Sec. 62. Liquidation.

820 words·~4 min read·/il/chapter-205/act-305/62

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(1)A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this Section.

(2)The board of directors shall adopt a resolution recommending the credit union be dissolved voluntarily, and directing that the question of liquidating be submitted to the members.

(3)Within 10 days after the board of directors decides to submit the question of liquidation to the members, the chairman or president shall notify the Secretary thereof, in writing, setting forth the reasons for the proposed action. Within 10 days after the members act on the question of liquidation, the chairman or president shall notify the Secretary, in writing, as to whether or not the members approved the proposed liquidation. The Secretary then must determine whether this Section has been complied with and if his decision is favorable, he shall prepare a certificate to the effect that this Section has been complied with, a copy of which will be retained by the Department and the other copy forwarded to the credit union. The certificate must be filed with the recorder or if there is no recorder, in the office of the county clerk of the county or counties in which the credit union is operating, whereupon the credit union must cease operations except for the purpose of its liquidation.

(4)As soon as the board of directors passes a resolution to submit the question of liquidation to the members, payment on shares, withdrawal of shares, making any transfer of shares to loans and interest, making investments of any kind and granting loans shall be suspended pending action by members. On approval by the members of such proposal, all such operations shall be permanently discontinued. The necessary expenses of operating shall, however, continue to be paid on authorization of the board of directors or the liquidating agent during the period of liquidation.

(5)For a credit union to enter voluntary liquidation, it must be approved by affirmative vote of the members owning a majority of the shares entitled to vote, in person or by proxy, at a regular or special meeting of the members. Notice, in writing, shall be given to each member, by first class mail, at least 10 days prior to such meeting. If liquidation is approved, the board of directors shall appoint a liquidating agent for the purpose of conserving and collecting the assets, closing the affairs of the credit union and distributing the assets as required by this Act.

(6)A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting and distributing its assets, and doing all acts required in order to terminate its operations and may sue and be sued for the purpose of enforcing such debts and obligations until its affairs are fully adjusted.

(7)Subject to such rules and regulations as the Secretary may promulgate, the liquidating agent shall use the assets of the credit union to pay; first, expenses incidental to liquidating including any surety bond that may be required; then, liabilities of the credit union; then special classes of shares. The remaining assets shall then be distributed to the members proportionately to the dollar value of the shares held by each member in relation to the total dollar value of all shares outstanding as of the date the dissolution was voted.

(8)As soon as the liquidating agent determines that all assets as to which there is a reasonable expectancy of sale or transfer have been liquidated and distributed as set forth in this Section, he shall execute a certificate of dissolution on a form prescribed by the Department and file the same, together with all pertinent books and records of the liquidating credit union with the Department, whereupon such credit union shall be dissolved. The liquidating agent must, within 3 years after issuance of a certificate by the Secretary referred to in Subsection

(3)of this Section, discharge the debts of the credit union, collect and distribute its assets and do all other acts required to wind up its business.

(9)If the Secretary determines that the liquidating agent has failed to make reasonable progress in the liquidating of the credit union's affairs and distribution of its assets or has violated this Act, the Secretary may take possession and control of the credit union and remove the liquidating agent and appoint a liquidating agent to complete the liquidation under his direction and control. The Secretary shall fill any vacancy caused by the resignation, death, illness, removal, desertion or incapacity to function of the liquidating agent.

(10)Any funds representing unclaimed dividends and shares in liquidation and remaining in the hands of the board of directors or the liquidating agent at the end of the liquidation must be deposited by them, together with all books and papers of the credit union, with the State Treasurer in compliance with the Revised Uniform Unclaimed Property Act.