Change 56 to Update the Texas Rules for Credit Unions Page: 9,173
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Subchapter J. Changes in Corporate Status
91.1003. Mergers/Consolidations.
(a) Definitions. The following words and terms, when used in this section, shall have the
following meanings, unless the context clearly indicates otherwise.
(1) Acquirer credit union - The credit union that will continue in operation after the
merger/consolidation.
(2) Acquiree credit union - The credit union that will cease to exist as an operating
credit union at the time of the merger/consolidation.
(3) Merger inducement A promise by a credit union to pay to the members of
another credit union a sum of money or other material benefit upon the successful completion of
a merger of the two credit unions.
(4) . Substantial - An amount that is large in size, value, or importance. For purposes
of this section, an amount is substantial if it exceeds $1,000.00 in total.
(b) Two or more credit unions organized under the laws of this state, another state, or the
United States, may merge/consolidate, in whole or in part, with each other, or into a newly
incorporated credit union to the extent permitted by applicable law, subject to the requirements
of this rule. A credit union may not offer a merger inducement to another credit union's
members as a means of promoting a merger of the two credit unions.
(c) Notice of Intent to Merge/Consolidate. The credit unions shall notify the commissioner
in writing of their intent to merge/consolidate within ten days after the credit unions' boards of
directors formally agree in principle to merge/consolidate.
(d) Plan for Merger/Consolidation. Upon approval of a proposition for merger/consolidation by
the boards of directors, the credit unions must prepare a plan for the proposed merger/consolidation.
The plan shall include:
(1) The terms and conditions of the merger/consolidation including a detailed description
of any substantial remuneration, such as bonuses, deferred compensation, early payout of
retirement benefits, severance packages, retainers, services agreements, or other substantial
financial rewards or benefits that any board member or senior management employee of the
acquiree credit union may receive in connection with the merger/consolidation;
(2) the current financial reports of each credit union;
(3) the combined financial reports of the two or more credit unions;
(4) an analysis of the adequacy of the combined Allowance for Loan and Lease Losses
account;
(5) an explanation of any proposed adjustments to the members' shares, or provisions for
reserves, dividends, or undivided profits;
(6) a summary of the products and services proposed to be available to the members of
the acquirer credit union, with an explanation of any changes from the current products and
services provided to the members;
(7) a summary of the advantages and disadvantages of the merger/consolidation;
(8) the projected location of the main office and any branch location(s) after the
merger/consolidation and whether any existing office locations will be permanently closed; and
(9) any other items deemed critical to the merger/consolidation agreement by the boards of
directors.
(e) Submission of an Application to Merge/Consolidate to Department.91-73
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Texas. Credit Union Department. Change 56 to Update the Texas Rules for Credit Unions, text, June 18, 2020; Austin, Texas. (https://texashistory.unt.edu/ark:/67531/metapth1364379/m1/3/: accessed May 21, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.