00 HOUSE BILL NO. 415 01 "An Act relating to trust companies and providers of fiduciary services; amending 02 Rules 6 and 12, Alaska Rules of Civil Procedure, Rule 40, Alaska Rules of 03 Criminal Procedure, and Rules 204, 403, 502, 602, and 611, Alaska Rules of 04 Appellate Procedure; and providing for an effective date." 05 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 06 * Section 1. AS 06.05.235(g) is amended to read: 07  (g) For the purpose of this section and AS 06.05.570, a trust company 08 organized under AS 06.26 [AS 06.25] that is engaged in the business of banking shall 09 be considered a state bank. 10 * Sec. 2. AS 06 is amended by adding a new chapter to read: 11 Chapter 26. Providers of Fiduciary Services. 12 Article 1. General Authority. 13  Sec. 06.26.010. Persons authorized to act as fiduciaries. Notwithstanding 14 other provisions of law and except as provided in AS 06.26.020, a person may not act 01 as a fiduciary in this state unless the person is 02  (1) a trust company organized under this chapter; 03  (2) a private fiduciary that has received an exemption under 04 AS 06.26.200; 05  (3) a state financial institution; 06  (4) a national bank having its principal office in this state and 07 authorized by the United States Comptroller of the Currency to act as a fiduciary; 08  (5) a federally chartered savings association having its principal office 09 in this state and authorized by its federal chartering authority to act as a fiduciary; 10  (6) an international bank or an interstate bank with a branch bank in 11 this state established or maintained under AS 06.05.550 or an interstate or international 12 trust company with a trust office authorized under AS 06.26.810 - 06.26.890; in this 13 paragraph, "branch bank," "international bank," and "interstate bank" have the 14 meanings given in AS 06.05.540; or 15  (7) an interstate or international trust company with a trust office 16 authorized by the department under AS 06.26.810 - 06.26.890. 17  Sec. 06.26.020. Exemptions. Notwithstanding any other provision of this 18 chapter, a person does not act as a fiduciary under this chapter if the person 19  (1) is licensed to practice law in this state, is acting within the scope 20 of that license, and any fiduciary activity is solely incidental to the person's practice 21 of law; 22  (2) acts as trustee under a deed of trust delivered only as security for 23 the payment of money or for the performance of another act; 24  (3) receives and distributes on behalf of a principal rents and proceeds 25 of sales as a real estate broker or other licensee under AS 08.88; 26  (4) is registered under AS 45.55 as a broker-dealer, a state investment 27 advisor, or an investment adviser representative and is acting within the scope of that 28 registration; 29  (5) engages in the sale and administration of an insurance product as 30 an insurance company licensed under AS 21 or insurance producer licensed under 31 AS 21 and is acting within the scope of that license; 01  (6) is a cemetery association organized and acting under AS 10.30; 02  (7) acts as a trustee under a voting trust under AS 10.06; 03  (8) has a certified public accountant certificate issued under AS 08.04 04 and is acting within the scope of that certificate; 05  (9) serves as trustee of a charitable trust for the benefit of a nonprofit 06 corporation incorporated under AS 10.20; 07  (10) holds real property in trust for the primary purpose of subdivision, 08 development, or sale or to facilitate a business transaction with respect to the real 09 property; 10  (11) serves as trustee of a trust if 11  (A) at least one settlor of the trust is a member of the trustee's 12 family; and 13  (B) the person has not publicly solicited appointment as trustee 14 for any trust; 15  (12) holds money or other assets as a homeowners' association or 16 similar organization to pay maintenance and other related costs for commonly owned 17 property; in this paragraph, "homeowners' association" includes an association of 18 apartment owners under AS 34.07.450 and a unit owners' association or master 19 association under AS 34.08.990; 20  (13) holds money or other assets in connection with the collection of 21 debts or payments on loans by a person acting solely as the agent or representative at 22 the sole direction of the person to whom the debt or payment is owed, including 23 engaging in the business of an escrow agent; 24  (14) holds or disburses money or other assets held by a court-appointed 25 conservator or receiver if the conservatorship or receivership is under continuous court 26 supervision; 27  (15) engages in other activities expressly excluded from the application 28 of this chapter by regulations adopted by the department that are consistent with this 29 chapter; 30  (16) is a business partner acting with regard to the business, or a co- 31 owner of property acting with regard to the co-owned property. 01  Sec. 06.26.030. Location of operation. (a) A trust company may act as a 02 fiduciary in this state, another state, or a foreign country, subject to complying with 03 applicable laws of the state or foreign country, at an office or branch established and 04 maintained under this chapter. 05  (b) A trust company may conduct any activities at an office outside this state 06 that are permissible for a trust company chartered by the host state, except to the 07 extent those activities are expressly prohibited by the laws of this state or by a 08 regulation or order of the department applicable to the trust company. 09 Article 2. Name, Powers, Organization, and Capitalization. 10  Sec. 06.26.040. Name of trust company. (a) A person may not to use the 11 words "trust" or "trust company" or any other words in a manner that could reasonably 12 be expected to convey the impression that the person is acting as a fiduciary unless the 13 person is authorized to act as a fiduciary under AS 06.26.010. 14  (b) This section does not prohibit the use of the words "trust" or "trust 15 company" in the name of a corporation that is in existence as of the effective date of 16 this Act and that is not subject to this chapter if the corporation was originally 17 organized under the laws of this state and has not, since the date of its original 18 organization, amended or restated its articles of incorporation to delete from its name 19 the words "trust" or "trust company." 20  Sec. 06.26.050. Powers of trust company. (a) A trust company may perform 21 any act as a fiduciary that a state financial institution, or a national bank exclusively 22 exercising trust powers, may perform, including 23  (1) acting as trustee under a written agreement; 24  (2) receiving money and other property as trustee for investment in real 25 or personal property; 26  (3) acting as a trustee and performing the fiduciary duties committed 27 or transferred to it by a court; 28  (4) receiving money or other assets under AS 06.35; 29  (5) acting as an executor, an administrator, or a trustee of the estate of 30 a deceased person; 31  (6) acting as a custodian, guardian, conservator, or trustee for a minor 01 or an incapacitated person; 02  (7) acting as a successor fiduciary to a depository; 03  (8) receiving for safekeeping any type of personal property; 04  (9) acting as a custodian, an assignee, a transfer agent, an escrow agent, 05 a registrar, or a receiver; 06  (10) acting as an investment advisor, an agent, or an attorney-in-fact 07 in any agreed upon capacity; 08  (11) exercising additional powers expressly authorized by a regulation 09 adopted under this chapter; and 10  (12) exercising an incidental power that is reasonably necessary to 11 enable it to fully exercise the powers expressly conferred according to commonly 12 accepted fiduciary customs and usage. 13  (b) A trust company may exercise the powers of a business incorporated under 14 the laws of this state that are reasonably necessary to enable the exercise of its specific 15 powers under this chapter. 16  (c) A trust company may contribute to community solicitations, or to 17 charitable, philanthropic, or benevolent instrumentalities that operate to promote public 18 welfare, amounts that its board considers appropriate and in the interests of the trust 19 company. 20  (d) Subject to AS 06.26.370, a trust company may deposit trust money or other 21 assets with itself. 22  (e) Subject to the approval of the department and to being insured by the 23 Federal Deposit Insurance Corporation or its successor, a trust company may accept 24 deposits from the public. 25  (f) A trust company organized under this chapter may apply for a certificate 26 of authority under AS 06.05. 27  (g) A trust company organized under this chapter with a certificate of authority 28 issued under AS 06.05 may exercise all powers granted to it under AS 06.05 to the 29 extent the powers do not conflict with this chapter. A trust company with a certificate 30 of authority issued under AS 06.05 is subject to all of the provisions of AS 06.05. In 31 case of a conflict between the provisions of this chapter and AS 06.05, the provisions 01 of this chapter apply. 02  (h) In (a) of this section, "national bank exclusively exercising trust powers" 03 means a person issued a charter by the United States Comptroller of the Currency if 04 the charter confers only trust powers. 05  Sec. 06.26.060. Organizers. One or more persons may organize a trust 06 company. 07  Sec. 06.26.070. Incorporation. (a) A trust company shall be incorporated 08 under AS 10.06. 09  (b) In addition to the items required under AS 10.06.208 to be included in 10 articles of incorporation, the articles of incorporation of a trust company must specify 11  (1) the judicial district where the trust company will be located and the 12 community where the trust company will locate its principal place of business; 13  (2) the amount of the trust company's stock, which must be divided into 14 shares having a par value of not less than $1 each; 15  (3) that there will be at least five but not more than 25 directors; 16  (4) the period for which the trust company is organized, whether 17 limited or perpetual; 18  (5) the name by which the trust company will be known, which must 19 contain the words "trust company" as a part of the name; and 20  (6) a declaration that each incorporator will, if elected, accept the 21 responsibilities and faithfully discharge the duties of a director. 22  Sec. 06.26.080. Amendment of articles or bylaws. (a) A trust company may 23 amend its articles of incorporation or bylaws in a manner consistent with its articles, 24 its bylaws, AS 10.06, and this chapter by a vote of its shareholders representing at 25 least a majority of the capital at a regular meeting or at a special meeting called for 26 that purpose. The trust company shall file a written notice of an amendment with the 27 department. 28  (b) The department has 60 days from the date that the department receives a 29 notice under (a) of this section to review the amendment, and the amendment becomes 30 effective on the 61st day after the department receives the notice unless the department 31 specifies a different date. The department may extend the 60-day period of review if 01 the department determines that the notice raises issues that require additional 02 information or if the department needs additional time for analysis. If the 60-day 03 period of review is extended, the amendment becomes effective only when the 04 department approves the amendment in writing. 05  Sec. 06.26.085. Certificate of authority required. A person may not act as 06 a trust company until a certificate of authority is received from the department. 07  Sec. 06.26.090. Application for certificate of authority. (a) An application 08 for a certificate of authority shall be made in the form required by the department and 09 must be supported by the information, data, records, and opinions of counsel required 10 by the department. The application must be accompanied by all fees and deposits 11 required by this chapter. 12  (b) The department may grant a certificate of authority only if the department 13 receives evidence from the applicant that the department determines demonstrates that 14 the establishment of the proposed trust company will serve public convenience and 15 well-being. The evidence must address the following factors: 16  (1) the market to be served; 17  (2) whether the proposed organizational structure, capital structure, and 18 amount of initial capitalization are adequate for the proposed trust company and its 19 location; 20  (3) whether the anticipated volume and nature of the proposed trust 21 company indicates a reasonable probability of success and profitability based on the 22 market sought to be served; 23  (4) whether, as a group, the proposed officers, directors, and employees 24 have sufficient fiduciary experience, ability, standing, competence, trustworthiness, and 25 integrity to justify a belief that the proposed trust company will operate in compliance 26 with the law and that success of the proposed trust company is probable; 27  (5) whether each principal shareholder has sufficient experience, ability, 28 standing, competence, trustworthiness, and integrity to justify a belief that the proposed 29 trust company will be free from improper or unlawful influence or interference with 30 respect to the trust company's operation in compliance with the law; and 31  (6) whether the persons organizing the trust company are acting in good 01 faith. 02  (c) The applicant for a certificate of authority bears the burden of establishing 03 that public convenience and well-being will be served by the establishment of the trust 04 company. The failure of an applicant to furnish required information, data, opinions 05 of counsel, other material, the required fee, or a required deposit is considered an 06 abandonment of the application. 07  (d) An applicant shall pay under AS 06.01.010 the investigation expenses 08 incurred by the department in processing an application for a certificate of authority. 09 When submitting an application to the department, the applicant shall pay the 10 department $2,000 as an advance payment of the investigation expenses incurred by 11 the department. If the investigation expenses incurred by the department are less than 12 $2,000, the department shall promptly refund the excess to the applicant. If the 13 investigation expenses incurred by the department are greater than $2,000, the 14 department may obtain reimbursement from the applicant. 15  (e) If a protest of the application is not filed with the department on or before 16 the 15th day after the last date that the notice is published under AS 06.26.100, the 17 department may immediately determine whether the application meets the requirements 18 of this section based on the application and investigation. The department may 19 approve the application or hold a hearing on the application. The department may 20 deny the application if the department determines that the requirements of this chapter 21 have not been met. 22  (f) If the department holds a hearing under (e) of this section, the department 23 shall determine whether all of the applicable requirements of this section have been 24 satisfied and shall enter an order granting or denying the certificate of authority. The 25 department may set conditions on the certificate of authority and shall include any 26 conditions in the order granting the certificate of authority. 27  Sec. 06.26.100. Department notices regarding application. (a) The 28 department shall notify the organizers of a proposed trust company when the 29 application under AS 06.26.090 is complete and accepted for filing and all required 30 fees and deposits have been paid. Promptly after notification, the organizers shall 31 publish in a form specified by the department notice of the filing of the application in 01 a newspaper of general circulation published in the community proposed as the trust 02 company's principal place of business. If a newspaper of general circulation is not 03 published in the community, the organizers shall publish the notice in a newspaper of 04 general circulation near the community. The department may require the organizers 05 to publish the notice at other locations reasonably necessary to solicit the views of 06 potentially affected persons. The notice must include a solicitation of comments and 07 protests. 08  (b) To prove that the publication required by (a) of this section has been 09 accomplished, the organizers shall file with the department an affidavit of publication 10 from the newspaper in which the notice was published. 11  Sec. 06.26.110. Issuance of certificate of authority; required operation. (a) 12 The department may not deliver a certificate of authority to a person to act as a trust 13 company until the person has 14  (1) received cash or marketable securities in at least the full amount of 15 the capital required under AS 06.26.120 from subscriptions for the issuance of shares; 16  (2) elected or qualified the initial officers and directors named in the 17 application for the certificate of authority or other officers and directors approved by 18 the department; and 19  (3) complied with all other requirements of this chapter related to the 20 organization of a trust company. 21  (b) A person who receives a certificate of authority, including a certificate of 22 authority with conditions, shall open a home office and begin providing fiduciary 23 services within six months after the date that the person receives the certificate of 24 authority or by the end of any extension of the six-month period allowed by the 25 department. If the person does not open the home office or begin providing fiduciary 26 services within the six months or by the end of any extension, the department shall 27 revoke the certificate of authority. 28  Sec. 06.26.120. Required capital; change in outstanding capital and 29 surplus. (a) A trust company may not act as a fiduciary unless the trust company has 30 paid-in capital in an amount acceptable to the department, but not less than $400,000, 31 and paid-in surplus equal to 20 percent of paid-in capital. The trust company shall 01 hold its unimpaired capital as security for the faithful discharge of the fiduciary duties 02 undertaken by the trust company and for the claims of creditors. 03  (b) The department may by order require or permit adjustment to capital for 04 a proposed or existing trust company if the department finds the condition and 05 operations of an existing trust company or the proposed scope or type of operations 06 of a proposed trust company requires adjustment to capital to protect the safety and 07 soundness of the trust company. The safety and soundness factors to be considered 08 by the department in the exercise of its discretion to adjust capital include 09  (1) the nature and type of business conducted; 10  (2) the nature and degree of liquidity of the assets held by the trust 11 company other than trust assets; 12  (3) the amount of fiduciary assets being managed; 13  (4) the type of fiduciary assets held and the depository of those assets; 14  (5) the complexity of the fiduciary duties and degree of discretion 15 undertaken; 16  (6) the competence and experience of management; 17  (7) the extent and adequacy of internal controls; 18  (8) the presence or absence of annual unqualified audits by an 19 independent certified public accountant; 20  (9) the reasonableness of the trust company's plans for retaining or 21 acquiring additional capital; and 22  (10) the existence and adequacy of insurance held by the trust company 23 to protect its customers, beneficiaries, and grantors. 24  (c) If the department orders a trust company to increase or adjust its capital, 25 the order must state the date by which the increase or adjustment must be made. 26 Unless the trust company makes a written request for a hearing within 30 days after 27 the order is issued and before the date for making the increase or adjustment, the order 28 becomes effective and final and may not be appealed to the department. An order 29 under this subsection does not prohibit the trust company from later applying to the 30 department to reduce capital requirements for the trust company under (b) of this 31 section. 01  (d) Subject to (b) of this section and AS 06.26.200, a trust company to which 02 the department issues a certificate of authority shall at all times maintain capital in at 03 least the amount required under (a) of this section, as increased or decreased under (b) 04 of this section. 05  (e) A trust company may not reduce or increase its outstanding capital through 06 dividend, redemption, issuance of shares, or otherwise without the prior written 07 approval of the department, unless otherwise permitted by this chapter. 08  (f) Prior approval by the department is not required for a decrease in surplus 09 caused by incurred losses that exceed undivided profits. A decrease to surplus as a 10 result of losses shall be replaced before payment of further dividends. 11  Sec. 06.26.130. Capital notes or debentures. (a) A trust company may, with 12 the written consent of the department, and if authorized by its articles of incorporation 13 or approved by persons owning two-thirds of the stock of the trust company entitled 14 to vote, issue convertible or nonconvertible capital notes or debentures. The principal 15 amount of notes and debentures outstanding at any time may not exceed 33 1/3 percent 16 of the capital stock and surplus fund of the trust company on the date of issuance. 17 The rate and term are subject to the approval of the department, but the term may not 18 exceed 20 years. 19  (b) A trust company may not retire capital notes or debentures if the retirement 20 creates an impairment of its capital. Capital notes and debentures are subordinated in 21 right of payment in the event of insolvency or liquidation of the trust company to the 22 prior payment of all deposits and all claims of other creditors except the holders of 23 securities on a parity with the capital notes and debentures and the holders of securities 24 expressly subordinated to the capital notes and debentures. 25  Sec. 06.26.140. Cumulative voting. Shareholders may not use cumulative 26 voting in the election of directors unless cumulative voting is allowed by the trust 27 company's articles of incorporation. 28 Article 3. Operation of Offices. 29  Sec. 06.26.150. Trust company home office. (a) A trust company shall 30 continuously maintain in this state a home office where the trust company operates and 31 keeps its corporate books and records. At least one executive officer shall maintain 01 an office at the home office. 02  (b) Each executive officer at the home office is an agent of the trust company 03 for service of process. 04  (c) A trust company may change its home office to any of its offices existing 05 at the time of the change within this state by filing a written notice with the 06 department setting out the name of the trust company, the street address of its home 07 office before the change, the street address to which the home office is to be changed, 08 and a copy of a resolution adopted by the trust company's board authorizing the 09 change. 10  (d) The change of the location of a home office takes effect on the 61st day 11 after the date the department receives the notice under (c) of this section, unless the 12 department establishes a different date or unless, before the 61st day, the department 13 notifies the trust company that the trust company shall establish to the satisfaction of 14 the department that the relocation is consistent with the original determination made 15 under AS 06.26.090 for the establishment of a trust company at that location, in which 16 event the change of home office takes effect when approved by the department. 17  Sec. 06.26.160. Trust company branch offices. (a) A trust company may 18 establish branch offices anywhere in the state by filing a written notice with the 19 department setting out the name of the trust company, the street address of the 20 proposed branch office, a description of the activities proposed to be conducted at the 21 branch office, and a copy of a resolution adopted by the trust company's board. The 22 department has 60 days from the date the department receives the notice to review the 23 proposal for the branch office, and the trust company may begin operating the branch 24 office on the 61st day after the date the department receives the notice, unless the 25 department specifies a different date. 26  (b) The department may extend the 60-day period of review provided by (a) 27 of this section if the department determines that the proposed branch office raises 28 issues that require additional information or if the department needs additional time for 29 analysis. If the 60-day period of review is extended, the trust company may establish 30 the branch office only after the department approves the branch office in writing. The 31 department may deny the trust company permission to establish a branch office if the 01 department has safety or soundness concerns. 02  Sec. 06.26.170. Trust company representative offices. (a) A trust company 03 may establish or acquire representative trust offices anywhere in this state. To 04 establish or acquire a representative office, a trust company shall (1) file a written 05 notice with the department that sets out the name of the trust company and the location 06 of the proposed representative office, (2) furnish a copy of a resolution adopted by the 07 trust company's board authorizing the establishment or acquisition of the representative 08 office, and (3) pay the filing fee established by the department by regulation. The 09 department has 60 days from the date the department receives the notice to review the 10 establishment or acquisition of a representative office, and the trust company may 11 begin operating the representative office on the 61st day after the date the department 12 receives the notice, unless the department specifies a different date. 13  (b) The department may extend the 60-day period of review provided by (a) 14 of this section if the department determines that the written notice raises issues that 15 require additional information or if the department needs additional time for analysis. 16 If the 60-day period of review is extended, the trust company may establish the 17 representative office only after the department approves the office in writing. The 18 department may deny permission to establish or acquire a representative office of the 19 trust company if the department has safety or soundness concerns. 20  Sec. 06.26.180. Interstate and international offices. (a) With the prior 21 written approval of the department, a trust company may establish a branch office or 22 a representative office outside this state. To establish an interstate or international 23 office, a trust company shall submit an application to the department specifying 24  (1) the location of the proposed office; 25  (2) the business to be conducted at the proposed office; and 26  (3) the laws of the jurisdiction where the office will be located that 27 permit the office to be established. 28  (b) The department may approve an application for an interstate or 29 international office if the department finds that 30  (1) the laws of the jurisdiction in which the office is to be located 31 permit the establishment of the office; and 01  (2) the department does not have a significant supervisory or regulatory 02 concern regarding the proposed office. 03  (c) If a trust company submits with the application a certified statement of the 04 governmental regulator for the jurisdiction in which the office is to be located 05 expressly permitting the establishment of the office, the trust company may establish 06 the office by following the procedures under AS 06.26.090, except that the trust 07 company may not establish the office before the 91st day after the date the department 08 receives the notice filed under AS 06.26.160(a) unless the department notifies the trust 09 company that the trust company may establish the office on an earlier date. 10  (d) The department may deny a trust company permission to establish an 11 interstate or international office if the department has safety or soundness concerns 12 regarding 13  (1) the market to be served; 14  (2) whether the proposed organizational structure, capital structure, and 15 amount of initial capitalization are adequate; 16  (3) whether the anticipated volume and nature of the proposed office 17 indicate a reasonable probability of success and profitability based on the market 18 sought to be served; 19  (4) whether, as a group, the officers, directors, and employees have 20 sufficient fiduciary experience, ability, standing, competence, trustworthiness, and 21 integrity to justify a belief that the proposed office will operate in compliance with 22 law. 23  Sec. 06.26.190. Hours of operation. (a) A trust company and an interstate 24 or international trust company maintaining a trust office under AS 06.26.810 - 25 06.26.890 may close on the legal holidays described in AS 44.12.010 - 44.12.025. A 26 notice of holiday closings shall be made available to the trust company's customers by 27 mail, by the Internet, or by other means. 28  (b) A trust company and an interstate or international trust company 29 maintaining a trust office under AS 06.26.810 - 06.26.890 may close on any business 30 day if the trust company 31  (1) notifies the department in advance of the closure; and 01  (2) makes a closure notice available to its customers by mail, by the 02 Internet, or by other means. 03  (c) The hours of operation, and any changes in the hours of operation, of a 04 trust company and an interstate or international trust company maintaining a trust 05 office under AS 06.26.810 - 06.26.890 must be submitted to the department and must 06 be made available to the trust company's customers by mail, by the Internet, or by 07 other means. 08  (d) Notwithstanding this section, the hours of operation of a trust company 09 with a certificate of authority issued under AS 06.05 are subject to AS 06.05.166. 10 Article 4. Private Fiduciaries. 11  Sec. 06.26.200. Private fiduciaries. (a) Unless a private fiduciary is exempt 12 under AS 06.26.020, or unless the department expressly in writing exempts the person 13 under this section from all or some of the provisions of this chapter, a private fiduciary 14 shall comply with the provisions of this chapter applicable to a trust company. 15  (b) A private fiduciary may apply in writing for an exemption from specific 16 provisions of this chapter. The department may grant the exemption, in whole or in 17 part, if the department finds that the private fiduciary does not and will not offer 18 fiduciary services to the general public. 19  (c) At the expense of the private fiduciary, the department may examine or 20 investigate the private fiduciary in connection with an application for an exemption 21 under this section. Unless the application presents novel or unusual questions, the 22 department shall approve or deny the application for exemption or, at the written 23 request of the private fiduciary, hold a hearing on the application not later than the 24 61st day after the date that the department considers the application complete and 25 accepted for filing. The department may require the private fiduciary to submit 26 additional information the department considers necessary to make an informed 27 decision. 28  (d) The department may make an exemption under this section subject to 29 conditions or limitations imposed by the department that are consistent with this 30 chapter. 31  (e) The department may adopt regulations that are consistent with this chapter 01 defining the activities that do not constitute offering fiduciary services to the general 02 public, specifying the provisions of this chapter that are subject to an exemption under 03 this section, and establishing procedures and requirements for obtaining, maintaining, 04 or revoking an exemption granted under this section. 05  Sec. 06.26.210. Requirements to apply for and maintain status as a private 06 fiduciary. (a) To obtain an exemption under AS 06.26.200, a private fiduciary shall 07 file an application with the department containing 08  (1) a nonrefundable application fee established by the department by 09 regulation; 10  (2) a detailed statement under oath showing the private fiduciary's 11 assets and liabilities as of the end of the month that precedes the date of the filing of 12 the application with the department; 13  (3) a statement under oath of the reason for requesting the exemption; 14  (4) a statement under oath that the private fiduciary does not currently 15 offer fiduciary services to the general public and that the private fiduciary will not 16 offer fiduciary services to the general public without the prior written permission of 17 the department; 18  (5) the current street address of the physical location in this state where 19 the private fiduciary will maintain its books and records, the private fiduciary's current 20 telephone number at that location, and a statement under oath that the address given 21 is true and correct and not a United States Postal Service post office box or a private 22 commercial mail drop; 23  (6) a list of the specific provisions of this chapter or regulations 24 adopted under this chapter from which the private fiduciary requests an exemption. 25  (b) The department may not approve an exemption under this section unless 26 the application complies with (a) of this section. 27  (c) To maintain its exemption under AS 06.26.200, a private fiduciary 28  (1) may not offer fiduciary services to the general public; 29  (2) shall file an annual certification on or before December 31 of each 30 year on a form provided by the department that the private fiduciary is maintaining the 31 conditions and limitations of its exempt status; the annual certification must be 01 accompanied by a fee established by the department by regulation. 02  (d) The annual certification required under (c) of this section is valid only if 03 it bears an acknowledgment stamped by the department. The department has 60 days 04 from the date it receives the annual certification to review the annual certification and 05 return a copy of the acknowledged annual certification to the private fiduciary. The 06 burden is on the exempt private fiduciary to notify the department of a failure to return 07 a copy of an acknowledged annual certification within the 60-day period. 08  (e) The department may examine or investigate the private fiduciary 09 periodically as necessary to verify the annual certification. 10  (f) Notwithstanding having an exemption under AS 06.26.200, a private 11 fiduciary shall comply with the home office provisions of AS 06.26.150 and shall 12 report to the department any change of address or telephone number within 30 days 13 after the change. 14  Sec. 06.26.220. Transfer of control. Control of an exempt private fiduciary 15 may not be sold or otherwise transferred with the an exemption under AS 06.26.200. 16 In any change of control, the exempt status of the private fiduciary automatically 17 terminates on the effective date of the transfer, and the person acquiring control must 18 comply with this chapter. After transfer of control, a separate application for an 19 exemption under AS 06.26.200 must be filed with the department if the acquiring 20 person wishes to obtain or continue an exemption under AS 06.26.200. 21  Sec. 06.26.230. Revocation of exemption. (a) The department may revoke 22 an exemption under AS 06.26.200 if the exempt private fiduciary 23  (1) makes a false statement under oath on any document required to be 24 filed by this chapter; 25  (2) fails to submit to an examination as required by AS 06.26.200; 26  (3) withholds requested information from the department; or 27  (4) violates a provision of this section applicable to exempt private 28 fiduciaries. 29  (b) If the department determines from examination or other credible evidence 30 that an exempt private fiduciary has violated a requirement of this chapter, the 31 department may by personal delivery or registered or certified mail, return receipt 01 requested, notify the exempt private fiduciary in writing that the department will 02 revoke the private fiduciary's exemption as of a stated date, which may not be before 03 the fifth calendar day after the date that the notification is delivered or mailed, unless 04 the private fiduciary requests a hearing in writing before the stated date. The 05 notification must state the grounds for the revocation with reasonable certainty. After 06 a revocation takes effect, the revocation is final, the private fiduciary may not appeal 07 the revocation to the department, and the private fiduciary is subject to all of the 08 requirements and provisions of this chapter that are applicable to private fiduciaries not 09 exempt under AS 06.26.200. 10  (c) A private fiduciary shall comply with the provisions of this chapter from 11 which it was formerly exempt within five calendar days after the effective date of a 12 revocation of its exemption under this section. However, if the department determines 13 at the time of revocation that the private fiduciary has been engaging in or attempting 14 to engage in acts intended or designed to deceive or defraud, the department may, in 15 the department's sole discretion, shorten or eliminate the five-calendar-day compliance 16 period. 17  (d) If, within the time allowed under (c) of this section, the private fiduciary 18 does not comply with all of the provisions of this chapter, including the capitalization 19 requirements that have been determined by the department as necessary to assure the 20 safety and soundness of the private fiduciary, the department may 21  (1) file a court action or pursue another remedy provided by this 22 chapter; or 23  (2) refer the private fiduciary to the attorney general for institution of 24 appropriate legal proceedings against the private fiduciary. 25  Sec. 06.26.240. Conversion to trust company. (a) A private fiduciary may 26 not offer fiduciary services to the general public as a trust company until the private 27 fiduciary satisfies the requirements of this section. 28  (b) The private fiduciary shall file a notice with the department on a form 29 prescribed by the department, furnish a copy of a resolution adopted by the board 30 authorizing the private fiduciary to offer fiduciary services to the general public, pay 31 any filing fee established by the department by regulation, and comply with the 01 requirements of this chapter for trust companies. The notice must provide the name 02 of the private fiduciary and acknowledge that any exemption granted or otherwise 03 applicable to the private fiduciary under AS 06.26.200 ceases to apply on the effective 04 date of the notice. 05  (c) The department has 60 days after the department receives the notice under 06 (a) of this section to review the conversion, and a private fiduciary may begin offering 07 fiduciary services to the general public on the 61st day after the date that the 08 department receives a notice under (a) of this section from the private fiduciary, unless 09 the department specifies a different date. 10  (d) The department may extend the 60-day period of review provided by (c) 11 of this section if the department determines that the notice raises issues that require 12 additional information or if the department needs additional time for analysis. If the 13 60-day period of review is extended, the private fiduciary may offer fiduciary services 14 to the general public only after written approval by the department. 15  (e) The department may deny a private fiduciary permission to offer fiduciary 16 services to the general public as a trust company if the department finds that the 17 private fiduciary does not meet the requirements of this chapter for trust companies. 18 Article 5. Investments, Loans, and Deposits. 19  Sec. 06.26.250. Regulations on investments. The department may adopt 20 regulations to establish limits, requirements, or exemptions for particular classes or 21 categories of investment, or limit or expand investment authority for trust companies 22 for particular classes or categories of securities or other property. 23  Sec. 06.26.260. Pledge of assets. (a) A trust company may not pledge or 24 create a lien on any of the assets belonging to the trust company except to secure 25  (1) the repayment of money borrowed; 26  (2) trust deposits as specifically authorized or required by AS 06.26.370 27 or by regulations adopted under this chapter; or 28  (3) deposits made by the United States government, the state, or a 29 municipality, or an agency of those governmental bodies. 30  (b) An act, a deed, a conveyance, a pledge, or a contract that violates this 31 section is void. 01 Article 6. Trust Assets. 02  Sec. 06.26.370. Deposits of trust assets. (a) A trust company may deposit 03 trust money or other trust assets with itself as an investment if the settlor or the 04 beneficiary authorizes the deposit and if 05  (1) the trust company maintains as security for the deposits a separate 06 fund of securities that may be used for trust investments and that are under the control 07 of a federal reserve bank or a clearing corporation in this state or elsewhere; in this 08 paragraph, "clearing corporation" has the meaning given in AS 45.08.102; 09  (2) the total market value of the security fund maintained under (1) of 10 this subsection is at all times at least equal to the deposit; 11  (3) the security fund maintained under (1) of this subsection is 12 expressly designated as a security fund; and 13  (4) the security fund maintained under (1) of this subsection is 14 maintained under the control of a person listed in AS 06.26.010. 15  (b) A trust company may make periodic withdrawals from or additions to the 16 security fund required by (a) of this section if the trust company maintains the value 17 required by (a) of this section for the security fund. Income from the securities in the 18 security fund belongs to the trust company. 19  (c) Notwithstanding (a) of this section, security under (a) of this section for 20 a deposit is not required to the extent the deposit is insured by the Federal Deposit 21 Insurance Corporation or its successor. 22  Sec. 06.26.380. Common investment funds. Subject to regulations adopted 23 by the department, a trust company may invest trust assets in common investment 24 funds. 25  Sec. 06.26.390. Fee determination; investment and management costs. (a) 26 A trust company shall deal at arm's length with a person when arranging the 27 compensation to be paid by the person for the services of the trust company. Any 28 compensation paid to the trust company must be a reasonable amount with respect to 29 the services rendered. 30  (b) When investing and managing trust assets, a trust company may only incur 31 costs that are appropriate and reasonable in relation to the assets, the purposes of the 01 trust, and the skills of the trust company. 02  Sec. 06.26.400. Disclosure of conflicts of interest. Before accepting 03 appointment as a trustee, a trust company shall disclose any conflict of interest that 04 may reasonably be expected to arise in the relationship. 05  Sec. 06.26.410. Standards for handling trust assets. (a) A trust company, 06 its representatives, and its appointees shall observe the standards of care applicable to 07 trustees under AS 13.36.225 - 13.36.290 (Alaska Uniform Prudent Investor Act). 08  (b) A trust company may not lend trust assets, except that a trust company 09 may make a loan to a beneficiary of the trust if the loan is expressly authorized or 10 directed by the instrument or transaction that created the trust. 11  Sec. 06.26.420. Duties at inception of trusteeship. Within a reasonable time 12 after accepting appointment as a trustee or receiving trust assets, a trust company shall 13 review the trust assets and implement decisions concerning the retention and 14 disposition of the trust assets in order to comply with the purposes, terms, distribution 15 requirements, and other circumstances of the trust and with the requirements of this 16 chapter. 17  Sec. 06.26.430. Loyalty and impartiality. (a) A trust company shall invest 18 and manage the trust company's trust assets solely in the interest of the beneficiaries. 19  (b) If a trust has two or more beneficiaries, the trust company shall act 20 impartially when investing and managing the trust assets and shall consider any 21 differing interests of the beneficiaries. 22  Sec. 06.26.440. Delegation of fiduciary functions. (a) A trust company 23 acting as a trustee may delegate an investment, management, or administrative function 24 for the trust assets held by the trust company if the trust company 25  (1) exercises reasonable care, judgment, and caution when selecting the 26 delegate and considers the delegate's financial standing, ability, and reputation; 27  (2) exercises reasonable care, judgment, and caution when establishing 28 the scope and other terms of the delegation; and 29  (3) periodically reviews the delegate's actions, monitors the delegate's 30 overall performance and compliance with the scope and other terms of the delegation, 31 and exercises reasonable care, judgment, and caution when performing and monitoring 01 the delegate. 02  (b) A trust company that delegates a function under (a) of this section shall 03 retain responsibility for the delegated fiduciary function. 04  (c) When performing a function delegated under (a) of this section, a delegate 05 owes a duty to the trust to exercise reasonable care to comply with the terms of the 06 delegation. 07  (d) A trust company that complies with the requirements of (a) of this section 08 is not liable to the beneficiaries or to the trust for a decision or an action of the 09 delegate to whom the function was delegated. 10  (e) By accepting the delegation of a function from a trust company, a delegate 11 submits to the jurisdiction of the courts of this state. 12  (f) A trust company delegating a function under (a) of this section may hire 13 and compensate as a delegate a person affiliated with the trust company if 14  (1) the delegation and compensation are authorized by a fiduciary 15 instrument, a court order, or in writing by each affected customer; or 16  (2) the standards of (a) of this section are satisfied. 17  (g) Fees paid under (f) of this section to a person affiliated with a trust 18 company must be competitive with fees charged by persons who are not affiliated with 19 the trust company and who are providing substantially similar services. 20  (h) In this section, 21  (1) "affiliated" has the meaning given in AS 06.35.010(e); 22  (2) "delegate" means a person to whom a trust company has delegated 23 a function under (a) of this section. 24 Article 7. Ownership. 25  Sec. 06.26.450. Acquisition of control. (a) Except as expressly otherwise 26 permitted under this chapter, a person may not, without the prior written approval of 27 the department, directly or indirectly acquire control of a trust company through a 28 change in a legal or beneficial interest in voting securities of a trust company or a 29 corporation or other person who owns voting securities of a trust company. 30  (b) This section does not apply to 31  (1) the acquisition of securities in connection with the exercise of a 01 security or other interest in full or partial satisfaction of a debt previously contracted 02 for in good faith if the acquiring person files written notice of acquisition with the 03 department before the person votes the securities acquired; 04  (2) the acquisition of voting securities in any class or series by a person 05 in control who has previously complied with and received approval to acquire control 06 under AS 06.26.450 - 06.26.490 or who was identified as a person in control in an 07 earlier application filed with and approved by the department; 08  (3) an acquisition or transfer by operation of law, a will, or intestate 09 succession if the acquiring person files written notice of acquisition with the 10 department before the person votes the securities acquired; or 11  (4) a transaction exempted by the department by regulation or order 12 because the transaction is not within the purposes of AS 06.26.450 - 06.26.490. 13  Sec. 06.26.460. Application for acquisition of control. (a) A proposed 14 transferee seeking approval under AS 06.26.450 to acquire control of a trust company 15 shall file with the department 16  (1) an application in the form prescribed by the department; 17  (2) the filing fee established by the department by regulation; and 18  (3) all information required by regulation or that the department 19 requires for a particular application in order to make an informed decision to approve 20 or reject the proposed acquisition. 21  (b) If the proposed transferee under (a) of this section includes a group of 22 persons acting together, the department may require each member of the group to 23 provide information to the department. 24  (c) If the proposed transferee is not a resident of the state, a corporation 25 organized under AS 10.06, or a foreign corporation qualified under AS 10.06 to 26 transact business in this state, the proposed transferee shall file with the department a 27 written consent to service of process on a resident of this state for any court action 28 arising out of or connected with the proposed acquisition of control. 29  (d) Promptly after the department accepts the application as complete, the 30 proposed transferee shall publish notice of the application, the date of filing the 31 application, and the identity of each participant in the acquisition of control in the form 01 specified by the department in a newspaper of general circulation published in the 02 community proposed as the trust company's principal place of business. If a 03 newspaper of general circulation is not published in the community, the notice shall 04 be published in a newspaper of general circulation near the community. If the 05 acquisition of control is filed in contemplation of a public tender offer subject to the 06 requirements of 15 U.S.C. 78n(d)(1), publication of notice of an application may be 07 deferred for up to 31 days after the date the application is filed if 08  (1) the proposed transferee requests confidential treatment and 09 represents that a public announcement of the tender offer and the filing of appropriate 10 forms with the United States Securities and Exchange Commission or the appropriate 11 federal banking agency, as applicable, will occur within the period of deferral; and 12  (2) the department determines that public interest will not be harmed 13 by the requested confidential treatment. 14  (e) The department may waive the requirement that a notice be published or 15 permit delayed publication of the notice if the department makes a written 16 determination that waiver or delay is in the public interest. 17  Sec. 06.26.470. Hearing and decision on application for acquisition of 18 control. (a) Not later than the 60th day after the date that the notice regarding 19 acquisition of control is published under AS 06.26.460, the department shall approve 20 the application or hold a hearing on the application. If the department decides to hold 21 a hearing, the department shall conduct one or more prehearing conferences and other 22 opportunities for discovery that the department considers advisable and consistent with 23 AS 06.01.030 and regulations of the department under AS 06.01 or this chapter. A 24 hearing held under this subsection is a confidential proceeding and closed to the 25 public. 26  (b) If the department approves an application filed under AS 06.26.460, the 27 applicant may acquire control. Any written commitment from the proposed transferee 28 offered to and accepted by the department as a condition for approval of the 29 application is enforceable against the trust company and the transferee. 30  Sec. 06.26.480. Appeal from adverse decision. (a) If a hearing has been 31 held under AS 06.26.470, the department has entered an order denying the application, 01 and the order has become final, the applicant may appeal the final order to the superior 02 court. 03  (b) Unless the court orders otherwise, the filing of an appeal under (a) of this 04 section does not stay the order of the department. 05  Sec. 06.26.490. Objection to other transfer. AS 06.26.450 - 06.26.490 may 06 not be construed to prevent the department from investigating, commenting on, or 07 seeking to enjoin or set aside a transfer of voting securities that evidence a direct or 08 indirect interest in a trust company if the department considers the transfer to be 09 against the public interest. 10 Article 8. Governance. 11  Sec. 06.26.500. Voting securities held as trust assets. (a) Voting securities 12 of a trust company held by the trust company as trust assets under a will or trust, 13 whether registered in the trust company's own name or in the name of its nominee, 14 may not be voted in the election of directors or on a matter affecting the compensation 15 of directors, officers, or employees of the trust company unless 16  (1) under the terms of the will or trust, the manner in which the voting 17 securities are to be voted may be determined by a donor or beneficiary of the will or 18 trust and the donor or beneficiary actually makes the determination in the matter at 19 issue; 20  (2) the terms of the will or trust expressly direct the manner in which 21 the securities must be voted to the extent that no discretion is vested in the trust 22 company as fiduciary; or 23  (3) the securities are voted solely by a person who is a joint fiduciary, 24 but who is not a person who is affiliated with the trust company, as if the joint 25 fiduciary were the sole fiduciary. 26  (b) Voting securities of a trust company that may not be voted under this 27 section are considered to be authorized but unissued for the purpose of determining the 28 procedures for and results of the vote under this section. 29  Sec. 06.26.510. Board of directors. (a) The board of directors of a trust 30 company shall consist of at least five but not more than 25 directors, and the majority 31 of the directors must be residents of this state. The principal executive officer of the 01 trust company is a member of the board and the board's presiding officer unless the 02 board elects a different presiding officer. The presiding officer shall perform the 03 duties designated by the board. 04  (b) Unless the department consents in writing, a person may not serve as a 05 director of a trust company if 06  (1) the trust company incurs an unreimbursed loss attributable to a 07 charged-off obligation of the person or holds a judgment against the person or against 08 another person who was controlled by the person when the loan that gave rise to the 09 judgment or charged-off obligation was funded and went into default; 10  (2) the person has been convicted of a felony, or of another crime 11 involving moral turpitude or breach of trust; or 12  (3) the person, acting as a personal representative, made a loan of trust 13 money or other assets, or a purchase or sale of trust assets, that is voidable under 14 AS 13.16.400 and the person has not corrected the situation; in this paragraph, 15 "personal representative" has the meaning given in AS 13.06.050. 16  (c) If a trust company does not elect directors before the 61st day after the 17 date of its regular annual meeting, the department may appoint a person to operate the 18 trust company and elect directors. If the appointed person is unable to locate or elect 19 persons willing and able to serve as directors, the department may close the trust 20 company for liquidation. 21  (d) A vacancy on a board that reduces the number of directors to fewer than 22 five shall be filled not later than the 30th day after the date that the vacancy occurs. 23 If the vacancy on the board is not filled within 30 days after the date that the vacancy 24 occurs, the department may appoint a person to operate the trust company and elect 25 a board of at least five persons. If the appointed person is unable to locate or elect 26 five persons willing and able to serve as directors, the department may close the trust 27 company for liquidation. 28  (e) Before beginning each term to which a person is elected to serve as a 29 director of a trust company, the person shall submit an affidavit to be filed with the 30 minutes of the trust company stating that the person, to the extent applicable, 31  (1) accepts the position and is not disqualified from serving in the 01 position; 02  (2) will not violate or knowingly permit a director, an officer, or an 03 employee of the trust company to violate any law applicable to the conduct of business 04 of the trust company; and 05  (3) will diligently perform the duties of the position. 06  Sec. 06.26.520. Board meetings and reports. (a) The board of directors of 07 a trust company shall meet at least once every three months. The department or a 08 director may call a special meeting of the board. A majority of the board constitutes 09 a quorum. The board shall keep minutes of each board meeting, including a record 10 of attendance and a record of all votes. 11  (b) At least once every three months, the board of directors of a trust company 12 shall review written reports prepared by the president, other officers of the trust 13 company, or a trust committee appointed under AS 06.26.540. The reports must 14 include the accounts that have been opened or closed during the calendar quarter 15 before the meeting and the trust accounts subject to annual review during the calendar 16 quarter before the meeting. 17  Sec. 06.26.530. Officers. (a) The board shall annually appoint the officers 18 of the trust company. The officers serve at the pleasure of the board. 19  (b) The president of the trust company is the principal executive officer 20 primarily responsible for the execution of board policies and operation of the trust 21 company. The trust company shall have an officer responsible for the maintenance 22 and storage of all corporate books and records of the trust company and for required 23 attestation of signatures. These positions may not be held by the same person. The 24 board may appoint other officers of the trust company as the board considers 25 necessary. 26  (c) Unless expressly authorized by a resolution of the board recorded in the 27 minutes of the board, an officer or employee may not create or dispose of a trust 28 company asset or create or incur a liability on behalf of the trust company. 29  Sec. 06.26.540. Trust committee. (a) The board may appoint a trust 30 committee to act for the company in matters dealing with the initial and annual 31 reviews of accounts, account acceptance, and investment strategies. A trust committee 01 shall consist solely of directors, officers, or employees of the trust company, or any 02 combination of these positions. The trust committee shall keep a record of its actions 03 and shall report in writing to the board on all actions taken by the trust committee 04 since the previous board meeting. The board shall ratify or rescind each action. 05  (b) The trust committee shall meet at least once a month to review existing 06 accounts and to ratify or rescind newly accepted accounts. The trust committee may 07 not ratify a new account unless it is approved by a majority of the members of the 08 trust committee present at the meeting at which the new account is considered. 09  (c) A trust committee may elect one or more officers to accept new accounts, 10 subject to the requirements of (b) of this section. 11  Sec. 06.26.550. Conveyances; execution. All conveyances of or other 12 instruments affecting real property owned or held in trust by a trust company must be 13 authorized by a resolution of the board or a trust committee appointed under 14 AS 06.26.540 and signed in the name of the trust company by its president or vice- 15 president. 16  Sec. 06.26.560. Prohibited acts. (a) A director, an officer, an employee, or 17 a shareholder of a trust company may not 18  (1) conceal information or a fact, or remove, destroy, or conceal a book 19 or record of the trust company, for the purpose of concealing information or a fact 20 from the department or an agent of the department; or 21  (2) for the purpose of concealing, remove or destroy a book or record 22 of the trust company that is material to a pending or anticipated court or administrative 23 proceeding. 24  (b) A director, an officer, or an employee of a trust company may not make 25 a false entry in the books, the records, a report, or a statement of the trust company. 26  Sec. 06.26.570. Transactions with management and affiliates; penalties. 27 (a) Without the prior approval of a disinterested majority of the board recorded in the 28 minutes, or, if a disinterested majority cannot be obtained, the prior written approval 29 of the department, a trust company may not directly or indirectly 30  (1) sell or lease an asset of the trust company to a director, an officer, 31 a principal shareholder, or an affiliate of the trust company; 01  (2) purchase or lease property in which a director, an officer, a 02 principal shareholder, or an affiliate of the trust company has an interest; or 03  (3) extend credit to a director, an officer, a principal shareholder, or an 04 affiliate of the trust company. 05  (b) In addition to the requirements of (a) of this section, a lease transaction 06 described in (a)(2) of this section involving real property may not be consummated, 07 renewed, or extended by the trust company without the prior written approval of the 08 department. 09  (c) A trust company may not extend credit to a director, an officer, an 10 employee, a principal shareholder, or an affiliate of the trust company unless the 11 extension of credit 12  (1) is made on substantially the same terms, including interest rates and 13 collateral requirements, as the terms prevailing at the time for comparable transactions 14 by the trust company with persons who are not directors, officers, employees, principal 15 shareholders, or affiliates of the trust company; 16  (2) does not involve more than the normal risk of loss or present other 17 unfavorable features; and 18  (3) follows credit underwriting procedures that are as stringent as the 19 underwriting procedures applicable to comparable transactions by the trust company 20 with persons who are not directors, officers, employees, principal shareholders, or 21 affiliates of the trust company. 22  (d) The department may adopt regulations to implement this section, including 23 regulations to establish limits, requirements, or exemptions other than those specified 24 by this section for particular categories of transactions. 25  (e) In this section, "affiliate" does not include a subsidiary of the trust 26 company. 27  Sec. 06.26.580. Trust asset transactions involving certain securities, assets, 28 or information. (a) Except as provided in this chapter, or as authorized under the 29 instrument creating the relationship, a trust company may not invest trust assets in the 30 stock or obligations of, or use trust assets to acquire property from, the trust company 31 or any of the trust company's officers, directors, or employees. A trust company may 01 not sell trust assets to the trust company or to any of the trust company's directors, 02 officers, or employees. 03  (b) A trust company may retain and vote the stock of the trust company, or 04 of a person affiliated with the trust company, that the trust company receives as trust 05 assets unless the trust document establishing the trust company as a fiduciary for the 06 trust assets provides otherwise. 07  (c) A trust company may not use material inside information in connection 08 with a decision or recommendation to purchase or sell a security that is a trust asset. 09  Sec. 06.26.585. Policies and procedures. A trust company shall adopt written 10 policies and procedures regarding decisions or recommendations to purchase or sell a 11 security that is a trust asset to facilitate compliance with federal and state securities 12 laws. These policies and procedures must include the prohibition in AS 06.26.580(c). 13  Sec. 06.26.590. Fiduciary responsibility. The board of a trust company is 14 responsible for the proper exercise of fiduciary powers by the trust company and for 15 each matter that is related to the exercise of fiduciary powers, including 16  (1) the determination of policies; 17  (2) the investment and disposition of trust assets; and 18  (3) the direction and review of the actions of each officer, employee, 19 and committee employed or used by the trust company in the exercise of its fiduciary 20 powers. 21  Sec. 06.26.600. Trust account record keeping. A trust company shall keep 22 its trust assets records separate and distinct from other records of the trust company 23 in the manner required by state and federal law. The fiduciary records must contain 24 all material information relating to each trust assets account, as appropriate under the 25 circumstances. 26  Sec. 06.26.610. Customer records confidential. (a) The trust company 27 records relating to customers are confidential and may not be made public unless 28  (1) disclosure is compelled by a court or administrative order; 29  (2) disclosure is required by federal or state law; 30  (3) disclosure is authorized in writing by the customer; 31  (4) disclosure is made to the holder of a negotiable instrument drawn 01 on the trust company as to whether the drawer has sufficient money or other assets in 02 the financial institution to cover the instrument; or 03  (5) an inquiry has been made by a state financial institution, or by a 04 credit-reporting agency regulated under 15 U.S.C. 1681 - 1681u (Fair Credit Reporting 05 Act) solely for the express purpose of determining the credit worthiness of the 06 customer as an applicant for credit, and the information disclosed by the trust 07 company, state financial institution, or credit-reporting agency relates only to the 08 payment habits of the customer in connection with loans or other credit 09 accommodations and does not pertain to records concerning deposit balances in savings 10 or checking accounts. 11  (b) When disclosure of trust company records is required or allowed under 12 (a)(1) or (2) of this section, the trust company shall notify the customer of the 13 disclosure. If notification before disclosure is not possible, the trust company shall 14 immediately notify the customer of the disclosure or inquiry. However, the trust 15 company may not notify the customer if disclosure is made under a search warrant or 16 under a court order issued at the request of a grand jury. 17  (c) When disclosure of trust company records is compelled by a court order 18 under (a)(1) of this section, the court may provide in the order for the reimbursement 19 of the trust company for the costs allowed by the rules of court and incurred by the 20 trust company to comply with the order. 21  Sec. 06.26.620. Insurance; bonds. (a) The board of directors of a trust 22 company shall maintain bonding and other insurance for the trust company against 23 dishonesty, fraud, defalcation, forgery, theft, embezzlement, burglary, robbery, theft, 24 and other similar insurable losses and hazards as required by the department by 25 regulation. The board shall obtain the bonding and other insurance from a person 26 authorized under AS 21 to act as an insurer or a surety insurer in this state. 27  (b) The board of directors shall procure errors and omissions insurance in the 28 amount of at least $500,000. 29  (c) At least once each year, the board of directors shall review the bonding and 30 other insurance required by this section to determine whether the coverage is adequate 31 in relation to the exposure of the trust company. The minimum amount of insurance 01 required by this section does not automatically represent adequate bonding and 02 insurance coverage in relation to the exposure. Immediately after procuring the 03 bonding and other insurance, the board shall file copies of the documents representing 04 the bonding and other insurance with the department. 05  Sec. 06.26.630. Reports of apparent crime. (a) A trust company that is the 06 victim of a robbery, that has a shortage of money or other assets in excess of $5,000, 07 or that is the victim of an apparent or suspected misapplication of its money or other 08 assets in any amount by a director, an officer, or an employee shall report the robbery, 09 shortage, or apparent or suspected misapplication to the department within 48 hours 10 after it is discovered. The initial report may be oral if the trust company promptly 11 confirms the report in writing to the department. The trust company or a director, an 12 officer, an employee, or an agent of the trust company is not liable for defamation to 13 or subject to any another cause of action based on supplying the information in the 14 report. 15  (b) A trust company may satisfy the requirements of (a) of this section by 16 filing with the department a copy of a written report filed with the appropriate law 17 enforcement agency. 18 Article 9. Organic Change. 19  Sec. 06.26.650. General provisions for conversions, mergers, and 20 consolidations. (a) A national bank or state bank whose main office is located in the 21 state may convert to a trust company or merge or consolidate with a trust company, 22 and a trust company may merge or consolidate with another trust company, if the 23 conversion, merger, or consolidation is consistent with federal and state law and 24 approved by the department. The requirements of AS 06.26.650 - 06.26.670 are in 25 addition to the merger and consolidation requirements of AS 10.06. 26  (b) Before merger or consolidation under (a) of this section, a trust company 27 shall file with the department a merger or consolidation application and other 28 information and reports that the department requires under AS 06.26.660. 29  (c) The department, in the exercise of its power to approve or disapprove 30 applications for merger or consolidation under (a) of this section, shall act in the 31 interests of promoting and maintaining a sound trust company system, promoting the 01 security of deposits and customers, preserving of the liquid position of trust companies, 02 and preventing injurious credit expansions and contractions. 03  (d) A trust company converting to or merging or consolidating with a national 04 bank shall submit to the department a copy of any application to the United States 05 Comptroller of the Currency for a national bank charter or any other application to the 06 United States Comptroller of the Currency to convert, merge, or consolidate when the 07 applications are forwarded to the United States Comptroller of the Currency. 08  (e) In this section, "national bank" has the meaning given in AS 06.05.540. 09  Sec. 06.26.660. Merger or consolidation. (a) To merge or consolidate under 10 AS 06.26.650, the merging persons shall file with the department the original articles 11 of merger or consolidation, a number of copies of the articles of merger or 12 consolidation equal to the number of trust companies involved in the merger or 13 consolidation, and an application in the form required by the department. The 14 department may require the submission of additional information it considers necessary 15 to make an informed decision. 16  (b) The department may approve a merger or a consolidation if 17  (1) the surviving or new trust company will be solvent and have 18 adequate capitalization for its operations and location; 19  (2) the surviving or new trust company has in all respects complied 20 with the statutes and regulations governing the organization of a trust company in this 21 state; 22  (3) all obligations and liabilities of each trust company that is a party 23 to the merger or consolidation have been properly discharged or otherwise lawfully 24 assumed or retained by a trust company or other fiduciary; 25  (4) a surviving or new trust company is not authorized to act as a 26 fiduciary under this chapter, will not act as a fiduciary, and has otherwise complied 27 with the laws of this state; 28  (5) the surviving or new trust company satisfies the provisions in 29 AS 06.26.090 that the department determines apply to the trust company; and 30  (6) all conditions imposed by the department have been satisfied. 31  (c) If the department approves the merger or consolidation and finds that all 01 investigative expenses incurred by the department and all required filing fees have 02 been paid, the department shall issue a certificate of merger. 03  Sec. 06.26.670. Rights of dissenters. In addition to the dissenter's rights 04 under AS 10.06 for a merger or consolidation, if a shareholder of a trust company 05 objects to a conversion of the trust company, the dissenting shareholder's rights shall 06 be exercised under and governed by AS 10.06.574 - 10.06.582 as if the conversion 07 were a merger. 08  Sec. 06.26.680. Authority to purchase assets of another trust company. (a) 09 A trust company with the prior written approval of the department may purchase all 10 or substantially all of the assets of another trust company, including the right to control 11 accounts established with the trust accounts. Except as otherwise expressly provided 12 by another statute, the purchase by a trust company of all or part of the assets of 13 another trust company does not make the purchasing trust company responsible for a 14 liability or obligation of the selling trust company that the purchasing trust company 15 does not expressly assume. Except as otherwise provided by statute, AS 06.26.430 - 16 06.26.490 do not govern or prohibit the purchase by a trust company of all or part of 17 the assets of a person who is not a trust company or an exempt private fiduciary. 18  (b) To purchase assets under (a) of this section, a trust company shall file with 19 the department an application in the form required by the department. The department 20 shall investigate the condition of the purchaser and seller and may require the 21 submission of additional information it considers necessary to make an informed 22 decision. The department shall approve the purchase if 23  (1) the purchasing trust company will be solvent after the purchase and 24 have sufficient capitalization for its operations and location; 25  (2) the purchasing trust company has complied with all applicable 26 statutes and regulations in this state; 27  (3) all fiduciary obligations and liabilities of the purchasing trust 28 company and selling trust company have been properly discharged or otherwise 29 lawfully assumed by the purchasing trust company; 30  (4) all conditions imposed by the department have been satisfied or 31 otherwise resolved; and 01  (5) all expenses incurred by the department and all required fees have 02 been paid. 03  (c) A purchase under this section is effective on the date the department 04 approves the purchase unless the purchase agreement provides for, and the department 05 consents to, a different effective date. 06  Sec. 06.26.690. Authority to act as disbursing agent. A purchasing trust 07 company may hold the purchase price and any additional money or other assets 08 delivered to it by the selling trust company in trust for the selling trust company and 09 may act as an agent of the selling trust company in disbursing the money or other 10 assets by paying the creditors of the selling trust company. If the purchasing trust 11 company acts under a written contract of agency approved by the department that 12 specifically names each creditor and the amount to be paid each creditor, and if the 13 agency is limited to the purely ministerial act of paying creditors the amounts due 14 them as determined by the selling trust company and reflected in the contract of 15 agency and does not involve discretionary duties or authority other than the 16 identification of the creditors named, the purchasing trust company 17  (1) may rely on the contract of agency and the instructions included in 18 it; and 19  (2) is not responsible for 20  (A) an error made by the selling trust company when 21 determining its liabilities, the creditors to whom the liabilities are due, or the 22 amounts due to the creditors; or 23  (B) a preference that results from the payments made under the 24 contract of agency and the instructions included in the contract. 25  Sec. 06.26.700. Liquidation of selling trust company. If a selling trust 26 company is at any time after the sale of assets voluntarily or involuntarily closed for 27 liquidation by a state or federal regulatory agency, the purchasing trust company shall 28 pay to the receiver of the selling trust company the balance of the money or other 29 assets held by the purchasing trust company in trust for the selling trust company and 30 not yet paid to the creditors of the selling trust company. Without further action, the 31 purchasing trust company is then discharged of all responsibilities to the selling trust 01 company and the selling trust company's receiver, creditors, and shareholders. 02  Sec. 06.26.710. Payment to creditors. A purchasing trust company may pay 03 a creditor of the selling trust company the amount to be paid the creditor under the 04 terms of the contract of agency entered into under AS 06.26.690 by opening an agency 05 account in the name of the creditor, crediting the account with the amount to be paid 06 the creditor under the terms of the agency contract, and mailing or personally 07 delivering a duplicate of the written evidence of the credit to the creditor at the 08 creditor's address shown in the records of the selling trust company. With regard to 09 the creditor, the purchasing trust company is an agent of the selling trust company only 10 to the extent of the credit reflected by the written evidence of the credit. 11  Sec. 06.26.720. Sale of assets. (a) The board of a trust company, with the 12 department's approval, may cause a trust company to sell all or substantially all of its 13 assets, including the right to control accounts established with the trust company for 14 trust assets, without shareholder approval if the department finds 15  (1) the interests of the trust company's creditors and depositors and 16 other customers are not jeopardized because of an unsafe or unsound condition of the 17 trust company; 18  (2) the sale is in the best interest of the trust company's creditors and 19 depositors and other customers; and 20  (3) the Federal Deposit Insurance Corporation or its successor approves 21 the transaction unless the deposits of the trust company are not insured by the Federal 22 Deposit Insurance Corporation or its successor. 23  (b) A sale under this section must include an assumption and promise by the 24 purchaser to pay or otherwise discharge 25  (1) all of the trust company's liabilities to customers; 26  (2) all of the trust company's liabilities for the salaries of the trust 27 company's employees incurred before the date of the sale; 28  (3) the obligations incurred by the department arising out of the 29 supervision or sale of the trust company; and 30  (4) the fees and any other payment due to the department under this 31 chapter and assessments due to the department under AS 06.01.010. 01  (c) This section does not limit the incidental power of a trust company to buy 02 and sell assets in the ordinary course of its operations. 03  (d) The sale by a trust company of all or substantially all of its assets with 04 shareholder approval is considered a voluntary dissolution and liquidation and is 05 governed by AS 06.26.730 - 06.26.800. 06 Article 10. Dissolution and Liquidation. 07  Sec. 06.26.730. Voluntary liquidation. (a) Without department approval, a 08 trust company may not cease acting as a fiduciary in this state and voluntarily 09 surrender its certificate of authority and as a consequence be relieved of the necessity 10 to comply with the requirements of this chapter. 11  (b) A trust company proposing to cease acting as a fiduciary in this state shall 12 submit to the department 13  (1) a certified copy of a resolution of the trust company's board of 14 directors reflecting the board's decision that the trust company should cease acting as 15 a fiduciary in this state; and 16  (2) the trust company's plan adopted by its board for winding up its 17 fiduciary operations in this state. 18  (c) The department may approve or disapprove the trust company's plan for 19 winding up its fiduciary operations in this state based on the department's evaluation 20 of whether the plan provides adequate protection for those persons and interests for 21 whom the trust company acts as a fiduciary. The department's approval may be 22 subject to any condition the department determines appropriate under the 23 circumstances. 24  (d) During the implementation of a trust company's plan for winding up its 25 fiduciary operations in this state, the department retains the authority to supervise the 26 trust company and may conduct any examination relating to either the trust company 27 or the plan for winding up that the department considers necessary or appropriate. 28  (e) If the department has reason to conclude that the trust company is not 29 safely or expeditiously implementing the approved plan for winding up the trust 30 company's fiduciary operations in this state, the department may 31  (1) begin revocation proceedings under AS 06.26.740; 01  (2) take possession of the trust company's trust business in this state 02 in the same manner, with the same effect, and subject to the same rights accorded to 03 the trust company under AS 06.26.750. 04  (f) The department shall cancel the trust company's certificate of authority if 05 the department approves the trust company's plan for winding up its fiduciary 06 operations in this state and if all of the following conditions that apply to the trust 07 company have been met: 08  (1) the trust company has completed its plan for winding up its 09 fiduciary operations in this state consistent with any conditions that the department 10 imposed on the plan under (c) of this section; 11  (2) the trust company has been relieved under all applicable laws of all 12 duties as trustee, executor, administrator, registrar of stocks and bonds, or any other 13 type of fiduciary position under court, private, or other appointment that the trust 14 company had accepted; 15  (3) if the trust company has its principal place of business in this state, 16 the trust company has, under all applicable laws, wound up its fiduciary operations in 17 each of the other jurisdictions where the trust company solicited appointment or served 18 as a fiduciary, or otherwise acted as a fiduciary; 19  (4) if the trust company has its principal place of business in this state 20 and is not authorized to engage in activities other than acting as a fiduciary, the trust 21 company is being liquidated under AS 06.26.760 - 06.26.800. 22  (g) Upon the department's canceling the trust company's certificate of 23 authority, the trust company may not without obtaining a new certificate of authority 24 act as a fiduciary in this state, or in any jurisdiction. 25  Sec. 06.26.740. Revocation. (a) If the department determines, after notice 26 and opportunity for a hearing under AS 06.01.030 and regulations adopted by the 27 department, that any of the following factors exist, the department may revoke a trust 28 company's certificate of authority: 29  (1) the existence of the trust company, or its authority to act as a 30 fiduciary, has been terminated or suspended under the laws of the state or other 31 jurisdiction in which the trust company is organized; 01  (2) the trust company's authority to act as fiduciary has been terminated 02 or suspended under the laws of the state or other jurisdiction in which the trust 03 company is organized, or its license to act as a fiduciary has been terminated or 04 suspended under the laws of any other jurisdiction in which the trust company had 05 been authorized to act as a fiduciary; 06  (3) a receiver, liquidator, or conservator has been appointed for the trust 07 company under the laws of the state or other jurisdiction in which the trust company 08 is organized, or for its operation in any other jurisdiction in which the trust company 09 operates; 10  (4) the trust company is violating or has violated or the department has 11 reasonable cause to believe is about to violate 12  (A) a law or regulation; 13  (B) a condition imposed by the department in writing in 14 connection with approving an application or notice under this chapter or 15 granting any other request of the trust company under this chapter; 16  (C) a written agreement that the trust company entered into with 17 the department; 18  (D) a cease and desist order issued by the department under 19 AS 06.01.030; 20  (5) the trust company is engaging in or has engaged in, or the 21 department has reasonable cause to believe the trust company is about to engage in an 22 unsafe or unsound practice; 23  (6) the trust company has ceased to pay its debts in the ordinary course 24 of business, is incapable of paying its debts as they mature, has liabilities in excess of 25 its assets, or is subject to or has applied for an adjudication in bankruptcy, 26 reorganization, or other relief under any bankruptcy, reorganization, insolvency, or 27 moratorium law; 28  (7) the trust company has ceased to act as a fiduciary in this state; 29  (8) the trust company has failed to pay any fees, charges, forfeitures, 30 penalties, or other payment due to the department under this title. 31  (b) If the department has reasonable cause to believe any of the factors 01 identified in (a) of this section is true, and if the department determines it is necessary 02 to protect the persons and interests in this state for whom the trust company acts as 03 a fiduciary or to protect the property in this state to which the trust company holds title 04 as a fiduciary or in which the trust company holds an interest as a fiduciary, the 05 department may immediately suspend the trust company's certificate of authority. 06  (c) Within 10 days after an order of the department suspending a trust 07 company's certificate of authority is served on a trust company, the trust company may 08 apply to the superior court in the jurisdiction where the trust company is acting as a 09 fiduciary for an injunction setting aside, limiting, or suspending enforcement of the 10 suspension order pending an opportunity for a hearing on whether the trust company's 11 certificate of authority should be revoked. 12  Sec. 06.26.750. Authority to take possession. If the department revokes a 13 trust company's certificate of authority under AS 06.26.740(a), the department may 14 take possession of the trust company's fiduciary operations in this state and may 15 appoint a receiver for the liquidation of the trust company's fiduciary operations in this 16 state. If the trust company has its principal place of business in this state, the 17 department may take possession of, and appoint a receiver for the liquidation of all the 18 trust company's fiduciary operations wherever they are conducted. 19  Sec. 06.26.760. Department in possession. (a) When the department has 20 taken possession of a trust company, it is vested with the full and exclusive power of 21 management and control, including the power to act as a trustee for trust assets, to 22 continue or discontinue the operation of the trust company, to stop or limit the 23 payment of the trust company's obligations, to employ necessary assistants, to execute 24 an instrument in the name of the trust company, to commence, defend, and conduct 25 in the trust company's name any action or proceeding to which the trust company may 26 be a party, to terminate the possession by restoring the trust company to its board, and 27 to reorganize or liquidate the trust company under this chapter. As soon as practicable 28 after taking possession, the department shall make an inventory of the trust assets and 29 the trust company assets and file a copy of the inventory with the superior court. 30  (b) When the department has taken possession, the following dates are 31 postponed until six months after the possession begins: 01  (1) notwithstanding other provisions of law, the date on which any 02 period of limitation fixed by a statute or agreement would otherwise expire on a claim 03 or right of action of the trust company; or 04  (2) the date on which an appeal must be taken or a pleading or other 05 document must be filed by the trust company in any pending court action or other 06 proceeding. 07  (c) A judgment, lien, or attachment may not be enforced against trust company 08 assets while the assets are in possession of the department. Upon the election of the 09 department in connection with a liquidation or reorganization, 10  (1) any lien or attachment, other than an attorney's or mechanic's lien, 11 obtained upon a trust company asset during the department's possession or within four 12 months before beginning that possession may be vacated, except liens created by the 13 department while in possession; and 14  (2) any transfer of trust company assets made after or in contemplation 15 of the trust company's insolvency or in anticipation of the department's takeover, with 16 intent to effect a preference of one creditor over another creditor or to prevent the 17 distribution of the trust company assets according to law, is void. 18  (d) The department may borrow money in the name of the trust 19 company in the department's possession and may pledge trust company assets as 20 security for the loan. 21  (e) All necessary and reasonable expenses resulting from the 22 department's possession of a trust company and of its reorganization or liquidation 23 shall be paid from trust company assets. 24  Sec. 06.26.770. Reorganization. (a) If the department decides to reorganize 25 a trust company, the department, after providing a hearing to all interested parties, 26 shall enter an order proposing a reorganization plan. The department shall send a copy 27 of the plan to each depositor and other customers and to each creditor who will not 28 receive payment of a claim in full under the plan and a notice that, unless within 30 29 days the plan is disapproved in writing by persons holding one-third or more of the 30 aggregate amount of the claims, the department will reorganize the trust company. 31  (b) A plan of reorganization may not be established under this chapter unless, 01 in the opinion of the department, 02  (1) the plan is fair to all classes of depositors, other customers, 03 creditors, and shareholders; 04  (2) subject to a fair adjustment for new capital that a class will pay 05 under the plan, the face amount of the trust company asset interest provided to a class 06 of depositors, other customers, creditors, or shareholders under the plan does not 07 exceed the value of the assets at liquidation less the full amount of the claims of all 08 prior classes; 09  (3) the plan provides for the issuance of common stock in an amount 10 that will provide an adequate ratio to deposits; 11  (4) any exchange of new common stock for obligations or stock of the 12 trust company will be made 13  (A) in the inverse order of the priorities in liquidation of the 14 classes that will retain an interest in the trust company; and 15  (B) upon terms that adjust in a fair manner any change in the 16 relative interest of the respective classes that will be produced by the exchange; 17  (5) the plan assures the removal of a director, an officer, or an 18 employee responsible for a problem identified by the department, including an unsafe, 19 unsound, or unlawful action or the existence of an unsafe or unsound condition; 20  (6) any merger or consolidation provided by the plan complies with this 21 chapter. 22  (c) When in the course of reorganization, supervening conditions render a plan 23 of reorganization unfair or its execution impractical, the department may modify the 24 plan or liquidate the trust company. 25  Sec. 06.26.780. Involuntary liquidation powers. (a) When liquidating a trust 26 company, the department may exercise any power incidental to liquidating a trust 27 company, but it may not, without the approval of the superior court, 28  (1) sell trust company assets having an appraised value in excess of 29 $100,000; 30  (2) compromise or release a claim that exceeds $100,000 exclusive of 31 interest; 01  (3) make full payment on a claim, other than a claim upon an 02 obligation incurred by the department, before preparing and filing a schedule of the 03 department's determinations under AS 06.26.790(d)(3). 04  (b) Within six months after beginning the liquidation of a trust company, the 05 department may terminate an executory contract for services or advertising to which 06 the trust company is a party or an obligation of the trust company as a lessee. A 07 lessor who receives 60 days' notice of the department's decision to terminate a lease 08 does not have a claim for rent other than rent accrued to the date of termination or for 09 damages due to the termination. 10  (c) As soon as practical after beginning the involuntary liquidation of a trust 11 company, the department shall take the steps necessary to terminate all fiduciary 12 positions held by the trust company, to surrender all property held by the trust 13 company as a fiduciary, and to settle the trust accounts of the trust company. 14  Sec. 06.26.790. Claims. (a) As soon as practical after beginning the 15 liquidation of a trust company, the department shall 16  (1) mail a notice of the liquidation proceedings to the last known post 17 office address of each depositor, creditor, lessee of a safe deposit box, bailor of 18 property, and trustor and beneficiary of trust assets held by the trust company; 19  (2) post a notice of the proceedings conspicuously on the premises of 20 the trust company; and 21  (3) publish a notice that the department determines to be appropriate 22 for the proceedings. 23  (b) The department shall mail with the notice sent under (a)(1) of this section 24 a statement of the amount shown on the trust company's books to be the claim of the 25 depositor or creditor. The notice must also include a demand that a person who is 26 entitled to property held by the trust company as bailee or trustee or in a safe deposit 27 box of the trust company withdraw the property within 30 days. The notice must 28 direct those depositors and creditors who claim amounts different from the amounts 29 in the notice to file their claims with the trust company under the procedure described 30 in the notice and before a specified date. The specified day may not be less than 60 31 days from the date of the first publication of the notice. 01  (c) A safe deposit box whose contents have not been removed within 30 days 02 after demand shall be opened. The department shall retain the contents of the box and 03 the other unclaimed property held by the trust company as bailee until the conclusion 04 of the liquidation proceedings. At the conclusion of the liquidation proceedings under 05 this section, the property held by the department under this subsection is considered 06 abandoned, and the department shall deliver the property to the Department of Revenue 07 under AS 34.45.110 - 34.45.780. 08  (d) Within six months after the last day specified in the notice for the filing 09 of claims, or within a longer period if allowed by the superior court, the department 10 shall 11  (1) reject a claim that it determines to be invalid; 12  (2) determine the amount, if any, owing to each known creditor or 13 depositor and the priority class of the person's claim under this chapter; 14  (3) prepare a schedule of its determinations for filing in the superior 15 court; 16  (4) publish a notice in a newspaper once each week for three successive 17 weeks, of the times and places where the schedule of determinations will be available 18 for inspection and the date when the department will file its schedule in court; the date 19 may not be sooner than 30 days after the first publication. 20  (e) Within 30 days after the filing with the superior court of the department's 21 schedule under (d)(3) of this section, a creditor, depositor, or stockholder may file with 22 the court an objection to a determination. The court shall hear and determine the filed 23 objections after the notice to the department and interested claimants that the court 24 establishes. If the court sustains an objection, the court shall direct that the schedule 25 be modified appropriately. 26  (f) After filing its schedule, the department may make partial distribution to 27 the holders of the claims that are undisputed or are allowed by the court if an adequate 28 reserve is established for the payment of disputed claims. As soon as practicable after 29 the determination of all objections, the department shall make the final distribution. 30  (g) The following claims have priority in liquidation proceedings, in the order 31 listed: 01  (1) obligations incurred by the department in liquidating the trust 02 company; 03  (2) wages and salaries of officers and employees earned during the 04 three-month period preceding the department's possession in an amount not exceeding 05 $3,000 for each person; 06  (3) fees and assessments owed by the trust company to the department; 07  (4) deposits; 08  (5) claims secured by trust company assets. 09  (h) After the payment of all other claims, including interest at the rate of 10.5 10 percent a year, the department shall pay claims that are otherwise valid but that were 11 not filed within the time prescribed. 12  (i) If the sum available for a class of creditors is insufficient to provide 13 payment in full, the sum shall be distributed pro rata to the claimants in the class. 14  (j) Unclaimed property remaining after the completion of the liquidation 15 proceedings under this section is presumed abandoned, and the property shall be 16 delivered to the Department of Revenue for handling under AS 34.45.110 - 34.45.780. 17  (k) After payment of the expenses of the liquidation and the claims against the 18 trust company arising from its fiduciary obligations in this state under AS 06.26.760 - 19 06.26.800, the receiver shall distribute any remaining money or other assets from the 20 liquidation of the trust company's fiduciary operations in this state equitably among, 21 as applicable, the receivers for liquidation of the trust company's fiduciary operations 22 in other states of the United States and under the laws of the United States, for 23 payment of the expenses of liquidation and claims against the trust company's 24 fiduciary operations. If the trust company's fiduciary operations are not being 25 liquidated in another state or under the laws of the United States, the receiver shall, 26 after satisfying the requirements of AS 06.26.760 - 06.26.800, pay any remaining 27 money or other assets from the liquidation of the trust company's fiduciary operations 28 in this state to the trust company. 29  (l) When the receiver has completed the liquidation of the trust company's 30 fiduciary operations in this state, the receiver shall, with notice to the department, 31 petition the court for an order declaring the trust company's fiduciary operations in this 01 state properly wound up under AS 06.26.760 - 06.26.800. Upon the filing of the 02 petition, the court shall proceed as provided in AS 06.26.760 - 06.26.800. 03  (m) An order issued by the court under a petition filed under (l) of this section 04 may only declare the trust company's fiduciary operations in this state have been 05 properly wound up and may not declare the trust company is dissolved. The court 06 may make whatever additional orders and grant whatever additional relief that the 07 court determines is proper under the evidence submitted. 08  (n) After an order is issued under (m) of this section declaring the trust 09 company's fiduciary operations in this state are properly wound up, 10  (1) the trust company shall, except for any further winding up, cease 11 acting as a fiduciary in this state or in any jurisdiction; and 12  (2) the receiver shall promptly file with the department a copy of the 13 order certified by the clerk of the court. 14  (o) If the trust company is a bank doing business under authority granted by 15 the department and is being liquidated under AS 06.26.760 - 06.26.800, the trust 16 company's fiduciary operations shall also be liquidated even if there would not be 17 independent grounds for liquidation of the fiduciary operations under this section. 18  (p) If the trust company is a bank doing business under authority granted by 19 the department, its fiduciary operations are being liquidated under this chapter, and the 20 trust company as a whole is being liquidated, the department shall merge the 21 liquidations. 22  (q) If the trust company is a bank doing business under AS 06.05 and is not 23 authorized to engage in any business other than fiduciary operations, the entire bank 24 shall be liquidated under AS 06.05.466 - 06.05.474. 25  Sec. 06.26.800. Federal Deposit Insurance Corporation as receiver or 26 liquidator. The department may appoint the Federal Deposit Insurance Corporation 27 or its successor as receiver for a trust company that the department has taken 28 possession of if the deposits of the trust company are insured by that corporation or 29 its successor. Upon filing with the court a certificate indicating the acceptance of the 30 appointment by the Federal Deposit Insurance Corporation or its successor, the 31 possession of and title to all the assets, business, and property of the trust company are 01 transferred to that corporation. The department is then relieved of all responsibility 02 and liability with respect to the reorganization or liquidation of the trust company. 03 The Federal Deposit Insurance Corporation or its successor may liquidate, reorganize, 04 merge, or consolidate the trust company in the manner permitted by the laws of the 05 United States or by this chapter, and possesses all the rights, powers, duties, and 06 obligations of the department in the liquidation, reorganization, merger, or 07 consolidation of the trust company under this chapter. 08 Article 11. Interstate and International Trust Company Offices. 09  Sec. 06.26.810. Fiduciary operations at a branch or trust office. (a) An 10 interstate or international trust company whose home office is not located in this state 11 may not act as a fiduciary in this state unless the trust company maintains a trust 12 office in this state as permitted under AS 06.26.810 - 06.26.890. 13  (b) An interstate or international trust company whose home office is not 14 located in this state and that establishes or acquires a trust office in this state under 15 AS 06.26.810 - 06.26.890 may conduct at the trust office any activity that a trust 16 company may conduct at a trust office under this chapter. 17  Sec. 06.26.820. Establishing or acquiring a trust office. An interstate or 18 international trust company whose home office is not located in this state, that does 19 not operate a trust office in this state, and that meets the requirements of AS 06.26.810 20 - 06.26.890 may establish a new trust office in this state or acquire a trust office in this 21 state that is in existence at the time of acquisition. 22  Sec. 06.26.830. Requirement of notice. To establish a new trust office or 23 acquire a trust office that is in existence at the time of acquisition in this state under 24 AS 06.26.810 - 06.26.890, an interstate or international trust company whose home 25 office is not located in this state shall provide, or cause its home jurisdiction regulator 26 to provide, written notice of the proposed transaction to the department on or after the 27 date on which the trust company applies to its home jurisdiction regulator for approval 28 to establish or acquire the trust office. The trust company shall file with the notice 29 and maintain a copy of a resolution adopted by the board of the trust company 30 authorizing the establishment or acquisition of the office and shall pay the filing fee 31 established by the department by regulation. 01  Sec. 06.26.840. Conditions for approval. (a) An interstate or international 02 trust company whose home office is not located in this state may not establish or 03 acquire a trust office in this state under AS 06.26.810 - 06.26.890 unless 04  (1) the trust company confirms in writing to the department that the 05 trust company will comply with all applicable laws of this state while it maintains a 06 trust office in this state; 07  (2) the trust company provides satisfactory evidence to the department 08 of compliance with the 09  (A) requirements for foreign corporations under AS 10.06; and 10  (B) applicable requirements of its home jurisdiction regulator 11 for establishing or acquiring and maintaining the office; 12  (3) the department, acting within 90 days after receiving notice under 13 AS 06.26.830, certifies to the home jurisdiction regulator that the requirements of 14 AS 06.26.810 - 06.26.890 have been met and the notice has been approved or, if 15 applicable, that any conditions imposed by the department under (b) of this section 16 have been satisfied; 17  (4) the department receives evidence from the trust company that the 18 department determines clearly demonstrates that the establishment or acquisition will 19 serve the public interest and well-being; the evidence must address the factors listed 20 in AS 06.26.090(b); and 21  (5) the department has received all required fees and the affidavit of 22 publication required by AS 06.26.100(b). 23  (b) An interstate or international trust company whose home office is not 24 located in this state may begin acting as a fiduciary at a trust office on the 91st day 25 after the date that the department receives the notice under (a) of this section for the 26 trust office unless the department specifies a different date. 27  (c) The department may extend the 90-day period of review provided by (a) 28 of this section if the department determines that the written notice raises issues that 29 require additional information or additional time for analysis by the department. If the 30 department extends the 90-day period of review, the trust company may establish the 31 trust office only after written approval by the department. 01  (d) The department may deny the trust company permission to establish or 02 acquire the trust office if the department finds that the trust company lacks sufficient 03 financial resources to undertake the proposed expansion without adversely affecting its 04 safety or soundness or that the proposed trust office would be contrary to the public 05 interest. When acting on the notice provided under (a) of this section, the department 06 shall consider the views of the home jurisdiction regulator. 07  (e) If the trust company is not a resident of this state, a corporation organized 08 under AS 10.06, or a foreign corporation authorized to transact business in this state, 09 the trust company shall file a written consent with the department permitting the 10 commissioner to act as the agent for the trust company for service of process in a court 11 action arising out of or connected with the proposed trust office. 12  Sec. 06.26.850. Representative office business; registration. (a) An 13 interstate or international trust company whose home office is not located in this state 14 may not provide fiduciary services, but may otherwise engage in trust business, at a 15 representative office as permitted by AS 06.26.810 - 06.26.890. 16  (b) Subject to the requirements contained in AS 06.26.810 - 06.26.890, an 17 interstate or international trust company whose home office is not located in this state 18 may establish or acquire representative offices in any location in this state. 19  (c) If an interstate or international trust company whose home office is not 20 located in this state does not maintain a trust office in this state wants to establish or 21 acquire a representative office in this state, the trust company shall file a notice with 22 the department on a form prescribed by the department. The trust company shall 23 furnish a copy of a resolution adopted by its board authorizing the establishment or 24 acquisition of the representative office and shall pay the filing fee established by the 25 department by regulation. The notice required under this subsection must provide the 26 name of the trust company, the location of the proposed representative office, and 27 satisfactory evidence that the trust company is chartered or otherwise organized in 28 another jurisdiction to act as a fiduciary. 29  (d) An interstate or international trust company whose home office is not 30 located in this state may commence business at a representative office on the 61st day 31 after the date that the department receives the notice required under (c) of this section 01 unless the department specifies a different date. 02  (e) The department may extend the 60-day period of review provided by (d) 03 of this section if the department determines that the written notice raises issues that 04 require additional information or additional time for analysis by the department. If the 05 60-day period of review is extended, the trust company may establish the 06 representative office only after written approval by the department. 07  (f) The department may deny the trust company permission to establish or 08 acquire a representative office if the department finds that the trust company lacks 09 sufficient financial resources to undertake the proposed expansion without adversely 10 affecting its safety or soundness or that the proposed representative office would be 11 contrary to the public interest. When acting on the notice provided under (c) of this 12 section, the department shall consider the views of the home jurisdiction regulator. 13  (g) The department may determine by order that an interstate or international 14 trust company whose home office is not located in this state does not meet the 15 requirements for establishing a representative office in this state under this section. 16 An order issued under this subsection is effective on the date of its issuance or on 17 another date as the department may determine. 18  Sec. 06.26.860. Additional trust offices. An interstate or international trust 19 company whose home office is not located in this state and that maintains a trust office 20 in this state under AS 06.26.810 - 06.26.890 may establish or acquire additional trust 21 offices or representative offices in this state to the same extent and in the same manner 22 that a trust company may establish or acquire branch offices in this state under the 23 procedures for establishing or acquiring branch offices under AS 06.26.160. 24  Sec. 06.26.870. Examinations; periodic reports; cooperative agreements; 25 assessment of fees. (a) When the department considers it necessary to protect the 26 public interest, the department or a competent person designated by the department 27 may examine an interstate or international trust company whose home office is not 28 located in this state but that has a trust office or a representative office in the state. 29 The trust company shall pay a fee established under AS 06.01.010 for the examination. 30  (b) The department may require periodic reports from an interstate or 31 international trust company whose home office is not located in this state and that 01 maintains a trust office in this state and from a bank holding company that controls 02 the trust company. The reports shall be made under oath and filed as frequently as 03 required by the department. The reports must contain the information and detail that 04 the department determines to be appropriate as required under regulations adopted by 05 the department. 06  (c) An interstate or international trust company whose home office is not 07 located in this state and that maintains a trust office or a representative office in this 08 state may be assessed and, if assessed, shall pay supervisory and examination fees as 09 required by the laws of this state and regulations of the department. Fees may be 10 shared with other governmental regulators or any organization affiliated with or 11 representing governmental regulators under agreements between the department and 12 the regulators or organization. 13  Sec. 06.26.880. Enforcement. (a) Consistent with AS 06.01.030 and 14 regulations adopted by the department under AS 06.01.030 or this chapter and after 15 notice and an opportunity for a hearing, the department may determine that 16  (1) an office maintained by an interstate or international trust company 17 whose home office is not located in this state is being operated in violation of a 18 provision of the laws of this state or in an unsafe and unsound manner; or 19  (2) an interstate or international trust company whose home office is 20 not located in this state is engaged in an activity that the foreign trust company may 21 not engage in under this chapter. 22  (b) If either of the conditions in (a) of this section exists, the department may 23 take the enforcement actions it would be empowered to take if the office or the 24 company were a trust company established under this chapter, including issuing an 25 order temporarily or permanently prohibiting the trust company from acting as a 26 fiduciary in this state. 27  (c) If a matter involves extraordinary circumstances that require immediate 28 action, the department may take any action permitted by this section without notice or 29 an opportunity for a hearing, but shall promptly provide an interstate or international 30 trust company whose home office is not located in this state a hearing if the trust 31 company files an application to rescind the action. The department shall promptly give 01 notice to the home jurisdiction regulator of each enforcement action taken against an 02 interstate or international trust company whose home office is not located in this state 03 and, to the extent practicable, shall consult and cooperate with the home jurisdiction 04 regulator when pursuing and resolving an enforcement action. 05  Sec. 06.26.890. Notice of subsequent merger, consolidation, or closing. An 06 interstate or international trust company whose home office is not located in this state 07 and that maintains a trust office or a representative office in this state under this 08 chapter shall give at least 60 days' prior written notice, or, in the case of an emergency 09 transaction, shorter notice that is consistent with applicable state and federal law, to 10 the department of 11  (1) a merger, consolidation, or other transaction that would cause a 12 change of control with respect to the trust company or any bank holding company that 13 controls the trust company if an application would be required to be filed under 12 14 U.S.C. 1817(j) (Change in Bank Control Act of 1978) or 12 U.S.C. 1841 - 1850 (Bank 15 Holding Company Act of 1956); 16  (2) a transfer of all or substantially all of the trust accounts or trust 17 assets of the trust company to another person; 18  (3) the closing or other disposition of any trust office of the trust 19 company in this state. 20 Article 12. Miscellaneous Provisions. 21  Sec. 06.26.900. Powers of department. (a) The department may 22  (1) exercise general supervision over all trust companies and 23 subsidiaries and affiliated corporations of the trust companies; 24  (2) in addition to other authority in this chapter to adopt regulations, 25 adopt regulations necessary to interpret and implement this chapter, including 26 regulations providing for the retention and preservation of trust company records; 27  (3) review and approve or disapprove applications for trust companies 28 under AS 06.26.090, trust company branch offices under AS 06.26.160, representative 29 offices under AS 06.26.170, and trust offices and representative offices under 30 AS 06.26.810 - 06.26.890; 31  (4) issue permits authorizing trust company holding companies to do 01 business in this state; 02  (5) determine for each trust company the amount of paid-in capital 03 necessary to operate under AS 06.26.120; 04  (6) review and approve transfers of trust company ownership under 05 AS 06.26.450; 06  (7) perform examinations of trust companies, branch offices, 07 representative offices, and subsidiaries of trust companies and private fiduciaries under 08 AS 06.01.015 and this chapter; 09  (8) relieve a trust company from the examination requirements of 10 AS 06.01.015 if the trust company's deposits are insured by the Federal Deposit 11 Insurance Corporation, a successor of the Federal Deposit Insurance Corporation, or 12 another agency of the United States that insures trust company deposits; 13  (9) approve under AS 06.26.190 the operation of a branch trust 14 company on a schedule different than normal banking days; 15  (10) approve the operation by a trust company of an automated teller 16 machine in accordance with AS 06.05; 17  (11) approve certain trust company subsidiaries; 18  (12) approve the acceptance by a trust company of the trust company's 19 stock or of the stock of the trust company's holding company as security for a loan 20 under circumstances approved by the department; 21  (13) restrict the withdrawal of deposits from a trust company if the 22 department finds that extraordinary circumstances make restriction necessary for the 23 proper protection of depositors; 24  (14) require a trust company to 25  (A) maintain its capital and reserve accounts in amounts 26 determined appropriate by the department; 27  (B) observe the methods and standards that the trust company 28 adopts for determining the value of various types of assets; 29  (C) charge off part or all of an asset that has not been lawfully 30 acquired; 31  (D) write down an asset to its market value; 01  (E) record liens and other interests in property; 02  (F) obtain a financial statement from a borrower or prospective 03 borrower to the extent that the trust company can obtain the statement; 04  (G) obtain insurance against damage to real property taken as 05 security; 06  (H) search or obtain insurance on the title to real property taken 07 as security; 08  (I) maintain adequate insurance against risks as the department 09 determines necessary and appropriate for the protection of depositors and the 10 public; 11  (J) charge off that portion of an asset classified as a loss, or 12 charge off or reserve up to 50 percent of loans classified as doubtful, in a state 13 or federal report of examination; or 14  (K) charge off all debts owed to the trust company in which 15 interest is past due and unpaid for a period of six months, unless the debt 16 principal is adequately secured and the trust company is in the process of 17 collection; 18  (15) require the board of directors of a trust company to hold a meeting 19 under AS 06.26.520; 20  (16) order the removal of a board member of a trust company under 21 AS 06.26.510; 22  (17) order a trust company to suspend the payment of dividends under 23 AS 06.26.120 and regulations adopted by the department; 24  (18) require a trust company to increase its capital accounts under 25 AS 06.26.120; 26  (19) take possession of a trust company in the manner provided in 27 AS 06.26.730 - 06.26.750, and operate, reorganize, or liquidate the trust company after 28 taking possession; 29  (20) issue an order under AS 06.01.030 that the department determines 30 is necessary to ensure compliance with this chapter; and 31  (21) exercise other powers expressly or implicitly granted under this 01 chapter. 02  Sec. 06.26.905. Cooperative agreements. (a) The department may enter into 03 cooperative, coordinating, or information-sharing agreements with other governmental 04 regulators or with an organization affiliated with or representing governmental 05 regulators to handle the periodic examination or other supervision of a trust office that 06 is located in this state and owned by an interstate trust company or of a trust office 07 that is located in a host state and owned by a trust company. Under the agreements, 08 the department may accept reports of examination and reports of investigation instead 09 of conducting the department's own examinations or investigations. 10  (b) The department may enter into joint enforcement action agreements with 11 other governmental regulators having concurrent jurisdiction over a trust company that 12 is located in this state and owned by an interstate trust company organized in another 13 state or over a trust office that is located in a host state and owned by a trust company. 14  (c) Notwithstanding the existence of an agreement under this section, the 15 department may at any time make an examination or take independent supervisory or 16 enforcement action if the department determines that the examination or action is 17 necessary or appropriate to carry out the department's responsibilities under this 18 chapter or to ensure compliance with the laws of this state. 19  Sec. 06.26.910. Civil enforcement. The department may bring any 20 appropriate civil court action against a person who the department determines has 21 committed or is about to commit a violation of this chapter. 22  Sec. 06.26.920. Interest of department officers and employees in trust 23 companies. (a) A state financial institution examiner of the department who deals 24 with the regulation of financial institutions, a special agent selected by the department 25 to do work relating to financial institutions, the commissioner, the deputy 26 commissioner of the department, or the director of the division of banking, securities, 27 and corporations 28  (1) may not 29  (A) be an officer, an employee, a director, a trustee, an attorney, 30 or a shareholder of a trust company; 31  (B) receive, directly or indirectly, a payment or gratuity from 01 a trust company; 02  (C) borrow money from a trust company, except as provided in 03 this section; 04  (2) may 05  (A) be a depositor in a trust company; 06  (B) name a trust company to act as a trustee under a trust 07 agreement; 08  (C) be indebted to a trust company upon an installment debt 09 incurred by the employee in the purchase of goods for personal use only and 10 transferred as security to the financial institution in the regular course of 11 business, including debts for household goods, mobile homes, motor vehicles, 12 or boats; or 13  (D) be indebted to a trust company for a loan secured by the 14 person's primary residence, if the loan closed before the person became an 15 employee subject to this section. 16  (b) This section does not limit the authority of an officer or employee of the 17 department when acting in the person's official capacity in the business of the 18 department. 19  (c) In this section, "trust company" includes an interstate or international trust 20 company whose home office is not located in this state. 21  Sec. 06.26.930. Trust company reports to the department; publication of 22 reports. (a) A trust company shall make at least four reports of its condition each 23 year to the department as required by and on forms prescribed by the department. 24 Each report shall be signed by a duly authorized officer of the trust company verified 25 by at least one independent director, and each verifying director shall certify under 26 oath that the director has personal knowledge of the facts stated in the report and that 27 the facts are true. Each report must exhibit in detail and under appropriate headings 28 the resources and liabilities of the trust company and must be received by the 29 department within 30 calendar days after the end of the period covered by the report. 30  (b) The department may require that a trust company submit special reports 31 whenever the department considers a report necessary in order to obtain full knowledge 01 of the trust company's condition. 02  (c) In addition to the other reports required by this section, a trust company 03 shall make at least one report of income and dividends to the department each year. 04 The trust company shall submit the report to the department within 30 days after the 05 end of the calendar year covered by the report. 06  (d) All of the reports of condition required by this section shall be made 07 available to all customers on request and at no charge to the customer. 08  Sec. 06.26.940. Remedy of person damaged by violation. In addition to any 09 other remedies available under law to the person, a person who suffers damages as a 10 result of a violation of this chapter by a person subject to this chapter may bring an 11 action in court against the person violating this chapter to recover the damages. In this 12 section, "person subject to this chapter" means a trust company, a private fiduciary, an 13 exempt private fiduciary, a person who is required to obtain a certificate of authority 14 under AS 06.26.090, and an interstate or international trust company. 15  Sec. 06.26.950. Limitation on powers. This chapter does not allow a trust 16 company to engage in banking. In this section, "banking" has the meaning given in 17 AS 06.05.540. 18 Article 13. General Provisions. 19  Sec. 06.26.960. Application of laws relating to general business 20 corporations. (a) Unless expressly authorized by this chapter, a trust company may 21 not take an action that is authorized by AS 10.06 regarding its corporate status, capital 22 structure, or a matter of corporate governance and for which AS 10.06 requires a filing 23 with the department unless the trust company first makes the required filing with the 24 department and receives the department's approval. 25  (b) The department may adopt regulations to alter or supplement the 26 procedures and requirements of AS 10.06 applicable to an act taken under this chapter 27 by a trust company. 28  Sec. 06.26.990. Definitions. (a) In this chapter, unless the context otherwise 29 requires, 30  (1) "board" means board of directors; 31  (2) "certificate of authority" means the certificate of authority issued 01 to a corporation under AS 06.26.110; 02  (3) "chapter" includes regulations adopted under this chapter; 03  (4) "commissioner" means the commissioner of community and 04 economic development; 05  (5) "customer" means a person using the services of a trust company 06 or a private fiduciary, and includes a depositor; 07  (6) "department" means the Department of Community and Economic 08 Development; 09  (7) "depository" means a person authorized by state or federal law to 10 accept deposits of trust assets; 11  (8) "exempt private fiduciary" means a private fiduciary that has 12 received an exemption under AS 06.26.200; 13  (9) "family member" means an individual who is related within the 14 fourth degree of affinity or consanguinity; 15  (10) "fiduciary" means a person to whom the property of another 16 person is entrusted for a purpose specified in a trust instrument or by a court order; 17  (11) "fiduciary operations" means operations performed by a fiduciary; 18  (12) "fiduciary services" means services to act as a fiduciary; 19  (13) "financial institution" has the meaning given in AS 06.05.540; 20  (14) "governmental regulator" means a governmental agency 21 responsible for regulating persons who act as fiduciaries; 22  (15) "home jurisdiction regulator" means the governmental agency 23 responsible for regulating an interstate or international trust company in the jurisdiction 24 where the trust company is chartered or otherwise organized; 25  (16) "insider" has the meaning given in 12 C.F.R. 215.2; 26  (17) "international" means an entity having offices in countries other 27 than the country in which the home office is located; 28  (18) "interstate" means an entity having offices in states of the United 29 States other than the state in which the home office is located; 30  (19) "issuer" has the meaning given in AS 45.55.990; 31  (20) "national bank" has the meaning given in AS 06.05.540; 01  (21) "private fiduciary" means a person who acts as a fiduciary, is not 02 exempt under AS 06.26.020, and does not offer its fiduciary services to the general 03 public; 04  (22) "provide fiduciary services to the general public" means to make 05 any sales, solicitations, arrangements, agreements, or transactions to provide fiduciary 06 services, regardless of whether a fee, commission, or any other type of remuneration 07 is charged, unless the person to whom the fiduciary services are provided is 08  (A) a family member of an individual who owns 100 percent 09 of the person providing the fiduciary services; 10  (B) owned entirely by a family member of the individual who 11 owns 100 percent of the person providing the fiduciary services; 12  (C) controlled by a trust or charitable organization established 13 by a family member of the individual who owns 100 percent of the person 14 providing the fiduciary services; 15  (23) "purchasing trust company" means a trust company purchasing all 16 or substantially all of the assets of another trust company; 17  (24) "representative office" means an office that provides support 18 services for a trust company, but at which the trust company does not provide 19 fiduciary services; 20  (25) "resident of this state" means an individual who is physically 21 present in Alaska and who intends to remain indefinitely in Alaska; 22  (26) "selling trust company" means a trust company selling all or 23 substantially all of its assets; 24  (27) "state bank" has the meaning given in AS 06.05.540; 25  (28) "trust account" means an account at a trust company for trust 26 assets; 27  (29) "trust assets" means assets held in trust for another person; 28  (30) "trust company" means a person who is organized to act as a 29 fiduciary and to offer its fiduciary services to the general public; 30  (31) "trust company assets" means assets that are not trust assets and 31 that are owned by a trust company; 01  (32) "trust holding company" means an organization formed for the 02 purpose of owning a trust company; 03  (33) "trust office" means an office that provides fiduciary services. 04  (b) In AS 06.26.220, 06.26.450 - 06.26.470, 06.26.510, 06.26.860, and 05 06.26.880, "control" means owning, or holding with the power to vote, 25 percent or 06 more of the voting securities or other capital stock. 07  Sec. 06.26.995. Short title. This chapter may be cited as the Revised Alaska 08 Trust Company Act. 09 * Sec. 3. AS 13.36.320(a) is amended to read: 10  (a) If at least one qualified person serves as trustee of a trust whose state 11 jurisdiction provision is valid, effective, and conclusive under AS 13.36.035(c), then 12 the following persons also may serve as trustees even though they are not qualified 13 persons: 14  (1) individuals who do not reside in  the state  [ALASKA]; 15  (2) trust companies that have their principal place of business outside 16  the state  [OF ALASKA] and that are not organized under  AS 06.26  [AS 06.25]; and 17  (3) banks that have their principal place of business outside  the state  18 [OF ALASKA] or that are not organized under AS 06.05. 19 * Sec. 4. AS 13.36.390(1) is amended to read: 20  (1) "qualified person" means 21  (A) an individual who, except for brief intervals, military 22 service, attendance at an educational or training institution, or for absences for 23 good cause shown, resides in this state, whose true and permanent home is in 24 this state, who does not have a present intention of moving from this state, and 25 who has the intention of returning to this state when away; 26  (B) a trust company that is organized under AS 06.26  27 [AS 06.25] and that has its principal place of business in this state; or 28  (C) a bank that is organized under AS 06.05, or a national 29 banking association that is organized under 12 U.S.C. 21 - 216d, if the bank 30 or national banking association possesses and exercises trust powers and has 31 its principal place of business in this state; 01 * Sec. 5. AS 21.66.250 is amended to read: 02  Sec. 21.66.250. Trust funds. Except as provided in AS 34.80, trust funds or 03 assets held in a fiduciary capacity by a title insurance company that is authorized to 04 do a trust business shall be invested in accordance with  AS 06.26  [AS 06.25]. 05 * Sec. 6. AS 06.25.010, 06.25.020, 06.25.030, 06.25.040, 06.25.050, 06.25.080, 06.25.085, 06 06.25.090, 06.25.100, 06.25.105, 06.25.110, 06.25.120, 06.25.130, 06.25.140, 06.25.150, 07 06.25.160, 06.25.170, 06.25.180, 06.25.190, 06.25.200, 06.25.210, 06.25.215, 06.25.220, 08 06.25.230, 06.25.240, 06.25.255, 06.25.260, 06.25.270, 06.25.280, 06.25.290, 06.25.300, 09 06.25.310, 06.25.315, and 06.25.350 are repealed. 10 * Sec. 7. The uncodified law of the State of Alaska is amended by adding a new section 11 to read: 12 COURT RULE CHANGES. AS 06.26.760(b)(2), enacted by sec. 2 of this Act, 13 amends 14 (1) Rule 6, Alaska Rules of Civil Procedure, by postponing the deadlines for 15 the filing of pleadings and other documents by a trust company in a civil action when the 16 Department of Community and Economic Development has taken possession of the trust 17 company; 18 (2) Rule 12, Alaska Rules of Civil Procedure, by postponing the deadlines for 19 serving an answer to a complaint, a third-party answer, a reply to a counterclaim, a cross- 20 claim, and an answer to a cross-claim by a trust company in a civil action when the 21 Department of Community and Economic Development has taken possession of the trust 22 company; 23 (3) Rule 40, Alaska Rules of Criminal Procedure, by postponing the deadlines 24 set in the Alaska Rules of Criminal Procedure for the filing of documents by a trust company 25 in a criminal action when the Department of Community and Economic Development has 26 taken possession of the trust company; 27 (4) Rule 204, Alaska Rules of Appellate Procedure, by postponing the 28 deadlines for the filing of appeals to the supreme court and the court of appeals by a trust 29 company when the Department of Community and Economic Development has taken 30 possession of the trust company; 31 (5) Rule 403, Alaska Rules of Appellate Procedure, by postponing the deadline 01 for the filing of petitions for review or cross-petitions for review by a trust company when the 02 Department of Community and Economic Development has taken possession of the trust 03 company; 04 (6) Rule 502, Alaska Rules of Appellate Procedure, by postponing the 05 deadlines set in the Alaska Rules of Appellate Procedure for the filing of documents by a trust 06 company when the Department of Community and Economic Development has taken 07 possession of the trust company; 08 (7) Rule 602, Alaska Rules of Appellate Procedure, by postponing the 09 deadlines for the filing of appeals to the superior court from a district court or an 10 administrative agency by a trust company when the Department of Community and Economic 11 Development has taken possession of the trust company; 12 (8) Rule 611, Alaska Rules of Appellate Procedure, by postponing the 13 deadlines set in the Alaska Rules of Appellate Procedure for the filing of petitions for review 14 to the superior court from a district court of an administrative agency by a trust company 15 when the Department of Community and Economic Development has taken possession of the 16 trust company. 17 * Sec. 8. The uncodified law of the State of Alaska is amended by adding a new section 18 to read: 19 TRANSITION. (a) The certificate of authority of a corporation incorporated under 20 former AS 06.25 before January 1, 2001, remains in effect until the corporation has either 21 revoked the original certificate of authority or has been issued an amended certificate of 22 authority. 23 (b) A trust company with a certificate of authority issued under AS 06.25 before the 24 effective date of this Act shall, before April 1, 2001, submit a plan acceptable to the 25 department to attain the minimum capital requirements provided for in AS 06.26.120(a), 26 enacted by sec. 1 of this Act. The plan must provide for attaining the minimums contained 27 in AS 06.26.120(a), enacted by sec. 1 of this Act, before January 1, 2006. 28 * Sec. 9. The uncodified law of the State of Alaska is amended by adding a new section 29 to read: 30 TRANSITION: REGULATIONS. Notwithstanding sec. 10 of this Act, the Department 31 of Community and Economic Development may proceed to adopt regulations necessary to 01 implement the changes made by secs. 1 - 6 of this Act. The regulations take effect under 02 AS 44.62 (Administrative Procedure Act), but not before January 1, 2001. 03 * Sec. 10. Sections 8 and 9 of this Act take effect immediately under AS 01.10.070(c). 04 * Sec. 11. Except as provided in sec. 10 of this Act, this Act takes effect January 1, 2001.