An association may voluntarily liquidate and dissolve only with the commissioner’s written approval, and several notice, voting, payment, and reporting steps must then be followed.
Approval by Commissioner. With the written approval of the commissioner, an association may voluntarily liquidate and dissolve. The commissioner shall grant approval if, from a written application submitted to the commissioner in the form that the commissioner requires, it appears that: A resolution proposing a voluntary liquidation and dissolution has been adopted by a majority of the existing members of the board of directors of the association; and The association is not in an impaired condition and has or will have sufficient liquid assets to pay off all depositors and other creditors immediately.(2) Approval by the commissioner shall be in writing, and notice of approval shall be sent by certified mail to the home office of the association within thirty (30) days after receipt of the application to liquidate and dissolve by the commissioner. If the commissioner disapproves the application within the time specified, the commissioner shall state the commissioner's disapproval and objections in writing and send the same by certified mail to the home office of the association, giving the association an opportunity to make changes and resubmit the application so as to obviate the objections. In the event that the commissioner disapproves the liquidation and dissolution after the resubmission, the commissioner shall send written notice of the final disapproval by certified mail to the home office of the association. Failure to send notice of approval or disapproval within the time specified shall be deemed to constitute approval of the voluntary liquidation and dissolution by the commissioner. Submission to Stockholders or Members. In the event the commissioner does approve the liquidation and dissolution, it shall be submitted to an annual or special meeting of stockholders or members. The liquidation and dissolution shall be adopted upon receiving the affirmative vote, in person or by proxy, of at least two-thirds (2/3) of the outstanding voting stock or votes of members. A certified report of the proceedings of the meeting shall be filed promptly with the commissioner. Cessation of Business. Upon approval by the commissioner and adoption by the stockholders or members, the association shall forthwith cease to do business, shall have only the powers necessary to effect an orderly liquidation and shall proceed to pay its depositors and creditors and stockholders or members and to wind up its affairs; and Within thirty (30) days after receipt of notice of approval, the association shall send a notice of liquidation by mail to each depositor, other creditor, person interested in funds held as a fiduciary, stockholder or member or other interested person. The notice shall be posted conspicuously on the premises of the association and shall be given publication that the commissioner may require. The association shall send with the notice a statement of the amount on its books shown to be the claim of the depositor or other creditor. The notice shall demand that the property held by the association as bailee be withdrawn by the person entitled thereto and that claims of depositors and other creditors, if the amount claimed differs from that stated in the notice to be due, be filed with the association before a specified date not earlier than sixty (60) days thereafter in accordance with the procedure prescribed in the notice. Claims of Depositors and Other Creditors. The approval of an application for liquidation and dissolution shall not impair any right of a depositor, or other creditor to payment in full, and all lawful claims of depositors and other creditors shall promptly be paid. Distribution of Assets. Any assets remaining after the discharge of all obligations shall be distributed to the stockholders or members in accordance with their respective interests. Distribution shall not be made before: All claims of depositors and creditors have been paid or, in the case of any disputed claims, the association has transmitted to the commissioner a sum adequate to meet any liability that may be judicially determined; and Any funds payable to a depositor or creditor or any property held as bailee and unclaimed have been transmitted to the commissioner. Any unclaimed distribution to a stockholder or member or property held as bailee shall be held until ninety (90) days after the final distribution and then transmitted to the commissioner. Any unclaimed property so held by the commissioner shall be treated as property held in the course of dissolution and reported to the treasurer in accordance with title 66, chapter 29, part 1. Possession by Commissioner. If the commissioner finds, during the course of the liquidation and dissolution, that the assets will be insufficient for the full discharge of all obligations or that completion of the liquidation has been unduly delayed, the commissioner may take possession and complete the liquidation in the manner provided in this chapter. Reports; Final Order. The commissioner may require reports of the progress of liquidation, and whenever the commissioner is satisfied that the liquidation has been properly completed, the commissioner shall cancel the certificate of authority and the charter and enter an order of dissolution.