1. (a) Scope. This section governs an application for the purchase of assets pursuant to the Finance Code, §§32.001(c) and 32.401-32.404.

2. (b) Form of application. The applicant shall submit a fully completed, verified application on a form prescribed by the banking commissioner and simultaneously tender the required filing fee pursuant to §15.2 of this title (relating to Filing Fees and Cost Deposits). The application must, except to the extent waived by the banking commissioner, include the following information:

   1. (1) a summary of the proposed transaction, including a description of the types and total dollar amounts of liabilities and obligations expressly assumed;
   2. (2) a copy of all agreements related to the proposed transaction executed by an authorized representative of each party to the transaction;
   3. (3) for each party to the transaction, a certified copy of those portions of the minutes of board meetings and shareholder or participant meetings at which action was taken regarding approval of the transaction, or a certificate of an officer verifying the action taken by the board of directors and the shareholders or participants approving the transaction, or an explanation of the basis for concluding such action was not required;
   4. (4) an assessment of the applicant's future prospects, proposed officers and directors, and proposed branches and other locations;
   5. (5) an assessment of the current regulatory and financial condition of each party to the transaction;
   6. (6) if the proposed transaction will change the existing CRA delineated community of the applicant, a copy of the proposed CRA map depicting the proposed delineated community of the applicant;
   7. (7) a copy of current financial statements for each entity involved in the proposed transaction, accompanied by an affidavit of no material change dated no earlier than 30 days prior to the date of submission of the application;
   8. (8) a copy of the latest annual report for each financial institution and bank holding company involved in the proposed transaction;
   9. (9) a copy of that portion of the most recent watch list for the applicant and that portion of the watch list of the selling party that identifies low-quality assets being acquired or liabilities being assumed;
   10. (10) a description of the due diligence review conducted by or for the applicant and a summary of findings;
   11. (11) a description of all material legal or administrative proceedings involving the applicant;

   12. (12) an opinion of legal counsel that conforms with §15.109 of this title (relating to Opinion of Legal Counsel), concluding the following:

       1. (A) the transaction will not cause or result in a material violation of the laws of this state relative to the organization and operation of state banks;
       2. (B) the liabilities and obligations of the purchasing bank will be limited to those expressly assumed under the purchase agreement, unless otherwise required by law; and
       3. (C) all conditions with respect to the transaction imposed by the banking commissioner have been satisfied or otherwise resolved or, to the best knowledge of legal counsel, no such conditions have been imposed;
   13. (13) a copy of each filing regarding the proposed transaction that is required to be made with another governmental authority, complete with all related attachments, exhibits, and correspondence;
   14. (14) a current pro forma balance sheet and income statement of the applicant, with adjustments, reflecting the proposed transaction as of the most recent quarter ended immediately prior to the filing of the application;
   15. (15) a copy of the applicant's strategic plan that complies with the department's Memorandum 1009, including projections of the balance sheet and income statement of the applicant as of the quarter ending one year from the date of its current pro forma financial statement required in accordance with paragraph (14) of this subsection;
   16. (16) an explanation of the manner and basis of valuing any of the shares or other evidences of ownership of an entity that is to constitute part of the consideration used to acquire assets;
   17. (17) the location of each new branch of the applicant that will result from the transaction;
   18. (18) for antitrust purposes, an analysis of the anticipated competitive effect of the proposed transaction in the affected markets and a statement of the basis of the analysis of the competitive effects, or alternatively, a copy of the analysis of competitive effects of the proposed transaction addressed in the companion federal regulatory agency application, if applicable; and
   19. (19) such other information that the banking commissioner, in the exercise of discretion, requires to be included in the particular application as considered necessary to an informed decision to approve or deny the proposed transaction.
3. (c) Applicant's duty to disclose. The applicant bears the burden to supply all material information necessary to enable the banking commissioner to make a fully informed decision regarding the application.
4. (d) Public notice. Within 14 days prior to or after submission of the initial application, the applicant shall publish notice in accordance with the requirements of §15.5 of this title (relating to Public Notice) in the specified communities where the home offices of the applicant and other financial institutions involved in the transaction are located.

Source Note:The provisions of this §15.105 adopted to be effective September 15, 1997, 22 TexReg 8948.