North Dakota Code 13-09.1-16 – Acquisition of control
1. Any person, or group of persons acting in concert, seeking to acquire control of a licensee shall obtain the written approval of the commissioner prior to acquiring control. An individual is not deemed to acquire control of a licensee and is not subject to the acquisition of control provisions when that individual becomes a key individual in the ordinary course of business.
Terms Used In North Dakota Code 13-09.1-16
- Appeal: A request made after a trial, asking another court (usually the court of appeals) to decide whether the trial was conducted properly. To make such a request is "to appeal" or "to take an appeal." One who appeals is called the appellant.
- Devise: To gift property by will.
- following: when used by way of reference to a chapter or other part of a statute means the next preceding or next following chapter or other part. See North Dakota Code 1-01-49
- Guardian: A person legally empowered and charged with the duty of taking care of and managing the property of another person who because of age, intellect, or health, is incapable of managing his (her) own affairs.
- Individual: means a human being. See North Dakota Code 1-01-49
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Person: means an individual, organization, government, political subdivision, or government agency or instrumentality. See North Dakota Code 1-01-49
- Process: means a writ or summons issued in the course of judicial proceedings. See North Dakota Code 1-01-49
- State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See North Dakota Code 1-01-49
- Trustee: A person or institution holding and administering property in trust.
- written: include "typewriting" and "typewritten" and "printing" and "printed" except in the case of signatures and when the words are used by way of contrast to typewriting and printing. See North Dakota Code 1-01-37
2. A person, or group of persons acting in concert, seeking to acquire control of a licensee shall, in cooperation with the licensee:
a. Submit an application in a form and in a medium prescribed by the commissioner; and b. Submit a nonrefundable fee of four hundred fifty dollars with the request for approval.
3. Upon request, the commissioner may permit a licensee or the person, or group of persons acting in concert, to submit some or all information required by the commissioner pursuant to subdivision a of subsection 2 without using the nationwide system.
4. The application required by subdivision a of subsection 2 must include information required by section 13-09.1-12 for any new key individuals that have not previously completed the requirements of section 13-09.1-12 for a licensee.
5. When an application for acquisition of control under this section appears to include all the items and address all of the matters that are required, the application must be considered complete and the commissioner shall promptly notify the applicant in a record of the date on which the application was determined to be complete. The commissioner shall approve or deny the application within sixty days after the completion date; or the commissioner may for good cause extend the application period.
6. A determination by the commissioner that an application is complete and is accepted for processing means only that the application, on its face, appears to include all of the items and address all of the matters that are required, and is not an assessment of the substance of the application or of the sufficiency of the information provided.
7. When an application is filed and considered complete under subsection 5, the commissioner shall investigate the financial condition and responsibility, financial and business experience, character, and general fitness of the person, or group of persons acting in concert, seeking to acquire control. The commissioner shall approve an acquisition of control pursuant to this section if the commissioner finds that all of the following conditions have been fulfilled:
a. The requirements of subsections 2 and 4 have been met, as applicable; and
b. The financial condition and responsibility, financial and business experience, competence, character, and general fitness of the person, or group of persons acting in concert, seeking to acquire control; and the competence, experience, character, and general fitness of the key individuals and persons that would be in control of the licensee after the acquisition of control indicate that it is in the interest of the public to permit the person, or group of persons acting in concert, to control the licensee.
8. If an applicant avails itself or is otherwise subject to a multistate licensing process:
a. The commissioner may accept the investigation results of a lead investigative state for the purpose of subsection 7 if the lead investigative state has sufficient staffing, expertise, and minimum standards; or
b. If North Dakota is a lead investigative state, the commissioner may investigate the applicant pursuant to subsection 7 and the time frames established by agreement through the multistate licensing process.
9. The commissioner shall issue a formal written notice of the denial of an application to acquire control within thirty days of the decision to deny the application. The commissioner shall set forth in the notice of denial the specific reasons for the denial of the application. An applicant whose application is denied by the commissioner under this subsection may appeal within thirty days after receipt of the written notice of the denial by requesting a hearing before the commissioner in accordance with chapter 28-32.
10. The requirements of subsections 1 and 2 do not apply to any of the following:
a. A person that acts as a proxy for the sole purpose of voting at a designated meeting of the shareholders or holders of voting shares or voting interests of a licensee or a person in control of a licensee; b. A person that acquires control of a licensee by devise or descent; c. A person that acquires control of a licensee as a personal representative, custodian, guardian, conservator, or trustee, or as an officer appointed by a court of competent jurisdiction or by operation of law; d. A person that is exempt under subsection 7 of section 13-09.1-02; e. A person that the commissioner determines is not subject to subsection 1 based on the public interest; f. A public offering of securities of a licensee or a person in control of a licensee; or g. An internal reorganization of a person in control of the licensee where the ultimate person in control of the licensee remains the same.
11. Persons in subdivisions b, c, d, f, and g of subsection 10 in cooperation with the licensee shall notify the commissioner within fifteen days after the acquisition of control.
12. The requirements of subsections 1 and 2 do not apply to a person that has complied with and received approval to engage in money transmission under this chapter or was identified as a person in control in a prior application filed with and approved by the commissioner or by a money service business accredited state pursuant to a multistate licensing process, provided that:
a. The person has not had a license revoked or suspended or controlled a licensee that has had a license revoked or suspended while the person was in control of the licensee in the previous five years; b. If the person is a licensee, the person is well managed and has received at least a satisfactory rating for compliance at its most recent examination by a money service business accredited state if such rating was given; c. The licensee to be acquired is projected to meet the requirements of section 13-09.1-32, 13-09.1-33, and 13-09.1-34 after the acquisition of control is completed, and if the person acquiring control is a licensee, that licensee is also projected to meet the requirements of sections 13-09.1-32, 13-09.1-33, and 13-09.1-34 after the acquisition of control is completed; d. The licensee to be acquired will not implement any material changes to its business plan as a result of the acquisition of control, and if the person acquiring control is a licensee, that licensee also will not implement any material changes to its business plan as a result of the acquisition of control; and
e. The person provides notice of the acquisition in cooperation with the licensee and attests to subdivisions a through d in a form and in a medium prescribed by the commissioner.
If the notice is not disapproved within thirty days after the date on which the notice was determined to be complete, the notice is deemed approved.
13. Before filing an application for approval to acquire control of a licensee a person may request in writing a determination from the commissioner as to whether the person would be considered a person in control of a licensee upon consummation of a proposed transaction. If the commissioner determines that the person would not be a person in control of a licensee, the proposed person and transaction is not subject to the requirements of subsections 1 and 2.
14. If a multistate licensing process includes a determination pursuant to subsection 13 and an applicant avails itself or is otherwise subject to the multistate licensing process:
a. The commissioner may accept the control determination of a lead investigative state with sufficient staffing, expertise, and minimum standards for the purpose of subsection 13; or
b. If North Dakota is a lead investigative state, the commissioner may investigate the applicant pursuant to subsection 13 and the time frames established by agreement through the multistate licensing process.