Vermont § 35101 - Conversions

§ 35101. Conversions

• (a) General. The provisions of this chapter shall apply whenever a federal credit union seeks to
  convert to a Vermont credit union or whenever a Vermont credit union seeks to convert
  to a federal credit union; provided, however, that conversion from a Vermont credit
  union to a federal credit union shall be as permitted in federal law and shall not
  require the Commissioner’s approval, and that federal law shall be controlling to
  the extent the laws of this State are inconsistent. (b) Types of conversions. The types of conversions permitted under this chapter are as follows: (1) conversion from a federal credit union to a Vermont credit union; and (2) conversion from a Vermont credit union to a federal credit union. (c) Manner of conversion. Any credit union may convert under this chapter in the following manner: (1) The governing body of the credit union shall approve the plan of conversion by at
  least a majority vote, unless a higher percentage is required by the credit union’s
  organizational documents. (2) The approved plan of conversion, together with a certified copy of the authorizing
  resolution adopted by the governing body of the credit union, shall be submitted to
  the Commissioner for approval pursuant to the requirements and procedures of chapter
  220, subchapter 8 of this title, except as provided in subsection (a) of this section. (3) The plan of conversion, as approved by the Commissioner, shall be submitted to members
  of the credit union for their approval at an annual meeting or at a special meeting
  called for that purpose. (4) The approved plan shall be finalized as provided in subsection 35101(f) of this section. (d) Contents of plan of conversion. The plan of conversion shall include: (1) the name of the credit union and its location; (2) the type of credit union that the resulting credit union is to be; (3) a method and schedule for terminating any nonconforming activities that would result
  from such conversion; (4) a statement of the competitive impact resulting from such conversion, including the
  loss of particular financial services in the market area resulting from such conversion; (5) a statement that the conversion is subject to approval of the Commissioner, except
  for conversions from a Vermont credit union to a federal credit union; (6) a statement that the conversion is subject to approval of the credit union’s members;
  and (7) such additional information as the Commissioner may require. (e) Member voting requirements. A majority of the members of the credit union casting votes at a duly called and noticed
  meeting, unless a higher percentage is required by the credit union’s organizational
  documents, is necessary to approve the plan of conversion at the meeting. For purposes
  of this section, written notice must be delivered in person to each member or mailed
  to each member at the address for such member appearing on the records of the credit
  union, not more than 30 days nor less than seven days prior to the date of the meeting.
  Notice may be given electronically if the member has specifically requested or consented
  to electronic notification of meetings. An affirmative vote constitutes approval of
  the adoption of any amendments to the organizational documents of the credit union
  that are necessary to effect the transaction. (f) Finalizing the plan of conversion. Except as provided in subsection (g) of this section, the credit union shall effect
  its conversion as follows: (1) Upon approval by the members, the credit union shall submit the executed conversion
  plan to the Commissioner, together with all necessary amendments to the credit union’s
  organizational documents, each certified by an officer of the credit union. (2) The Commissioner shall issue to the resulting credit union a certificate specifying
  the name of the converting credit union and the name and organizational structure
  of the resulting credit union. The resulting credit union shall file one copy of the
  certificate issued by the Commissioner with the Secretary of State for recording.
  The certificate shall be conclusive evidence of the conversion and the correctness
  of all proceedings relating to the conversion in all courts and places. The certificate
  may be filed in any land records office to evidence the new name in which property
  of the converting credit union is to be held. (3) Unless a later date is specified in the conversion plan, the conversion becomes effective
  upon filing of the certificate as provided in subdivision (2) of this subsection,
  and the former charter of the converting credit union shall terminate automatically.
  The Commissioner may file or order any credit union to file conforming documents with
  the Secretary of State. (g) Completion of conversion into federal credit union. Upon completion of a conversion into a federal credit union, the federal credit union
  shall certify in writing to the Commissioner and the Secretary of State that the conversion
  has been completed under applicable federal law. The charter of the converting credit
  union shall terminate automatically upon issuance of the federal credit union charter. (h) If the Commissioner disapproves the conversion plan, the Commissioner shall state
  the reasons for the disapproval in writing and furnish them to the credit union. The
  credit union shall be given a reasonable opportunity to amend the plan to eliminate
  the reasons for disapproval. (i) Authority for expedited conversion. Notwithstanding any other section of law or any organizational document of the credit
  union, the Commissioner may order that a charter conversion become effective immediately
  when the Commissioner finds it is necessary for the protection of members or the public. (k) Rules of the Commissioner. The Commissioner shall issue such rules governing the conversion of a credit union
  organized under this chapter to a federal credit union and the conversion of a federal
  credit union to a credit union organized under this chapter as the Commissioner deems
  necessary or appropriate. (Added 2005, No. 16, § 1, eff. July 1, 2005; amended 2021, No. 105 (Adj. Sess.), § 343, eff. July 1, 2022.)