GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1995

H	1 

HOUSE BILL 933

Short Title:  Equitable Liquidation/Conversion.	(Public)

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Sponsors: Representative Allred.

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Referred to:  Business and Labor Sub. on Economic Expansion & Growth, if favorable, Financial Institutions.

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April 12, 1995

A BILL TO BE ENTITLED
AN ACT TO PROVIDE FOR FAIR AND EQUITABLE LIQUIDATIONS OF MUTUAL ASSOCIATIONS AND SAVINGS BANKS.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 54B-42 reads as rewritten:
"§54B-42.  Rules, regulations and reports of voluntary dissolution.
(a)	The Administrator shall promulgate rules and regulations governing the dissolution and liquidation of State associations. These rules and regulations shall include, but not be limited to, provisions with respect to:
(1)	The protection and liquidation of assets;
(2)	The plan of liquidation;
(3)	Notice to file claims;
(4)	Claims of members;
(5)	Payments of claims and distribution; and
(6)	Final distribution and liquidation.
The Administrator shall adopt rules to assure that the plan of liquidation is fair and equitable to all members with respect to claims and distributions and based on the prorated financial interest of the members in the mutual association.
(b)	Upon completion of liquidation, the liquidators shall file with the Administrator a final report and accounting of the liquidation.  The approval of the report by the Administrator shall operate as a complete and final discharge of the liquidators, the board of directors, and each member or stockholder in connection with the liquidation of such association.  Upon approval of the report, the Administrator shall issue a certificate of dissolution of the association and shall record same in the manner required by this Chapter for the recording of certificates of incorporation; and upon such recording, the dissolution shall be effective.  The Administrator shall not approve the report of a mutual association or issue a certificate of dissolution unless the report and accounting of the liquidation provides that there has been a fair and equitable distribution of the assets of the association based on the prorated financial interest of the members in the mutual association."
Sec. 2.  Article 3 of Chapter 54B of the General Statutes is amended by adding a new section to read:
"§ 54B-39.1.  Prohibition of director and officer incentives.
The officers and directors of a mutual association shall not receive financial incentives related to a merger of the mutual association under this Article."
Sec. 3.  G.S. 54C-43 reads as rewritten:
"§ 54C-43.  Reports of voluntary dissolution.
Upon completion of liquidation, the liquidator shall file with the Administrator a final report and accounting of the liquidation.  The Administrator's approval of the report shall operate as a complete and final discharge of the liquidator, the board of directors, and each member or stockholder in connection with the liquidation of the savings bank.  Upon approval of the report, the Administrator shall issue a certificate of dissolution of the savings bank and shall record same in the manner required by this Chapter for the recording of certificates of incorporation.  The dissolution is effective upon the recording of the certificates of incorporation.  The Administrator shall not approve the report of a mutual savings bank or issue a certificate of dissolution unless the report and accounting of liquidation provides that there has been a fair and equitable distribution of the assets of the savings bank based on the prorated financial interest of the members in the mutual association."
Sec. 4.  Article 3 of Chapter 54C of the General Statutes is amended by adding a new section to read:
"§ 54C-40.1.  Prohibition of director and officer incentives.
The officers and directors of a mutual savings bank shall not receive financial incentives related to a merger of the mutual savings bank under this Article."
Sec. 5.  This act is effective upon ratification.