Texas Administrative Code › Title 7 - BANKING AND SECURITIES › Part 2 - TEXAS DEPARTMENT OF BANKING › Chapter 21 - TRUST COMPANY CORPORATE ACTIVITIES › Subchapter F - APPLICATION FOR MERGER, CONVERSION, OR SALE OF ASSETS › Section 21.61 - Definitions

Current through Reg. 49, No. 28; July 12, 2024
(a) Words and terms
				  used in this subchapter that are defined in the Trust Company Act or in §
										RSA 21.1 of this
				  title (relating to Definitions), have the same meanings as defined
				  therein.
(b) The following words
				  and terms, when used in this subchapter, shall have the following meanings
				  unless the context clearly indicates the contrary.
(1) Annual report--Formal financial
				  statements and accompanying narrative of management issued yearly for the
				  benefit of shareholders and other interested parties.
(2) Chartering agency--A government authority
				  that has chartering jurisdiction over an entity involved in a transaction under
				  this subchapter.
(3) Corporation or
				  domestic corporation--A corporation for profit subject to the provisions of the
				  Texas Business Organizations Code, except a foreign corporation.
(4) Current financial statements--Audited
				  financial statements dated as of a date not more than 180 days prior to the
				  date of submission of an application, or unaudited financial statements dated
				  as of a date not more than 90 days prior to the date of submission of an
				  application.
(5) Fiduciary
				  institution--A bank, savings association, savings bank, credit union, or other
				  financial institution with the power to act as a fiduciary under applicable
				  law.
(6) Low-quality asset--An
				  asset as defined in
				  RSA
				  371c(b)(10), currently an
				  asset that falls in any one or more of the following categories:
(A) an asset classified as "substandard,"
				  "doubtful," or "loss," or treated as "other loans especially mentioned" in the
				  most recent report of examination or inspection of an affiliate prepared by
				  either a federal or state supervisory agency;
(B) an asset in a nonaccrual
				  status;
(C) an asset on which
				  principal or interest payments are more than 30 days past due; or
(D) an asset whose terms has been
				  renegotiated or compromised due to the deteriorating financial condition of the
				  obligor.
(7) Material
				  administrative proceeding--A past or pending proceeding by a state, federal, or
				  foreign regulatory agency against the applicant or other person involved in a
				  transaction under this subchapter that resulted in or could result in the
				  issuance of a cease and desist, removal, enforcement action, determination
				  letter or other order, including an order of supervision or conservatorship;
				  excluding, however, a past proceeding that resulted in an order, other than a
				  removal order, that has been satisfied or otherwise terminated more than five
				  years prior to the date the application or notice requesting such information
				  is submitted.
(8) Material legal
				  proceeding--
(A) a past or pending criminal
				  proceeding against the applicant or other person involved in a transaction
				  under this subchapter that resulted or may result in conviction of the
				  applicant or other person of a crime under a state or federal law or the law of
				  a foreign country relating to fiduciaries, banks or other financial
				  institutions, securities, financial instrument reporting, or another crime
				  involving moral turpitude; or
(B) a
				  past or pending proceeding that has or may result in a judgment against the
				  applicant or other person or entity involved in a transaction under this
				  subchapter and the loss contingency must be disclosed in the financial
				  statements of the entity under generally accepted accounting principles, or is
				  otherwise material.
(9)
				  Merger--A transaction that is:
(A) the
				  division of a trust company into two or more new trust companies, fiduciary
				  institutions, or other entities, or into a surviving trust company and one or
				  more new trust companies, fiduciary institutions, or other entities;
				  or
(B) the combination of one or
				  more trust companies with one or more fiduciary institutions or other entities,
				  resulting in:
(i) one or more surviving trust
				  companies, fiduciary institutions, or other entities;
(ii) the creation of one or more new trust
				  companies, fiduciary institutions, or other entities; or
(iii) one or more surviving trust companies,
				  fiduciary institutions, or other entities and the creation of one or more new
				  trust companies, fiduciary institutions, or other entities.
(10) Other entity--An
				  entity, whether or not organized for profit, including a corporation, limited
				  or general partnership, joint venture, joint stock company, cooperative,
				  association, or another legal entity organized pursuant to the laws of this
				  state or another state or country to the extent such laws or the constituent
				  documents of that entity, consistent with such laws, permit that entity to
				  enter into a merger or share exchange subject to this subchapter.
(11) Principal executive officer--An officer
				  primarily responsible for the execution of board policies and operation of a
				  trust company or other entity.
(12)
				  Purchase of assets--The purchase other than in the ordinary course of business
				  of all, substantially all, or a part of the assets of a trust company,
				  fiduciary institution, or other entity, including but not limited to fiduciary
				  rights pertaining to client accounts.
(13) Regulatory restriction--A memorandum of
				  understanding, determination letter, notice of determination, order to cease
				  and desist, or other state or federal administrative enforcement order issued
				  by a state or federal banking regulatory agency, or another limitation imposed
				  on a fiduciary institution or other entity by a state or federal banking
				  regulatory agency that restricts its ability to act without authorization from
				  the regulatory agency imposing the condition.
(14) Resulting trust company--A trust company
				  that is a surviving or newly created entity in a merger.
(15) Sale of assets--The sale, lease,
				  exchange, or other disposition of substantially all of the assets of a trust
				  company, including but not limited to fiduciary rights pertaining to client
				  accounts, other than in the ordinary course of business.
(16) Share exchange--A transaction by which
				  one or more trust companies, fiduciary institutions, or other entities acquire
				  all of the outstanding shares of one or more classes or series of one or more
				  trust companies under the authority of Finance Code, §
											RSA 182.301, and
				  the Texas Business Organizations Code.
(17) Trust company--A state trust company as
				  defined by Finance Code, §
											RSA
				  181.002(a).
(18) Verified--Documents submitted by the
				  applicant that have been attested to as true and correct, but not necessarily
				  notarized.