12 C.F.R. Appendix A to Part 704—Model Forms
Title 12 - Banks and Banking
This appendix contains sample forms intended for use by corporate credit unions to aid in compliance with the membership capital account and paid-in capital disclosure requirements of §704.3. Sample Form 1 Terms and Conditions of Membership Capital Account (1) A membership capital account is not subject to share insurance coverage by the NCUSIF or other deposit insurer. (2) A membership capital account is not releasable due solely to the merger, charter conversion or liquidation of the member credit union. In the event of a merger, the membership capital account transfers to the continuing credit union. In the event of a charter conversion, the membership capital account transfers to the new institution. In the event of liquidation, the membership capital account may be released to facilitate the payout of shares with the prior written approval of NCUA. (3) A member credit union may withdraw membership capital with three years' notice. (4) Membership capital cannot be used to pledge borrowings. (5) Membership capital is available to cover losses that exceed retained earnings and paid-in capital. (6) Where the corporate credit union is liquidated, membership capital accounts are payable only after satisfaction of all liabilities of the liquidation estate including uninsured obligations to shareholders and the NCUSIF. (7) Where the corporate credit union is merged into another corporate credit union, the membership capital account will transfer to the continuing corporate credit union. The three-year notice period for withdrawal of the membership capital account will remain in effect. (8) {If an adjusted balance account}: The membership capital balance will be adjusted __(1 or 2)___ time(s) annually in relation to the member credit union's ___ (assets or other measure) ___ as of ___(date(s))___. {If a term certificate}: The membership capital account is a term certificate that will mature on ___(date)___. I have read the above terms and conditions and I understand them. I further agree to maintain in the credit union's files the annual notice of terms and conditions of the membership capital account. The notice form must be signed by either all of the directors of the member credit union or, if authorized by board resolution, the chair and secretary of the board of the credit union. The annual disclosure notice form must be signed by the chair of the corporate credit union. The chair must then sign a statement that certifies that the notice has been sent to member credit unions with membership capital accounts. The certification must be maintained in the corporate credit union's files and be available for examiner review. Sample Form 2 Terms and Conditions of Paid-In Capital (1) A paid-in capital account is not subject to share insurance coverage by the NCUSIF or other deposit insurer. (2) A paid-in capital account is not releasable due solely to the merger, charter conversion or liquidation of the member credit union. In the event of a merger, the paid-in capital account transfers to the continuing credit union. In the event of a charter conversion, the paid-in capital account transfers to the new institution. In the event of liquidation, the paid-in capital account may be released to facilitate the payout of shares with the prior written approval of NCUA. (3) The funds are callable only at the option of the corporate credit union and only if the corporate credit union meets its minimum required capital and NEV ratios after the funds are called. (4) Paid-in capital cannot be used to pledge borrowings. (5) Paid-in capital is available to cover losses that exceed retained earnings. (6) Where the corporate credit union is liquidated, paid-in capital accounts are payable only after satisfaction of all liabilities of the liquidation estate including uninsured obligations to shareholders and the NCUSIF, and membership capital holders. (7) Where the corporate credit union is merged into another corporate credit union, the paid-in capital account will transfer to the continuing corporate credit union. (8) Paid-in capital is perpetual maturity and noncumulative dividend. I have read the above terms and conditions and I understand them. I further agree to maintain in the credit union's files the annual notice of terms and conditions of the paid-in capital instrument. The notice form must be signed by either all of the directors of the credit union or, if authorized by board resolution, the chair and secretary of the board of the credit union. [67 FR 65657, Oct. 25, 2002]
Title 12: Banks and Banking
PART 704—CORPORATE CREDIT UNIONS
Appendix A to Part 704—Model Forms
