCEPTIONS
History Note: Authority G.S. 54B‑33;
Eff. January 1, 1980;
Transferred From 4 NCAC 9I Eff. August 31, 1981;
Amended Eff. December 1, 1984; May 1, 1984; September 1,
1983;
Repealed Eff. January 1, 1986.
04 NCAC 16G .0906 CRITERIA FOR DENIAL
04 NCAC 16G .0907 OPTIONAL CHARTER PROVISION
History Note: Authority G.S. 54B‑33;
Eff. September 1, 1983;
Amended Eff. December 1, 1984; May 1, 1984;
Repealed Eff. January 1, 1986.
04 NCAC 16G .0908 DEFINITIONS
(a) For the purpose of this Section, the term
"offer" includes every offer to buy or acquire, solicitation of an
offer to sell, tender offer for, or request or invitation for tenders of, a
security or interest in a security for value.
(b) For the purpose of this Section, the term
"person" means an individual, a group acting in concert, a
corporation, a partnership, an association, a joint stock company, a trust, an
unincorporated organization or similar company or a syndicate.
(c) Without limitation on the generality of its meaning,
the term "security" includes nontransferable subscription rights
issued pursuant to a plan of conversion.
(d) For purposes of this Section, the term
"acquire" includes every type of acquisition, whether affected by
purchase, exchange, operation of law, or otherwise.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0909 PROHIBITED TRANSFERS
Prior to completion of a conversion, no person shall
transfer or enter into any agreement or understanding to transfer the legal or
beneficial ownership of conversion subscription rights or the underlying
securities to the account of another.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0910 PROHIBITION OF OFFERS AND CERTAIN
ACQUISITIONS
Prior to completion of a conversion, no person shall make
any offer, or any announcement of an offer, for any security of the converting
savings bank issued in connection with the conversion nor shall any person
knowingly acquire securities of the converted savings bank issued in connection
with the conversion in excess of the maximum purchase limitations established
in the approved plan of conversion.
History Note: Authority G.S. 54C‑33; 54C‑53.
Eff. February 15, 1992
04 NCAC 16G .0911 EXCEPTIONS
(a) Rules .0909 and .0910 of this Section shall not apply
to a transfer, agreement, or understanding to transfer, offer, or announcement
of an offer or intent to make an offer which:
(1) pertains only to securities to be purchased
pursuant to Paragraph (6) of Rule .0311 and Paragraphs (6) and (11) of Rule
.0312 of this Subchapter; and
(2) has the prior written approval of the
administrator.
(b) Rule .0910 of this Section shall not apply to any offer
with a view toward public resale made exclusively to the savings bank or its
underwriters or selling group acting on the savings bank's behalf.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
04 NCAC 16G .0912 CRITERIA FOR DENIAL
The administer shall not approve an application involving an
offer for, or an announcement thereof, or an acquisition of any security of a
converted savings bank submitted under 4 NCAC 16A .0105(d) if it finds that such
offer frustrates the purpose of the provisions of this Subchapter, is
manipulative or deceptive, subverts the fairness of the conversion, is likely
to result in injury to the savings bank, or is otherwise violative of law or
regulation.
History Note: Authority G.S. 54C‑33; 54C‑53;
Eff. February 15, 1992.
SECTION .1000 ‑ FORMS
04 NCAC 16G .1001 FACING SHEET
04 NCAC 16G .1002 FORM AC: APPLICATION FORM
04 NCAC 16G .1003 FORM PS: PROXY STATEMENT
04 NCAC 16G .1004 FORM OC: OFFERING CIRCULAR FORM
History Note: Authority G.S. 54B‑33;
Eff. January 1, 1980;
Transferred From 4 NCAC 9I Eff. August 31, 1981;
Repealed Eff. September 1, 1983.
SECTION .1100 ‑ SALE‑OF‑CONTROL CONVERSIONS
04 NCAC 16G .1101 DEFINITIONS
04 NCAC 16G .1102 SALE‑OF‑CONTROL CONVERSION
OF AN ASSOCIATION
04 NCAC 16G .1103 ADDITIONAL REQUIREMENTS FOR SALE‑OF‑CONTROL
CONVERSION
04 NCAC 16G .1104 ADDITIONAL NOTICE REQUIREMENTS
04 NCAC 16G .1105 RECORD DATE/NOTICE REQUIREMENTS
04 NCAC 16G .1106 COMPETING SALE‑OF‑CONTROL
OFFERS
04 NCAC 16G .1107 MANAGEMENT'S PROXY/MAILING
COMMUNICATIONS FOR PROPONENTS
04 NCAC 16G .1108 ADDITIONAL DISCLOSURE REQUIREMENTS
History Note: Authority G.S. 54B‑33;
Eff. September 1, 1983;
Repealed Eff. April 1, 1984.
SECTION .1200 ‑ CONVERSION: MERGERS: ACQUISITIONS
04 NCAC 16G .1201 CONVERSION IN CONNECTION WITH
ACQUISITION OR MERGER
04 NCAC 16G .1202 RIGHTS OF MEMBERS
History Note: Authority G.S. 54B‑33; 54B‑55;
Eff. February 1, 1984;
Repealed Eff. January 1, 1986.
04 NCAC 16G .1203 CONVERSION IN CONNECTION WITH
ACQUISITION
(a) A mutual savings bank may convert to stock form as part
of a transaction whereby an existing holding company acquires all its
conversion stock; provided that the eligible account holders, supplemental
eligible account holders, and voting members of the converting savings bank
shall receive, without payment, nontransferable rights to purchase capital
stock of the existing holding company the same as they would have to purchase
capital stock of the converting savings bank in a standard conversion under the
provisions of this Subchapter.
(b) If the existing holding company acquiring the
converting savings bank has consolidated total assets which are 10 times
greater than the total assets of the converting savings bank which it is
acquiring and the capital stock of such holding company is listed on a national
or regional stock exchange or is quoted on the National Association of
Securities Dealers Quotation (NASDAQ) System, then the plan of conversion shall
not be required to contain provisions of Subparagraphs (6), (7), (8), (16),
(17) and (18) of Rule .0311 of this Subchapter.
History Note: Authority G.S. 54C‑33; 54C‑53;
54C‑195;
Eff. February 15, 1992;
Amended Eff. April 15, 1993.
04 NCAC 16G .1204 CONVERSION IN CONNECTION WITH MERGER
(a) A mutual savings bank may convert to stock form by
merging with an existing stock depository institution as part of a transaction
in which the equity securities of the existing stock depository institution or
its holding company acquiring all of the conversion stock are issued; provided
that the eligible account holders, supplemental eligible account holders, and
voting members of the converting savings bank shall receive, without payment,
nontransferable rights to purchase capital stock of the existing stock
depository institution, or its holding company the same as they would have to
purchase capital stock of the converting savings bank in a standard conversion
under the provisions of this Subchapter.
(b) If the existing depository institution, or its holding
company, whose equity securities will be issued in connection with the merger
of the converting savings bank has consolidated total assets which are 10 times
greater than the total assets of the converting savings bank which it is
acquiring and the capital stock of such existing depository institution, or its
holding company, is listed on a national or regional stock exchange or is
quoted on the National Association of Securities Dealers Quotation (NASDAQ)
System, then the plan of conversion shall not be required to contain provisions
of Subparagraphs (6), (7), (8), (16), (17) and (18) of Rule .0311 of this
Subchapter.
History Note: Authority G.S. 54C‑33; 54C‑53;
54C‑195;
Eff. February 15, 1992;
Amended Eff. April 15, 1993.
