Current through Reg. 49, No. 38; September 20, 2024
(a) The application
for mutual to stock conversion must include:
(1) a plan of conversion;
(2) amendments to the savings association's
certificate of formation and bylaws;
(3) a copy of the proxy and soliciting
materials to be used; and
(4) such
other information the Commissioner may require.
(b) The plan of conversion must provide:
(1) a comprehensive description of the
nontransferable subscription rights received each eligible accountholder,
including details on oversubscriptions;
(2) that the shares of the converting savings
association be offered to persons with subscription rights and management, in
that order, and that any remaining shares will be sold either in a public
offering through an underwriter or directly by the converting savings
association in a direct community offering;
(3) that a direct community offering by the
converting savings association will give a preference to natural persons
residing in the counties in which the savings association has an
office;
(4) that the sale price of
the shares of capital stock to be sold in the conversion will be a uniform
price determined in accordance with paragraph (1) of this subsection, and
specify the underwriting and/or other marketing arrangements to be
made;
(5) that the conversion must
be completed on or before 24 months after the date the savings association
members approve the plan of conversion;
(6) that each savings accountholder of the
converting savings association will receive, without payment, a withdrawable
savings account or accounts in the converted savings association equal in
withdrawable amount to the withdrawal value of such accountholder's savings
account or accounts in the converting savings association;
(7) for an eligibility record date;
(8) that expenses incurred in the conversion
are reasonable;
(9) that the
converting savings association may not loan funds or otherwise extend credit to
any person to purchase the capital stock of the savings association;
(10) that the proxies held with respect to
voting rights in the saving association will not be voted regarding the
conversion, and that new proxies will be solicited for voting on the proposed
plan of conversion; and
(11) the
amount of the deposit of an accountholder will be the total of the deposit
balances in the accountholder's savings accounts in the converting savings
association as of the close of business on the eligibility record date. The
plan of conversion may provide that the total deposit balances of less than $50
(or any lesser amounts) will not be considered for purposes of paragraph (6) of
this subsection.
(c) A
plan of conversion must be adopted by not less than two-thirds of the
board.
(d) Public Notice. An
application for mutual to stock conversion is deemed to be a complete
application at the time the Department notifies the applicant that application
is complete and has been accepted for filing as provided by §
60.101 of this title (relating to
Application Filing Requirements). Upon receipt of such notice, the proposed
incorporators must publish a public notice of the application as provided by
§
60.103 of this title (relating to
Public Notice of Application), which must be published in each county in which
the savings association has an office, and must prominently post the notice in
each of its offices.
(e) Following
approval of the application for conversion by the Commissioner, the plan of
conversion must be submitted to the members at an annual or special meeting and
the plan must be approved, in person or by proxy, by at least a majority of the
total outstanding votes of the members.
(f) No offer to sell securities of a savings
association pursuant to a plan of conversion may be made prior to
Commissioner's approval of the:
(1)
application for conversion;
(2)
proxy statement; and
(3) offering
circular.
(g) Within 45
days:
(1) of the date of the mailing of the
subscription form, the subscription rights must be exercised;
(2) after the last day of the subscription
period, the sale of all shares of capital stock of the converting savings
association to be made under the plan of conversion, including any sale in a
public offering or direct community marketing, must be completed.
(h) The converting savings
association must pay interest at not less than the savings account interest
rate on all amounts paid in cash or by check or money order to the savings
association to purchase shares of capital stock in the subscription offering or
direct community offering from the date payment is received by the savings
association until the conversion is completed or terminated.
(i) For the purpose of this rule, the public
offering and a direct community offering is deemed to commence upon the
declaration of effectiveness by the Commissioner of the final offering
circular.
(j) The Commissioner may
grant a written waiver from any requirement of this rule that is not otherwise
required by statute.
