Texas Administrative Code › Title 7 - BANKING AND SECURITIES › Part 2 - TEXAS DEPARTMENT OF BANKING › Chapter 21 - TRUST COMPANY CORPORATE ACTIVITIES › Subchapter E - CHANGE OF CONTROL › Section 21.51 - Application for Acquisition or Change of Control of Trust Company

Current through Reg. 49, No. 28; July 12, 2024
(a) General.
				  Without the prior written consent of the banking commissioner, or as otherwise
				  provided by this section, a person or entity may not, directly or indirectly,
				  acquire a legal or beneficial interest in voting securities of a trust company
				  or a corporation or other entity owning voting securities of a trust company
				  if, after the acquisition, the person or entity would control the trust
				  company. Except as otherwise provided in this section, an application must be
				  filed with the banking commissioner for review and consideration of the
				  proposed transaction.
(b) Form of
				  application. The applicant shall submit a fully completed, verified application
				  on a form prepared and prescribed by the banking commissioner and
				  simultaneously tender the required filing fee pursuant to §
										RSA
				  21.2 of this title (relating to Filing and
				  Investigation Fees). The application must, except to the extent expressly
				  waived in writing by the banking commissioner, disclose the following
				  information:
(1) the identity, biographical
				  data, business background, and experience relating to trust industry matters,
				  and a current statement of financial condition, a statement of changes in net
				  worth and a statement of cash flows of each person by whom, or on whose behalf,
				  the acquisition is to be made and by each person acting in concert with others
				  seeking to acquire voting securities subject to Finance Code, §
											RSA
				  183.001, and to this section. Financial
				  statements will be considered current if audited and dated within 180 days of
				  the date of the application or will be considered current if unaudited and
				  dated within 90 days of the date of the application. All financial statements
				  must be accompanied by an affidavit of no material change dated as of the date
				  of application;
(2) a completed
				  authorization to release employment, financial, credit, fingerprint
				  information, and criminal history records to the department;
(3) a completed confirmation inquiry
				  form;
(4) the identity of each
				  entity other than a natural person seeking to acquire control or working in
				  concert with others to acquire control of a trust company and a copy of the
				  entity's most recent audited financial statement. Financial statements will be
				  considered current if audited and dated within 180 days of the date of the
				  application or will be considered current if unaudited and dated within 90 days
				  of the date of the application. All financial statements must be accompanied by
				  an affidavit of no material change dated as of the date of
				  application;
(5) a description of
				  all material, pending or adjudicated legal or administrative proceedings in
				  which each acquiring person or entity is or was a party. A material legal
				  proceeding includes a proceeding in which the person or entity has been charged
				  with, cited for, or convicted under a state or federal law relating to trust or
				  other financial institutions, securities or financial instrument reporting, or
				  a felony or crime that directly relates to the duties and responsibilities
				  involved in the operation of a trust company or financial institution under the
				  laws of a state, the United States, or another country. A material legal
				  proceeding also includes a proceeding that resulted in a material unsatisfied
				  judgment, or may result in a judgment, against the acquiring person or entity
				  and such loss contingency must be disclosed in the financial statements of the
				  acquiring person or entity under generally accepted accounting principles, or
				  is otherwise material. A material administrative proceeding includes a
				  proceeding in which the person or entity is or has been subject to a cease and
				  desist, removal, enforcement, or other order, including an order of supervision
				  or conservatorship issued by a state, federal, or foreign regulatory
				  agency;
(6) the terms and
				  conditions of the proposed acquisition or change of control and the manner in
				  which the acquisition or change of control is to be made;
(7) the identity, source, and amount of the
				  funds or other consideration used or to be used in making the acquisition or
				  change of control;
(8) if a portion
				  of the funds or other consideration to be used in making the acquisition has
				  been borrowed or is to be borrowed or otherwise obtained for the purpose of
				  making the acquisition, a complete description of the transaction, the names of
				  the parties to the transaction, and a summary of all arrangements, agreements,
				  or understandings with such parties including terms of repayment;
(9) the applicant's current or proposed
				  business or strategic plan including amendments to a current plan;
(10) plans or proposals to liquidate the
				  trust company, to sell its assets or merge it with another trust company or
				  other entity, or to make other major changes in its business, corporate
				  structure, or management;
(11)
				  plans or proposals to change officers and directors of the trust company and
				  the related trust or financial institution management experience of proposed or
				  current officers and directors;
(12) the terms and conditions of an offer,
				  invitation, agreement, or arrangement under which a voting security will be
				  acquired and any contract affecting such security or its financing after it is
				  acquired;
(13) pro forma financial
				  statements with projections indicating whether the acquired or controlled trust
				  company will be adequately capitalized for a period of not less than two years
				  from the date of acquisition; and
(14) such other information that the banking
				  commissioner requires to be included in the particular application as
				  considered necessary to an informed decision to approve or reject the proposed
				  acquisition. The applicant bears the burden to supply all material information
				  necessary to enable the banking commissioner to make a fully informed decision
				  regarding the application.