§ 378 — Power to issue shares; dues thereon

§ 378. Power to issue shares; dues thereon. 1. Every savings and loan\nassociation shall be either permanent or serial in character. A\npermanent association shall be one which issues instalment shares, not\nin series, and credits dividends thereon to the holders of such shares\nindividually. A serial association shall be one which issues instalment\nshares in series and credits the dividends apportioned to such shares by\nseries. No additional shares shall be issued in any series after a\ndividend has been credited thereto unless the person to whom such shares\nshall be issued shall pay therefor the book value of such shares\nincluding the estimated accrued dividend thereon since the close of the\npreceding dividend period. Dividends credited by a serial association\nupon shares issued by it other than instalment shares may be credited to\nthe holders of such shares individually.\n 2. The members of a savings and loan association shall be: (1) those\npersons who are the holders of record of shares whose membership shall\ncontinue until such shares have matured and been paid, or have been\nwithdrawn, retired, suspended, forfeited, or transferred; and (2) all\nborrowers from the association and all persons obligated to the\nassociation on loans whose membership shall continue until such loans or\nobligations have been paid. Each member shall be entitled to at least\none vote upon all question at any meeting of such members of the\nassociation, except when by statute the vote is required to be based\nupon the capital of the association. Every member entitled to vote at a\nmeeting of members of the association may authorize another person or\npersons to act for him by proxy, but no director, officer, clerk, teller\nor bookkeeper of the savings and loan association shall act as proxy at\nany meeting of such association. Every proxy must be signed by the\nmember or his attorney-in-fact. No proxy shall be valid after the\nexpiration of eleven months from the date thereof unless otherwise\nprovided in the proxy. Every proxy shall be revocable at the pleasure of\nthe member executing it. The authority of the holder of a proxy to act\nshall not be revoked by the incompetence or death of the member who\nexecuted the proxy unless, before the authority is exercised, written\nnotice of an adjudication of such incompetence or of such death is\nreceived by the officer of the association responsible for maintaining\nthe list of members. The by-laws may prohibit or further limit proxies\nfor members and their duration. No director or officer of a savings and\nloan association shall be eligible to act as an inspector of an election\nof directors at any meeting of members of the association.\n 3. The capital of every such association shall consist of the dues and\ndividends credited to its members upon their shares either individually\nor by series, time deposits held by such association pursuant to section\nthree hundred seventy-eight-a of this chapter together with interest\naccrued on such deposits, and demand deposits held by such association\npursuant to subdivision thirteen of section three hundred eighty-three\nof this chapter.\n 4. Any savings and loan association may issue shares of the following\nclasses: (a) Instalment shares, class one, upon which regular payments\nof dues shall be made as provided in the by-laws of the association,\nuntil such shares reach their matured value or are withdrawn, retired or\nforfeited; and instalment shares, class two, which shall have no\nparticipation in dividends and upon which the dues payable in regularly\nincreasing amounts are applied in reduction of a debt due to the\nassociation from the holder of such shares in accordance with a\ndirection given by him.\n (b) Savings shares, upon which dues shall be paid in such sums, at\nsuch times and for such purposes as the holder thereof may elect, until\nthe shares are withdrawn or retired. Upon the request of the holder\nthereof, such savings shares may be converted by the issuing association\ninto special savings shares authorized for issuance by paragraph (bb) of\nthis subdivision. The association may enter such conversion in its\nrecords and on the evidence of ownership of the savings shares as an\nalternative to withdrawal or retirement of the savings shares and\nissuance of special savings shares.\n (bb) Subject to such limitations and restrictions as may be prescribed\nby regulation of the superintendent of financial services, special\nsavings shares, upon which dues shall be paid in such sums, at such\ntimes and for such purposes as the holder thereof may elect, and which\nshall provide that dividends shall be credited from the date of actual\nreceipt of such dues to the date they are withdrawn or retired.\nDividends on special savings shares shall be credited and shall be made\navailable no later than the end of a regular dividend period, or at the\ntime such special savings shares are withdrawn or retired if in the\nopinion of a majority of the board of directors it appears the savings\nand loan association will have sufficient profit available at the end of\nsuch regular dividend period to pay dividends and if the board of\ndirectors chooses payment of dividends at withdrawal as an option to\nperiodic payment of dividends. Any savings and loan association which\ndoes not make dividends available pursuant to the provisions of this\nparagraph shall promptly notify the superintendent of financial services\nof such decision. Withdrawals or retirements of special savings shares\nduring the last three business days of any regular dividend period or,\nin the event that any one of such last three business days is a\nSaturday, withdrawals of such shares upon one of the last four business\ndays of any such period may receive dividends apportioned for the full\nperiod.\n (c) Accumulative prepaid shares upon which a single payment of dues to\nthe amount of fifty per centum or more of the matured value thereof\nshall be paid at the time when such shares are issued. The whole or a\npart of the dividends apportioned to such shares shall be credited\nthereto until such shares are matured, withdrawn or retired. Any balance\nof such dividends not so credited shall be paid in cash.\n (d) Income shares, upon which a single payment of dues amounting to\none hundred dollars per share shall be paid at the time when such shares\nare issued. The dividends on such shares shall be paid in cash or, in\naccordance with the written order of the holder, applied to the purchase\nof other shares in the association. Income shares may be issued which\nshall not be withdrawable without the consent of the board of directors,\nuntil the expiration of a fixed period, which shall be not more than ten\nyears. Whenever income shares are issued which are not withdrawable\nuntil the expiration of a fixed period, a statement that they are not\nwithdrawable until the expiration of such fixed period shall be printed\nupon the face of the certificate of shares or other evidence of\nownership in such manner as to be clearly legible. Whenever any\nassociation is unable to locate the holder of income shares and\ndividends shall have been apportioned which cannot be paid to the holder\nthereof by reason of the inability of such association to locate such\nholder, such association may credit such dividends as dues upon another\nclass of shares in the name of holder of such income shares and shall\ncarry such other shares and any accumulations thereon for the benefit of\nsuch shareholder. Income shares which are not withdrawable until the\nexpiration of a fixed period shall be termed "income shares, class two."\nOther income shares shall be termed "income shares, class one."\n (e) Cumulative income shares upon which a single payment of dues of\nnot less than one hundred dollars shall be paid at the time such shares\nare issued. The dividends on such shares may be credited thereto until\nsuch shares are matured, withdrawn or retired. Cumulative income shares\nmay be issued which shall not be withdrawable without the consent of the\nboard of directors, until the expiration of a fixed period, which shall\nbe not more than ten years nor less than ninety days. Whenever\ncumulative income shares are issued which are not withdrawable until the\nexpiration of a fixed period, a statement that they are not withdrawable\nuntil the expiration of such fixed period shall be printed upon the face\nof the certificate of shares or other evidence of ownership in such\nmanner as to be clearly legible. Cumulative income shares which are not\nwithdrawable until the expiration of a fixed period shall be termed\n"cumulative income shares, class two." Other cumulative income shares\nshall be termed "cumulative income shares, class one."\n 5. All shares hereafter issued by any savings and loan association\nshall have a matured value of one hundred dollars, except that\ninstalment shares may be issued having a matured value of not less than\none hundred nor more than two hundred fifty dollars.\n 6. Shares issued in the name of more than one person shall confer no\ngreater voting rights than if issued in the name of one person.\n 7. Persons who hold shares in a fiduciary capacity shall have all the\nrights and privileges of membership, except to hold office.\n 8. A savings and loan association shall have a lien upon the shares of\nits members to the extent of any lawful fines or other obligations due\nto it, whether or not such shares are specifically transferred or\npledged to it, and may, at its option, after five days' notice to the\nmember, apply such shares toward the payment of any matured obligations\ndue it.\n 9. A savings and loan association may in its discretion accept or\nrefuse advance payments of dues.\n 10. Notwithstanding any provision of this chapter, a savings and loan\nassociation, in its organization certificate, by-laws, advertising\nmatter or any other instrument, document or other writing used in or in\nconnection with its business, may designate its shares as "deposit\naccounts" or "savings accounts" its members as "depositors", its dues or\nshare payments as "deposits", and its capital as "deposit liability".\nThe use of any term permitted by this subdivision shall not affect any\nright, duty, privilege or liability which the savings and loan\nassociation, any member or any depositor would otherwise have.\n