Code of Alabama - Title 5: Banks and Financial Institutions - Section 5-17-21 - Voluntary dissolution

Section 5-17-21 - Voluntary dissolution.

(a) Unless otherwise provided in the bylaws of the credit union, the membership of the credit union may elect to dissolve the credit union upon an affirmative vote of two thirds of the members of the credit union who participate in the vote.

(b) The vote to voluntarily dissolve a credit union shall be taken at a meeting held for that purpose. Voting by mail ballot shall be permitted. Notice of the meeting must state that the purpose of the meeting is to vote on the voluntary dissolution of the credit union and must be mailed to the last known address of each member of the credit union at least 30 calendar days prior to the date of the meeting. The notice, at a minimum, shall also contain all of the following information:

(1) A general description of the implications of the dissolution process on the deposit shares of members.

(2) A general description of the implications of the dissolution process on members who have borrowings with the credit union.

(3) A statement that, following dissolution, the credit union shall continue in existence for the purpose of discharging its debts, collecting and distributing its assets, and doing all other acts required in order to wind up its business.

(c) If the membership of a credit union approves the voluntary dissolution of the credit union, upon written notice from the board of directors of the credit union that such action has been approved by the membership and that the requirements of this section have been satisfied, the Administrator of the Alabama Credit Union Administration shall issue in duplicate a certificate to the effect that this section has been complied with. The certificate shall be filed with the probate judge of the county in which the credit union is located, whereupon the credit union is dissolved and shall cease to carry on business except for the purposes of liquidation and the winding up of its business.

(d) A credit union voluntarily dissolved pursuant to this section shall continue in existence for the purpose of discharging its debts, collecting and distributing its assets, and doing all other acts 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 adjusted and wound up.

(Acts 1927, No. 597, p. 696; Code 1940, T. 28, §300; Acts 1975, No. 561, p. 1267, §10; Acts 1985, No. 85-457, p. 425, §14; Act 2016-133, §1.)

Last modified: May 3, 2021