Pennsylvania § 1302 - Approval of voluntary dissolution.

§ 1302. Approval of voluntary dissolution.

(a) General rule.--The procedure for voluntary dissolution shall be as follows:

(1) A plan of dissolution, setting forth in detail the number of liquidating trustees, which shall be one, three or five, to be elected by the members, the amount of the bond which shall be supplied by each of the liquidating trustees and the powers, duties and compensation of such trustees, shall be adopted by a vote of at least two-thirds of all directors of the credit union.

(2) A meeting of the membership shall be called for the purpose of acting on the plan of dissolution. Notice setting forth the date and purpose of such meeting shall be furnished each member at least ten days prior to the date of the meeting. The plan of dissolution shall be adopted upon the affirmative vote of a majority of the entire membership of the credit union in person or by written ballot.

(3) Upon approval of the plan, the members shall forthwith proceed to elect the number of liquidating trustees provided for in the plan of dissolution. If more than one liquidating trustee is to be elected, each member shall have the right to multiply his vote by the number of trustees to be elected and cast the whole number of such votes for one candidate or distribute them among two or more candidates. The candidates receiving the highest number of votes up to the number of liquidating trustees to be chosen shall be elected.

(4) A certificate of election to dissolve signed by a duly authorized officer of the credit union shall be executed and delivered to the department. The certificate shall set forth:

(i) The name of the credit union.

(ii) The exact location of its place of business.

(iii) The names and addresses of its officers and directors.

(iv) The number of directors voting for, and the number voting against, the proposed plan of voluntary dissolution.

(v) The total number of members and the number of members voting for, and the number voting against, the proposed plan of voluntary dissolution.

(vi) The names and addresses of the proposed liquidating trustees and the number of votes received by every candidate for the position of liquidating trustee.

(vii) The amount of the bond required to be supplied by each trustee.

(viii) A verified statement by each of the proposed liquidating trustees stating that he is willing to serve as liquidating trustee, subject to the provisions of this chapter and to the terms of the proposed plan of voluntary dissolution, that he will, so far as the duty devolves upon him, diligently and honestly liquidate the affairs of the credit union, and will not knowingly violate or permit to be violated any of the provisions of this chapter or of the proposed plan of voluntary liquidation.

(ix) The proposed plan of voluntary dissolution.

(b) Department review.--Upon receipt of the certificate of election to dissolve, the department shall conduct an examination or an investigation, or take such other action as it deems necessary, to determine whether to approve the plan of voluntary dissolution. If the department determines that the plan of voluntary dissolution does not prejudice the interests of members or creditors, it shall endorse its approval on the certificate of election to dissolve and send it to the Department of State for filing. If the department disapproves the plan, it shall return the certificate to the credit union stating in detail its reasons for doing so.

(c) Effect of filing certificate.--Upon the filing by the Department of State of the certificate of election to dissolve, the Department of State shall furnish a copy thereof to the department and the credit union. Upon such filing, the credit union shall cease to transact its business, and the liquidating trustee or trustees shall commence the liquidation of the credit union. The liquidating trustee or trustees shall thereafter be authorized to carry out, in his own name or in their own names as liquidating trustee or trustees of the credit union, the powers granted to him or them by the plan of voluntary dissolution and may sue and be sued for the purpose of determining and enforcing the debts due the credit union and its obligations.

(d) Cross reference.--See 15 Pa.C.S. § 134 (relating to docketing statement).

(Dec. 9, 2002, P.L.1572, No.207, eff. 60 days; June 18, 2014, P.L.754, No.62, eff. 60 days)

2014 Amendment. Act 62 amended subsec. (a)(2).

2002 Amendment. Act 207 amended subsecs. (a)(4), (b) and (c).