HARRY HUGHES, Governor

463

NOT ACQUIRE, DIRECTLY OR INDIRECTLY, CONTROL OF A GUARANTY
STOCK ASSOCIATION.

(C)   PROHIBITION.

A PERSON MAY NOT ACQUIRE, DIRECTLY OR INDIRECTLY,
CONTROL OF MORE THAN ONE GUARANTY STOCK ASSOCIATION.

(D)   CONFLICT OF INTEREST.

(1)   EXCEPT AS PROVIDED IN ITEM (2) OF THIS
SUBSECTION, A CONTROLLING PERSON MAY NOT PARTICIPATE,
DIRECTLY OR INDIRECTLY, IN A BUSINESS OR TRANSACTION THAT
WOULD RESULT IN A CONFLICT OF INTEREST WITH THE GUARANTY
STOCK ASSOCIATION.

(2)   A CONTROLLING PERSON MAY ENGAGE IN ANY
BUSINESS OR TRANSACTION WITH A GUARANTY STOCK ASSOCIATION
IF:

(I)   A FULL DISCLOSURE IS MADE TO THE BOARD
OF DIRECTORS OF THE GUARANTY STOCK ASSOCIATION;

(II)   THE TRANSACTION IS APPROVED IN GOOD
FAITH BY THE RECORDED VOTE OF THE DISINTERESTED DIRECTORS OF
THE ASSOCIATION; AND

(III)   ANY PROFITS OF THE CONTROLLING
PERSON ARE NOT AT THE EXPENSE OF THE GUARANTY STOCK
ASSOCIATION AND DO NOT PREJUDICE ITS BEST INTERESTS.

(E) LOAN TO CONTROLLING PERSON.

A GUARANTY STOCK ASSOCIATION MAY MAKE A LOAN TO ANY
CONTROLLING PERSON ONLY IF:

(1)   THE LOAN IS APPROVED BY A TWO THIRDS VOTE OF
ITS BOARD OF DIRECTORS WITH ANY DIRECTOR OF THE ASSOCIATION
WHO HAS ANY FINANCIAL INTEREST IN OR IS AN EMPLOYEE OR
DIRECTOR OF THE CONTROLLING PERSON ABSTAINING;

(2)   THE SECURITY IS APPRAISES BY A DISINTERESTED
APPRAISER; AND

(3) THE LOAN IS APPROVED BY THE DIVISION
DIRECTOR.

(F) SALE OR TRANSFER BY CONTROLLING PERSON.

(1)   UNLESS THE DIVISION DIRECTOR APPROVES THE
PLAN OF SALE OR TRANSFER, A CONTROLLING PERSON MAY NOT SELL
OR TRANSFER MORE THAN 25 PERCENT OF THE GUARANTY STOCK THAT
CONSTITUTES A CONTROLLING BLOCK.

(2)   IF THE DIVISION DIRECTOR FINDS THAT THE
CHARACTER, RESPONSIBILITY, AND GENERAL FITNESS OF THE
PROPOSED TRANSFEREE WARRANTS BELIEF THAT THE GUARANTY STOCK