17:12B-261. Conversion of mutual association to capital stock association

A mutual association which is a member of the Federal Savings and Loan Insurance Corporation, organized pursuant to the provisions of this act, may convert itself into a capital stock association with the same force and effect as though originally incorporated as a capital stock association.

a. When, in the judgment of the board of such association, it shall be deemed advisable and in the best interests of its members that the same shall be converted into a capital stock association, as provided in this section, the board shall adopt a resolution to that effect, and follow such procedures as may be required by regulations promulgated by the commissioner;

b. Upon compliance with the requirements of subsection a. of this section, a meeting of the members of the association shall be held upon not less than 30 days' written notice to each member by mailing, postage prepaid, directed to his last address as shown on the books of the association, which notice shall contain a statement of the time, place and purpose for which such meeting is called. Such notice shall be accompanied by a proxy statement and proxy form in accordance with regulations promulgated by the commissioner;

c. At the meeting of the members of any such association held as provided in subsection b. of this section, such members may, by the affirmative vote of at least a majority of the votes of the members of the mutual association present, either in person or by proxy, declare by resolution the determination to convert the association into a capital stock association. A copy of the minutes of the proceedings of such meeting of the members shall be filed in the office of the commissioner within such time and in such form and manner as set forth in regulations promulgated by the commissioner;

d. At the meeting at which the conversion is voted upon, the members of the association shall also vote upon the directors who shall be the directors of the capital stock association after the effective date of the conversion. The directors so elected shall be the incorporators and execute and file with the commissioner a certificate of incorporation as provided for in section 18 of this amendatory and supplementary act, together with an application for conversion which shall contain the plan of conversion pursuant to the provisions of this act. Upon a finding by the commissioner that (1) the plan of conversion has been adopted and approved by the mutual association in compliance with the provisions of this act, (2) is fair and equitable to all members, and (3) sufficient provision has been made to protect the interest of the depositors of the prospective capital stock association, he shall issue a certificate of approval of the conversion which shall be endorsed upon or annexed to the certificate of incorporation. The certificate of incorporation with the commissioner's approval endorsed thereon or annexed thereto, shall be recorded within 30 days after such approval in the same manner and places as required by section 22 (C. 17:12B-22) of this act, upon the approval by the commissioner and the filing of the certificate of incorporation as aforesaid, the association shall cease to be a mutual association and thereafter shall operate as a capital stock association. Upon the conversion of the mutual association, the legal existence of the association shall not terminate but the capital stock association shall be a continuation of the entity of the mutual association and all property of the mutual association, including its right, title and interest in and to all property of whatsoever kind and nature, whether real, personal or mixed and things, and choses in action, and every right, privilege, interest and asset of every conceivable value or benefit then existing or pertaining to it, or which would inure to it, immediately by operation of law and without the necessity of any conveyance or transfer and without any further act or deed shall vest in the capital stock association into which the mutual association has converted itself. The capital stock association shall have, hold and enjoy the same in its own right as fully and to the same extent as the same was possessed, held and enjoyed by the mutual association. The capital stock association as of the time and the taking effect of the conversion shall continue to have and succeed to all the rights, obligations and relations of the mutual association. All pending actions and other judicial or administrative proceedings to which the mutual association was a party shall not be discontinued by reason of the conversion, but may be prosecuted to final judgment or order in the same manner as if the conversion had not been made and the capital stock association resulting from the conversion may continue such actions in its corporate name notwithstanding such conversion. Any judgment or order may be rendered for or against it which might have been rendered for or against the mutual association theretofore involved in the judicial proceedings.

L.1974, c. 137, s. 32, eff. Oct. 23, 1974.