§ 28-1-30-5 — Conversion procedures

(a) A credit union may convert to a mutual
bank with the approval of the department and, if required by law, the
appropriate federal agency.
(b) The department shall prescribe procedures for mutual bank
conversions. The procedures must require the following:
(1) The credit union must prepare and submit to the department
a plan of mutual bank conversion that:
(A) provides the terms and conditions of the mutual bank
conversion as required by the department;
(B) complies with any federal requirements for conversion; and
(C) provides for a two (2) year period after conversion that a
director or employee of the credit union may not acquire stock
in the resulting institution or a successor institution on terms
other than those readily available to all members of the former
credit union.
(2) The credit union must submit evidence with the conversion
plan that is satisfactory to the department proving that:
(A) the credit union has applied for deposit insurance from the
Federal Deposit Insurance Corporation or its successor in
interest; and
(B) upon conversion, the deposits in the resulting mutual bank
will be insured by the Federal Deposit Insurance Corporation.
(3) The plan of mutual bank conversion is conditioned upon the
approval of at least a majority of the total number of votes cast at
a regular or special meeting of the membership.
(4) Notice of the meeting must be delivered in person to each
member or mailed to each member not more than thirty (30) days
but not less than fourteen (14) days before the date of the meeting.
(c) The notice of the meeting of the membership required under
subsection (b)(4) must include the following:
(1) The date, time, and location of the meeting.
(2) A description of the matters to be voted upon at the meeting.
(3) A ballot that contains:
(A) two (2) voting options:
(i) a vote to approve the conversion; and
(ii) a vote to disapprove the conversion; and
(B) a notice that the member has the right to vote either by mail
ballot or at the meeting.
(4) A disclosure that:
(A) the board of directors of the credit union has proposed that
the credit union convert to a mutual savings bank charter;
(B) the conversion could shift voting rights from each member
having one (1) vote to a certain number of shares qualifying for
one (1) vote;
(C) subsequent to the conversion, management may solicit
proxies and vote them as a block;
(D) a mutual savings bank can convert to a stock savings bank;
(E) upon conversion, the credit union will lose its federal tax
exempt status;
(F) members may vote by mail ballot or in person at the
meeting; and
(G) the complete application and proposal for the conversion
are available for inspection at the credit union's offices during
normal business hours.
(d) The board of directors of the converting credit union shall certify
the results of the membership vote to the department within ten (10)
days after the vote is taken.
(e) Upon the approval of a plan of mutual bank conversion by the
board of directors of the credit union, the plan of mutual bank
conversion and a certified copy of the resolution of the board of
directors approving the plan of mutual bank conversion must be
submitted to the department and, if required, the appropriate federal
agency for approval.
(f) The credit union shall provide the department with additional
relevant information concerning the plan of mutual bank conversion as
requested by the department.

Legislative History

As added by P.L.62-1999, SEC.2.