§ 487-A — Conversion of a credit union into a mutual savings bank

§ 487-a. Conversion of a credit union into a mutual savings bank. 1.\nAny credit union having its place of business in this state may convert\nto a mutual savings bank, subject to the requirements and procedures set\nforth in the laws and regulations governing mutual savings banks.\n 2. A proposal for a conversion described in this section shall first\nbe approved, and a date set for a vote thereon by the members (either at\na meeting to be held on that date or by written ballot to be filed on or\nbefore that date), by a majority of the directors of the credit union.\nApproval of the proposal for conversion shall be by the affirmative vote\nof a majority of the members of the credit union who vote on the\nproposal.\n 3. A credit union that proposes to convert to a mutual savings bank\nunder this section shall submit notice to each of its members who is\neligible to vote on the matter of its intent to convert. Such notice\nmust adequately describe the purpose and subject matter of the vote to\nbe taken at the meeting or by submission of a written ballot. Such\nnotice shall be submitted:\n a. ninety days before the date of the member vote on the conversion;\n b. sixty days before the date of the member vote on the conversion;\nand\n c. thirty days before the date of the member vote on the conversion.\nThe notice submitted thirty days before the date of the member vote on\nthe conversion shall contain a written ballot, and shall clearly inform\nthe member that the member may vote at the meeting or by submitting the\nwritten ballot. Such notice also shall state the date, time and place of\nthe meeting.\n 4. The superintendent shall require a credit union that proposes to\nconvert to a mutual savings bank under this section to submit a notice\nto the superintendent of its intent to convert during the ninety-day\nperiod preceding the date of the completion of the conversion,\naccompanied by an investigation fee as prescribed pursuant to section\neighteen-a of this chapter.\n 5. No director or senior management official of a credit union may\nreceive any economic benefit in connection with a conversion of the\ncredit union as described in this section, other than:\n a. director fees; and\n b. compensation and other benefits paid to directors or senior\nmanagement officials of the converted institution in the ordinary course\nof business.\n c. For purposes of this subdivision, the term "senior management\nofficial" means a chief executive officer, an assistant chief executive\nofficer, a chief financial officer, and any other senior executive\nofficer as defined by the appropriate federal banking agency pursuant to\nsection 32(f) of the Federal Deposit Insurance Act, 12 U.S.C. 1831i(f).\n 6. The member vote concerning charter conversion under this section\nshall be verified by the superintendent. If the superintendent\ndisapproves of the methods by which the member vote was taken or\nprocedures applicable to the member vote, the member vote shall be taken\nagain, as directed by the superintendent.\n 7. Upon completion of a conversion described in this section, the\ncredit union shall no longer be subject to any of the provisions of this\narticle.\n When the superintendent shall have approved the organization\ncertificate and the proposed bylaws and shall have issued the\nauthorization certificate, as provided in article six of this chapter,\nthe credit union shall cease to be a credit union and shall thereupon be\nconverted into a mutual savings bank; provided, however, that such\ncredit union shall be deemed to be continued for the purpose of\nprosecuting or defending suits and of enabling it to wind up its affairs\nas a credit union and to dispose of and convey its property.\n At the time when such conversion becomes effective, all the property\nof the credit union shall immediately by act of law and without any\nconveyance or transfer become the property of the mutual savings bank\nand the mutual savings bank shall succeed to all the rights, obligations\nand relations of the credit union.\n