Iowa Admin. Code r. 189-3.4 - Notice to members and voting procedures
(1)
Requirements. All
conversion plans shall be submitted to the superintendent in accordance with
189-3.5 (533). The members may
not vote on the proposal until the credit union has received preliminary
approval from the superintendent under
189-3.5 (533), as well as the
preliminary determination from the National Credit Union Administration on the
proposition for conversion.
(2)
Vote by board of directors. The board of directors shall, by
majority vote, select the method of voting for the membership vote on the
conversion proposal in accordance with Iowa Code section
533.203. Each credit union
member shall have a meaningful opportunity to vote in a membership vote. The
board of directors shall vote to conduct the vote in whole by electronic voting
only if all members have access to an electronic voting device. If the number
of members who have opted to receive notices electronically is less than all
members, the board may provide access to an electronic device in each credit
union office for the members to vote electronically in order to satisfy the
access requirement. Otherwise, the board shall also conduct the vote in part by
mail-in ballot or in person at a meeting held for the purpose of voting,
pursuant to the requirements of this rule.
(3)
Election committee. The
board shall appoint an election committee of not fewer than seven members, none
of whom may be from the board of directors or be a member of a director's
immediate family or be an employee of the credit union or a member of an
employee's immediate family.
a. It is the duty
of the election committee to oversee balloting, to tabulate votes, and to
ensure that each member shall only be allowed to vote once and that multiple
ballots submitted by the same member are disqualified.
b. The election committee shall elect a
chairperson from among the committee members. If the balloting includes a vote
taken at a meeting of members, the chairperson of the election committee shall
announce the results of the election at the meeting; otherwise, the chairperson
shall certify the vote to the board within five days of the close of
balloting.
c. No member or agent of
the election committee shall reveal the manner in which any member
voted.
d. If the board of
directors, by majority vote, has elected to utilize electronic voting, the
election committee shall test the integrity of the electronic voting system at
regular intervals during the election period. In the event of a malfunction of
the electronic voting system, the board may in its discretion order the
election to be held in another form, consistent with Iowa Code section
533.203.
e. For electronic ballots, it is the duty of
the election committee to verify, or cause to be verified, the name and credit
union account number of the voter as registered in the electronic voting
system.
f. For mail-in ballots,
including absentee ballots, it is the duty of the election committee to verify,
or cause to be verified, the name and credit union account number of the voter
as they appear on the identification form, to place the verified identification
form and the sealed ballot envelope in a place of safekeeping pending the count
of the vote, and, in the case of a questionable or challenged identification
form, to retain the identification form and sealed ballot envelope together
until the verification or challenge has been resolved.
(4)
Notice of balloting. The
secretary shall set forth the conversion issue in a notice mailed to all
members eligible to vote at least 90 calendar days, 60 calendar days, and 30
calendar days prior to the closing date of balloting.
a. The notice shall set forth the rules and
procedures for voting, the date of the close of balloting for ballots submitted
other than in person during voting at a meeting held for the purpose of voting,
that balloting is subject to an affirmative vote of a majority of all members
eligible to vote, and that no other vote on the subject shall be taken after
the closing date of balloting except for votes cast in person during voting at
a meeting held for the purpose of voting.
(1)
The close of balloting for ballots submitted other than in person during voting
at a meeting held for the purpose of voting shall be at least five days prior
to any meeting where voting will occur.
(2) Electronic ballots shall be submitted no
later than midnight on the date balloting closes for ballots submitted other
than in person during voting at a meeting held for the purpose of voting in
order to be considered valid.
(3)
Ballots mailed to the credit union shall be postmarked no later than the
closing date of balloting for ballots submitted other than in person during
voting at a meeting held for the purpose of voting and received within five
business days after the closing date of balloting in order to be considered
valid.
(4) Ballots hand-delivered
to the credit union shall be received prior to the close of normal credit union
business hours on the closing date of balloting for ballots submitted other
than in person during voting at a meeting held for the purpose of voting in
order to be considered valid.
(5)
If more than one method of voting will be used, the notice shall also
communicate, in bold-faced type, that members have the right to vote on the
proposed amendment through any of the methods of voting designated by the
board, but that members will only be allowed to vote once.
b. The notice shall do all of the following:
(1) Adequately describe the purpose and the
subject matter of the vote.
(2)
Accurately disclose the reasons for the conversion, stated in specific terms
and not as generalities. If a purpose of conversion is to become a mutual
savings bank, a savings association that is in mutual form, or a stock
institution, the notice shall clearly inform the member of all of the
following:
1. That the conversion, if
approved, could lead to members' losing their ownership interest in the credit
union.
2. That a credit union
member has no more than one vote regardless of the number of shares held, but
that in a mutual savings bank or savings association, voting may be based on
the amount in the member's deposit accounts, commonly one vote granted for each
$100 on deposit.
3. That if the
mutual savings bank or association converts to a stock institution, members
will lose their ownership interests and voting rights automatically received as
a member.
4. The method that will
be used to provide for a pro-rata distribution of all unencumbered credit union
retained and undivided earnings in excess of regulatory required reserves, as
calculated pursuant to Iowa Code section
533.303, or in excess of a
well-capitalized net worth level, calculated pursuant to the Federal Credit
Union Act, 12 U.S.C. ยง1790d, whichever amount is greater. The
pro-rata distribution shall occur on all shares of record as of the date of
first notice to members under this rule and shall be based upon the member's
share balance less any amount pledged to share-secured loans.
(3) Specify the costs of the
conversion, such as changing the credit union name, examination and operating
fees, attorney and consulting fees, tax liability, and any change or increase
in compensation or economic benefit to directors or senior management
officials, pursuant to subrule 3.10(2).
(4) Include an affirmative statement that, at
the time of conversion to a federal credit union and for a period of five years
thereafter, the credit union does or does not intend to do each of the
following:
1. Convert to a mutual savings bank
or savings association or a stock institution.
2. Provide any compensation to previously
uncompensated members of the board of directors, or increase compensation or
other conversion-related economic benefit, including stock options, special
prices on stock, or first rights of refusal, to directors, senior management
officials, or their agents, brokers, family members or other closely related
parties.
3. Base member voting
rights on account balances.
c. The notice shall not be included as part
of any general mailing to members.
d. The notice may be sent electronically to
those members who have opted to receive notices electronically.
e. The notice shall be posted in each credit
union office 90 calendar days, 60 calendar days, and 30 calendar days before
the close of balloting.
f. A member
who joins the credit union subsequent to the 30-calendar-day notice and prior
to the close of balloting and who is eligible to vote on the conversion shall
be provided a copy of the 30-calendar-day notice and any balloting
materials.
(5)
Mailed ballots. If the board voted by majority vote to conduct
the vote in whole or in part by mailed ballot:
a. The secretary shall include the following
balloting materials with the 30-calendar-day notice of balloting:
(1) One ballot, clearly identified as the
ballot.
(2) One ballot envelope
clearly marked "ballot" with instructions that the completed ballot shall be
placed in that envelope and sealed.
(3) One identification form to be completed
so as to include the name, address, signature, and credit union account number
of the voter.
(4) One mailing
envelope in which the voter, following instructions provided, shall insert the
sealed "ballot" envelope and the identification form. The mailing envelope
shall have postage prepaid and be preaddressed for return to the election
committee.
b. If the
credit union will also be conducting electronic voting, the mail-in ballot is
not required for members who have opted to receive notices or statements
electronically, and electronic mail may be used to provide the instructions and
notices for the electronic voting procedure.
c. Ballots mailed to the election committee
or hand-delivered to the credit union shall be received unopened and placed in
ballot boxes. The ballot boxes shall be opened by and the vote tallied by the
election committee.
d. If
additional voting will be conducted at a meeting of members, the tallies shall
be placed in the ballot boxes, and the ballot boxes shall be resealed to be
taken to the meeting. If no other voting is scheduled to occur, the election
committee shall tally the total votes and certify the vote count to the board
no later than five days after the closing date of balloting for ballots
submitted other than in person during voting at a meeting held for the purpose
of voting.
(6)
Electronic voting. If the board voted by majority vote to
conduct the vote in whole or in part by electronic voting:
a. The secretary shall include with the
notice of balloting specific instructions for electronic voting, including how
to access and use the electronic voting system, and the period of time in which
votes will be taken.
b. For those
members who have opted to receive notices or statements electronically, the
instructions required under this subrule may be communicated
electronically.
c. The electronic
voting shall be tallied by the election committee prior to any meeting where
voting is also scheduled to take place, and the committee shall take the
tallies to the meeting. If no meeting is scheduled for voting, the election
committee shall tally the votes and certify the vote count to the board no
later than five days after the closing date of balloting for ballots submitted
other than in person during voting at a meeting held for the purpose of
voting.
(7)
Absentee ballots-subsequent in-person vote at
meeting. If the board of directors, by majority vote, has elected to
conduct the vote only in person at a meeting of members, the board may also, by
majority vote, utilize absentee ballots when, in the opinion of the board, it
is in the best interest of the credit union and its membership.
a. The secretary shall include with the
notice of balloting a statement that members may vote either in person at the
meeting of members or by absentee ballot if the member submits a written or
electronic request for an absentee ballot and returns the ballot prior to the
close of balloting for ballots submitted other than in person during voting at
a meeting held for the purpose of voting.
b. The secretary shall mail the balloting
materials specified in paragraph 3.4(5)"a" to each member who is eligible to
vote and who has submitted a written or electronic request for an absentee
ballot.
c. Ballots mailed to the
election committee or hand-delivered to the credit union shall be received
unopened and deposited in ballot boxes. The ballot boxes shall be opened by and
the vote tallied by the election committee, the tallies placed in the ballot
boxes, and the ballot boxes resealed to be taken to the meeting.
d. At the meeting of members, printed ballots
shall be given to those members who have not voted. The completed ballots shall
be deposited in ballot boxes placed in conspicuous locations by the election
committee before the meeting. After the members have been given an opportunity
to vote, balloting shall be closed, the ballot boxes opened and the vote
tallied by the election committee and added to any previous count of absentee
ballots. The election committee shall immediately certify the vote count to the
board. The chairperson of the election committee shall announce the result of
the vote at the meeting.
(8)
In-person vote at
meeting. If the board voted by majority vote to conduct the vote in
whole or in part at a meeting of members, then printed ballots shall be
distributed to those in attendance at the meeting who have not voted by another
method, and the ballots shall be deposited in ballot boxes placed in
conspicuous locations by the election committee before the meeting. After those
members have been given an opportunity to vote at the meeting, balloting shall
be closed, the ballot boxes opened and the vote tallied by the election
committee and added to any previous count of mailed or electronic ballots. The
election committee shall immediately certify the vote count to the board. The
chairperson of the election committee shall announce the result of the vote at
the meeting.
(9)
Preservation of ballots. Ballots shall be preserved according
to the requirements of
189-12.9 (533). The 60-day
retention period required by 189-subrule 12.9(2) shall run from the date the
results are certified to the board by the election committee.
(10)
Certification of vote by board
of directors. The board of directors shall certify to the
superintendent the results of the membership vote and the written materials
provided to members according to the requirements of
189-3.6 (533).
(11)
Publication of results.
The board shall inform the membership of the results of the vote, and of the
superintendent's approval or disapproval, by conspicuously posting notice in
each credit union office for a period of 60 days following receipt of the
superintendent's decision under
189-3.7 (533). In addition to
posting the results in each credit union office, the board shall also
communicate the results to the membership by at least one of the following
methods:
a. Include the results in the next
mailing of the member's statement of account.
b. Include the results in the credit union
newsletter.
c. Include the results
in the sponsor's newsletter.
d.
Post a notice on the credit union's Web site.
e. Place a notice in a newspaper of general
circulation within the geographic area of operation of the credit
union.
(12)
Effective date of conversion. The board shall notify the
superintendent of the effective date of the conversion and shall file evidence
of federal regulatory approval for the conversion pursuant to
189-3.9 (533).
(13)
Certificate of
conversion. Upon receipt of the certificate of conversion from the
superintendent, the credit union shall file the certificate pursuant to
189-3.9 (533).
(14)
Termination of conversion
proceedings. At any time prior to completion of a conversion to a
federal credit union, the board or the members as provided in the bylaws may
call for a special meeting of the members to be held to terminate the
conversion proceedings. The membership shall approve the proposal to terminate
the conversion proceedings by the affirmative vote of a majority of those
members who vote on the proposal.
Notes
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