Article 2. Dissolution of California Financial Code >> Division 5. >> Chapter 9. >> Article 2.

(a) Whenever the board of directors of a credit union recommends by a vote of a majority of all its members the dissolution of the credit union, the members of the credit union, at any meeting specially called to consider the subject, may elect to dissolve the credit union, by the vote or written consent of a majority of all members of the credit union.
  (b) The commissioner may approve the dissolution of a credit union which is recommended by the vote of a majority of the board members of the credit union, even if the dissolution is approved by less than a majority of all members of the credit union, if the commissioner finds, upon the written and verified application filed by the board of directors, that (1) notice of the meeting called to consider the dissolution or the written ballot for written vote on the dissolution was mailed to each member entitled to vote upon the question, (2) the notice or the written ballot disclosed the purpose of the meeting or the written vote and informed the membership that approval of the dissolution might be sought pursuant to this section, and (3) a majority of the votes cast upon the question were in favor of the dissolution.
  (c) Whenever the members of the board of directors vote to recommend the dissolution of any credit union, the credit union shall not make any loans, withdrawal of shares, or withdrawal of certificates for funds until the members approve or disapprove the recommendation of the board of directors.

If the dissolution of the credit union is approved pursuant to subdivision (a) or (b) of Section 15250, the board of directors of the credit union shall elect a committee of three members or may by resolution appoint a liquidating agent to liquidate the assets of the credit union. If the commissioner is appointed liquidating agent, the commissioner may act as liquidating agent or appoint the National Credit Union Administration or other person to act as liquidating agent. Whenever the commissioner is appointed liquidating agent, the credit union shall surrender its certificate to act as a credit union.

Promptly thereafter the president or vice president and secretary or assistant secretary, or a majority of the committee or the liquidating agent in charge of liquidation, shall sign and verify a certificate stating that the credit union has elected to wind up and dissolve and showing by what vote or consent such election was made. The certificate shall be filed in the office of the Secretary of State, and copies of the certificate certified by the Secretary of State shall be filed with the commissioner.

After a vote to dissolve a credit union no business may be carried on by the credit union except in the proper course of liquidation.

The committee or the liquidating agent in charge of liquidation may sue in the name and on behalf of the credit union, and may sell or otherwise dispose of the assets of the credit union, in whole or in part, at public or private sale.

After determining that all known debts and liabilities of the credit union have been paid or adequately provided for, the committee or the liquidating agent in charge of liquidation shall distribute all the remaining assets of the credit union among the members or shareholders. Each share is entitled to its proportionate amount of the assets according to the amount paid on that share.

When a credit union has completely wound up, all of its known debts and liabilities actually paid or adequately provided for or paid as far as its assets permit, and its known assets distributed, a majority of the committee or the liquidating agent in charge of liquidation shall sign and acknowledge a certificate stating that the credit union has been completely wound up, its known assets distributed, any tax or penalty due under the Bank and Corporation Franchise Tax Law paid, and its other known debts and liabilities actually paid or adequately provided for or paid as far as its assets permit and that the credit union is dissolved.

The certificate of dissolution shall be filed in the office of the Secretary of State and copies, certified by him, shall be filed in the office of the commissioner.

At any time during the liquidation process, the committee or the liquidating agent in charge of liquidation may be relieved of their duties at the discretion of the commissioner and the commissioner shall thereafter act as the liquidating agent or appoint a liquidating agent to complete the dissolution of the credit union.

Where the commissioner finds that on the date of filing with the Secretary of State of the certificate of election to wind up and dissolve, the credit union does not have sufficient assets to return to its shareholders their investment in full, the credit union shall not be liable for the costs of administration assessed under Article 4 (commencing with Section 14350) of Chapter 3.