7-7-7.   Conversion of associations.
     (1) Any state or federal mutual association and any federal capital stock association may convert to a state capital stock association, and any state or federal capital stock association and any federal mutual association may convert to a state mutual association upon an equitable basis subject to the laws and rules governing the converting association, the approval of the commissioner, the approval of the members or stockholders of the converting association, and any rules adopted by the commissioner under this subsection.
     (a) Upon receipt of the approval of a proposed conversion from the commissioner, a converting association may, under the supervision of the supervisor, carry out the plan of conversion. A record of all acts and proceedings taken by the board of directors of the converting association in carrying out the proposed conversion shall be filed with the supervisor.
     (b) Upon the issuance to an applicant of a certificate of conversion, the corporate existence of the converting applicant shall not terminate, but the applicant shall be a continuation of the entity so converted. All property of the converting applicant, including its rights, titles, and interests in and to all property of whatever kind, whether real, personal, or mixed, things in action, and every right, privilege, interest and asset of any conceivable value or benefit then existing, or pertaining to it, or which would inure to it, immediately, by operation of law and without any conveyance or transfer and without any further act or deed, shall vest in and remain the property of the converted applicant, and the same shall have, hold, and enjoy that property in its own right as fully and to the same extent as that property was possessed, held, and enjoyed by the converting applicant before the conversion, and the converted applicant, upon issuance of the certificate of the conversion, shall continue to have and succeed to all the rights, obligations, and relations of the converting applicant. Pending actions and other judicial proceedings to which the converting applicant is a party shall not be abated or discontinued by reason of the conversion, but may be prosecuted to final judgment, order, or decree in the same manner as if conversion had not occurred, and the converted applicant may continue the actions in its new corporate name. Any judgment, order, or decree may be rendered for or against it which might have been rendered for or against the converting applicant involved before the conversion in the proceedings.
     (c) A conversion carried out under this Subsection (1) is effective on the date that all provisions of this chapter and the rules adopted under it have been complied with and a certificate of conversion has been issued by the commissioner.
     (d) In adopting rules or issuing orders in connection with the conversion of an association, the commissioner shall ensure that:
     (i) accurate and adequate disclosure of the terms and effects of plans of conversion are provided to purchasers of capital stock in resulting associations, including account holders of converting mutual associations;
     (ii) adjustments are made in plans of conversion to be effected by way of merger or holding company acquisition necessary or appropriate to accomplish the purposes of this section;
     (iii) plans of conversion and proxy statements, offering circulars and related instruments and actions implementing those plans are subject to review and approval by the appropriate supervisory authorities;
     (iv) the capital stock issued as a part of conversion is fairly and independently valued and priced;
     (v) the capital stock is allocated and distributed fairly and without employment of manipulative or deceptive devices;

     (vi) appropriate provision is made regarding fractional share interest and minimum capital stock purchase requirements; and
     (vii) plans of conversion are adopted and implemented in such form and manner that stability and continuity of management are encouraged and that the stability, safety, and soundness of associations and other financial institutions are not impaired. In no event shall any rule or order issued by the commissioner regarding the conversion of an association make it more difficult for an association subject to those rules or orders to implement conversion than for an association subject only to federal laws and regulations.
     (e) A conversion proposed by a domestic association shall, after approval by the commissioner, be submitted to the members or stockholders at an annual meeting or at a special meeting called to consider that action. The conversion must have the approval of a majority of the total votes eligible to be cast by members or stockholders at the meeting. Notice shall be given of any meeting at which a conversion is to be considered. The notice shall expressly state that a proposed conversion will be submitted for approval or disapproval, include a full and accurate description of the plan of conversion and all other matters to be brought before the meeting, state that a proxy for the meeting given previously is revocable, and state the time, date, and place of the meeting. The notice shall be mailed at least 20 days prior to the date of the meeting to each voting member or stockholder of the converting association addressed to his address shown on the records of the association and to the supervisor or commissioner.
     (f) If the commissioner finds that a conversion proceeding has been completed in accordance with the requirements of this section and any other applicable law and rules, he shall issue to the applicant a certificate of conversion, attaching as a part of the certificate a copy of the charter, articles of incorporation, articles of association, or similar instrument. The commissioner shall also cause the same to be filed with the Division of Corporations and Commercial Code.
     (2) Any state mutual or state capital stock association eligible under federal law or regulations to become a federal association may convert to a federal association by following the procedure outlined in this Subsection (2).
     (a) At any regular meeting or at any special meeting of the members or stockholders of the association called to consider the action and held in accordance with the laws governing the association, the members or stockholders by majority vote of those present or voting by proxy may declare by resolution the determination to convert the association into a federal association.
     (b) A copy of the minutes of the meeting of the members or shareholders verified by the affidavit of the president or vice president and the secretary of the meeting shall be, within ten days after the meeting, filed with the commissioner. This verified copy of the minutes of the meeting, when so filed, shall be presumptive evidence of the holding of the meeting and of the action there taken by the members or stockholders.
     (c) Within a reasonable time and without any unnecessary delay after the adjournment of the meeting of shareholders, the association shall take such action as may be necessary under requirements of the Office of Thrift Supervision or other federal agency to make it a federal association, and within ten days after receipt of the federal charter there shall be filed with the commissioner a copy of the charter or a certificate showing the organization of the association as a federal association, certified by or on behalf of the Office of Thrift Supervision or other federal agency. Upon the filing of these instruments the association shall cease to be a state association and shall thereafter be a federal association.
     (d) Upon completion of a conversion to a federal association, the corporate existence of

the converting association shall not terminate, but the association shall be a continuation of the entity so converted. All property of the converting association, including its rights, titles, and interests in and to all property of whatever kind, whether real, personal, or mixed, things in action, and every right, privilege, interest, and asset of any conceivable value or benefit then existing, or pertaining to it, or which would inure to it, immediately, by operation of law and without any conveyance or transfer and without any further act or deed, shall vest in and remain the property of the converted association, and the same shall have, hold, and enjoy that property in its own right as fully and to the same extent as that property was possessed, held, and enjoyed by the converting association, and the converted association shall continue to have and succeed to all the rights, obligations, and relations of the converting association. All pending actions and other judicial proceedings to which the converting association is a party shall not be abated or discontinued by reason of the conversion, but may be prosecuted to final judgment, order, or decree in the same manner as if the conversion had not been made, and the converted association may continue the actions in its new corporate name. Any judgment, order, or decree may be rendered for or against it which might have been rendered for or against the converting association before the conversion involved in the proceedings.
     (e) Upon the completion of a conversion to a federal association, the converted association shall cease to be supervised by the commissioner or by this state except as a federal association.

Amended by Chapter 200, 1994 General Session
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Last revised: Thursday, May 28, 2009