Court Opinion

ID: 4134253
Source: CourtListenerOpinion
Date Created: 2017-02-18 01:47:59.081365+00
Date Added: 2024-06-11T14:34:16.649829
License: Public Domain

EX     GENERAL

                   A~JSTIN. TEXAR     78711

                         June 11, 1969

The Honorable W. Sale Lewis          Opinion Woo.M- 414
Savings and Loan Commissioner
of Texas                             Re: Whether a wholly owned
Austin, Texas 7871.1.                    Texas Corporationand
                                         subsidiaryof a parent
                                         Savings and Loan Asso-
                                         ciation may acquire out-
                                         standing shares of the
                                         Permanent Reserve Fund
                                         Stock of another Texas
                                         Savings and Loan Asso-
Dear Mr. Lewlsr                          ciatlon.
            In your recent letter you requested this office's
opinion as to whether a wholly owned Texas corporationand
subsidiaryof 'aparent Savings and Loan Associationmay acquire
outstanding      shares of the permanent reserve fund stock of
another Texas Savings end LoanAssociation.
       We understand that Oak Cliff Savings and Loan Association
is a state chartered Permanent Reserve Fund Stock Association
governe~dby the Texas Savings and Loan Act. The 8.8 Corpora-
tion is a corporationchartered under the Texas Business Corp-
oration Act. Fort Worth Savings end Loan Association is a
state chartered Permanent Reserve Fund Stock Association
governed by the Texas Savings and Loan Act. The 8.8 Corporation
Is a wholly owned subsidiaryof Oak Cliff Savings and Loan
Association. Article &2a, Section 5.11 of the Texas Savings
and Loan Act, Vernon's Civil Statutes,provides for the in-
vestment power of savings and loan associationsand sets out
specific investments,and further provides that every associa-
tion shall have power to invest in such other securitiesor
obligationswhich the Commissionermay approve and place on a
published list. The Savings and Loan Commissionerof Texas
entered an order, dated October 17, 1968, granting authority
to Oak Cliff Savings and Loan Associationto Invest in The
8.8 Corporation.
       The 8.8 Corporationentered into a contract to acquire
a minimum of 200,000 shares of the outstandingpermanent re-
serve fund stock of Fort Worth Savings and Loan Association.
Article 2.02 (7) of the Texas Bustness CorporationAct, Vernon's
Civil Statutes, provides that each corporation shall have
power:
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Honorable W. Sale Lewis, page 2 (M-414)

           "To purchase, receive, subscribe for, or
            otherwise acquire, own, hold, vote, use,
            employ, mortgage, lend, pledge, sell or
            otherwise dispose of, and otherwise use
            and deal in and with, shares or other
            Interests in, or obligationsof, other
            domestic or foreign corporations,associa-
            tions, partnerships,or individuals,or
            direct or indirect obligationsof the
            United States or of any other government,
            state, territory,government district, or
            municipality,or of any Instrumentality
            thereof."
       Accordingly,The 8.8 Corporationhas the power to
acquire the outstanding shares'ofpermanent reserve fund
stock of Fort Worth Savings and Loan Association.
       Article 852a, Sectlonll.01 of the Texas Savings and
Loan Act, Vernon's Civil Statutes, provides as follows:
           "Savings associations,the officers, employ-
            ees, or agents, savings accounts and the
            permanent reserve fund stock thereof, and
            the sale, issuance, or offering of savings
            accounts and permanent reserve fund stock
            of any associationor Federal savings and
            loan associationare hereby exempted from
            all provisions of law of this state, other
            than this Act, which provide for supervision,
            registrationor regulation In connection
            with the sale, issuance or offering of
            securities,and the sale, issuance or offer-
            ing of any such accounts or stock shall be
            legal without any action or approval what-
            soever on the part of any official, other
            than the Commissioner,authorized to license,
            regulate or supervise the sale, issuance
            or offering of securities."
       There are no provisions In the Texas Savings and
Loan Act which regulate or supervise the sale, issuance or
offering of securitiesother than Section 11.01 and Section
10.03 which requires approval by the Savings and Loan Comm-
issioner of any plan of reorganization,merger, or consoli-
dation with another associationor Federal assocfation.
Accordingly,The 8.8 Corporationmay acquire outstanding
shares of the permanent reserve fund stock of Fort Worth
                          -2063-
.   -

    Honorable W. Sale Lewis, page 3 (M-414)

    fund stock of Fort Worth Savings and Loan Association.
                            SUMMARY
                            -------
           The 8.8 Corporationmay acquire outstanding shares
    of the permanent reserve fund stock of Fort Worth Savings
    and Loan Association.

                                                C   FORD C. MARTIN
                                                A        General of Texas
    Prepared by Ray McGregor
    Assistant Attorney General
    APPROVED:
    OPIWION COMMITTEE
    Kerns Taylor, Chairman
    George Kelton, Vice-Chairman
    Robert C. Crouch
    Sam McDaniel
    Ralph Rash
    Vince Taylor
    W. V. Geppert
    Staff Legal Assistant
    Hawthorne Phillips
    Executive Assistant

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