(1) Title change. Prior to changing its corporate title, a subsidiary holding company
must file with the appropriate Reserve Bank a written notice indicating
the intended change. The Reserve Bank shall provide to the subsidiary
holding company a timely written acknowledgment stating when the notice
was received. If, within 30 days of receipt of notice, the Reserve
Bank or the Board does not notify the subsidiary holding company of
its objection on the grounds that the title misrepresents the nature
of the institution or the services it offers, the subsidiary holding
company may change its title by amending section 1 of its charter
in accordance with this section and the amendment provisions of its
charter.
(2) Home office. A subsidiary holding company
may amend its charter by substituting a new domicile in section 2
of its charter.
(3) Number of shares of stock and par value. A subsidiary holding company may amend Section 5 of its charter
to change the number of authorized shares of stock, the number of
shares within each class of stock, and the par or stated value of
such shares.
(4) Capital stock. A subsidiary holding company
may amend its charter by revising Section 5 to read as follows:
Section 5. Capital
stock. The total number of shares of all classes of capital stock
that the subsidiary holding company has the authority to issue is
, of which
shall be common stock of par [or if no par value
is specified the stated] value of
per share and of which [list
the number of each class of preferred and the par or if no par value
is specified the stated value per share of each such class]. The shares
may be issued from time to time as authorized by the board of directors
without further approval of shareholders, except as otherwise provided
in this Section 5 or to the extent that such approval is required
by governing law, rule, or regulation. The consideration for the issuance
of the shares shall be paid in full before their issuance and shall
not be less than the par [or stated] value. Neither promissory notes
nor future services shall constitute payment or part payment for the
issuance of shares of the subsidiary holding company. The consideration
for the shares shall be cash, tangible or intangible property (to
the extent direct investment in such property would be permitted),
labor, or services actually performed for the subsidiary holding company,
or any combination of the foregoing. In the absence of actual fraud
in the transaction, the value of such property, labor, or services,
as determined by the board of directors of the subsidiary holding
company, shall be conclusive. Upon payment of such consideration,
such shares shall be deemed to be fully paid and nonassessable. In
the case of a stock dividend, that part of the retained earnings of
the subsidiary holding company that is transferred to common stock
or paid-in capital accounts upon the issuance of shares as a stock
dividend shall be deemed to be the consideration for their issuance.
Except for shares issued in the initial organization
of the subsidiary holding company, no shares of capital stock (including
shares issuable upon conversion, exchange, or exercise of other securities)
shall be issued, directly or indirectly, to officers, directors, or
controlling persons of the association or subsidiary holding company
other than as part of a general public offering or as qualifying shares
to a director, unless their issuance or the plan under which they
would be issued has been approved by a majority of the total votes
eligible to be cast at a legal meeting.
Nothing contained in this Section 5 (or in any supplementary
sections hereto) shall entitle the holders of any class of a series
of capital stock to vote as a separate class or series or to more
than one vote per share, except as to the cumulation of votes for
the election of directors, unless the charter otherwise provides that
there shall be no such cumulative voting: Provided, That this
restriction on voting separately by class or series shall not apply:
(i) To any provision which would authorize the holders of preferred
stock, voting as a class or series, to elect some members of the board
of directors, less than a majority thereof, in the event of default
in the payment of dividends on any class or series of preferred stock;
(ii) To any provision
that would require the holders of preferred stock, voting as a class
or series, to approve the merger or consolidation of the subsidiary
holding company with another corporation or the sale, lease, or conveyance
(other than by mortgage or pledge) of properties or business in exchange
for securities of a corporation other than the subsidiary holding
company if the preferred stock is exchanged for securities of such
other corporation: Provided, That no provision may require
such approval for transactions undertaken with the assistance or pursuant
to the direction of the Board or the Federal Deposit Insurance Corporation;
(iii) To any amendment
which would adversely change the specific terms of any class or series
of capital stock as set forth in this Section 5 (or in any supplementary
sections hereto), including any amendment which would create or enlarge
any class or series ranking prior thereto in rights and preferences.
An amendment which increases the number of authorized shares of any
class or series of capital stock, or substitutes the surviving subsidiary
holding company in a merger or consolidation for the subsidiary holding
company, shall not be considered to be such an adverse change.
A description of the different classes and series (if
any) of the subsidiary holding company’s capital stock and a statement
of the designations, and the relative rights, preferences, and limitations
of the shares of each class of and series (if any) of capital stock
are as follows:
A. Common stock. Except as provided in this Section 5 (or in any supplementary sections
thereto) the holders of the common stock shall exclusively possess
all voting power. Each holder of shares of the common stock shall
be entitled to one vote for each share held by each holder, except
as to the cumulation of votes for the election of directors, unless
the charter otherwise provides that there shall be no such cumulative
voting.
Whenever there shall have been paid, or declared and
set aside for payment, to the holders of the outstanding shares of
any class of stock having preference over the common stock as to the
payment of dividends, the full amount of dividends and of sinking
fund, retirement fund, or other retirement payments, if any, to which
such holders are respectively entitled in preference to the common
stock, then dividends may be paid on the common stock and on any class
or series of stock entitled to participate therewith as to dividends
out of any assets legally available for the payment of dividends.
In the event of any liquidation, dissolution, or winding
up of the subsidiary holding company, the holders of the common stock
(and the holders of any class or series of stock entitled to participate
with the common stock in the distribution of assets) shall be entitled
to receive, in cash or in kind, the assets of the subsidiary holding
company available for distribution remaining after:
(i) Payment
or provision for payment of the subsidiary holding company’s debts
and liabilities;
(ii) distributions or provision for distributions in settlement of
its liquidation account; and
(iii) distributions or provision for
distributions to holders of any class or series of stock having preference
over the common stock in the liquidation, dissolution, or winding
up of the subsidiary holding company. Each share of common stock shall
have the same relative rights as and be identical in all respects
with all the other shares of common stock.
B. Preferred stock. The subsidiary holding company may provide
in supplementary sections to its charter for one or more classes of
preferred stock, which shall be separately identified. The shares
of any class may be divided into and issued in series, with each series
separately designated so as to distinguish the shares thereof from
the shares of all other series and classes. The terms of each series
shall be set forth in a supplementary section to the charter. All
shares of the same class shall be identical except as to the following
relative rights and preferences, as to which there may be variations
between different series:
(a) The distinctive serial designation and the number of shares constituting
such series;
(b) The dividend
rate or the amount of dividends to be paid on the shares of such series,
whether dividends shall be cumulative and, if so, from which date(s),
the payment date(s) for dividends, and the participating or other
special rights, if any, with respect to dividends;
(c) The voting powers, full or limited, if
any, of shares of such series;
(d) Whether the shares of such series shall
be redeemable and, if so, the price(s) at which, and the terms and
conditions on which, such shares may be redeemed;
(e) The amount(s) payable upon the shares
of such series in the event of voluntary or involuntary liquidation,
dissolution, or winding up of the subsidiary holding company;
(f) Whether the shares of such
series shall be entitled to the benefit of a sinking or retirement
fund to be applied to the purchase or redemption of such shares, and
if so entitled, the amount of such fund and the manner of its application,
including the price(s) at which such shares may be redeemed or purchased
through the application of such fund;
(g) Whether the shares of such series shall
be convertible into, or exchangeable for, shares of any other class
or classes of stock of the subsidiary holding company and, if so,
the conversion price(s) or the rate(s) of exchange, and the adjustments
thereof, if any, at which such conversion or exchange may be made,
and any other terms and conditions of such conversion or exchange.
(h) The price or other consideration
for which the shares of such series shall be issued; and
(i) Whether the shares of such
series which are redeemed or converted shall have the status of authorized
but unissued shares of serial preferred stock and whether such shares
may be reissued as shares of the same or any other series of serial
preferred stock.
Each share of each series of serial preferred stock shall
have the same relative rights as and be identical in all respects
with all the other shares of the same series.
The board of directors shall have authority to divide,
by the adoption of supplementary charter sections, any authorized
class of preferred stock into series, and, within the limitations
set forth in this section and the remainder of this charter, fix and
determine the relative rights and preferences of the shares of any
series so established.
Prior to the issuance of any preferred shares
of a series established by a supplementary charter section adopted
by the board of directors, the subsidiary holding company shall file
with the appropriate Reserve Bank a dated copy of that supplementary
section of this charter established and designating the series and
fixing and determining the relative rights and preferences thereof.
(5) Limitations on subsequent issuances. A subsidiary holding company may amend its charter to require shareholder
approval of the issuance or reservation of common stock or securities
convertible into common stock under circumstances which would require
shareholder approval under the rules of the New York or American Stock
Exchange if the shares were then listed on the New York or American
Stock Exchange.
(6) Cumulative voting. A subsidiary holding
company may amend its charter by substituting the following sentence
for the second sentence in the third paragraph of Section 5: “Each
holder of shares of common stock shall be entitled to one vote for
each share held by such holder and there shall be no right to cumulate
votes in an election of directors.”
(7) [Reserved]
(8) Anti-takeover
provisions following mutual to stock conversion. Notwithstanding
the law of the state in which the subsidiary holding company is located,
a subsidiary holding company may amend its charter by renumbering
existing sections as appropriate and adding a new section 8 as follows:
Section 8. Certain
Provisions Applicable for Five Years. Notwithstanding anything
contained in the subsidiary holding company’s charter or bylaws to
the contrary, for a period of [specify number of years up to five]
years from the date of completion of the conversion of the subsidiary
holding company from mutual to stock form, the following provisions
shall apply:
A. Beneficial
Ownership Limitation. No person shall directly or indirectly
offer to acquire or acquire the beneficial ownership of more than
10 percent of any class of an equity security of the subsidiary holding
company. This limitation shall not apply to a transaction in which
the subsidiary holding company forms a holding company without change
in the respective beneficial ownership interests of its stockholders
other than pursuant to the exercise of any dissenter and appraisal
rights, the purchase of shares by underwriters in connection with
a public offering, or the purchase of shares by a tax-qualified employee
stock benefit plan which is exempt from the approval requirements
under section 238.12(a) of this chapter.
In the event shares are acquired in violation of this
section 8, all shares beneficially owned by any person in excess of
10 percent shall be considered “excess shares” and shall not be counted
as shares entitled to vote and shall not be voted by any person or
counted as voting shares in connection with any matters submitted
to the stockholders for a vote.
For purposes of this section 8, the following definitions
apply:
(1) The term “person” includes an individual,
a group acting in concert, a corporation, a partnership, an association,
a joint stock company, a trust, an unincorporated organization or
similar company, a syndicate or any other group formed for the purpose
of acquiring, holding or disposing of the equity securities of the
subsidiary holding company.
(2) The term “offer” includes every offer to buy or otherwise acquire,
solicitation of an offer to sell, tender offer for, or request or
invitation for tenders of, a security or interest in a security for
value.
(3) The term “acquire”
includes every type of acquisition, whether effected by purchase,
exchange, operation of law or otherwise.
(4) The term “acting in concert” means (a)
knowing participation in a joint activity or conscious parallel action
towards a common goal whether or not pursuant to an express agreement,
or (b) a combination or pooling of voting or other interests in the
securities of an issuer for a common purpose pursuant to any contract,
understanding, relationship, agreement or other arrangements, whether
written or otherwise.
B. Cumulative
Voting Limitation. Stockholders shall not be permitted to cumulate
their votes for election of directors.
C. Call for
Special Meetings. Special meetings of stockholders relating to
changes in control of the subsidiary holding company or amendments
to its charter shall be called only upon direction of the board of
directors.
