South Carolina § 34-26-1200 - Dissolution; voluntary liquidation; distribution of assets.

§ 34-26-1200. Dissolution; voluntary liquidation; distribution of assets.

(1) A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this section.

(2) If it decides to begin the procedure, the board of directors shall adopt a resolution recommending the credit union be dissolved voluntarily, and directing that the question of liquidation be submitted to the members.

(3) Within ten days after the board of directors decides to submit the question of liquidation to the members, the credit union shall notify the Board of Financial Institutions and the insuring organization in writing, setting forth the reasons for the proposed liquidation. Within ten days after the members act on the question of liquidation, the credit union shall notify the Board of Financial Institutions and the insuring organization in writing as to the action of the members on the proposal.

(4) As soon as the board of directors decides to submit the question of liquidation to the members, payments on, withdrawals of, and making any transfer of share and deposit accounts to loans and interest, making investments of any kind, and granting loans may be restricted or suspended pending action by members on the proposal to liquidate. On approval by the members of such proposal, all such business transactions shall be permanently discontinued. Necessary expenses of operation shall, however, continue to be paid on authorization of the board of directors or liquidating agent during the period of liquidation.

(5) For a credit union to enter voluntary liquidation, approval is required by a two-thirds majority of the members voting in accordance with Section 34-26-570(2) of this chapter at a regular or special meeting of the members. When authorization for liquidation is to be obtained at a meeting of the members, notice in writing shall be given to each member, by first class mail, at least ten days prior to such meeting. Certification of the voluntary liquidation shall be filed with the board accompanied by the resolution of the board of directors and a certified extract of the shareholders' meeting approving the liquidation.

(6) A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting on loans and distributing its assets, and performing all duties required in order to wind up its business and may sue and be sued for the purpose of enforcing such debts and obligations until its affairs are fully concluded.

(7) The board of directors or the liquidating agent shall distribute the assets of the credit union or the proceeds of any disposition of the assets in the sequence described in Section 34-26-220(6).

(8) As soon as the board of directors or the liquidating agent determines that all assets from which there is a reasonable expectancy of realization have been liquidated and distributed as set forth in this section, they shall execute a certificate of dissolution and file the same, together with all pertinent books and records of the liquidating credit union, with the Board of Financial Institutions, whereupon such credit union shall be dissolved.

HISTORY: 1996 Act No. 371, SECTION 1, eff May 29, 1996.