HB-5021, As Passed Senate, May 18, 2016

SENATE SUBSTITUTE FOR

HOUSE BILL NO. 5021

     A bill to amend 2003 PA 215, entitled

"Credit union act,"

by amending section 371 (MCL 490.371), as amended by 2004 PA 471.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 371. (1) Two or more domestic credit unions may merge

into 1 of the credit unions, or into a newly formed domestic credit

union, if all of the following are met:

     (a) The credit union board of each constituent credit union by

majority vote adopts a plan of merger that includes all of the

following:

     (i) The name of each constituent credit union and the name of

the surviving credit union.

     (ii) The terms and conditions of the proposed merger,

including the manner and basis of converting the member shares in

each constituent credit union into member shares in the surviving

credit union, or into cash or other property, or into a combination

of shares, cash, or other property.

     (iii) A statement of any amendment to the certificate of

organization of the surviving credit union affected by the merger

or a statement that no changes are to be made in the certificate of

organization of the surviving credit union.

     (iv) Any other provisions concerning the proposed merger that

the constituent credit unions consider necessary or desirable.

     (b) If the credit union board of each constituent credit union

adopts the plan of merger, the constituent credit unions submit the

plan of merger to the commissioner. director. Each constituent

credit union shall submit the time and place of the meeting of the

credit union board at which it approved the plan, the vote of the

directors board members on approving the plan, and a copy of the

resolution of the credit union board approving the plan to the

commissioner director with the plan of merger.

     (c) Subject to subsection (6), the members of each constituent

credit union except the surviving credit union approve the plan of

merger, at a special membership meeting called for that purpose or

by mail ballot. If the vote is held at a special membership

meeting, the credit union board shall provide each member with

written notice of the meeting that states the purpose of the

meeting, at least 10 7 days and not more than 30 days before the

meeting. The plan of merger is approved if a majority of the

members of the constituent credit union who that vote on the merger

vote in favor of the merger.

     (d) If the membership of a constituent credit union approves

of a plan of merger under subdivision (c), the credit union shall

notify the commissioner director that the plan of merger is

approved, the vote by which the members approved the plan, and a

copy of the meeting notice if the plan was approved at a special

membership meeting or the ballot and mailing date and closing date

if the plan was approved by mail ballot of the members.

     (e) The commissioner director grants final approval of the

plan of merger. The commissioner director shall grant final

approval of the plan if all of the requirements of subdivisions (a)

to (d) are met.

     (2) One or more domestic credit unions may merge with 1 or

more foreign credit unions if both of the following are satisfied:

     (a) The merger is permitted by the law of the jurisdiction

under whose law each foreign constituent credit union is organized

and each foreign constituent credit union complies with that law in

effecting the merger.

     (b) Each domestic constituent credit union complies with

subsection (1).

     (3) If a plan of merger under subsection (1) or (2) is

approved, each constituent credit union shall execute and file a

certificate of merger with the commissioner director that contains

all of the following:

     (a) The statements required in subsection (1)(a)(i) and (iii).

     (b) A statement that the plan of merger has been approved by

the members of the constituent credit unions required to vote under

subsection (1)(c).

     (c) A statement of any assumed names the surviving credit

union will use in this state if the commissioner director approves.

The statement shall specify each new assumed name of the surviving

credit union, each current assumed name the surviving entity

retains, and each assumed name transferred to the surviving entity

from another constituent credit union.

     (d) The proposed effective date of the merger. , if later than

the date the certificate of merger is filed. The commissioner shall

not accept a certificate of merger and the merger is not effective

if an effective date is specified that is more than 90 days after

the date of filing.

     (4) When a merger takes effect, all of the following apply:

     (a) Every other constituent credit union merges into the

surviving credit union and the separate existence of every

constituent credit union except the surviving credit union ceases.

     (b) All property, debts, causes of action, and other interests

of, belonging to, or due to each constituent credit union are

vested in the surviving credit union without further act or deed

and without reversion or impairment.

     (c) The surviving credit union has all of the liabilities of

each constituent credit union.

     (d) A proceeding pending against any constituent credit union

may be continued as if the merger had not occurred or the surviving

credit union may be substituted in the proceeding for the

constituent credit union if the existence of the constituent credit

union ceased.

     (e) The certificate of organization of the surviving credit

union is amended to the extent provided in the certificate of

merger.

     (f) The membership shares in each constituent credit union are

converted into membership shares in the surviving credit union,

cash, or other property as provided in the plan of merger. If a

person is a member of more than 1 of the constituent credit unions,

the person is entitled to only 1 membership in the surviving credit

union.

     (g) The surviving credit union is liable for, and is subject

to service of process in a proceeding in this state for the

enforcement of, any obligation of a domestic constituent credit

union.

     (5) If the surviving credit union in a merger under subsection

(2) is a foreign credit union, and the surviving credit union

transacts business in this state, it shall comply with the

provisions of this act concerning foreign credit unions.

     (6) The commissioner director may waive the membership vote

described in subsection (1)(c) for a constituent credit union if he

or she determines that it is in the best interests of the

membership of the constituent credit union or that the constituent

credit union is insolvent or in imminent danger of becoming

insolvent.

     (7) Credit unions with different fields of membership may

merge under this section.

     Enacting section 1. This amendatory act takes effect 90 days

after the date it is enacted into law.

     Enacting section 2. This amendatory act does not take effect

unless all of the following bills of the 98th Legislature are

enacted into law:

     (a) House Bill No. 5017.

     (b) House Bill No. 5018.

     (c) House Bill No. 5019.

     (d) House Bill No. 5020.

     (E) House Bill No. 5022.