(1) Provide that the stock shall be sold
at a total price equal to the estimated pro forma market value of
such stock, based upon an independent valuation;
(2) Provide that the aggregate amount of
outstanding common stock of the subsidiary holding company owned or
controlled by persons other than the subsidiary holding company’s
mutual holding company parent at the close of the proposed issuance
shall be less than fifty percent of the subsidiary holding company’s
total outstanding common stock (This provision may be omitted if the
proposed issuance will be conducted by a subsidiary holding company
that was in the stock form when acquired by its mutual holding company
parent);
(3) Provide
that all employee stock ownership plans or other tax-qualified employee
stock benefit plans (collectively, ESOPs) must not encompass, in the
aggregate, more than either 4.9 percent of the outstanding shares
of the subsidiary holding company’s common stock or 4.9 percent of
the subsidiary holding company’s stockholders’ equity at the close
of the proposed issuance;
(4) Provide that all ESOPs and management recognition plans (MRPs)
must not encompass, in the aggregate, more than either 4.9 percent
of the outstanding shares of the subsidiary holding company’s common
stock or 4.9 percent of the subsidiary holding company’s stockholders’
equity at the close of the proposed issuance. However, if the subsidiary
holding company’s tangible capital equals at least ten percent at
the time of implementation of the plan, the Board may permit such
ESOPs and MRPs to encompass, in the aggregate, up to 5.88 percent
of the outstanding common stock or stockholders’ equity at the close
of the proposed issuance;
(5) Provide that all MRPs must not encompass, in the aggregate, more
than either 1.47 percent of the common stock of the subsidiary holding
company or 1.47 percent of the subsidiary holding company’s stockholders’
equity at the close of the proposed issuance. However, if the subsidiary
holding company’s tangible capital is at least ten percent at the
time of implementation of the plan, the Board may permit MRPs to encompass,
in the aggregate, up to 1.96 percent of the outstanding shares of
the subsidiary holding company’s common stock or 1.96 percent of the
savings subsidiary holding company’s stockholders’ equity at the close
of the proposed issuance;
(6) Provide that all stock option plans (Option Plans) must not encompass,
in the aggregate, more than either 4.9 percent of the subsidiary holding
company’s outstanding common stock at the close of the proposed issuance
or 4.9 percent of the subsidiary holding company’s stockholders’ equity
at the close of the proposed issuance;
(7) Provide that an ESOP, a MRP or an Option
Plan modified or adopted no earlier than one year after the close
of: the proposed issuance, or any subsequent issuance that is made
in substantial conformity with the purchase priorities section 239.59(a)
set forth in subpart E of this part, may exceed the percentage limitations
contained in paragraphs (a)(3) through (6) of this section (plan expansion),
subject to the following two requirements. First, all common stock
awarded in connection with any plan expansion must be acquired for
such awards in the secondary market. Second, such acquisitions must
begin no earlier than when such plan expansion is permitted to be
made;
(8) (i) Provide that the aggregate
amount of common stock that may be encompassed under all Option Plans
and MRPs, or acquired by all insiders of the subsidiary holding company
and subsidiary savings association and associates of insiders of the
subsidiary holding company and subsidiary savings association, must
not exceed the following percentages of common stock or stockholders’
equity of the subsidiary holding company, held by persons other than
the subsidiary holding company’s mutual holding company parent at
the close of the proposed issuance:
Aggregate amount
of common stock that may be encompassed under all Option Plans and
MRPs
| Institution
size |
Officer
and director purchases (percent) |
| $50,000,000 or less |
35 |
| $50,000,001-100,000,000 |
34 |
| $100,000,001-150,000,000 |
33 |
| $150,000,001-200,000,000 |
32 |
| $200,000,001-250,000,000 |
31 |
| $250,000,001-300,000,000 |
30 |
| $300,000,001-350,000,000 |
29 |
| $350,000,001-400,000,000 |
28 |
| $400,000,001-450,000,000 |
27 |
| $450,000,001-500,000,000 |
26 |
| Over $500,000,000 |
25 |
(ii) The
percentage limitations contained in paragraph 8(i) of this section
may be exceeded provided that all stock acquired by insiders and associates
of insiders or awarded under all MRPs and Option Plans in excess of
those limitations is acquired in the secondary market. If acquired
for such awards on the secondary market, such acquisitions must begin
no earlier than one year after the close of the proposed issuance
or any subsequentissuance that is made in substantial conformity with
the purchase priorities set forth in subpart E of this part. (iii)In
calculating the number of shares held by insiders and their associates
under this provision, shares awarded but not delivered under an ESOP,
MRP, or Option Plan that are attributable to such persons shall not
be counted as being acquired by such persons.
(9) Provide that the amount
of common stock that may be encompassed under all Option Plans and
MRPs must not exceed, in the aggregate, 25 percent of the outstanding
common stock held by persons other than the subsidiary holding company’s
mutual holding company parent at the close of the proposed issuance;
(10) Provide that the
issuance shall be conducted in compliance with, to the extent applicable,
the forms required by the Board;
(11) Provide that the sales price of the
shares of stock to be sold in the issuance shall be a uniform price
determined in accordance with section 239.24;
(12) Provide that, if at the close of the
stock issuance the subsidiary holding company has more than thirty-five
shareholders of any class of stock, the subsidiary holding company
shall promptly register that class of stock pursuant to the Securities
Exchange Act of 1934, as amended (15 U.S.C. 78a-78jj), and undertake
not to deregister such stock for a period of three years thereafter;
(13) Provide that, if
at the close of the stock issuance the subsidiary holding company
has more than one hundred shareholders of any class of stock, the
subsidiary holding company shall use its best efforts to:
(i) Encourage
and assist a market maker to establish and maintain a market for that
class of stock; and
(ii) List that class of stock on a national or regional securities
exchange or on the NASDAQ quotation system;
(14) Provide that, for a period
of three years following the proposed issuance, no insider of the
subsidiary holding company or his or her associates shall purchase,
without the prior written approval of the Board, any stock of the subsidiary
holding company except from a broker dealer registered with the Securities
and Exchange Commission, except that the foregoing restriction shall
not apply to:
(i) Negotiated transactions involving
more than one percent of the outstanding stock in the class of stock;
or
(ii) Purchases
of stock made by and held by any tax-qualified or non-tax-qualified
employee stock benefit plan of the subsidiary holding company even
if such stock is attributable to insiders of the subsidiary holding
company and subsidiary savings association or their associates;
(15) Provide
that stock purchased by insiders of the subsidiary holding company
and subsidiary savings association and their associates in the proposed
issuance shall not be sold for a period of at least one year following
the date of purchase, except in the case of death of the insider or
associate;
(16) Provide
that, in connection with stock subject to restriction on sale for
a period of time:
(i) Each certificate for such stock
shall bear a legend giving appropriate notice of such restriction;
(ii) Appropriate instructions
shall be issued to the subsidiary holding company’s transfer agent
with respect to applicable restrictions on transfer of such stock;
and
(iii) Any shares
issued as a stock dividend, stock split, or otherwise with respect
to any such restricted stock shall be subject to the same restrictions
as apply to the restricted stock;
(17) Provide that the subsidiary holding
company will not offer or sell any of the stock proposed to be issued
to any person whose purchase would be financed by funds loaned, directly
or indirectly, to the person by the subsidiary holding company;
(18) Provide that, if
necessary, the subsidiary holding company’s charter will be amended
to authorize issuance of the stock and attach and incorporate by reference
the text of any such amendment;
(19) Provide that the expenses incurred
in connection with the issuance shall be reasonable;
(20) Provide that the Stock Issuance Plan,
if proposed as part of a Reorganization Plan, may be amended or terminated
in the same manner as the Reorganization Plan. Otherwise, the Stock
Issuance Plan shall provide that it may be substantively amended by
the board of directors of the issuing subsidiary holding company as
a result of comments from regulatory authorities or otherwise prior
to approval of the Plan by the Board, and at any time thereafter with
the concurrence of the Board; and that the Stock Issuance Plan may
be terminated by the board of directors at any time prior to approval
of the Plan by the Board, and at any time thereafter with the concurrence
of the Board;
(21) Provide
that, unless an extension is granted by the Board, the Stock Issuance
Plan shall be terminated if not completed within 90 days of the date
of such approval; or
(22) Provide that the subsidiary holding company may make scheduled
discretionary contributions to a tax-qualified employee stock benefit
plan provided such contributions do not cause the subsidiary holding
company to fail to meet any of its regulatory capital requirements.
