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Alabama Code (Last Updated: November 28, 2014) |
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Title5 BANKS AND FINANCIAL INSTITUTIONS. |
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Chapter5A. ORGANIZATION AND OPERATION OF BANKS. |
§5-5A-44. Acquisition of majority of voting shares of a bank; procedure.
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(a) No person may acquire any voting security of a state bank or of any corporation or other entity owning voting securities of a state bank if after the acquisition such person would own or possess the power to vote a majority of the voting securities of such bank, unless an application is filed with the superintendent for review of the proposed transaction and for his or her action, if any, as provided in this section.
(b) The application shall be on a form prescribed by the superintendent and shall be made under oath. The application must contain all information that the superintendent by regulation requires to be furnished in an application, as well as any information that the superintendent orders to be included in the particular application being filed and shall be accompanied by the filing fee prescribed by the Banking Board. No acquiring party may acquire control of a bank unless the superintendent has approved the acquiring party's acquisition plan. The acquiring party shall file its application with the superintendent, and the application shall, except to the extent expressly waived by the superintendent, contain the following information:
(1) The identity, personal history, business background, and experience of each person by whom or on whose behalf the acquisition is to be made, including his or her material business activities and affiliations during the past five years, and a description of any material pending legal or administrative proceedings in which he or she is a party and any criminal indictment or conviction of such person by a state or federal court.
(2) A statement of the assets and liabilities of each person by whom or on whose behalf the acquisition is to be made, as of the end of the fiscal year for each of the five fiscal years immediately preceding the date of the notice, together with related statements of income and source and application of funds for each of the fiscal years then concluded, all prepared in accordance with generally accepted accounting principles consistently applied, and an interim statement of the assets and liabilities for each such person, together with related statements of income and source and application of funds, as of a date not more than 90 days prior to the date of the filing of the notice.
(3) The terms and conditions of the proposed acquisition and the manner in which the acquisition is to be made.
(4) The identity, source, and amount of the funds or other consideration used or to be used in making the acquisition, and if any part of these funds or other consideration has been or is to be borrowed or otherwise obtained for the purpose of making the acquisition, a description of the transaction, the names of the parties, and any arrangements, agreements, or understandings with such persons.
(5) Any plans or proposals which any acquiring party making the acquisition may have to liquidate the bank, to sell its assets or merge it with any company or to make any other major change in its business or corporate structure or management.
(6) The identification of any person employed, retained, or to be compensated by the acquiring party, or by any person on his or her behalf, to make solicitations or recommendations to stockholders for the purpose of assisting in the acquisition, and a brief description of the terms of such employment, retainer, or arrangement for compensation.
(7) Copies of all invitations or tenders or advertisements making a tender offer to stockholders for purchase of their stock to be used in connection with the proposed acquisition.
(8) If any tender offer, request, or invitation for tenders, or other agreement to acquire control is proposed to be made by means of a registration statement under the Federal Securities Act of 1933, as amended, or under circumstances requiring the disclosure of similar information under the Federal Securities Exchange Act of 1934, as amended, or in an application filed with the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System, or the Securities Commissioner of Alabama requiring similar disclosure, the superintendent may accept the registration statement or application with any additional information as the superintendent may require in lieu of the requirements of this section.
(9) If, while an application is pending, any material change occurs in the facts stated in the application, the acquiring party within 10 days after the change shall file with the superintendent an amendment to the application describing the change in accordance with rules the superintendent may adopt.
For the purposes of this section, the term person means an individual or a corporation, partnership, trust, association, joint venture, pool, syndicate, sole proprietorship, unincorporated organization, or any other form of entity not specifically listed herein.
Information obtained by the superintendent under this section is confidential and may not be disclosed by the superintendent or any officer or employee of the State Banking Department, except that the superintendent may in his or her discretion, if the superintendent deems it necessary or proper to the enforcement of the laws of this state or the United States and to the best interest of the public, divulge such information to any department, agency, or instrumentality of the state or federal government.
(c) The superintendent shall issue an order denying an application if he or she finds that:
(1) The financial condition of any acquiring person is such as might jeopardize the financial stability of the bank or prejudice the interests of the depositors or stockholders of the bank;
(2) The competence, experience, or integrity of any acquiring person or of any of the proposed management personnel indicates that it would not be in the interest of the depositors or stockholders of the bank, or in the interest of the public to permit such person to control the bank; or
(3) Any acquiring person neglects, fails, or refuses to furnish the superintendent all the information required by him or her.
(d) The superintendent shall approve or deny a change of control under this section within 60 days after receipt of a completed application; provided that if the superintendent requests additional information from the applicant following receipt of a completed application, the time limit for the decision by the superintendent shall be the later of (1) the date set forth above in this subsection; or (2) 30 days after the receipt by the superintendent of the requested additional information. Any agreement entered into by the applicants and the superintendent as a condition that the application will not be denied is enforceable against the applicant and the bank.
(e) From any final order denying the application the applicant may appeal the decision in the manner and through the procedures established in Sections 5-5A-8 and 5-5A-9 for the denial of incorporation of a bank.
(f) This section does not apply to:
(1) The acquisition of securities in connection with the exercise of a security interest or otherwise by way of foreclosure on default in the payment of a debt previously contracted for in good faith;
(2) Acquisitions or transfers by gift, operation of law or by will or intestate succession; or
(3) Any transaction which the superintendent by regulation or order may exempt as not being contemplated by the purposes of this section or the regulation of which is not necessary or appropriate for the protection of the bank.
However, in any change of control transaction exempted from filing an application pursuant to this subsection, the acquiring person shall notify the superintendent within 60 days of obtaining control, shall submit a business plan including management structure within 90 days of obtaining control for approval by the superintendent, and shall obtain the superintendent's prior approval for any changes to the business plan during the first three years from the date of change of control.
(g) If it appears to the superintendent that any person has committed or is about to commit a violation of this section or any regulation or order of the superintendent adopted under it, the Attorney General on behalf of the superintendent may apply to the Circuit Court of Montgomery County for an order enjoining the violation and for any other equitable relief as the nature of the case may require.
(h) Fees collected under this section shall be paid into the special fund established by the State Treasurer pursuant to Section 5-2A-20.