Article 2. Conservatorship of California Financial Code >> Division 6. >> Chapter 6. >> Article 2.

If any facts occur which would entitle the commissioner under Section 17621 to take possession of the property, business and assets of a licensee the commissioner may appoint a conservator of a licensee and require of him such bond as the commissioner deems proper. The commissioner may also, upon the request of the board of directors of a licensee, appoint a conservator of such licensee and require of him such bond as the commissioner deems proper. The conservator, under the direction of the commissioner, shall take possession of the property, business and assets of the licensee and take such action as he may deem necessary to conserve the assets of such licensee pending further disposition of its business. The conservator shall retain such possession until the property, business and assets of the licensee are returned to the licensee or until further order of the commissioner.

Subject to the other provisions of this article, a conservator, while in possession of the property, business and assets of a licensee, has the same powers and rights and is subject to the same duties and obligations as the commissioner while in possession of the property, business and assets of a licensee; and during such time the rights of a licensee and of all persons with respect thereto, subject to the other provisions of this article, are the same as if the commissioner had taken possession of such property, business and assets. A conservator, while in possession of the property, business and assets of a licensee, shall have all the rights, powers and privileges of the licensee, its officers and directors. All expenses of any such conservatorship shall be paid out of the assets of the licensee and shall be a lien thereon which shall be prior to any other lien. The conservator shall receive a salary, fixed by the commissioners, in an amount no greater than that which would be paid by the commissioner to a special deputy in charge of the liquidation of the licensee.

Upon appointing a conservator the commissioner shall cause to be made and completed at the earliest possible date such an examination of the affairs of the licensee as shall be necessary to inform him as to its financial condition.

A conservator, while in possession of the property, business and assets of a licensee, may call, upon the notice required by the licensee's bylaws, a meeting of the investors of the licensee who are entitled to vote, for any purpose, including without limitation the election of a board of directors, and upon the holding of a meeting for such purpose the terms of office of all directors shall expire, or may call, upon the notice required by the licensee's bylaws, a meeting of the board of directors for any purpose, including without limitation the filling of vacancies on the board of directors or the removal and election or the removal or election of officers. Each such meeting shall be supervised by the conservator.

If the commissioner becomes satisfied that it may be done safely and in the public interest, he may terminate the conservatorship and permit the licensee for which a conservator was appointed to resume its business under direction of its board of directors, subject to such terms, conditions, restrictions and limitations as he may prescribe.