CFR > Title 12 - Banks and Banking > CHAPTER VII—NATIONAL CREDIT UNION ADMINISTRATION > SUBCHAPTER A—REGULATIONS AFFECTING CREDIT UNIONS (parts 700 to 761) > PART 708b—MERGERS OF FEDERALLY-INSURED CREDIT UNIONS; VOLUNTARY TERMINATION OR CONVERSION OF INSURED STATUS > 708b.2—Definitions.

708b.2—Definitions.

(a) Continuing credit union means the credit union that will continue in operation after the merger.
(b) Convert, conversion, and converting, when used in connection with insurance, refer to the act of canceling federal insurance and simultaneously obtaining insurance from another insurance carrier. They mean that after cancellation of federal insurance the credit union will be nonfederally-insured.
(c) Federally-insured means insured by the National Credit Union Administration (NCUA) through the National Credit Union Share Insurance Fund (NCUSIF).
(d) Independent entity means a company with experience in conducting corporate elections. No official or senior manager of the credit union, or the immediate family members of any official or senior manager, may have any ownership interest in, or be employed by, the entity.
(e) Insurance and insured refer to primary share or deposit insurance. These terms do not include excess share or deposit insurance as referred to in part 740 of this chapter.
(f) Merging credit union means the credit union that will cease to exist as an operating credit union at the time of the merger.
(g) Nonfederally-insured means insured by a private or cooperative insurance fund or guaranty corporation organized or chartered under state or territorial law.
(h) Regional director means either the director of the NCUA regional office for the region where a natural person credit union's main office is located or the director of the NCUA's Office of Consumer Protection. For corporate credit unions, regional director means the director of NCUA's Office of Corporate Credit Unions.
(i) Share insurance communication means any written communication, excluding the forms in Subpart C of this Part, that is made by or on behalf of a federally-insured credit union that is intended to be read by two or more credit union members and that mentions share insurance conversion or termination. The term:
(1) Includes communications delivered or made available before, during, and after the credit union's board of directors decides to seek conversion or termination.
(2) Includes, but is not limited to, communications delivered or made available by mail, e-mail, and internet website posting.
(3) Does not include communications intended to be read only by the credit union's own employees or officials.
(j) State credit union means any credit union organized and operated according to the laws of any state, the several territories and possessions of the United States, or the Commonwealth of Puerto Rico. Accordingly, state authority means the appropriate state or territorial regulatory or supervisory authority for any such credit union.
(k) Terminate, termination, and terminating, when used in reference to insurance, refer to the act of canceling federal insurance and mean that the credit union will become uninsured.
(l) Uninsured means there is no share or deposit insurance available on the credit union accounts.

Code of Federal Regulations

[70 FR 3288, Jan. 24, 2005, as amended at 75 FR 80680, Dec. 23, 2010]

Code of Federal Regulations

§ 708b.2 , Nt.

Code of Federal Regulations

Effective Date Note: At 75 FR 81393, Dec. 28, 2010, § 708b.2 was amended by removing alphabetical paragraph designations (a) through (k) and adding definitions of “conducted by an independent entity,” “merger-related financial arrangement,” “secret ballot,” and “senior management official” in alphabetical order, effective Jan. 27, 2011. For the convenience of the user, the added text is set forth as follows: § 708b.2 Definitions. Conducted by an independent entity means: (1) The independent entity will receive the ballots directly from voting members. (2) After the conclusion of the special meeting that ends the ballot period, the independent entity will open all the ballots in its possession and tabulate the results. The entity must not open or tabulate any ballots before the conclusion of the special meeting. (3) The independent entity will certify the final vote tally in writing to the credit union and provide a copy to the NCUA Regional Director. The certification will include, at a minimum, the number of members who voted, the number of affirmative votes, and the number of negative votes. During the course of the voting period the independent entity may provide the credit union with the names of members who have not yet voted, but may not provide any voting results to the credit union prior to certifying the final vote tally. Merger-related financial arrangement means a material increase in compensation (including indirect compensation, for example, bonuses, deferred compensation, or other financial rewards) or benefits that any board member or senior management official of a merging credit union may receive in connection with a merger transaction. For purposes of this definition, a material increase is an increase that exceeds the greater of 15 percent or $10,000. Secret ballot means no credit union employee or official can determine how a particular member voted. Credit union employees and officials are prohibited from assisting members in completing ballots or handling completed ballots. Senior management official means the chief executive officer (who may hold the title of president or treasurer/manager), any assistant chief executive officer, and the chief financial officer.