Connecticut General Statutes 36a-196 – Issuance of common stock
(a) Following the reorganization of any mutual savings bank or mutual savings and loan association pursuant to sections 36a-192 to 36a-199, inclusive, the reorganized savings institution of such mutual holding company shall not sell or offer to sell its common stock or securities convertible into common stock unless each eligible account holder of the reorganized savings institution receives, without payment, nontransferable subscription rights to purchase common stock or securities convertible into common stock, as the case may be, of the reorganized savings institution pursuant to a subscription offering: (1) In which every eligible account holder may receive the right, subject to modification in the event of an over-subscription to the subscription offering by all eligible account holders, to purchase up to a maximum of one-half of one per cent of the total number of the shares of common stock or securities convertible into common stock, as the case may be, being offered by the reorganized savings institution; (2) in which every eligible account holder, regardless of such account holder’s relationship to the reorganized savings institution, may participate at the same time as every other eligible account holder; and (3) which offering shall precede any offering of the reorganized savings institution’s common stock or securities convertible into common stock, as the case may be, to the members of the general public. The terms of the subscription offering may provide that any savings account with total balances of less than five hundred dollars, or any lesser amount as determined by the governing board of the reorganized savings institution, shall not constitute a qualifying deposit for participation in the subscription offering. Not later than fifteen days from the date of submission to the commissioner of a plan outlining the terms of the subscription offering, the reorganized savings institution shall mail by first class mail a notice to each eligible account holder as of the eligibility record date indicating that: (A) The governing board of the reorganized savings institution has approved the sale of a certain number of shares of common stock or securities convertible into common stock, as the case may be; (B) such eligible account holder shall have nontransferable rights to subscribe for shares of the common stock or securities convertible into common stock, as the case may be, of the reorganized savings institution; (C) the holders of capital stock of the reorganized savings bank shall have exclusive voting rights; (D) the right to subscribe to shares of common stock or securities convertible into common stock, as the case may be, will expire unless such rights are exercised by the eligible account holder within the time period specified in such notice, which date shall not be less than sixty days from the date of the submission to the commissioner of the plan outlining the terms of the subscription offering; and (E) in order to obtain further information with respect to the subscription offering, the eligible account holder shall indicate such eligible account holder’s interest to the reorganized savings institution by returning a postage prepaid expression of interest sent by the reorganized savings institution not later than the date set forth in the notice, which date shall be not less than thirty days from the date of the submission to the commissioner of the plan outlining the terms of the subscription offering. In mailing such notice to eligible account holders, the reorganized savings institution may rely upon the last-known valid address of such account holder in its possession. The reorganized savings institution shall have no further obligation to forward information regarding the conversion offering to eligible account holders who have not returned postage prepaid expressions of interest or responded otherwise in writing to such notice.
Terms Used In Connecticut General Statutes 36a-196
- Bank: means a Connecticut bank or a federal bank. See Connecticut General Statutes 36a-2
- Capital stock: when used in conjunction with any bank or out-of-state bank means a bank or out-of-state bank that is authorized to accumulate funds through the issuance of its capital stock. See Connecticut General Statutes 36a-2
- Commissioner: means the Banking Commissioner and, with respect to any function of the commissioner, includes any person authorized or designated by the commissioner to carry out that function. See Connecticut General Statutes 36a-2
- Company: means any corporation, joint stock company, trust, association, partnership, limited partnership, unincorporated organization, limited liability company or similar organization, but does not include (A) any corporation the majority of the shares of which are owned by the United States or by any state, or (B) any trust which by its terms shall terminate within twenty-five years or not later than twenty-one years and ten months after the death of beneficiaries living on the effective date of the trust. See Connecticut General Statutes 36a-2
- Deposit: means funds deposited with a depository. See Connecticut General Statutes 36a-2
- Governing board: means the group of persons vested with the management of the affairs of a financial institution irrespective of the name by which such group is designated. See Connecticut General Statutes 36a-2
- Holding company: means a bank holding company or a savings and loan holding company, except, as used in sections 36a-180 to 36a-191, inclusive, "holding company" means a company that controls a bank. See Connecticut General Statutes 36a-2
- Loan: includes any line of credit or other extension of credit. See Connecticut General Statutes 36a-2
- Mutual: when used in conjunction with any institution that is a bank or out-of-state bank means any such institution without capital stock. See Connecticut General Statutes 36a-2
- Mutual holding company: means a mutual holding company organized under sections 36a-192 to 36a-199, inclusive, and unless otherwise indicated, a subsidiary holding company controlled by a mutual holding company organized under sections 36a-192 to 36a-199, inclusive. See Connecticut General Statutes 36a-2
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Reorganized savings bank: means any savings bank incorporated and organized in accordance with sections 36a-192 and 36a-193. See Connecticut General Statutes 36a-2
- Reorganized savings institution: means any reorganized savings bank or reorganized savings and loan association. See Connecticut General Statutes 36a-2
- Savings account: means a deposit account, other than an escrow account established pursuant to §. See Connecticut General Statutes 36a-2
- State: means any state of the United States, the District of Columbia, any territory of the United States, Puerto Rico, Guam, American Samoa, the trust territory of the Pacific Islands, the Virgin Islands and the Northern Mariana Islands. See Connecticut General Statutes 36a-2
- Subsidiary: has the meaning given to that term in 12 USC Section 1841(d), as amended from time to time. See Connecticut General Statutes 36a-2
(b) The provisions of subsection (a) of this section shall not be applicable to any sale or offer to sell of the common stock or securities convertible into common stock of a reorganized savings institution which sale or offer to sell: (1) Is made solely to the mutual holding company of such reorganized savings institution; or (2) is made subsequent to a prior sale or offer to sell of the common stock or securities convertible into common stock of the reorganized savings institution which sale or offer to sell was made in accordance with subsection (a) of this section and in which the number of shares offered for sale would have constituted twenty per cent of the total authorized and outstanding shares of common stock of the reorganized savings institution if all of such shares had been sold in such offering and, in the case of securities convertible into common stock, if all of such stock had been immediately converted to common stock.
(c) The provisions of sections 36a-105 and 36a-108 shall apply to the issuance of shares of common stock or shares of securities convertible into common stock only by a reorganized savings institution.
(d) A reorganized savings institution that issues or has issued and outstanding any common stock, securities convertible into common stock or preferred stock to any persons other than the mutual holding company of which it is a subsidiary shall file, together with its mutual holding company, in the manner set forth in this subsection, consolidated financial statements and periodic and other reports whether or not required under federal law. Such consolidated financial statements and periodic and other reports shall include all information required under, and shall be prepared in accordance with the requirements of the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Securities and Exchange Commission adopted pursuant thereto. In addition, the reorganized savings institution shall prepare for mailing to each shareholder proxy materials in accordance with the requirements of the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Securities and Exchange Commission adopted pursuant thereto. If such consolidated financial statements, reports or proxy materials are required to be filed with any federal authority or agency pursuant to federal law, there shall be no concurrent state filing requirement. If such consolidated financial statements, reports or proxy materials are not required to be filed with any federal authority or agency, copies of such consolidated financial statements, reports or proxy materials shall be filed with the commissioner and be a public record. For purposes of this subsection, a reorganized savings institution shall be deemed to have issued securities whether such securities are privately placed or publicly underwritten.