§ 26–509.01. Voluntary Liquidation.
(a) A District credit union may, by a 2/3 vote of the board of directors and in the manner described in this section, elect to voluntarily dissolve and liquidate its affairs.
(b) The board shall notify the Commissioner of its vote to voluntarily dissolve and liquidate its affairs no later than 10 days after the vote. The notification shall be in writing and set forth the reasons for the proposed liquidation and a plan for liquidation, including any suspension of:
(1) Payments on accounts;
(2) Withdrawals of funds;
(3) Transfers to loan accounts;
(5) New loans; or
(6) Other similar financial transactions.
(c) Upon documentation that the District credit union has complied with this section, the Commissioner shall certify that the District credit union has complied with this section and shall forward a copy of the certification to the District credit union.
(d) The terms and conditions of a liquidation plan approved under this section shall go into effect immediately upon approval by the District credit union's members, pursuant to subsection (e) of this section.
(e) Voluntary liquidation requires approval by a vote of 2/3 of the members present, either in person, by mail ballot, or by electronic means, at a regular meeting that specifically included the liquidation issue on the notice or by a special meeting called specifically to vote on the liquidation issue with a minimum of 25% of the total membership voting. 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 10 days, but not more than 30 days, prior to the meeting.
(f) If liquidation is approved, the board of directors shall appoint a liquidating agent or committee for the purpose of conserving and collecting the assets, closing the affairs of the District credit union, and distributing the assets as required by this subchapter.
(g) A liquidating District credit union shall continue in existence for the purpose of discharging its debts, collecting on loans, distributing its assets, and doing all acts necessary to terminate operations. The liquidating District credit union may sue and be sued for the purpose of enforcing debts and obligations until the liquidating District credit union's affairs are fully concluded.
(h) The liquidating agent or committee shall distribute the assets of the District credit union or the proceeds of any disposition of the assets in the sequence described in § 26-510.05(b).
(i)(1) The liquidating agent shall execute a certificate of dissolution when the liquidating agent or committee determines that all assets from which there is a reasonable expectancy of recovery have been liquidated and distributed as set forth in this section. The certificate of dissolution shall be executed on a form prescribed by the Commissioner and filed, together with all pertinent books and records of the liquidating District credit union, with the Commissioner.
(2) The liquidating agent or committee shall, within 3 years after issuance of a certificate of dissolution, discharge the debts of the District credit union, collect and distribute its assets, and do all other acts required to windup its business.
(j)(1) The Commissioner may issue a cease and desist order against the liquidating agent or committee and appoint a new liquidating agent to complete the liquidation under the Commissioner's direction and control if the Commissioner determines that the liquidating agent or committee has failed to make reasonable progress toward liquidating the District credit union's affairs and distributing its assets, or has violated this subchapter.
(2) The Commissioner shall fill any vacancy caused by the resignation, death, illness, removal, desertion, or incapacity to function of the Commissioner's appointed liquidating agent.
(k) Any funds that represent unclaimed dividends and shares in liquidation at the end of the liquidation shall remain in the hands of the board of directors, the liquidating agent, or committee, and shall be deposited by them, together with all the District credit union's books and papers, with the Commissioner. The Commissioner shall deposit the funds with the D.C. Treasurer.
§ 26–509.02. Voluntary merger of credit unions.
(a) A District credit union may, with the written approval of the Commissioner and subject to all applicable local and federal laws and regulations, merge with one or more other District credit unions, foreign credit unions, or federal credit unions. A District credit union merging with another District credit union may do so regardless of whether the credit unions serve the same field of membership.
(b)(1) When a District credit union merges with one or more other District credit unions, the entities shall either designate one of them as the continuing credit union, or they shall structure a new credit union and designate it as the new credit union. All participating credit unions, other than the continuing or new credit union, shall be designated as merging credit unions.
(2) When a District credit union merges with one or more foreign credit unions or federal credit unions, the District credit union shall be subject to all applicable local and federal laws and regulations governing the chartering jurisdiction.
(c) To merge, participating credit unions shall prepare a merger plan. The merger plan which has been approved by a majority of the directors of all of the participating credit unions shall be submitted to the appropriate regulatory authorities for preliminary approval by the regulatory authority. If the merger plan includes the creation of a new credit union, all documents required by this subchapter for the chartering of a new District credit union shall be submitted as part of the merger plan. Each participating credit union, except the continuing credit union, shall also submit in writing to the Commissioner:
(1) The time and place of the meeting of the board of directors at which the merger plan was agreed upon;
(2) The vote of directors in favor of the adoption of the merger plan; and
(3) A copy of the resolution or other action by which the merger plan was agreed upon.
(d)(1) Each merging District credit union shall conduct a membership vote on its participation in the plan at a special meeting called for that purpose, by mail ballot, or by electronic means. Members shall be provided written notice of the meeting, which shall state the purpose of the meeting, at least 10 days but not more than 30 days prior to the meeting.
(2) If a majority of the voting members approve the merger plan, the District credit union shall submit a record of that fact to the Commissioner, indicating the vote by which the members approved the merger plan and copies of the notices provided to members, including copies of the membership meeting notice and mail or electronic ballot if the vote was conducted by mail or electronic means.
(e) The Commissioner shall approve a merger plan after determining that the requirements of subsection (d) of this section have been met. If the merger plan includes the creation of a new District credit union, the new District credit union shall be approved pursuant to part B of this subchapter. The Commissioner shall notify all participating credit unions of the Commissioner's action on the merger plan.
(f) Each merging credit union shall cease operations within 90 days of approval of a merger plan by the Commissioner. All property, property rights, and members' interests in each merging credit union shall vest in the continuing or new credit union, as applicable, without deed, endorsement, or other instrument of transfer. All debts, obligations, and liabilities of each merging credit union shall be deemed to have been assumed by the continuing or new credit union. The rights and privileges of the members of each merging credit union shall remain intact. If a person is a member of more than one of the participating credit unions that person shall be entitled to only one set of membership rights in the continuing or new credit union.
(g) If the continuing or new credit union is chartered by another state or territory of the United States, it shall be subject to the requirements of § 26-502.10.
§ 26–509.03. Credit union conversion.
(a) A District credit union may be converted to a federal credit union or a foreign credit union, subject to rules issued by the Commissioner and applicable laws governing the prospective chartering jurisdiction.
(b) A federal credit union or a foreign credit union may convert to a District credit union incorporated under this subchapter if the converting federal or foreign credit union complies with all requirements of its current chartering jurisdiction and the requirements of the Commissioner and files proof of such compliance with the Commissioner.
§ 26–509.04. Bank to credit union conversion.
(a) A locally regulated or federally regulated bank may convert its charter to a District credit union charter under this subchapter, subject to applicable local and federal laws and regulations governing the bank.
(b) The Commissioner shall prescribe procedures by which a locally regulated or federally regulated bank may convert to a District credit union charter, and those procedures shall include the following:
(1) The converting bank shall prepare and submit to the Commissioner a conversion plan that provides how the converting bank will:
(A) Comply with the membership requirements under this subchapter, including the possible divestiture of customers who do not meet membership limitations;
(B) Convert its board to a voluntary, non-paid structure if the District credit union does not provide for the compensation of its directors;
(C) Divest its board of stock options;
(D) Divest its capital stock;
(E) Phase out all impermissible investments; and
(F) Comply with District credit union business loan limitations.
(2) A converting bank shall perform a complete policy review to address appraisal restrictions, lending restrictions, investment restrictions, corporate structure restrictions, and power structure to ensure compliance with this subchapter and the Commissioner's rules.
(c) The conversion plan shall be adopted by not less than a majority of the board of directors of the converting bank.
(d) Upon approval of a plan of conversion by the board of directors of a converting bank, the conversion plan and certified copy of the resolution of the board of directors approving the conversion plan shall be submitted to the Commissioner for approval.
(e) The Commissioner may authorize a District credit union resulting from a charter conversion under this subchapter to:
(1) Windup any activities that the converting bank legally engaged in at the effective time of the charter conversion but that otherwise are not permitted for District credit unions; or
(2) Retain, for a transitional period, any assets that the converting bank legally held at the effective time of the charter conversion that otherwise may not be held by District credit unions.
(f) The terms and conditions for the windup of activities under subsection (e)(1) of this section, and the retention of assets under subsection (e)(2) of this section shall be at the Commissioner's discretion; except, that the transitional period during which activities under subsection (e)(1) of this section may be carried out or assets retained under subsection (e)(2) of this section shall not exceed 10 years after the effective date of the charter conversion.