US Laws, Codes, Statutes & Cases

OKLAHOMA STATUTES

TITLE 18.

CORPORATIONS

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§18-803.  Definitions.

A.  As used herein, unless the context clearly indicates that a different meaning is intended:

1.  "Associated act" means the Oklahoma General Corporation Act, Section 1001 et seq. of this title, in the case of a corporation; the Oklahoma Revised Uniform Limited Partnership Act, Section 301 et seq. of Title 54 of the Oklahoma Statutes, in the case of a limited partnership; or the Oklahoma Limited Liability Company Act, Section 2000 et seq. of this title, in the case of a limited liability company;

2.  "Interest" means a share of stock in a corporation, a partnership interest in a limited partnership or a membership interest in a limited liability company;

3.  "Owner" means a shareholder in the case of a corporation, a general or limited partner in the case of a limited partnership or a member in the case of a limited liability company;

4.  "Manager" means a director or officer in the case of a corporation, a general partner in the case of a limited partnership or a manager in the case of a limited liability company;

5.  "Professional entity" means a domestic corporation, limited partnership or limited liability company formed for the purpose of rendering professional service;

6.  "Professional service" means the personal service rendered by:

a. a physician, surgeon or doctor of medicine pursuant to a license under Sections 481 through 524 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of medicine,

b. an osteopathic physician or surgeon pursuant to a license under Sections 620 through 645 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of osteopathy,

c. a chiropractic physician pursuant to a license under Sections 161.1 through 161.20 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of chiropractic,

d. a podiatric physician pursuant to a license under Sections 135.1 through 160.2 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of podiatric medicine,

e. an optometrist pursuant to a license under Sections 581 through 606 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of optometry,

f. a veterinarian pursuant to a license under Sections 698.1 through 698.18 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of veterinary medicine,

g. an architect pursuant to a license under Sections 46.1 through 46.37 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of architecture,

h. an attorney pursuant to his authority to practice law granted by the Supreme Court of the State of Oklahoma,

i. a dentist pursuant to a license under Sections 328.1 through 328.51a of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of dentistry,

j. a certified public accountant or a public accountant pursuant to his authority to practice accounting under Sections 15.1 through 15.35 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of public accountancy,

k. a psychologist pursuant to a license under Sections 1351 through 1376 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of psychology,

l. a physical therapist pursuant to a license under Sections 887.1 through 887.18 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of physical therapy,

m. a registered nurse pursuant to a license under Sections 567.1 through 567.16a of Title 59 of the Oklahoma Statutes, and any other subsequent laws regulating the practice of nursing,

n. a professional engineer pursuant to a license under Sections 475.1 through 475.22b of Title 59 of the Oklahoma Statutes, and any subsequent laws relating to the practice of engineering,

o. a land surveyor pursuant to a license under Sections 475.1 through 475.22b of Title 59 of the Oklahoma Statutes, and any subsequent laws relating to the practice of land surveying,

p. an occupational therapist pursuant to Sections 888.1 through 888.15 of Title 59 of the Oklahoma Statutes and any subsequent law regulating the practice of occupational therapy,

q. a speech pathologist or speech therapist pursuant to Sections 1601 through 1622 of Title 59 of the Oklahoma Statutes, and any subsequent law regulating the practice of speech pathology,

r. an audiologist pursuant to Sections 1601 through 1622 of Title 59 of the Oklahoma Statutes, and any subsequent law regulating the practice of audiology,

s. a registered pharmacist pursuant to Sections 353 through 366 of Title 59 of the Oklahoma Statutes, and any subsequent law regulating the practice of pharmacy,

t. a licensed perfusionist pursuant to Sections 2051 through 2071 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of perfusionists,

u. a licensed professional counselor pursuant to Sections 1901 through 1920 of Title 59 of the Oklahoma Statutes, and any subsequent law regulating the practice of professional counseling,  

v. a licensed marital and family therapist pursuant to Sections 1925.1 through 1925.18 of Title 59 of the Oklahoma Statutes, and any subsequent law regulating the practice of marital and family therapy, or

w. a dietitian licensed by the Licensed Dietitian Act and subsequent laws regulating the practice of dieticians;

7.  "Related professional services" means those services which are combined for professional entity purposes as follows:

a. any combination of the following professionals:

(1) a physician, surgeon or doctor of medicine pursuant to a license under Sections 481 through 524 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of medicine,

(2) an osteopathic physician or surgeon pursuant to a license under Sections 620 through 645 of Title 59 of the Oklahoma Statutes, and any subsequent laws relating to the practice of osteopathy,

(3) a dentist pursuant to a license under Sections 328.1 through 328.51a of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of dentistry,

(4) a chiropractic physician pursuant to a license under Sections 161.1 through 161.20 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of chiropractic,

(5) a psychologist pursuant to a license under Sections 1351 through 1376 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of psychology,

(6) an optometrist pursuant to a license under Sections 581 through 606 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of optometry,  

(7) a podiatric physician pursuant to a license under Sections 135.1 through 160.2 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of podiatric medicine, or

(8) a dietitian licensed by the Licensed Dietitian Act and subsequent laws regulating the practice of dieticians, or

b. any combination of the following professions:

(1) an architect pursuant to a license under Sections 46.1 through 46.37 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of architecture,

(2) a professional engineer pursuant to a license under Sections 475.1 through 475.22b of Title 59 of the Oklahoma Statutes, and any subsequent laws relating to the practice of engineering, or

(3) a land surveyor pursuant to a license under Sections 475.1 through 475.22b of Title 59 of the Oklahoma Statutes, and any subsequent laws relating to the practice of land surveying;

8.  "Regulating board" means the board which is charged with the licensing and regulation of the practice of the profession which the professional entity is organized to render;

9.  "Individual", "incorporator" and "shareholder" each include the trustee of an express trust created by a person duly licensed to render a professional service who has the right to revoke said trust and who is serving as the trustee of said trust.  Any certificate required by the Professional Entity Act to be issued to an individual incorporator or shareholder may be issued to the grantor on behalf of a trust.  All references in the Professional Entity Act to death and incapacity of a shareholder shall include the death and incapacity of the grantor of a trust which own stock in a professional corporation;

10.  "Incapacity" of a shareholder means a determination by a court of competent jurisdiction, or otherwise by two independent licensed physicians, that the share holder is fully incapacitated or is partially incapacitated to the extent that the shareholder is not capable of rendering the professional service for which the professional corporation was organized; and

11.  "Other personal representative" includes the successor trustee of an express trust owning stock in a professional corporation, which trust was created by a person duly licensed to render the professional service for which the professional corporation was organized who has the right to revoke the trust and who is the original trustee of the trust.

B.  The definitions of the applicable associated act shall apply to this act, unless the context clearly indicates that a different meaning is intended.

Added by Laws 1961, p. 204, § 3, emerg. eff. July 26, 1961.  Amended by Laws 1963, c. 342, § 1, emerg. eff. June 24, 1963; Laws 1970, c. 95, § 1, emerg. eff. March 30, 1970; Laws 1971, c. 164, § 1, emerg. eff. May 25, 1971; Laws 1976, c. 27, § 1; Laws 1981, c. 312, § 1, eff. Oct. 1, 1981; Laws 1983, c. 4, § 1, eff. Nov. 1, 1983; Laws 1986, c. 292, § 147, eff. Nov. 1, 1986; Laws 1990, c. 328, § 1, eff. Sept. 1, 1990; Laws 1993, c. 345, § 1, eff. Sept. 1, 1993; Laws 1994, c. 216, § 1, emerg. eff. May 20, 1994; Laws 1995, c. 339, § 2, eff. Nov. 1, 1995; Laws 1996, c. 226, § 22, eff. July 1, 1996; Laws 1998, c. 25, § 1, eff. Nov. 1, 1998; Laws 2001, c. 307, § 1, eff. Nov. 1, 2001.

§18381.1.  Short title.

Sections 381.1 through 381.78 of this title and Sections 6, 7, 8, 25, 26, 27, 32, 37, 38, 39, 46, 50, 51, and 80 through 87 of this act shall be known and may be cited as the "Oklahoma Savings and Loan Code".

Added by Laws 1970, c. 101, § 1, eff. June 1, 1970.  Amended by Laws 1987, c. 61, § 1, emerg. eff. May 4, 1987; Laws 1988, c. 65, § 1, emerg. eff. March 25, 1988; Laws 2000, c. 81, § 1, eff. Nov. 1, 2000.

§18381.2.  Definitions.

As used in the Oklahoma Savings and Loan Code:

1.  "Act" or "this act" means the Oklahoma Savings and Loan Code;

2.  "Association" means a savings and loan association or savings bank, including any association previously referred to as a building and loan association, incorporated and now existing under the laws of this state or hereafter incorporated under this act or which is otherwise authorized to transact savings and loan association or savings bank business under this act;

3.  "Branch" means any place of business separated from the main office of an association at which deposits are received, checks paid, or money lent;

4.  "Capital accounts" means permanent capital stock, undivided profits, surplus or reserves;

5.  "Certificate of Authority" means a certificate issued by the Commissioner authorizing an association to transact association business;

6.  "Commissioner" means the State Banking Commissioner, or the State Deputy Banking Commissioner when acting on behalf of the Commissioner pursuant to subsections C or E of Section 201 of Title 6 of the Oklahoma Statutes;

7.  "Consumer banking electronic facility" means any electronic device owned, operated, leased by or on behalf of a bank, savings association, or credit union other than a telephone or modem operated by a customer of a depository institution, to which a person may initiate an electronic fund transfer.  The term includes, without limitations, a point-of-sale terminal, automatic teller machine, automated loan machines, video banking centers, or any other similar electronic devices;

8.  "Department" means the Oklahoma State Banking Department;

9.  "Deposit account" means any form of deposit, share or other account maintained by a depositor at an association, including demand deposit accounts, whether evidenced by a passbook, certificate, or otherwise, and which does not represent permanent capital stock;

10.  "Deposit association" means an association which is qualified to accept deposit accounts or which becomes so qualified pursuant to this act;

11.  "Earnings" means the money payable or to be credited to holders of deposit accounts by an association as payment for the use of the funds which constitute such accounts.  Earnings on deposit accounts in a deposit association may be designated as interest, and earnings on other deposit accounts may be designated as dividends;

12.  "Existing mutual association" means a mutual association which was authorized to do business in Oklahoma on the effective date of this act;

13.  "Federal association" means a savings and loan association or savings bank organized and existing under the laws of the United States;

14.  "Foreign association" means any firm, company, association, partnership or corporation, by whatever name called, actually engaged in the savings association business, which is not organized under the laws of this state or of the United States;

15.  "Insured association" means an association the deposit accounts of which are insured by the Federal Deposit Insurance Corporation to the extent provided by federal law;

16.  "Main office" means the office location which has been designated by the Commissioner or the Office of Thrift Supervision as the main office of an association;

17.  "Member" means the holder of a deposit account of a mutual association, and also includes the owner of real estate upon which the mutual association holds a mortgage or deed of trust;

18.  "Mutual association" means an association which derives its principal capital from the deposit accounts of its members and whose members have the right to participate in the management of the association.  The term includes any association organized or existing under prior laws of this state.  A mutual association is not a deposit association unless and until it becomes qualified as such;

19.  "Net worth" of a stock association shall mean the aggregate of the permanent capital stock account, paidin surplus, earned surplus, legal and federal insurance reserves and undivided profits;

20.  "Permanent capital stock" means that part of the capital or liabilities of an association representing ownership of the association and which is not subject to being withdrawn or the value paid to the holder thereof unless and until all other liabilities of the association have been fully liquidated and paid;

21.  "Shares" or "share accounts" means any deposit account issued by a mutual association in the form of installment shares, optional installment shares, full paid shares, prepaid shares, savings shares, or other shares by whatever name called, evidenced by passbook, certificate, or other evidence or holding;

22.  "Stock association" means an association which issues permanent capital stock and which limits the right to participate in the management of the association to the holders of such permanent capital stock.  Stock associations are also deposit associations;

23.  "Stockholder" means the holder of permanent capital stock;

24.  "Withdrawable account" means a deposit account of an association which does not represent permanent capital stock; and

25.  "Withdrawal value" means the amount paid to an association on a deposit account plus earnings credited thereto, less lawful deductions therefrom.

Added by Laws 1970, c. 101, § 2, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 1, eff. July 1, 1979; Laws 1986, c. 219, § 4, emerg. eff. June 9, 1986; Laws 1988, c. 65, § 2, emerg. eff. March 25, 1988; Laws 1990, c. 118, § 1, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 29, eff. July 1, 1993; Laws 2000, c. 81, § 2, eff. Nov. 1, 2000.

§18-381.2a.  Successor agency to Federal Savings and Loan Insurance Corporation - Construction of terms.

Wherever the terms "Federal Savings and Loan Insurance Corporation" or "FSLIC" appear in the Oklahoma Statutes, such terms shall be deemed to refer to the successor agency to the Federal Savings and Loan Insurance Corporation established pursuant to federal law.

Added by Laws 1993, c. 183, § 30, eff. July 1, 1993.

§18381.3.  Conformity of existing associations.

The certificate of incorporation and certificate of authority to transact business as an association, of every association heretofore organized under the laws of this state and existing as of January 1, 2000, shall continue in full force and effect, and the same shall be deemed as modified to conform with this act without the adoption of a new certificate of incorporation or issuance of a new certificate of authority.  The contracts, obligations and liabilities of every such association, and the contracts, notes, mortgages, investments and other assets and rights of every kind and nature held by it, as well as its bylaws and resolutions, shall continue in full force and effect.  Every such association and every association hereafter incorporated shall have perpetual existence, subject to merger, conversion or liquidation pursuant to the provisions of this act.

Added by Laws 1970, c. 101, § 3, eff. June 1, 1970.  Amended by Laws 1988, c. 65, § 3, emerg. eff. March 25, 1988; Laws 2000, c. 81, § 3, eff. Nov. 1, 2000.

§18381.4.  Existing capital accounts.

The shares of capital, savings share accounts or other capital accounts of every existing association, and the certificates and passbooks evidencing the same, in whatever form issued, shall continue in full force and effect with full deposit account holders' rights, including the right to withdraw, to vote and to share in distribution of assets upon liquidation of the association.

Added by Laws 1970, c. 101, § 4, eff. June 1, 1970.  Amended by Laws 2000, c. 81, § 4, eff. Nov. 1, 2000.

§18381.5.  Abolition of Oklahoma Savings and Loan Board - Transfer of power, duties and responsibilities to State Banking Commissioner.

A.  The Oklahoma Savings and Loan Board is abolished.  The power, duties and responsibilities exercised by the Oklahoma Savings and Loan Board shall be transferred to the State Banking Commissioner.  All unexpended funds, property, records, personnel and outstanding financial obligations and encumbrances of the Oklahoma Savings and Loan Board are hereby transferred to the Oklahoma State Banking Department.

B.  Any reference to the Oklahoma Savings and Loan Board in the Oklahoma Statutes or in rules promulgated pursuant to the Oklahoma Statutes shall mean the State Banking Commissioner.

C.  The rules promulgated by the Oklahoma Savings and Loan Board shall continue in effect until such rules are amended or repealed by rule of the Commissioner promulgated pursuant to the provisions of Article I of the Administrative Procedures Act, Section 250.3 et seq. of Title 75 of the Oklahoma Statutes.

Added by Laws 1970, c. 101, § 5, eff. June 1, 1970.  Amended by Laws 1988, c. 65, § 4, emerg. eff. March 25, 1988; Laws 1993, c. 183, § 31, eff. July 1, 1993; Laws 2000, c. 81, § 5, eff. Nov. 1, 2000.

§18-381.5a.  Savings and Loan Advisory Council.

A.  There is hereby created the "Savings and Loan Advisory Council" which shall advise the State Banking Commissioner on matters relating to the regulation of savings and loan associations in this state.  The Council shall consist of five (5) members, appointed by the Commissioner.  At least three of the members shall have been actively engaged as officers in the management of a state-chartered savings and loan association.  Members shall serve at the pleasure of the Commissioner.

B.  The Council shall meet at the call of the Commissioner.  Members shall select a chairman at their first meeting and annually thereafter.  A majority of the Council shall constitute a quorum for the transaction of business.

Added by Laws 1993, c. 183, § 32, eff. July 1, 1993.

§18-381.6.  Repealed by Laws 1993, c. 183, § 73, eff. July 1, 1993.

§18-381.6a.  Records - Confidentiality.

A.  The following records in the Oklahoma State Banking Department are designated as public records:

1.  All applications for association charters and branches and supporting information with the exception of personal financial records of individual applicants;

2.  All records introduced at public hearings on association charter and branch applications;

3.  Information disclosing the failure of an association, a foreign association and their branches in this state and the reasons therefor;

4.  Reports of completed investigations which uncover a shortage of funds in an association or an out-of-state association and branches of either, after the reporting of the shortage to proper authorities by the State Banking Commissioner;

5.  Names of all stockholders and officers of associations, foreign associations, holding companies, and branches of foreign associations located in this state filed in the office of the Secretary of State; and

6.  Regular financial call reports of associations.

B.  All other records in the Department shall be confidential and not subject to public inspection.  However, the Commissioner may, in the sole discretion of the Commissioner, divulge such confidential information after receipt of a written request which shall:

1.  Specify the record or records to which access is requested; and

2.  Give the reasons for the request.

Such records may also be produced pursuant to a valid judicial subpoena or other legal process requiring production, if the Commissioner determines that the records are relevant to the hearing or proceeding and that production is in the best interests of justice.  The records may be disclosed only after a determination by the Commissioner that good cause exists for the disclosure.  Either prior to or at the time of any disclosure, the Commissioner shall impose such terms and conditions as the Commissioner deems necessary to protect the confidential nature of the record, the financial integrity of any institution to which the record relates, and the legitimate privacy of any individual named in such records.

Added by Laws 2000, c. 81, § 6, eff. Nov. 1, 2000.

§18-381.7a.  Examinations - Reports by associations - Penalty.

A.  1.  The State Banking Commissioner shall, at least every eighteen (18) months or as often as the Commissioner deems advisable, examine every association, and for the purpose of making such examinations and special examinations, shall have full access to all books, papers, securities, records and other sources of information under the control of the association.  The Commissioner shall make and file in the office of the Commissioner a report in detail disclosing the results of such examination.  The Commissioner shall mail a copy of the report to the association examined.  However, the Commissioner may accept, in lieu of any three consecutive association examinations, an examination of the association by the Office of Thrift Supervision, if conducted within a reasonable period of time, and if a copy of the examination is furnished to the Commissioner.

2.  The Commissioner may also accept any other report relative to the condition of an association, which shall include joint or concurrent examinations that may be obtained by the authorities within a reasonable period, in lieu of such report authorized by the laws of this state to be required of such association by the Oklahoma State Banking Department, provided a copy of such report is furnished to the Commissioner.

3.  The Commissioner may enter into cooperative, coordinating and information-sharing agreements with the Federal Deposit Insurance Corporation, the Federal Home Loan Bank Board, or the Office of Thrift Supervision with respect to the periodic examination or other supervision of any association.

4.  When requested in writing upon authority of the board of directors or stockholders owning a majority of the capital stock of any association, the Commissioner shall, if in the opinion of the Commissioner such examination is desirable, make or cause to be made an examination into the affairs and conditions of such association.  For such examination, the association shall pay the same fees as provided for in subsection D of Section 381.15 of this title.

B.  Every association shall make two reports each year.  Associations may be required to make more reports if called upon by the Commissioner.  All reports shall be according to the form which may be prescribed by the Commissioner.  The reports shall be verified by the oath or affirmation of the president, cashier or secretary of such association and attested by the signatures of at least two of the directors.  Each report shall exhibit, in detail and under appropriate headings, the resources and liabilities of the association at the close of business on any last day specified by the Commissioner, shall be transmitted to the Commissioner within thirty (30) calendar days after the call date, and may, at the option of the association, be published at the expense of the association in the same form in which it is presented to the Commissioner.  The Commissioner shall also have the power to request special reports from any association whenever, in the judgment of the Commissioner, such reports are necessary in order to gain a full and complete knowledge of its condition.  However, the reports authorized and required by this section, to be requested by the Commissioner, shall relate to a date prior to the date of such request and such prior date shall be specified in the request.  Additionally, the Commissioner may accept, in lieu of the reports referred to in this section, reports made by associations that are members of the Federal Home Loan Bank System on forms provided by the Federal Home Loan Bank System.

C.  Every association which fails to make and transmit any report required pursuant to this section shall be subject to a penalty, at the discretion of the Commissioner, not to exceed Fifty Dollars ($50.00) for each day, after the specified period, that the association delays to make and transmit its report.  Whenever any association delays or refuses to pay the penalty herein imposed for a failure to make and transmit a report, the Commissioner is hereby authorized to maintain an action in the name of the state against the delinquent association for the recovery of such penalty, and all sums collected by such action shall be paid into the State Treasury to be credited to the General Revenue Fund.

D.  The Commissioner may provide a form for the examinations and reports set forth in this section.  All examinations and reports received by the Commissioner shall be preserved in the office of the Commissioner for a period of not less than five (5) years.  The preservation may be in an electronic format, and paper copies or originals need not be retained.  Such examination, reports and all other records of operating associations in the Department are to be kept confidential, except as permitted by this act.

Added by Laws 2000, c. 81, § 7, eff. Nov. 1, 2000.

§18-381.8.  Repealed by Laws 1993, c. 183, § 73, eff. July 1, 1993.

§18-381.8a.  Preservation of documents - Electronically stored or imaged documents or reproductions.

All documents which the Oklahoma State Banking Department is required, by any provision of this act or by any other statute or rule of this state, to retain or preserve in its possession may be retained and preserved, in lieu of retention of the original records or copies, in an electronic format and stored by electronic imaging or otherwise so that the documents may be reproduced later.  Any such electronically stored or imaged document or reproduction shall have the same force and effect as the original document and be admitted in evidence as if such document was the original.

Added by Laws 2000, c. 81, § 8, eff. Nov. 1, 2000.

§18-381.9.  Repealed by Laws 2000, c. 81, § 88, eff. Nov. 1, 2000.

§18381.10.  Certificate of authority.

No association or foreign association shall transact business or operate in this state without a certificate of authority issued by the State Banking Commissioner.

Laws 1970, c. 101, § 10, eff. June 1, 1970; Laws 1993, c. 183, § 34, eff. July 1, 1993.

§18381.11.  Supervision by State Banking Commissioner - Additional powers - Orders - Notice and hearing - Temporary orders - Cooperative agreements - Opinions.

A.  The State Banking Commissioner shall have general supervision of associations, in addition to the authority set forth in other sections of this act.  In addition to other powers conferred by this act, the Commissioner shall have the power to order an association, a holding company of an association, shareholder, officer, director, or employee to:

1.  Maintain an accounting system in accordance with such rules as may be prescribed by the Commissioner; provided, the accounting system required shall have due regard to the size of the association;

2.  Observe methods and standards which the Commissioner may prescribe for determining the value of various types of assets;

3.  Charge off the whole or part of an asset which at the time of the Commissioner's action could not lawfully be acquired;

4.  Write down an asset to its market value;

5.  Record liens and other interests in property;

6.  Obtain a financial statement from a borrower to the extent the association can do so;

7.  Obtain insurance against damage to real estate taken as security;

8.  Search, or obtain insurance for, the title to real estate taken as security;

9.  Maintain adequate insurance against such other risks as the Commissioner may determine to be necessary and appropriate for the protection of depositors and the public; and

10.  Cease and desist from engaging in any act or transaction, or doing any act in furtherance thereof, which would constitute a violation of the provisions of this act, applicable federal laws, the applicable laws of another state, or a lawful regulation issued thereunder, or to cease and desist from engaging in any unsafe or unsound practice.

B.  Before issuing an order provided for in subsection A of this section, the Commissioner shall give reasonable notice and opportunity for a hearing.  However, if the Commissioner makes written findings of fact that the protection of depositors will be harmed by delay in issuing an order provided for in subsection A of this section, the Commissioner may issue a temporary order pending the hearing on the order provided for in subsection A of this section.  The temporary order shall remain in effect until three (3) business days after the hearing on the order provided for in subsection A of this section and shall become final if the association subject to the order fails within fifteen (15) days after the receipt of the order to request a hearing to determine whether the temporary order should be modified, vacated, or become final.  If a hearing on the temporary order is not held upon written request, the temporary order shall dissolve, and the order provided for in subsection A of this section shall not be issued except upon reasonable notice and opportunity for hearing.

C.  The Commissioner may enter into cooperative, coordinating, and information-sharing agreements with any other supervisory agencies or any organization affiliated with or representing one or more supervisory agencies with respect to the periodic examination or other supervision of any association, bank holding company, or branch in this state or an out-of-state association, or any branch of an Oklahoma-chartered association in any other state, and the Commissioner may accept such reports of examination and reports of investigation in lieu of conducting the Commissioner's own examinations or investigations.

D.  The Commissioner may enter into cooperative agreements with other regulatory agencies to facilitate the regulation of associations and holding companies doing business in this state.  The Commissioner may accept reports of examinations and other records from such other agencies in lieu of the Oklahoma State Banking Department conducting the examinations of associations controlled by out-of-state holding companies.  The Commissioner may take any action jointly with other regulatory agencies having concurrent jurisdiction over associations and holding companies or may take such actions independently in order to carry out the Commissioner's responsibilities.

E.  1.  The Commissioner may issue interpretive statements containing matters of general policy for the guidance of associations subject to this act.  The Commissioner may amend or repeal an interpretative statement by issuing an amended statement or notice of repeal of a statement and shall provide notice thereof and make it available upon request to all associations chartered under this act.

2.  The Commissioner may issue opinions in response to specific requests from members of the public or the association industry directly or through the Deputy State Banking Commissioner or the attorneys of the Department.  The Commissioner may amend or repeal an opinion by issuing an amended statement or notice of repeal of an opinion and shall provide notice thereof and make it available upon request to all associations chartered under this act.  However, the requesting party may rely on the original opinion if:

a. all material facts were originally disclosed to the Commissioner,

b. considerations of safety and soundness of the affected association are not implicated with respect to further and prospective reliance on the original opinion, and

c. the text and interpretation of relevant governing provisions of this act have not been changed by legislative or judicial action.

3.  An interpretive statement or opinion issued under this section does not have the force of law and is not a rule.

F.  Upon failure of such association to comply with the order or requirements of the Commissioner, the Commissioner may suspend the certificate of authority to transact business of such association, or the Commissioner may place the association in receivership in the manner provided by this act.

Added by Laws 1970, c. 101, § 11, eff. June 1, 1970.  Amended by Laws 1993, c. 183, § 35, eff. July 1, 1993; Laws 2000, c. 81, § 9, eff. Nov. 1, 2000.

§18-381.12.  Repealed by Laws 1993, c. 183, § 73, eff. July 1, 1993.

§18381.13.  Savings and loan administrator.

The State Banking Commissioner may appoint a savings and loan administrator with special duties and authority of conducting and supervising examinations of associations in addition to such other duties as the Commissioner may assign to the savings and loan administrator.

The bond of the savings and loan administrator shall be the same as that set for the Deputy State Banking Commissioner.

Added by Laws 1970, c. 101, § 13, eff. June 1, 1970.  Amended by Laws 1979, c. 173, § 10; Laws 1988, c. 65, § 7, emerg. eff. March 25, 1988; Laws 2000, c. 81, § 10, eff. Nov. 1, 2000.

§18381.14.  Limitation of liability.

The State Banking Commissioner, or any member of his staff including any member of the Savings and Loan Advisory Council, shall not be liable in any civil action for damages for any act done or omitted in good faith in performing the functions of his office.

Laws 1970, c. 101, § 14, eff. June 1, 1970; Laws 1993, c. 183, § 36, eff. July 1, 1993.

§18-381.15.  Examination and audit reports from Director of the Office of Thrift Supervision - Assessments and fees - Special examinations.

A.  In the case of any insured association which is examined periodically by the Director of the Office of Thrift Supervision, and whose financial records are audited periodically in accordance with regulations of the Director of the Office of Thrift Supervision, the State Banking Commissioner may accept such examination and audit reports, and rely upon accuracy thereof, in lieu of examinations by the savings and loan administrator.  It shall be the responsibility of each insured association to provide such reports to the Commissioner within ten (10) days of such time as such reports are received from the agency, person or firm preparing them.  The Commissioner may require a special examination of any association to be made at any time when in the judgment of the Commissioner an examination may be necessary.

B.  The Commissioner shall charge and collect assessments from each association chartered pursuant to this act on each One Thousand Dollars ($1,000.00) of assets, or major fraction thereof, at a rate established by the Commissioner.  The Commissioner may charge and collect assessments on an annual basis and may, in addition to any annual assessment, charge and collect a special assessment from each association, at rates established by the Commissioner.  Assessments shall be deposited in the Oklahoma State Banking Department revolving fund pursuant to Section 211.1 of Title 6 of the Oklahoma Statutes.  Effective January 1, 2005, and each year thereafter, twenty percent (20%) of all assessments collected pursuant to this subsection shall be deposited to the General Revenue Fund of the State Treasury.  The annual assessments shall be paid to the Oklahoma State Banking Department no later than the fifth day of February in each year.

C.  The Commissioner shall charge and collect from each association under the supervision of the Commissioner an annual fee, in addition to the assessment set forth in subsection B of this section, of not more than Five Hundred Dollars ($500.00), which shall be deposited in the Oklahoma State Banking Department revolving fund as set forth in Section 211.1 of Title 6 of the Oklahoma Statutes.

D.  Whenever it is deemed advisable by the Commissioner, a special examination of an association may be conducted.  The expense of the Department necessarily incurred in the special examination shall be chargeable to the association at a rate not in excess of Fifty Dollars ($50.00) per examiner per hour plus travel expenses as provided by Section 201.1 of Title 6 of the Oklahoma Statutes for each examining person while engaged at such association.

E.  Each foreign association doing business in this state under a certificate of authority shall furnish to the Commissioner, with each annual examination report, a statement showing the total amount of Oklahoma real estate loans and other loans made to Oklahoma residents.  The annual supervisory fee of every such foreign association shall be computed and paid on the aggregate amount of such loans at the rate of twelve cents ($0.12) per One Thousand Dollars ($1,000.00) of such loans.

F.  Except as otherwise provided by law, all fees set by the Commissioner or otherwise provided for in rules promulgated by the Commissioner shall be deposited in the Department revolving fund pursuant to Section 211.1 of Title 6 of the Oklahoma Statutes.

Added by Laws 1970, c. 101, § 15, eff. June 1, 1970.  Amended by Laws 1975, c. 236, § 2, emerg. eff. May 30, 1975; Laws 1979, c. 173, § 11; Laws 1988, c. 65, § 8, emerg. eff. March 25, 1988; Laws 1990, c. 118, § 2, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 37, eff. July 1, 1993; Laws 2000, c. 81, § 11, eff. Nov. 1, 2000; Laws 2003, c. 356, § 8, emerg. eff. June 3, 2003.

§18381.16.  Filing requirements for new mutual and stock associations.

At any time hereafter when ten or more individuals, residents of this state, desire to form a mutual association, or one or more individuals, residents of this state, desire to form a stock association under the provisions of this act, such persons, hereinafter referred to as the incorporators, shall file with the State Banking Commissioner the following:

1.  Four copies of the proposed certificate of incorporation, signed and acknowledged by all of the incorporators and addressed to the Secretary of State;

2.  An original and three copies of an application for a certificate of authority to transact business as an association, addressed to the Commissioner;

3.  Four copies of the proposed bylaws for the proposed association;

4.  A remittance of Two Hundred Dollars ($200.00) payable to the Secretary of State of Oklahoma, as the incorporation fee in lieu of the fees prescribed by paragraph 9 of subsection A of Section 1142 of this title, which shall not be applicable to an association; and

5.  A deposit of Two Thousand Dollars ($2,000.00) payable to the Commissioner to be used for the purpose of defraying expenses of an investigation and report of the feasibility of the proposed association and other expenses incidental to the consideration of the application.

Added by Laws 1970, c. 101, § 16, eff. June 1, 1970.  Amended by Laws 1975, c. 236, § 3, emerg. eff. May 30, 1975; Laws 1984, c. 229, § 7, operative July 1, 1984; Laws 1988, c. 65, § 9, emerg. eff. March 25, 1988; Laws 1990, c. 118, § 3, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 38, eff. July 1, 1993; Laws 2000, c. 81, § 12, eff. Nov. 1, 2000.

§18381.17.  Contents of certificate of incorporation.

The certificate of incorporation shall set forth:

1.  The name of the association;

2.  That its term of existence is perpetual;

3.  That the purpose for which it is formed is to engage in the business of an association pursuant to the Oklahoma Savings and Loan Code and the rules promulgated thereunder;

4.  The place where it is to maintain the main office for the transaction of business;

5.  The names and addresses of the incorporators, and the amounts of the deposit accounts or number of shares of stock subscribed by each of them;

6.  If the association will be a stock association, the number of shares of stock of each class to be authorized and issued and the par value per share; and

7.  Such other proper provisions to govern the business and affairs of the association as may be desired by the incorporators.

Added by Laws 1970, c. 101, § 17, eff. June 1, 1970.  Amended by Laws 1988, c. 65, § 10, emerg. eff. March 25, 1988; Laws 1993, c. 183, § 39, eff. July 1, 1993; Laws 2000, c. 81, § 13, eff. Nov. 1, 2000.

§18381.18.  Application and supporting data.

The application for a certificate of authority to transact business as an association shall be accompanied by data concerning the community in which the proposed association is to be located, the occupations of the incorporators, and a plan for payment of expenses of the proposed association until it is incorporated and is granted a certificate of authority, in the case of a stock association, or until it becomes selfsustaining from its own operating income in the case of a mutual association.

Added by Laws 1970, c. 101, § 18, eff. June 1, 1970.  Amended by Laws 1988, c. 65, § 11, emerg. eff. March 25, 1988; Laws 2000, c. 81, § 14, eff. Nov. 1, 2000.

§18381.19.  Order - Certificate of authority.

The State Banking Commissioner shall act upon and issue an order granting or denying each application for a certificate of authority.  If the Commissioner finds that the application should be granted, the Commissioner shall designate the amount of deposit accounts required and fix a reasonable time within which the funds subscribed may be placed in escrow in a bank or trust company approved by the Commissioner, to be delivered to the association after incorporation or returned to the subscribers if incorporation is not completed.  The Commissioner may also require the incorporators to advance funds necessary to pay organizational expenses and other expenses for starting business, such advances to be repaid by the association after its incorporation and the granting of its certificate of authority, in the case of a stock association, or after its income is sufficient to meet reserve requirements, in the case of a mutual association, and further, in the case of a mutual association, to pay reasonable earnings on the deposit accounts of the association.  If and when all requirements are met, a certificate of authority shall be issued by the Commissioner.  The Secretary of State shall file the approved certificate of incorporation upon receipt of the incorporation fee.  If the deposit accounts of the association are to be insured, approval shall be contingent upon the making, by the proposed association, of a bona fide application for insurance of accounts and deposits by the Federal Deposit Insurance Corporation and upon approval of such application by the Federal Deposit Insurance Corporation.

Added by Laws 1970, c. 101, § 19, eff. June 1, 1970.  Amended by Laws 1975, c. 236, § 4, emerg. eff. May 30, 1975; Laws 1988, c. 65, § 12, emerg. eff. March 25, 1988; Laws 1990, c. 118, § 4, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 40, eff. July 1, 1993; Laws 2000, c. 81, § 15, eff. Nov. 1, 2000.

§18381.20.  Payment into escrow account - Required savings capital.

A.  Before a certificate of authority is issued for a new mutual association, there shall be paid into the escrow fund as subscriptions to deposit accounts of the proposed association such aggregate amount as the State Banking Commissioner shall deem adequate, but, if insured, not less than an amount necessary to meet the requirements of the Federal Deposit Insurance Corporation.  If the organizers intend to organize and operate the association without federal insurance on its deposit accounts, the amount paid into the escrow fund as subscriptions to deposit accounts of the proposed association shall be at the sole discretion of the Commissioner.

B.  No permanent capital stock association may be organized hereafter unless, prior to the filing of its certificate of incorporation, such amounts of its permanent capital stock as the Commissioner shall deem adequate, but, if insured, not less than an amount necessary to meet the requirements of the Federal Deposit Insurance Corporation shall have been subscribed for and paid for in lawful money of the United States.  If the organizers intend to organize and operate the association without federal insurance on its deposit accounts, the amount of permanent capital stock required shall be at the sole discretion of the Commissioner.

Added by Laws 1970, c. 101, § 20, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 2, eff. July 1, 1979; Laws 1987, c. 61, § 3, emerg. eff. May 4, 1987; Laws 1988, c. 65, § 13, emerg. eff. March 25, 1988; Laws 1990, c. 118, § 5, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 41, eff. July 1, 1993; Laws 2000, c. 81, § 16, eff. Nov. 1, 2000.

§18381.21.  Corporate existence  Organizational meeting.

The corporate existence of an association shall begin on the date of filing of the certificate of incorporation with the Secretary of State and within thirty (30) days thereafter an organizational meeting shall be held by the deposit account holders or permanent capital stock subscribers pursuant to notice mailed to each of them not less than seven (7) days before the date of the meeting.  At such meeting, bylaws of the association shall be adopted and directors shall be elected.

Added by Laws 1970, c. 101, § 21, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 3, eff. July 1, 1979; Laws 1988, c. 65, § 14, emerg. eff. March 25, 1988; Laws 2000, c. 81, § 17, eff. Nov. 1, 2000.

§18381.22.  Corporate name.

The name of every association hereafter incorporated pursuant to this act, and of any existing association which hereafter changes its name, shall be approved by the State Banking Commissioner.  The name shall not so nearly resemble the name of another association or federal association as to be likely to deceive the public.  Associations may operate under trade names as approved by the Commissioner.

Added by Laws 1970, c. 101, § 22, eff. June 1, 1970.  Amended by Laws 1987, c. 61, § 4, emerg. eff. May 4, 1987; Laws 1990, c. 118, § 6, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 42, eff. July 1, 1993; Laws 2000, c. 81, § 18, eff. Nov. 1, 2000.

§18381.23.  Exclusiveness of name.

No person, firm, company, partnership or corporation, either domestic or foreign, unless lawfully authorized to do business in this state under the provisions of this act, shall do business in this state under any name or title which contains the terms "savings and loan", "building and loan", "savings association", "savings bank" or combination of such terms in any manner which indicates or reasonably implies that its business is of the character or kind carried on or transacted by an association, or that is likely to lead any person to believe that such business is that of an association.  Upon application by the Commissioner, or any association, a court of competent jurisdiction may issue an injunction to restrain any such entity from violating or continuing to violate the provisions of this section.

Added by Laws 1970, c. 101, § 23, eff. June 1, 1970.  Amended by Laws 1988, c. 65, § 15, emerg. eff. March 25, 1988; Laws 2000, c. 81, § 19, eff. Nov. 1, 2000.

§18381.24.  Change of office location - Change of name.

No association shall move its main office or branch office, or change its name except with permission granted by order of the State Banking Commissioner.  In the event permission is granted to move the main office to a town or city other than that named in the certificate of incorporation of the association, or to change the name, an amended certificate of incorporation shall be filed.

Added by Laws 1970, c. 101, § 24, eff. June 1, 1970.  Amended by Laws 1988, c. 65, § 16, emerg. eff. March 25, 1988; Laws 1990, c. 173, § 19, emerg. eff. May 3, 1990; Laws 1993, c. 183, § 43, eff. July 1, 1993; Laws 2000, c. 81, § 20, eff. Nov. 1, 2000.

§18-381.24a.  Branch banking - Deposit limitation - Certificate - Penalty.

A.  Beginning on the effective date of this act, upon approval of the State Banking Commissioner, any association shall be authorized to establish and operate in this state, on real property owned or leased by the association, an unlimited number of branches by acquisition, de novo, or otherwise.  Such branches may be fixed or mobile, and any permissible function, business, power, or activity of any kind of the association may be performed or engaged in at such location.  However, branches established by acquisition shall be subject to the limitations as set forth in subsection B of this section.

B.  1.  It shall be unlawful for any association to acquire any other association, federal association or bank in this state or any portion of its assets if such acquisition would result in the association having direct or indirect ownership or control of more than fifteen percent (15%) of the aggregate deposits of all financial institutions located in this state which have deposits insured by the Federal Deposit Insurance Corporation as determined by the Commissioner on the basis of the most recent reports of such institutions to their supervisory authorities which are available at the time of the proposed acquisition.

2.  The deposit limitation provided for in this subsection shall not apply to disallow an acquisition of a bank, association or federal association if control results only by reason of ownership or control of shares of such financial institution acquired directly or indirectly:

a. in a good faith fiduciary capacity, except when such shares are held for the benefit of the acquiring association's shareholders, or

b. by an association in the regular course of securing or collecting a debt previously contracted in good faith, or

c. at the request of or in connection with the exercise of regulatory authority for the purpose of preventing imminent failure of the bank, association or federal association or to protect the depositors thereof as determined by the principal supervisory agency in its sole discretion.

Provided, however, at the end of a period of five (5) years from the date of acquisition, for the circumstances set forth in subparagraphs b and c of this paragraph, the deposits of the acquired bank or association or federal association shall be included in computing the deposit limitation and if deposits are in excess, appropriate reductions and disposition shall be made within six (6) months to meet such limitations.  Further, in the circumstances set forth in subparagraph c of this paragraph, the Commissioner and the Federal Deposit Insurance Corporation shall give priority in authorizing any such acquisition to any acquiring association whose total deposits do not exceed the deposit limitation.

C.  1.  No association shall be permitted to establish or operate a branch except upon certificate issued by the Commissioner or Office of Thrift Supervision.

2.  The application for a certificate to establish, operate, or relocate a branch of an association shall comply with the regulations of the Commissioner.

D.  The provisions of this section shall not be construed in derogation or denial of the right to operate and maintain facilities as provided for in Sections 381.24b, 381.24c and 381.24d of this title.

E.  A violation of any portion of this section, upon conviction, shall be a misdemeanor punishable by a fine not exceeding Five Hundred Dollars ($500.00).  Each day's violation shall constitute a separate offense.

F.  Nothing contained in this section shall be construed to limit the authority of federal savings associations to branch in accordance with federal law and regulations.

Added by Laws 1990, c. 173, § 20, emerg. eff. May 3, 1990.  Amended by Laws 1992, c. 295, § 29, eff. July 1, 1992; Laws 1993, c. 183, § 44, eff. July 1, 1993; Laws 1994, c. 17, § 1, emerg. eff. April 4, 1994; Laws 1996, c. 48, § 1, emerg. eff. April 8, 1996; Laws 2000, c. 81, § 21, eff. Nov. 1, 2000; Laws 2000, c. 205, § 37, emerg. eff. May 17, 2000.

§18-381.24b.  Detached facilities - Certificate - Making of loans prohibited - Penalty.

A.  1.  Any association may maintain and operate, subject to the approval of the State Banking Commissioner as evidenced by the certificate of the Commissioner, outside attached facilities and detached facilities on real property owned or leased by the association having one or more tellers' windows for drive-in or walk-up service or both.

2.  Any branch may maintain and operate outside attached facilities having one or more tellers' windows for drivein or walkup service or both on property owned or leased by the association.

B.  1.  No association shall be permitted to maintain and operate such additional outside facilities except upon certificate issued by the Commissioner.  The issuance of the certificates shall rest solely in the discretion of the Commissioner.

2.  The application for a certificate to maintain and operate a detached facility shall comply with the rules of the Commissioner.  An application fee shall be payable to the Oklahoma State Banking Department in an amount set by rule of the Commissioner.

3.  Any association function may be performed at the facilities except that of making loans.  Upon the recommendation of the Commissioner, the Attorney General shall bring an appropriate action to enjoin an association from conducting the making of loans at such facilities.

4.  Any association validly operating a detached facility prior to May 3, 1990, shall be granted a certificate to continue its operation at such facility.

5.  The provisions of this section shall not be construed in derogation or denial of the right to operate and maintain facilities as provided for in Sections 381.24c and 381.24d of this title.

C.  A violation of any portion of this section shall be and constitute a misdemeanor punishable upon conviction by a fine not exceeding Five Hundred Dollars ($500.00).  Each day's violation shall constitute a separate offense.

D.  Nothing contained in this section shall be construed to limit the authority of federal savings associations to maintain and operate outside or detached facilities in accordance with federal law and regulations.

Added by Laws 1990, c. 173, § 21, emerg. eff. May 3, 1990.  Amended by Laws 1993, c. 183, § 45, eff. July 1, 1993; Laws 2000, c. 81, § 22, eff. Nov. 1, 2000.

§18-381.24c.  Military savings facilities - Certificate - Application - Functions permitted - Penalty.

A.  Any association may, subject to the approval of the State Banking Commissioner as evidenced by its certificates, and subject to the approval of the military installation commander as evidenced by a letter of approval, maintain and operate a military savings facility on any military installation located in this state.

B.  As used in this section, the term "military savings facility" shall mean a detached facility or branch maintained by an association upon a military installation within this state, provided such military savings facility must be within the confines of a military reservation and located upon property owned or leased by the United States government.

C.  1.  No association shall be permitted to maintain and operate such military savings facility, except on certificate issued by the Commissioner.  The issuance of such certificate shall rest solely in the discretion of the Commissioner.

2.  The application for a certificate to maintain and operate a military savings facility shall comply with the regulations of the Commissioner.  An application fee shall be payable to the Oklahoma State Banking Department in an amount set by rule of the Commissioner.

3.  No association function shall be performed at the facility save that of accepting deposits, cashing checks, making change, selling drafts, cashier's checks, money orders, traveler's checks, etc., accepting payment for personal utility bills, redeeming and selling United States Savings Bonds, and such other services as the installation commander may request, in writing, of the association.  Upon the recommendation of the Commissioner, the Attorney General shall bring an appropriate action to enjoin an association from conducting association functions at such facility other than those herein granted.

D.  A violation of any portion of this section shall be and constitute a misdemeanor punishable upon conviction by a fine not exceeding Five Hundred Dollars ($500.00).  Each day's violation shall constitute a separate offense.

Added by Laws 1990, c. 173, § 22, emerg. eff. May 3, 1990.  Amended by Laws 1993, c. 183, § 46, eff. July 1, 1993; Laws 2000, c. 81, § 23, eff. Nov. 1, 2000.

§18-381.24d.  Consumer banking electronic facilities - Assistance in operation of facility - Access - Authority of federal savings associations.

A.  Any association may install, operate or utilize consumer banking electronic facilities, provided written notice is given to the State Banking Commissioner prior to the commencement of operations of each facility.  Such notice shall contain any reasonable descriptive information pertaining to the facility as shall be required by the rules or regulations of the Commissioner.

B.  A consumer banking electronic facility, when located other than at an association's main office or detached facility, may be operated exclusively by association customers or transactions may be performed through the assistance of any person provided that person is not employed, either directly or indirectly, by any association, association holding company or subsidiary thereof.  Such assistance shall not be deemed to be engaging in association business.  Persons assisting association customers at the site of a consumer banking electronic facility may be trained by association employees and nothing in this section shall be construed to prohibit periodic servicing of a consumer banking electronic facility by an association employee.  Under no circumstances may an employee of an association, association holding company, affiliate or subsidiary thereof perform transactions for others at the consumer banking electronic facility.  However, a consumer banking electronic facility located on the business premises of a person engaged in the sale of goods or services may be used to perform internal nonbanking functions for such persons.

C.  Consumer banking electronic facility transactions shall be considered as the conduct of association transactions at the main office of the association for which the data is transmitted.

D.  1.  An association or combination of associations or business entity or organization offering such services to an association which establishes or maintains a manned or unmanned consumer banking electronic facility or facilities shall make the use thereof available to associations located in this state on a fair and equitable basis of nondiscriminatory access and rates.  Provided, that if a retailer does accept any credit or debit card or other system, nothing herein shall be construed to deprive such retailer of the right to accept or reject any other credit or debit card or other system offered by any other association or business entity.

2.  An association or combination of associations which establishes and maintains a manned consumer banking electronic facility or facilities may make the use thereof available on a reciprocal basis to banks and credit unions located in this state on a fair and equitable basis of nondiscriminatory access and rates.

3.  In the event of a dispute, the Commissioner shall have the jurisdiction to determine, after a hearing conducted upon notice and pursuant to regulations adopted by the Commissioner, what constitutes a fair and equitable basis of nondiscriminatory access and rates, based upon cost of installation and proportionate usage of the facility.  A principal factor in any equitable formula of shared costs of installation and/or operation shall give weight to the number of transactions of each participating association.

4.  Proceedings under this section shall be subject to Article II of the Administrative Procedures Act, Section 309 et seq. of Title 75 of the Oklahoma Statutes.

E.  Nothing contained in this section shall be construed to limit the authority of federal savings associations to install, operate or utilize consumer banking electronic facilities in accordance with federal law and regulations.

Added by Laws 1990, c. 173, § 23, emerg. eff. May 3, 1990.  Amended by Laws 1993, c. 183, § 47, eff. July 1, 1993; Laws 2000, c. 81, § 24, eff. Nov. 1, 2000.

§18-381.24e.  Operations centers.

Upon written notice to the State Banking Commissioner, any association may establish one or more operations centers on property owned or leased by the association.  For purposes of this section, "operations center" means an association facility separated from the main office of the association at which only the following association operations are conducted:  computer processing, information systems, electronic communications, loan payment processing, bookkeeping, item processing, currency and coin processing and storage, data processing, and all support functions related thereto.

Added by Laws 2000, c. 81, § 25, eff. Nov. 1, 2000.

§18-381.24f.  Origination of loans and deposit accounts at locations other than main or branch office.

Subject to rules as may be promulgated by the State Banking Commissioner, an association may utilize employees of the association to originate loans or originate deposit accounts, or both, at locations other than the main office or a branch office of such association, provided that the loan decision is made and the loan is funded at the main office or a branch office of the association and provided that no deposits shall be accepted or received at the deposit origination office.

Added by Laws 2000, c. 81, § 26, eff. Nov. 1, 2000.

§18-381.24g.  Association subsidiary as agent of holding company.

A.  Any association subsidiary of an association holding company may receive deposits, renew time deposits, close loans, service loans, and receive payments on loans and other obligations as an agent for any other bank or association owned or controlled by the same holding company.

B.  Despite any other provision of law, an association as an agent in accordance with subsection A of this section for an affiliate shall not be considered a branch of the affiliate.

C.  An agency relationship between subsidiary institutions pursuant to subsection A of this section shall be on terms that are consistent with safe and sound practices and all applicable regulations of any appropriate regulatory agency.

Added by Laws 2000, c. 81, § 27, eff. Nov. 1, 2000.

§18381.25.  Amendment of certificate of incorporation.

An amended certificate of incorporation must be signed and acknowledged by all of the directors of the association, and shall conform with the requirements for the original certificate of incorporation except that the names and addresses of the directors shall be stated in lieu of names of the incorporators.  An amended certificate of incorporation shall be submitted to the State Banking Commissioner for approval and shall be filed with the Secretary of State upon payment by the association of the statutory filing fees for filing an amended certificate of incorporation.

Added by Laws 1970, c. 101, § 25, eff. June 1, 1970.  Amended by Laws 1987, c. 61, § 5, emerg. eff. May 4, 1987; Laws 1988, c. 65, § 17, emerg. eff. March 25, 1988; Laws 2000, c. 81, § 28, eff. Nov. 1, 2000.

§18381.26.  Bylaws  Resolutions of savings and loan associations  Limiting director's liability.

A.  The bylaws of every association shall prescribe the notice and the time and place of the annual meeting of members or stockholders; the requirements for holding special meetings of members or stockholders; and the manner of determining the number and terms of office of the directors.

B.  1.  Provisions with respect to directors' meetings, the selection and duties of officers, making of loans, issuance of various classes of deposit accounts or permanent capital stock, distribution of earnings, amendments of the bylaws, rights and obligations of members or stockholders, and any other matters concerning operations of the association not in conflict with this act or rules of the State Banking Commissioner and not otherwise inconsistent with law or the certificate of incorporation of the association may be included in the bylaws.

2.  The bylaws or a resolution of an association as adopted or amended by the members or stockholders may include a provision eliminating or limiting the personal liability of a director to the association or its holding company, or to the shareholders of either for any negligence in the performance of his duties but not for:

a. any breach of the director's duty of loyalty to the association or its holding company, or to the shareholders of either,

b. acts or omissions not in good faith or which involve intentional misconduct or a violation of law, or

c. any transaction from which the director derived an improper personal benefit.

C.  All bylaws and amendments hereafter adopted shall be promptly submitted to the Commissioner for approval.  Any decision of the Commissioner disapproving proposed amendments may be appealed pursuant to the provisions of Section 207 of Title 6 of the Oklahoma Statutes.

D.  The bylaws of each association shall constitute laws of the association, subordinate to this act, to the rules of the Commissioner, and to applicable federal regulations.

E.  The provisions of the Oklahoma General Corporation Act shall, insofar as the Oklahoma General Corporation Act is not inconsistent with this act, govern associations operating pursuant to the provisions of this act.

Added by Laws 1970, c. 101, § 26, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 4, eff. July 1, 1979; Laws 1987, c. 61, § 6, emerg. eff. May 4, 1987; Laws 1988, c. 65, § 18, emerg. eff. March 25, 1988; Laws 1990, c. 118, § 7, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 48, eff. July 1, 1993; Laws 2000, c. 81, § 29, eff. Nov. 1, 2000.

§18381.27.  Membership and voting rights.

Every holder of a deposit account of a mutual association and every borrower on the security of a mortgage or acquiring ownership of property upon which a mortgage is held by the association shall be deemed a member of such association.  In a mutual association, a holder of a deposit account shall be entitled to one vote for each One Hundred Dollars ($100.00) of the deposit account of the holder, and a mortgagor or owner of property on which the association holds a mortgage shall be entitled to one vote at all meetings of the members.  Holders of the capital stock in a stock association shall have exclusive voting rights.

Added by Laws 1970, c. 101, § 27, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 5, eff. July 1, 1979; Laws 2000, c. 81, § 30, eff. Nov. 1, 2000.

§18381.28.  Members meetings.

An annual meeting of the members or stockholders of each association shall be held to elect directors, and special meetings of the members or stockholders may be called and held pursuant to such notice as may be provided by the bylaws.

Amended by Laws 1988, c. 65, § 19, emerg. eff. March 25, 1988.  

§18381.29.  Voting by proxy.

At any meeting of the members or stockholders of an association or federal association voting may be in person or by proxy appointing a person or group to cast the votes of the member or stockholder, provided that no proxy shall be eligible to be voted at any meeting unless such proxy shall have been filed with the association at least five (5) days prior to the date of the meeting. Unless otherwise specified in the proxy, every proxy shall continue in force from year to year until revoked by a writing duly delivered to the secretary or until superseded by a subsequent proxy.

Laws 1970, c. 101, § 29, eff. June 1, 1970; Laws 1978, c. 168, § 7, eff. July 1, 1979.  

§18381.30.  Quorum.

At an annual meeting or at any special meeting of the members any number of members present in person or by proxy eligible to be voted constitutes a quorum.  At an annual meeting or at any special meeting of a stock association, stockholders of a majority of the stock held shall be present in person or by proxy eligible to be voted to constitute a quorum.  A majority of all votes cast at any meeting of members shall determine any questions unless this act specifically provides otherwise.

Laws 1970, c. 101, § 30, eff. June 1, 1970; Laws 1978, c. 168, § 8, eff. July 1, 1979.  

§18381.31.  Directors.

A.  The operating and business policies of each association shall be directed by a board of directors of not less than five nor more than fifteen persons elected by a majority of the votes of the members or stockholders present in person or by proxy at the annual meeting.  Directors need not be members or stockholders unless so required by the association's certificate of incorporation or bylaws.  A majority of the directors shall be bona fide residents of this state.  Directors may be elected for a longer term than one (1) year if the bylaws so provide, but no director may be elected for a term longer than three (3) years, and the terms of at least two directors shall expire each year.

B.  If a vacancy occurs with respect to the board of directors, the remaining directors, though less than a quorum, may fill such vacancy by electing a director or directors to serve the remainder of the unexpired term for the class of directors in which such vacancies exist.

C.  The board of directors shall meet each year, following the annual members' or stockholders' meeting, and shall elect the officers at such meeting.  Such additional meetings of the board of directors shall or may be held as the bylaws shall require or permit.  A majority of the directors, if present at any meeting, shall constitute a quorum unless the bylaws otherwise provide.

Added by Laws 1970, c. 101, § 31, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 9, eff. July 1, 1979; Laws 1986, c. 219, § 5, emerg. eff. June 9, 1986; Laws 1987, c. 61, § 7, emerg. eff. May 4, 1987; Laws 1988, c. 65, § 20, emerg. eff. March 25, 1988; Laws 2000, c. 81, § 31, eff. Nov. 1, 2000.

§18-381.31a.  Examination of association affairs by board of directors.

The board of directors of every association shall examine, at least once in each calendar year at intervals of not more than fifteen (15) months, all the affairs of the association including the character and value of investments and loans, the efficiency of operating procedures, and such other matters as the Commissioner prescribes.  A report of the examination shall be submitted promptly to the Commissioner and shall embody such information as the Commissioner requires.  The board of directors may provide that such examination shall be conducted by a committee of not less than three directors, by certified public accountants, or by independent auditors responsible only to the board of directors.  Such examination shall be made when practicable without the assistance of the executive officers of the bank or trust company.  Such report of examination shall be reviewed by the directors at the next meeting of the board of directors.

Added by Laws 2000, c. 81, § 32, eff. Nov. 1, 2000.

§18381.32.  Officers.

The officers of an association shall consist of a president to be chosen from among the directors, one or more vicepresidents, a secretary, a treasurer, and any other officers authorized by the bylaws or by the directors.  Any number of offices may be held by the same person unless the certificate of incorporation or bylaws provide otherwise.

Amended by Laws 1988, c. 65, § 21, emerg. eff. March 25, 1988.  

§18381.33.  Indemnification  Directors, officers, employees and agents.

Any association shall have power to indemnify any person who is or was an officer, director, employee or agent of the association, or who is or was serving at the request of the association as an officer, director, employee or agent of another corporation, partnership, joint venture, trust or other enterprise unless such person has violated paragraph 2 of subsection B of Section 381.26 of this title, in accordance with Section 1031 of this title.

Amended by Laws 1987, c. 61, § 8, emerg. eff. May 4, 1987.  

§18381.34.  Fidelity bonds  Waiver.

Every association must protect itself against loss of money or property by or through any fraud, dishonesty, forgery or alteration, larceny, theft, embezzlement, or other criminal act of any director, officer, employee or agent, by a blanket bond covering all personnel and agents or by individual fidelity bonds, issued by a corporate surety.  The amount and form of each such bond and sufficiency of the surety thereon shall be subject to review and disapproval by the State Banking Commissioner.  The Commissioner may waive the bond requirement, in whole or in part, upon a showing by the association that such bonding is either unavailable, economically infeasible, or an imprudent business decision.  Such waiver shall be for a period of time, to be stated in the Commissioner's order, not exceeding one (1) year, subject to extension upon further application.  The order of the Commissioner waiving the bond requirement shall be conditioned on the association continuing to seek an available, economically feasible bond.

Added by Laws 1970, c. 101, § 34, eff. June 1, 1970.  Amended by Laws 1987, c. 61, § 9, emerg. eff. May 4, 1987; Laws 2000, c. 81, § 33, eff. Nov. 1, 2000.

§18-381.35.  Repealed by Laws 2000, c. 81, § 88, eff. Nov. 1, 2000.

§18381.36.  Reserves and liquidity.

Every association shall set up and maintain reserves for the purpose of absorbing losses and shall maintain such portion of its assets in cash and other liquid assets as shall be required by regulations of the State Banking Commissioner and by other applicable federal regulations.

Added by Laws 1970, c. 101, § 36, eff. June 1, 1970.  Amended by Laws 1988, c. 65, § 22, emerg. eff. March 25, 1988; Laws 1990, c. 118, § 8, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 49, eff. July 1, 1993; Laws 2000, c. 81, § 34, eff. Nov. 1, 2000.

§18381.37.  Capital  Deposit accounts  Liability.

A.  A mutual association may raise capital in the form of deposit accounts or shares for such fixed, minimum or indefinite periods of time as are authorized by its bylaws or by regulations of the State Banking Commissioner.  Such deposit accounts shall all have equal priority upon liquidation.  A mutual association may issue such passbooks, certificates, and other evidence of deposit accounts as are now or hereafter so authorized.  With the exception of forms now in use by existing associations, all such forms evidencing deposit accounts shall be promptly submitted to the Commissioner, or to the Director of the Office of Thrift Supervision, and the issuance of any such form shall be immediately discontinued in the event of disapproval.  Unless otherwise provided by its bylaws, the total amount of deposit account liability of a mutual association is unlimited.

B.  A stock association may incur liabilities in the form of deposit accounts for such fixed, minimum or indefinite periods of time as are authorized by its bylaws or by regulations of the Commissioner.  Such deposits shall all have equal priority upon liquidation.  A stock association may issue such passbooks, certificates and other evidence of deposits as are now or may hereafter be authorized for deposit associations.  New or proposed forms evidencing deposit accounts shall be promptly submitted to the Commissioner and to the Director of the Office of Thrift Supervision, and the issuance of any such form shall be immediately discontinued in the event of disapproval.  In stock associations, holders of deposit accounts shall participate first in all assets upon liquidation, but only to the extent of their deposit accounts.  Unless otherwise provided by its bylaws, the total amount of deposit account liability of a stock association is unlimited.

Added by Laws 1970, c. 101, § 37, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 11, eff. July 1, 1979; Laws 1988, c. 65, § 23, emerg. eff. March 25, 1988; Laws 1990, c. 118, § 9, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 50, eff. July 1, 1993; Laws 2000, c. 81, § 35, eff. Nov. 1, 2000.

§18381.38.  Classification of deposit accounts.

Any association may classify its deposit accounts according to the character, amount or duration thereof, or regularity of additions thereto, and may pay additional or higher rates of earnings on accounts based on such classifications than is paid on regular deposit accounts, provided that any such higher rate, or bonus, to be paid on any class of accounts shall not exceed the limitations prescribed by the State Banking Commissioner or by applicable federal regulations.  A mutual association may also classify its accounts according to type of account, such as full paid, single payment, installment, optional installment, bonus or other types of accounts designated by the bylaws and permitted by the Commissioner.

Added by Laws 1970, c. 101, § 38, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 12, eff. July 1, 1979; Laws 1990, c. 118, § 10, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 51, eff. July 1, 1993; Laws 2000, c. 81, § 36, eff. Nov. 1, 2000.

§18-381.39.  Repealed by Laws 2000, c. 81, § 88, eff. Nov. 1, 2000.

§18-381.39a.  Joint accounts - P.O.D. accounts - Designation of beneficiaries - Payment.

A.  When a deposit has been made or shall hereafter be made in any association in the names of two or more persons, payable to any of them or payable to any of them or their survivor, such deposit, or any part thereof, or any interest thereon, may be paid to either of the persons, whether one of such persons shall be a minor or not, and whether the other be living or not.  The receipt or acquittance of the person so paid shall be valid and sufficient release and discharge to the association for any payment so made.

B.  1.  When a deposit has been made or shall hereafter be made in any association using the terms "Payable on Death" or "P.O.D.", such deposits shall be payable on the designated person's death to a trust designated in the deposit account agreement as the P.O.D. beneficiary, or to an individual or individuals named beneficiary, if living, and if not, to the named beneficiary's estate, notwithstanding any provision to the contrary contained in Sections 41 through 57 of Title 84 of the Oklahoma Statutes.  Such deposit shall constitute a contract between the depositor and the association that upon the death of the named owner of the account the association will hold the funds for or pay them to the named beneficiary or the estate of the named beneficiary.

2.  In order to designate multiple payable-on-death beneficiaries for a deposit account, the account should be styled as follows:  "(Name of Account Owner), payable on death (or P.O.D.) to (Name of Beneficiary), (Name of Beneficiary), and (Name of Beneficiary), in equal shares".

3.  Adjustments may be made in the styling, depending upon the number of beneficiaries.  It is to be understood that each beneficiary is entitled to a proportionate share of the account proceeds upon the owner's death.  In the event of the death of a beneficiary prior to the death of the owner, the beneficiary's share shall go to the beneficiary's estate.  It is not permissible for an account to designate unequal shares for different payable-on-death beneficiaries.

4.  An association may require the owner of an account to provide an address for any payable-on-death beneficiary.  If the P.O.D. account is an interest-bearing account and the funds are not claimed by the payable-on-death beneficiary or beneficiaries within sixty (60) days after the death of the account holder, or after the association has notice of the account holder's death, whichever is later, the association has the right to convert the account to a noninterest-bearing account.

5.  No change in the designation of a named beneficiary shall be valid unless executed by the owner of the fund and in the form and manner prescribed by the association; however, this section shall be subject to the provisions of Section 178 of Title 15 of the Oklahoma Statutes.

6.  The receipt or acquittance of the named beneficiary so paid or the legal representative of such named beneficiary's estate, if deceased, shall be valid and sufficient release and discharge to the association for any payment so made, unless, prior to such payment, the association receives notice in the form and manner required in Section 905 of Title 6 of the Oklahoma Statutes.

C.  The provisions of this section shall apply to all forms of deposit accounts, including, but not limited to, transaction accounts, savings accounts, certificates of deposits, negotiable order of withdrawal (N.O.W.) accounts, and money market deposit accounts (M.M.D.A.).

Added by Laws 2000, c. 81, § 37, eff. Nov. 1, 2000.

§18-381.40.  Repealed by Laws 2000, c. 81, § 88, eff. Nov. 1, 2000.

§18-381.40a.  Totten Trusts - Express trusts - Payment.

A.  Whenever any deposit shall be made in an association by any person which is in the form of a trust for another, and no other or further notice of the existence and terms of a legal and valid trust shall have been given in writing to the association, in the event of the death of the trustee, the same, or any part thereof, together with the interest thereon, may be paid to the person or persons for whom the deposit was made.  A deposit held in this form shall be deemed to constitute a Totten Trust.  A revocation of such trust may only be made in writing to the association, and the association shall not suffer any liability for payment of funds pursuant to the trust unless and until it receives written notice of revocation.

B.  1.  If a deposit account is opened with an association by one or more persons expressly as a trustee for one or more other named persons and further notice of the existence and terms of a legal and valid trust is not given in writing to the association, the association may accept and administer the account as set forth in subsection A of this section.

2.  If a deposit account is opened with an association by one or more persons expressly as a trustee for one or more other named persons pursuant to or purporting to be pursuant to a written trust agreement, the trustee may provide the association with a certificate of trust to evidence the trust relationship.  The certificate shall be an affidavit of the trustee and must include the effective date of the trust, the name of the trustee, the name or method for choosing successor trustees, the name and address of each beneficiary, the authority granted to the trustee, the disposition of the account on the death of the trustee or the survivor of two or more trustees, other information required by the association, and an indemnification of the association.  The association may accept and administer the account, subject to the provisions of Title 58 of the Oklahoma Statutes, in accordance with the certificate of trust without requiring a copy of the trust agreement.  The association is not liable for administering the account as provided by the certificate of trust, even if the certificate of trust is contrary to the terms of the trust agreement, unless the association has actual knowledge of the terms of the trust agreement.

3.  On the death of the trustee or the survivor of two or more trustees, the association may pay all or part of the withdrawal value of the account with interest as provided by the certificate of trust.  If the trustee did not deliver a certificate of trust, the association's right to treat the account as owned by a trustee ceases on the death of the trustee.  On the death of the trustee or the survivor of two or more trustees, the association shall, unless the certificate of trust provides otherwise, pay the withdrawal value of the account, with interest, in equal shares to the persons who survived the trustee, are named as beneficiaries in the certificate of trust, and can be located by the association from its own records.  If there is not a certificate of trust, payment of the withdrawal value and interest shall be made as provided by Title 58 of the Oklahoma Statutes.  Any payment made under this section for all or part of the withdrawal value and interest discharges any liability of the association to the extent of the payment.  The association may pay all or part of the withdrawal value and interest in the manner provided by this section, regardless of whether it has knowledge of a competing claim, unless the association receives actual knowledge that payment has been restrained by order of a court of competent jurisdiction.

4.  This section does not obligate an association to accept a deposit account from a trustee who does not furnish a copy of the trust agreement or to search beyond its own records for the location of a named beneficiary.

5.  This section does not affect a contractual provision to the contrary that otherwise complies with the laws of this state.

Added by Laws 2000, c. 81, § 38, eff. Nov. 1, 2000.

§18-381.41.  Repealed by Laws 2000, c. 81, § 88, eff. Nov. 1, 2000.

§18-381.41a.  Deposit accounts with minors - Authority to control - Loans to minors prohibited.

A.  Except as otherwise provided by this section, an association lawfully doing business in this state may enter into a deposit account with a minor as the sole and absolute owner of the account and may pay checks and withdrawals and otherwise act with respect to the account on the order of the minor.  A payment or delivery of rights to a minor who holds a deposit account evidenced by a receipt or acquittance signed by the minor discharges the association to the extent of the payment made or rights delivered.

B.  If the minor is the sole and absolute owner of the deposit account, the disabilities of minority are removed for the limited purposes of enabling:

1.  The minor to enter into a depository contract with the association; and

2.  The association to enforce the contract against the minor, including collection of overdrafts and account fees and submission of account history to account reporting agencies and credit reporting bureaus.

C.  A parent or legal guardian of a minor may deny the minor's authority to control, transfer, draft on, or make withdrawals from the minor's deposit account by notifying the association in writing.  On receipt of the notice by the association, the minor may not control, transfer, draft on, or make withdrawals from the account during minority except with the joinder of a parent or legal guardian of the minor.

D.  If a minor with a deposit account dies, the receipt or acquittance of the minor's parent or legal guardian discharges the liability of the association to the extent of the receipt of acquittance, except that the aggregate discharges under this subsection may not exceed Three Thousand Dollars ($3,000.00).

E.  Subsection A of this section does not authorize a loan to the minor by the bank, whether on pledge of the savings account of the minor or otherwise, or bind the minor to repay a loan made except as provided by subsection B of this section or other law, unless the depository institution has obtained the express consent and joinder of a parent or legal guardian of the minor.  This subsection does not apply to an inadvertent extension of credit because of an overdraft from insufficient funds, returned checks or deposits, or other shortages in a depository account resulting from normal banking operations.

Added by Laws 2000, c. 81, § 39, eff. Nov. 1, 2000.

§18381.42.  Deposit accounts of incompetents.

When a deposit account is held in any association or federal association by a person who becomes incompetent and an adjudication of incompetency has been made by a court of competent jurisdiction, such an association may pay or deliver the withdrawal value of such deposit account and any earnings that may have accrued thereon to the guardian or conservator for such person upon proof of the appointment and qualification of such guardian or conservator.  However, if such association has received no written notice and is not on actual notice that such deposit account holder has been adjudicated incompetent, it may pay such funds to such holder or transfer the deposit account on the order of the deposit account holder, and such payment or transfer shall be a valid and sufficient release and discharge of the association for the payment or transfer so made.

Added by Laws 1970, c. 101, § 42, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 16, eff. July 1, 1979; Laws 2000, c. 81, § 40, eff. Nov. 1, 2000.

§18381.43.  Deposit accounts of administrators, executors, conservators, guardians, trustees or other fiduciaries.

Any association or federal association may accept deposit accounts in the name of any administrator, executor, conservator, guardian, trustee, or other fiduciary for a named beneficiary or beneficiaries.  Any such fiduciary shall have power to vote as a member of a mutual association as if the membership were held absolutely, to open and to make additions to, and to withdraw such deposit account in whole or in part.  The withdrawal value of any such deposit account, and earnings thereon, or other rights relating thereto may be paid or delivered, in whole or in part, to such fiduciary without regard to any notice to the contrary as long as such fiduciary is living.  The payment or delivery to any such fiduciary or a receipt or acquittance signed by any such fiduciary to whom any such payment or any such delivery of rights is made shall be a valid and sufficient release and discharge of an association for the payment or delivery so made.  Whenever a deposit account shall be opened by any person who designates himself or herself or another as trustee by written declaration of trust, which provides that the trust shall terminate upon the death of such person, then, in the event of the death of the person so described as trustee, the withdrawal value of such deposit account or any part thereof, together with the earnings thereon, may be paid to the person for whom the deposit account was thus described to have been opened.  The payment or delivery to any such beneficiary, beneficiaries or designated person for any such payment or delivery shall be a valid and sufficient release and discharge of an association for the payment or delivery so made.

Added by Laws 1970, c. 101, § 43, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 17, eff. July 1, 1979; Laws 1988, c. 65, § 24, emerg. eff. March 25, 1988; Laws 2000, c. 81, § 41, eff. Nov. 1, 2000.

§18381.44.  Payment to administrator or executor of deceased nonresident.

When a deposit account is held in any association or federal association by a person residing in another state or country, the deposit account, together with additions thereto and earnings thereon, or any part thereof, may be paid to the administrator or executor appointed in the state or country where the account or deposit holder resided at the time of death.  Such payment shall be a valid and sufficient release and discharge of the association for the payment so made unless the association has received written notice and is on actual notice of the appointment of an executor or administrator by an Oklahoma court of probate jurisdiction.

Added by Laws 1970, c. 101, § 44, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 18, eff. July 1, 1979; Laws 2000, c. 81, § 42, eff. Nov. 1, 2000.

§18381.45.  Power of attorney  Revocation.

Any association or federal association may continue to recognize the authority of an attorneyinfact authorized in writing to manage or to make withdrawals either in whole or in part from a deposit account, whether of a minor or adult, until it receives written notice or is on actual notice of the revocation of such authority.  For the purposes of this section, written notice of the death or adjudication of incompetency of such deposit account holder shall constitute written notice of revocation of the authority of the attorney.

Added by Laws 1970, c. 101, § 45, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 19, eff. July 1, 1979; Laws 2000, c. 81, § 43, eff. Nov. 1, 2000.

§18381.46.  Right to withdraw.

The holder of a deposit account in an association shall have the right to withdraw all or any part of the deposit account, subject to the right of the association and authority of the State Banking Commissioner or the Director of the Office of Thrift Supervision, to impose limitations upon the right of withdrawal from a deposit account for a fixed or minimum term with respect to which deposit account the applicable fixed or minimum term has not expired.  With respect to deposit accounts which consist solely of funds in which the entire beneficial interest is held by one or more individuals or by an organization which is operated primarily for religious, philanthropic, charitable, educational, political, or other similar purposes and which is not operated for profit, and with respect to deposits of public funds by an officer, employee or agent of the United States, any state, county, municipality, or political subdivision thereof, the District of Columbia, the Commonwealth of Puerto Rico, American Samoa, Guam, any territory or possession of the United States, or any political subdivision thereof, such deposit accounts may be subject to check or to transfer or withdrawal on negotiable order or authorization to the association, and deposit account holders may make withdrawals or transfers from such accounts upon nontransferable order or authorization.  An association may offer money market deposit accounts, as defined by federal regulations, and may permit withdrawals or transfers from such accounts to the same extent permitted by federal regulations, but subject to all of the limitations contained therein.

Added by Laws 1970, c. 101, § 46, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 20, eff. July 1, 1979; Laws 1981, c. 114, § 1, emerg. eff. April 28, 1981; Laws 1990, c. 118, § 11, emerg. eff. April 23, 1990; Laws 2000, c. 81, § 44, eff. Nov. 1, 2000.

§18381.47.  Notice and payment of withdrawals.

With respect to deposit accounts, an association may require such minimum advance notice of withdrawal as is specified by federal regulations or such longer advance notice period of not more than thirty (30) days as its bylaws may provide.  The payment of withdrawals from deposit accounts, in the event an association does not have funds available to pay all withdrawals when due, shall be subject to such rules and procedures as may be prescribed by the State Banking Commissioner, but any association which, except as authorized in writing by the Commissioner, fails to make full payment of any withdrawal when due shall be deemed to be in an unsafe or unsound condition to transact business within the meaning of Section 381.74 of this title.

Added by Laws 1970, c. 101, § 47, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 21, eff. July 1, 1979; Laws 1990, c. 118, § 12, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 52, eff. July 1, 1993; Laws 2000, c. 81, § 45, eff. Nov. 1, 2000.

§18-381.48a.  Sole owner accounts without payable-on-death beneficiary - Transfer of deposits to known heirs - Affidavit.

A.  When a deposit has been made in an association in the name of a sole individual without designation of a payable-on-death beneficiary, upon the death of the sole owner of the deposit account, if the amount of the aggregate deposits held in single ownership accounts in the name of the deceased individual is Five Thousand Dollars ($5,000.00) or less, the association may transfer the funds to the known heirs of the deceased upon receipt of an affidavit sworn to by the known heirs of the deceased which establishes jurisdiction and relationship and states that the owner of the deposit account left no will.  The affidavit shall be sworn to and signed by the known heirs of the deceased and same shall swear that the facts set forth in the affidavit establishing jurisdiction, heirship and intestacy are true and correct.

B.  Receipt by the association of the affidavit described in subsection A of this section shall be a valid and sufficient release and discharge to the association for any transfer of deposits made pursuant thereto and shall set to discharge the association from liability as to any other party, including any heir, legatee, devisee, creditor or other person having rights or claims to funds or property of the decedent, and include a discharge of the association from liability for any estate, inheritance or other taxes which may be due the state from the estate or as a result of the transfer.

C.  Any person who knowingly submits and signs a false affidavit as provided in this section shall be fined not more than Three Thousand Dollars ($3,000.00) or imprisoned for not more than six (6) months, or both.  Restitution of the amount fraudulently attained shall be made to the rightful beneficiary by the guilty person.

Added by Laws 2000, c. 81, § 46, eff. Nov. 1, 2000.

§18381.49.  Earnings on deposit accounts.

With the exception of interest at a rate fixed, or negotiated on an individual basis, by a deposit association prior to the acceptance of the deposit, an association shall determine the rates of earnings to be paid on all classes of deposit accounts, the times and manner of crediting, distributing and paying of such earnings, and the qualifications and limitations applicable to each class of deposit accounts for which a rate higher than regular rate is provided.

Added by Laws 1970, c. 101, § 49, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 22, eff. July 1, 1979; Laws 2000, c. 81, § 47, eff. Nov. 1, 2000.

§18381.50.  Requirements to become deposittype association or stock association.

A.  Any mutual association may become a deposittype association and any mutual association may become a stock association by adoption of a resolution by a majority of the votes cast in person or by proxy specially executed for that meeting within ninety (90) days prior to the meeting at an annual meeting or at any special meeting of its members, and by adoption of an appropriate amended certificate of incorporation and bylaw provisions consistent with this act, and in the case of conversions from mutual to stock form, upon approval of the conversion by the State Banking Commissioner, and if applicable, the Director of the Office of Thrift Supervision.  Copies of the resolution to become a deposit association and/or stock association pursuant to this act and of the amended certificate of incorporation and bylaw amendments, certified by the secretary or president of the association, shall be filed with the Commissioner.  Upon approval by the Commissioner, the Commissioner shall file a copy of such approved resolution with the Secretary of State, and the association shall be qualified to accept deposit accounts and issue permanent capital stock in accordance with this act from and after the effective date stated in the resolution.  In no case of conversion of a mutual to a stock association shall any reserves existing at the time of such conversion ever inure to the benefit of the permanent capital stock, but shall be maintained as reserves in accordance with directions of the Commissioner.

B.  At the meeting at which conversion to a stock association is voted upon, the members of the mutual association shall also vote upon the directors who shall be the directors of the stock association after conversion takes effect.  The directors shall execute and file with the Commissioner an amended certificate of incorporation as provided for in Section 381.17 of this title, together with an application for conversion, a fee to be set by the Commissioner, and if the association intends to be an insured association, a firm commitment for, or evidence of, insurance of  its deposit accounts by the Federal Deposit Insurance Corporation.  The Commissioner may refuse to approve the application and decline to issue a charter and file the amended certificate of incorporation if there is reason to believe that the plan of conversion is not fair and equitable to all the members and that sufficient provision is not made to protect the interests of the depositors of the prospective capital stock association.  Upon the approval by the Commissioner of the application for conversion and the amended certificate of incorporation and the issuance of a charter, the association shall cease to be a mutual association.  Upon the conversion of a mutual association, the legal existence of the association shall not terminate but the stock association shall be a continuation of the entity of the mutual association and all property of the mutual association, including its rights, titles and interests in and to all property of whatever kind, whether real, personal or mixed, and things 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 act of law and without any conveyance or transfer and without any further act or deed shall remain and vest in the stock association into which the mutual association has converted itself.  The 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 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 proceedings to which the mutual 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 stock association resulting from the conversion may continue the actions in its corporate name.  Any judgment, order or decree may be rendered for or against it which might have been rendered for or against the mutual association theretofore involved in the judicial proceedings.

C.  If the association will be an insured association, approval by the Commissioner shall be contingent upon the converting association either having insurance of its deposit accounts by the Federal Deposit Insurance Corporation, or by the association making a bona fide application for insurance of deposit accounts, and upon acceptance and approval of such application by the corporation.

D.  The conversion of a state mutual association into a stock association shall be effected in accordance with a plan of conversion adopted by the members as provided in this section and consistent with the other provisions of this title.  The plan shall provide that:

1.  Each deposit account holder in the mutual association shall receive a withdrawable account in the stock association equal in amount to the withdrawable account of the deposit account holder in the mutual association;

2.  A record date for determining deposit account holders entitled to purchase stock shall be established which is not less than ninety (90) days prior to the date of adoption of the plan of conversion by the board of directors of the association;

3.  Officers, directors and employees of the association and their associates shall forego any participation in the initial distribution of permanent capital stock to the extent that any such person increased the account of such person by more than Twenty Thousand Dollars ($20,000.00) during the six (6) months preceding the record date established pursuant to this section.  The term "associate" of a person shall mean parents, spouse, sisters, brothers, children or anyone married to one of the foregoing persons, any corporation of which the person is an officer, director or owner of more than ten percent (10%) of the outstanding voting securities, any trust of which such person is a trustee or substantial beneficiary, and any partnership of which such person is a general or limited partner;

4.  The amount of stock to which a member is entitled shall be determined on the basis of the ratio of deposits of such member with the association on the record date to the total deposits of the association on the record date, as applied to the initial issuance of permanent capital stock.  Each deposit account holder as of the record date may receive warrants authorizing the purchase of shares of permanent capital stock at a price determined by the board of directors of the institution and approved by the Commissioner and by the Director of the Office of Thrift Supervision, and scrip denoting fractional stock interests of less than one share, provided, however, that no deposit account holder shall be entitled to scrip representing fractional interests of less than onefifth share of stock; and

5.  In connection with a conversion, deposit account holders shall have a preemptive right to purchase such permanent capital stock for a period of not less than fourteen (14) days from the date the offer to sell permanent capital stock is made.

E.  If the association is an insured association, the reserves of a stock association resulting from the conversion of a mutual association shall be not less than the amount necessary to meet the requirements of the Federal Deposit Insurance Corporation.

Added by Laws 1970, c. 101, § 50, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 23, eff. July 1, 1979; Laws 1980, c. 103, § 1, eff. Oct. 1, 1980; Laws 1988, c. 65, § 25, emerg. eff. March 25, 1988; Laws 1990, c. 118, § 13, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 53, eff. July 1, 1993; Laws 2000, c. 81, § 48, eff. Nov. 1, 2000.

§18381.51.  Deposits authorized.

An association may accept deposits for fixed, minimum or indefinite periods of time, including accounts bearing a fixed rate of interest, as may be authorized by its directors, subject to the provisions of its bylaws and the authority of the State Banking Commissioner and, if applicable, the Director of the Office of Thrift Supervision to disapprove of such a rate.

Added by Laws 1970, c. 101, § 51, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 24, eff. July 1, 1979; Laws 1990, c. 118, § 14, emerg. eff. April 23, 1990; Laws 2000, c. 81, § 49, eff. Nov. 1, 2000.

§18-381.52a.  Additional association powers and authorities - Special or fiduciary duties or obligations.

In addition to other provisions of this act relating to deposit accounts, an association may exercise the powers and authorities applicable under the provisions of Article IX of the Oklahoma Banking Code, Sections 901 through 907 of Title 6 of the Oklahoma Statutes.  An association may also exercise the powers and authorities applicable under the provisions of Article XIII of the Oklahoma Banking Code, Section 1301 et seq. of Title 6 of the Oklahoma Statutes, as amended from time to time.  Further, unless an association shall have expressly agreed in writing to assume special or fiduciary duties or obligations, no such duties or obligations will be imposed on the association with respect to a depositor of the association or a borrower, guarantor or surety, and no special or fiduciary relationship shall be deemed to exist.

Added by Laws 2000, c. 81, § 50, eff. Nov. 1, 2000.

§18-381.52b.  Deposit accounts that may be provided.

An association may provide all types of deposit accounts unless otherwise provided by rule of the State Banking Commissioner or applicable federal law.

Added by Laws 2000, c. 81, § 51, eff. Nov. 1, 2000.

§18-381.53.  Repealed by Laws 2000, c. 81, § 88, eff. Nov. 1, 2000.

§18381.53a.  Permanent capital stock  Treasury stock  Redemption  Paidin surplus  Dividends  Minimum capital requirements.

A.  Permanent capital stock shall consist of common stock, which shall have full voting rights, and may also include preferred stock.  Such stock shall have a par value of not less than one cent ($0.01) per share, and the proceeds thereof, to the extent of such par value, shall be set apart and be nonwithdrawable, and shall be a reserve to absorb losses after all surplus, undivided profits, and other reserves available for losses have been depleted.

B.  1.  With the approval of the State Banking Commissioner and subject to the conditions as the Commissioner may prescribe, a bank may purchase its own stock as treasury stock.

2.  Preferred stock shall not be issued for a limited term, nor shall it be redeemable at the option of the holders.  An association shall not bind itself by contract to redeem its preferred stock upon the happening of certain events, other than dissolution.  However, preferred stock shall be subject to redemption at any time at the option of the association, with the prior approval of the Commissioner and only if, subsequent to the redemption, the association would meet its minimum capital requirements as imposed by applicable federal law.

C.  Any paidin surplus with respect to common stock may be made available for payment of organization and initial operating expenses or may be credited to surplus, or the contingent reserve, or the federal insurance reserve, or be transferred to common or preferred stock as a stock dividend, prorated to the holders of common stock.  An association shall not issue permanent capital stock for a consideration other than cash or for a price less than par value thereof, except that, with the approval of the Commissioner, stock may be issued for a consideration other than cash in connection with mergers, consolidations or transfers and, when fully paid, the stock shall be kept unimpaired to the extent of its par value.

D.  A stock association may declare and distribute cash dividends from net earnings, surplus or undivided profits.  With the prior consent of the Commissioner, the stock of an association may be reduced by resolution of the board of directors approved by vote or written consent of the holders of a majority of the outstanding stock of such association to such amount as the Commissioner shall approve, and any such reduction shall be credited to the contingent reserve account and shall not be available for dividends to common stockholders; provided, any reduction in the amount of permanent capital stock is subject to the provisions of this section and Section 381.20 of this title, fixing minimum permanent capital stock requirements.

E.  No cash dividends shall be declared on common stock unless, subsequent to the dividends, the association would continue to meet its minimum capital requirements as imposed by the Commissioner or the Director of the Office of Thrift Supervision.  Subject to the provisions of this act, permanent capital stock shall be entitled to such rate of dividends, if earned, as declared by the board of directors.

Added by Laws 1978, c. 168, § 31, eff. July 1, 1979.  Amended by Laws 1987, c. 61, § 10, emerg. eff. May 4, 1987; Laws 1990, c. 118, § 15, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 55, eff. July 1, 1993; Laws 2000, c. 81, § 52, eff. Nov. 1, 2000.

§18381.53b.  Impairment of permanent capital stock  Notice  Appraisals  Assessments.

A.  If the State Banking Commissioner, as a result of any examination or from any report made to the Commissioner, finds that the permanent capital stock of any association is impaired, the Commissioner shall notify the association that such impairment exists and require the association to immediately make good such impairment.  After such notice has been given to an association and until the impairment has been made good, that association may not issue or renew any time instrument if that instrument, when aggregated with any other funds of the same depositor in the same capacity, would equal or exceed One Hundred Thousand Dollars ($100,000.00) unless such time instrument earns an annual rate of interest less than four percent (4%).  In the event the amount of the impairment as determined by the Commissioner is questioned by the association, then upon application, which shall be filed within ten (10) days, the value of the assets in question shall be determined by appraisals made by independent appraisers acceptable to the Commissioner and the association.

B.  The directors of the association, upon which such notice has been made, shall levy a pro rata assessment upon the permanent capital stock thereof to make good such impairment and shall cause notice of such request of the Commissioner and such levy to be given in writing to each stockholder of such association and the amount of assessment which the stockholder must pay for the purpose of making such assessment.

Added by Laws 1978, c. 168, § 32, eff. July 1, 1979.  Amended by Laws 1988, c. 65, § 26, emerg. eff. March 25, 1988; Laws 2000, c. 81, § 53, eff. Nov. 1, 2000.

§18381.53c.  Refusal or neglect to pay assessment  Sale of stock  Payment of assessment.

A.  If any stockholder shall refuse or neglect to pay the assessment specified in such notice within sixty (60) days from the date of mailing, the directors of such association shall have the right to sell to the highest bidder at public auction any part or all of the stock necessary to pay the assessment of such stockholder, after giving the notice of such sale for ten (10) days in a newspaper of general circulation published in the county where the main office of such association in this state is located, and a copy of such notice of sale shall also be served on such stockholder by mailing a copy of such notice to his lastknown address ten (10) days before the day fixed for such sale, or such stock may be sold at a private sale and without public notice.  However, before making such private sale thereof, an offer in writing shall first be obtained and a copy thereof served upon the owner of record of the stock to be sold, by mailing a copy of such offer to the lastknown address of such owner, and if after service of such offer such owner shall still refuse or neglect to pay such assessment within thirty (30) days from the time of the service of such offer, the directors may accept such offer and sell such stock to the person making such offer, or to any other person or persons making a larger offer than the amount named in the offer submitted to the stockholder, but such stock, in no event, shall be sold for less than the amount of such assessment so called for and the expense of the sale.

B.  Out of the proceeds of the stock so sold, the directors shall pay the amount of assessment levied thereon and the necessary cost of sale, and the balance, if any, shall be paid to the person or persons whose stock has thus been sold.  A sale of stock as herein provided shall effect an absolute cancellation of the outstanding certificate or certificates evidencing the stock so sold, and shall make the same null and void and a new certificate shall be issued by the association to the purchaser thereof.

Added by Laws 1978, c. 168, § 33, eff. July 1, 1979.  Amended by Laws 2000, c. 81, § 54, eff. Nov. 1, 2000.

§18381.53d.  Proceeds from assessment  Disposition.

The proceeds from any assessment, less the cost of any sales and any forfeiture of delinquent stock, shall be credited to the contingent reserve account.

Laws 1978, c. 168, § 34, eff. July 1, 1979.  

§18381.53e.  Permits to sell stock  Application  Issue of permit  Conditions  Amendment, alteration or revocation.

No association shall sell, offer for sale, negotiate for the sale of or take subscriptions for, or issue any of its permanent capital stock until it shall have first applied for and secured from the State Banking Commissioner a permit authorizing it to do so.  Such application shall be in writing, be verified and be filed with the Commissioner.  In such application the association shall set forth the names and addresses of its officers, the location of its main office and branch offices, an itemized account of its financial condition, the amount and character of its stock and shares, a copy of any prospectus or advertisement or other description of its stock to be distributed or published, a copy of all minutes of any proceedings of its directors, members or stockholders relating to or affecting the issue of such stock and such additional information concerning the association, its condition and affairs as the Commissioner may require.  Upon the filing of such application it shall be the duty of the Commissioner to examine it and the other papers and documents filed therewith.  If the Commissioner finds that the proposed issue is such as will not mislead the public as to the nature of the investment or will not work a fraud upon the purchaser thereof, the Commissioner shall issue to the association a permit authorizing it to issue and dispose of its stock in such amounts as the Commissioner may in such permit provide.  Otherwise, the Commissioner shall deny the application and notify the association in writing of the decision.  Every permit shall recite in bold type that the issuance thereof is permissive only and does not constitute a recommendation or endorsement of the stock permitted to be issued.  The Commissioner may impose conditions requiring the impoundment of the proceeds from the sale of such stock, limiting the expense in connection with the sale thereof, and such other conditions as the Commissioner may deem reasonable and necessary or advisable to insure the disposition of the proceeds from the sale of such stock in the manner and for the purposes provided in such permit.  The Commissioner may, from time to time, amend, alter or revoke any permit issued by the Commissioner or temporarily suspend the rights of such association under such permit.  The Commissioner shall have the power to establish such rules as may be reasonable or necessary to carry out the purposes and provisions of this section.

Added by Laws 1978, c. 168, § 35, eff. July 1, 1979.  Amended by Laws 2000, c. 81, § 55, eff. Nov. 1, 2000.

§18381.53f.  Insurance.

All insured associations shall keep in force, at all times, insurance covering their deposit accounts to the extent provided by federal law.

Added by Laws 1978, c. 168, § 36, eff. July 1, 1979.  Amended by Laws 1990, c. 118, § 16, emerg. eff. April 23, 1990; Laws 2000, c. 81, § 56, eff. Nov. 1, 2000.

§18381.54.  General powers.

Associations shall have the powers enumerated, authorized and permitted by this act and such other rights and powers as may be incidental to or reasonably necessary or appropriate for the accomplishment of the objects and purposes of the association.  Among others, and except as otherwise limited herein, every association shall have the following general powers:

1.  To have perpetual existence; to adopt and use a corporate seal; to adopt, amend and repeal bylaws; and to sue and be sued, complain and defend in any court having jurisdiction;

2.  To own or rent such equipment, fixtures, furnishings and other personal property as may be deemed expedient for the transaction of the business of the association; and to acquire personal property in satisfaction of indebtedness owed to the association;

3.  To sell, exchange and dispose of and convey real and personal property acquired pursuant to this act, and to mortgage, pledge, lease or otherwise contract with respect to such property;

4.  If and when an association is not a member of a Federal Home Loan Bank, to borrow not more than an aggregate amount equal to onefourth (1/4) of its savings or deposits liability on the date of borrowing and such additional sums as the State Banking Commissioner may approve.  If and when an association is a member of a Federal Home Loan Bank, to secure advances of not more than an aggregate amount equal to onehalf (1/2) of its savings or deposits liability; within such amount equal to onehalf (1/2) of its savings or deposits liability, the association may borrow from sources, individual or corporate, other than such Federal Home Loan Bank, an aggregate amount not in excess of the amount permitted by the Federal Home Loan Bank Board.  A subsequent reduction of savings or deposits liability shall not affect in any way outstanding obligations for borrowed money.  All such loans and advances may be secured by property of the association.  Insured associations may also issue and market such bonds, debentures, obligations and like securities as the Commissioner and the Director of the Office of Thrift Supervision may authorize;

5.  To sell and assign without recourse any loan, including any participating interests therein held by an association; provided that the Commissioner may by regulation limit the total dollar volume of loans sold in any calendar year to a designated percentage of total loans held by the association;

6.  To qualify as and become a member of a Federal Home Loan Bank;

7.  To obtain and maintain insurance of the deposit accounts of its members by the Federal Deposit Insurance Corporation;

8.  To appoint and compensate such officers, agents and employees as its business shall require; to provide for reasonable life, health and medical insurance for its personnel; to adopt and operate reasonable bonus plans and retirement benefits for its officers and employees; to pay reasonable fees to its directors for their services; and to provide for indemnification of its officers, employees and directors as permitted by this act whether by insurance or otherwise;

9.  To become a member of and make reasonable payments or contributions to any organization to the extent that such organization assists in furthering or facilitating the association's purposes or its community responsibilities;

10.  If and when an association is a member of a Federal Home Loan Bank, to act as fiscal agent of the United States and, when so designated by the Secretary of the Treasury, to perform all reasonable duties as fiscal agent of the United States as the Secretary of the Treasury may require; and to act as agent for any instrumentality of the United States and as agent of this state or any instrumentality thereof;

11.  To act as agent for others in servicing loans and making collections thereon; and to act as agent for others in any transaction incidental to the operation of its business;

12.  To act as trustee of any trust created or organized in the United States and forming part of a stock bonus, pension, or profitsharing plan qualifying for specific tax treatment under Section 401(d) of the Internal Revenue Code of 1986; as trustee or custodian of an individual retirement account within the meaning of Section 408(a) of the Internal Revenue Code of 1986; or as trustee with no active fiduciary duties, provided, that the association shall invest the funds of the trust or account only in the association's own accounts, deposits, obligations, or securities or, upon the condition that the association does not exercise any investment discretion or directly or indirectly provide any investment advice with respect to the trust or account assets, in such other assets as the customer may direct.  The association shall observe principles of sound trust administration, including those relating to recordkeeping and segregation of assets, and may receive reasonable compensation for acting in any trust capacity authorized by this paragraph;

13.  To acquire savings of the public and pay earnings thereon, and to lend and invest its funds as provided in this act;

14.  To conduct a safe deposit business in compliance with the requirements of applicable federal law and Sections 1301 through 1313 of Title 6 of the Oklahoma Statutes;

15.  To organize a finance subsidiary;  

16.  To own capital stock of an operating subsidiary; and

17.  To have and to exercise all such incidental powers as shall be necessary to carry on the association business including, but not limited to, all such powers as may now or hereafter be conferred upon federal associations by federal laws and the regulations and policies of the Office of Thrift Supervision, unless otherwise prohibited or limited by the Commissioner.

Added by Laws 1970, c. 101, § 54, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 27, eff. July 1, 1979; Laws 1987, c. 61, § 11, emerg. eff. May 4, 1987; Laws 1988, c. 65, § 27, emerg. eff. March 25, 1988; Laws 1990, c. 118, § 17, emerg. eff. April 23, 1990; Laws 2000, c. 81, § 57, eff. Nov. 1, 2000.

§18381.55.  Investment in real property.

In addition to any powers of investment permitted pursuant to paragraph 17 of Section 381.54 of this title, every association shall have power to invest in real property as follows:

1.  Such real property or interests therein as the directors may deem necessary or convenient for the conduct of the business of the association, which for the purposes of this act shall be deemed to include the ownership of stock of a wholly owned subsidiary corporation having as its exclusive activity the ownership and management of such property or interests, but the amount so invested shall not exceed the sum of the reserves and undivided profits of the association, unless the State Banking Commissioner authorizes a greater amount to be so invested;

2.  An amount not exceeding the lesser of:

a. the sum of its reserves and undivided profits, or

b. ten percent (10%) of its assets as reported in its most recent quarterly thrift financial report or other statement of condition submitted to the Oklahoma State Banking Department, in the purchase of real estate for the purpose of producing income or for inventory or sale or for development and improvement, including the erection of buildings thereon, for sale or rental purposes;

3.  Such real property as may be acquired in satisfaction or partial satisfaction of indebtedness owed to the association, by deed, sheriff's deed, trustee's deed or otherwise.

Added by Laws 1970, c. 101, § 55, eff. June 1, 1970.  Amended by Laws 1988, c. 65, § 28, emerg. eff. March 25, 1988; Laws 1993, c. 183, § 56, eff. July 1, 1993; Laws 2000, c. 81, § 58, eff. Nov. 1, 2000.

§18381.56.  Investment in securities.

In addition to any powers of investment permitted pursuant to paragraph 17 of Section 381.54 of this title, associations shall have power to invest in securities as follows:

1.  In obligations of, or obligations which are fully guaranteed as to principal and interest by, the United States or this state; in stock or obligations of any Federal Home Loan Bank or Banks; in stock or obligations of the Federal Deposit Insurance Corporation; and in stock or obligations of the Federal National Mortgage Association or any successor or successors thereto;

2.  In time deposits, certificates, accounts, or other obligations of banks or other financial institutions, the accounts of which are insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration;

3.  Not in excess of five percent (5%) of its assets, as reported in its most recent quarterly thrift financial report or other statement of condition submitted to the Oklahoma State Banking Department, in bonds, notes or other evidences of indebtedness which are a general obligation of, or guaranteed as to principal and interest by, any agency or instrumentality of the United States not specified in paragraph 1 of this section, or of any city, county or school district in this state; and

4.  Not in excess of ten percent (10%) of its assets in the capital stock, obligations or other securities of service organizations substantially all of the activities of which consist of originating, purchasing, selling and servicing loans upon real estate and participating interests therein, or clerical, bookkeeping, accounting, statistical or similar functions performed primarily for financial institutions plus such other activities as the State Banking Commissioner may approve.

Added by Laws 1970, c. 101, § 56, eff. June 1, 1970.  Amended by Laws 1983, c. 26, § 1, emerg. eff. April 18, 1983; Laws 1987, c. 61, § 12, emerg. eff. May 4, 1987; Laws 1990, c. 118, § 18, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 57, eff. July 1, 1993; Laws 2000, c. 81, § 59, eff. Nov. 1, 2000.

§18381.57.  Loans.

Associations shall have power to invest, sell, or otherwise deal in loans or other investments to the same extent permitted for federal associations, except as otherwise provided by the rules of the State Banking Commissioner.

Added by Laws 1970, c. 101, § 57, eff. June 1, 1970.  Amended by Laws 1975, c. 236, § 5, emerg. eff. May 30, 1975; Laws 1978, c. 168, § 28, eff. July 1, 1979; Laws 1981, c. 135, § 1, emerg. eff. May 5, 1981; Laws 1988, c. 65, § 29, emerg. eff. March 25, 1988; Laws 1990, c. 118, § 19, emerg. eff. April 23, 1990; Laws 2000, c. 81, § 60, eff. Nov. 1, 2000.

NOTE: Laws 1981, c. 118, § 1 repealed by Laws 1988, c. 65, § 36, emerg. eff. March 25, 1988.

§18381.58.  Loan rates of interest.

All contracts of an association for the loan of money shall be subject to the laws of this state with respect to maximum interest rates which may be charged and to the penalties for violation thereof.

Added by Laws 1970, c. 101, § 58, eff. June 1, 1970.  Amended by Laws 2000, c. 81, § 61, eff. Nov. 1, 2000.

§18381.59.  Conversion into federal association.

At an annual meeting or at any special meeting of the members or stockholders called to consider such action, any association may convert itself into a federal association pursuant to the laws of the United States, as now or hereafter amended, upon a majority vote of the outstanding stock entitled to vote thereon or upon a majority vote of the total number of votes of the members present in person or by proxy.  There shall be filed with the State Banking Commissioner a copy of the charter issued to such federal association by the Director of the Office of Thrift Supervision or a certificate showing the organization of such association as a federal association, certified by the Director of the Office of Thrift Supervision.  Upon the grant to any association of a charter by the Director of the Office of Thrift Supervision, the association receiving such charter shall cease to be an association incorporated by this state.  Upon conversion of any association into a federal association, such federal association shall be deemed to be a continuation of the entity of the association so converted and all property of the converted association, including its rights, titles, and interests in and to all property of whatever kind, whether real, personal, or mixed, and 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, shall immediately by operation of law and without any conveyance or transfer and without any further act or deed remain and be vested in and continue and be the property of such federal association into which the state association has converted itself, and such federal 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 converting association, and such federal association as of the time of the taking effect of such conversion 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 state association is a party shall not be deemed to have abated or to have discontinued by reason of such conversion, but may be prosecuted to final judgment, order, or decree in the same manner as if such conversion into such federal association had not been made and such federal association resulting from such conversion may continue such action in its corporate name as a federal association, and any judgment, order or decree may be rendered for or against it which might have been rendered for or against the converting state association theretofore involved in such judicial proceedings.

Added by Laws 1970, c. 101, § 59, eff. June 1, 1970.  Amended by Laws 1987, c. 61, § 13, emerg. eff. May 4, 1987; Laws 1990, c. 118, § 20, emerg. eff. April 23, 1990; Laws 2000, c. 81, § 62, eff. Nov. 1, 2000.

§18381.60.  Conversion into statechartered association.

At an annual meeting or at any special meeting of the members or stockholders called to consider such action, any federal association may convert itself into an association under this act upon a majority vote of the outstanding stock entitled to vote thereon or upon a majority vote of the total number of votes of the members of such federal association eligible to be cast.  Copies of the minutes of the proceedings of such meetings of members or stockholders, verified by the affidavit of the secretary or an assistant secretary, and verified copies of the plan of conversion shall be filed for approval with the State Banking Commissioner.  At the meeting at which conversion is voted upon, the members or stockholders shall also vote upon the directors who shall be the directors of the statechartered association after conversion takes effect.  Such directors then shall execute and file a certificate of incorporation and proposed bylaws, and the Commissioner shall file a certificate of authority upon approval by the Commissioner, all as provided in this act.  The association shall include in the certificate of incorporation, the following:  "This association is incorporated by conversion from a federal association."  All of the directors who are chosen for the association shall sign and acknowledge the certificate of incorporation as the subscribers.  The Commissioner may provide, by regulation, for any additional procedure to be followed, and application fee to be paid, by any such federal association converting into an association under this act.  All the provisions regarding property and other rights and liabilities contained in Section 381.59 of this title shall apply, in reverse order, to the conversion of a federal association into an association incorporated under this act, so that the statechartered association shall be a continuation of the corporate entity of the converting federal association.

Added by Laws 1970, c. 101, § 60, eff. June 1, 1970.  Amended by Laws 1987, c. 61, § 14, emerg. eff. May 4, 1987; Laws 1988, c. 65, § 30, emerg. eff. March 25, 1988; Laws 1993, c. 183, § 58, eff. July 1, 1993; Laws 2000, c. 81, § 63, eff. Nov. 1, 2000.

§18381.61.  Merger or consolidation.

Pursuant to a plan agreed upon by at least twothirds of the members of the board of directors as being equitable to the members or stockholders of the association and as not impairing other associations, foreign associations, and federal associations, an association may merge or consolidate with another association, foreign association, or federal association, provided that the plan of such merger or consolidation shall be approved at an annual meeting or at any special meeting of the members or stockholders called to consider such action by a majority vote of the outstanding stock entitled to vote thereon or upon a majority vote of the total number of votes of the members present in person or by proxy.  An application to merge or consolidate shall be filed with the State Banking Commissioner and the same shall be the subject of an individual proceeding pursuant to Article II of the Administrative Procedures Act, Section 309 et seq. of Title 75 of the Oklahoma Statutes.  If the merger or consolidation is approved by the Commissioner, a copy of the order of approval shall be filed with the Secretary of State who shall then issue a certificate of merger.  In all cases of merger or consolidation, the corporate continuity of the resulting corporation shall have the same incidents, rights and liabilities as that of an association which has converted pursuant to this act.  The Commissioner may provide, by rule, for any additional procedure to be followed, and application fee to be paid, by any associations merging or consolidating pursuant to this act.

Added by Laws 1970, c. 101, § 61, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 29, eff. July 1, 1979; Laws 1987, c. 61, § 15, emerg. eff. May 4, 1987; Laws 1993, c. 183, § 59, eff. July 1, 1993; Laws 2000, c. 81, § 64, eff. Nov. 1, 2000.

§18381.62.  Voluntary liquidation.

A.  With the approval of the State Banking Commissioner, an association may liquidate and dissolve.  The Commissioner may grant such approval upon an application by an association after the proposal to liquidate and dissolve has been approved by a vote of a majority of the outstanding voting stock, in the case of a stock association, or by a majority vote of the total number of votes of the members present in person or by proxy, in the case of a mutual association, at a meeting called for that purpose, and that after giving effect to any proposed purchase of the assets of the association and assumption of its liabilities as provided for in Section 381.63a of this title the association will be solvent and will have sufficient liquid assets to pay off any remaining depositors and creditors immediately.

B.  1.  Upon approval by the Commissioner, the association shall immediately cease to do business, shall have only the powers necessary to effect an orderly liquidation and shall proceed to pay its depositors and creditors and to wind up its affairs.

2.  Within thirty (30) days of the approval, the association shall send a notice of liquidation by mail to each depositor, creditor, person interested in funds held as a fiduciary, lessee of a safe deposit box and a bailor of property at the address of such person as shown on the books of the association.  However, in the case of all depositors, creditors, loan customers or lessees of safe deposit boxes whose deposits, accounts or other contractual arrangements with the association have been purchased or assumed as provided for in Section 381.63a of this title, a notice of purchase and assumption shall be sent by the purchaser in lieu of a notice of liquidation by the liquidating association.  The notice prepared by the association shall be posted conspicuously on the premises of the association and shall be given such publication as the Commissioner may require.  The purchaser or the liquidating association, as applicable, shall send with each notice a statement of the amount shown on the books to be the claim or liability of the depositor, creditor or other customer.  Each such notice shall demand that claims of depositors and creditors, or corrected statements of amounts owed by the customer, if the amount claimed or owed differs from that stated in the notice, be filed with the notifying institution before a specified date not earlier than sixty (60) days thereafter in accordance with the procedure prescribed in the notice.  The notice prepared by the liquidating association shall also demand that property held by the association as bailee or in a safe deposit box not taken over by a purchaser be withdrawn by the person entitled thereto.

3.  As soon after approval as may be practicable the association shall resign all fiduciary positions and take such action as may be necessary to settle its fiduciary accounts, and the manner of succession of trust powers and successor trustees shall follow the same procedure as set out in Section 1018 of Title 6 of the Oklahoma Statutes.

4.  Any safe deposit boxes which have not been taken over by a purchaser, and the contents of which have not been removed within thirty (30) days after demand, shall be opened.  Sealed packages containing the contents of such box, with a certificate of inventory of contents, together with any other unclaimed property held by the association as bailee and certified inventories thereof, shall be transferred to the Commissioner who shall administer the property in accordance with the provisions of the Uniform Unclaimed Property Act.

5.  The approval of an application for liquidation shall not impair the right of a depositor or creditor whose account has not been unconditionally assumed by a purchaser to be paid in full by the liquidating association, and all lawful claims of remaining creditors and depositors of the liquidating association shall promptly be paid.  The unearned portion of the rental of a safe deposit box not taken over by a purchaser shall be returned to the lessee.

6.  Any assets remaining after the discharge of or adequate provision for all obligations shall be distributed to the stockholders or members in accordance with a plan of voluntary liquidation filed with and approved by the Commissioner.  No such distribution shall be made before all claims of depositors and creditors have been:

a. assumed as provided for in Section 381.63a of this title,

b. provided for by the establishment of a reserve fund in an amount approved by the Commissioner,

c. paid by the liquidating association, or

d. in the case of any disputed claim, provided for by transmittal to the Commissioner of a sum adequate to meet any liability that may be judicially determined.

C.  Any unclaimed distribution to a stockholder, member or depositor shall be held until ninety (90) days after the final distribution and then transmitted to the Commissioner.  Such unclaimed funds shall be held by the Commissioner and administered in accordance with the provisions of the Uniform Unclaimed Property Act.

D.  If the Commissioner finds that assets will be insufficient for the full discharge of all obligations or that completion of the liquidation has been unduly delayed, the Commissioner may take possession and complete the liquidation in the manner provided in this act for involuntary liquidations.

E.  The Commissioner may require reports of the progress of liquidation.  Whenever the Commissioner is satisfied that the liquidation has been properly completed the Commissioner shall enter an order of dissolution and recommend to the Secretary of State that the association's certificate of incorporation be canceled, upon receipt of which the Secretary of State shall cancel such certificate.

Added by Laws 1970, c. 101, § 62, eff. June 1, 1970.  Amended by Laws 1978, c. 168, § 30, eff. July 1, 1979; Laws 1988, c. 65, § 31, emerg. eff. March 25, 1988; Laws 1991, c. 331, § 49, eff. Sept. 1, 1991; Laws 1993, c. 183, § 60, eff. July 1, 1993; Laws 2000, c. 81, § 65, eff. Nov. 1, 2000.

§18381.63a.  Purchase and sale of assets and business of association  Authorization and approval  Assumption of certificates of deposit  Transfer of fiduciary positions.

A.  Any association may sell to any other association, federal association, national banking association or Oklahoma-chartered bank all, or substantially all, of the selling association's assets and business, or all, or substantially all, of the assets and business of any department or branch of the selling association.

B.  Any association, upon assuming the liabilities relating thereto, may purchase all, or substantially all, of the assets and business of another association, federal association, national banking association or Oklahoma-chartered bank, or all, or substantially all, of the assets and business of any department or branch of the selling institution.

C.  The agreement of purchase and sale shall be authorized and approved by the boards of directors of the purchasing and selling institutions, and authorized and approved by the vote of a majority of the stockholders of the purchasing and selling institutions, or by a majority vote of the total number of votes of the members present in person or by proxy, in the case of mutual associations or mutual federal associations, at meetings called for the purpose and shall be filed with the State Banking Commissioner accompanied by evidence of such stockholders' or members' approval in like manner as plans of merger are filed.  Copies of the agreement of purchase and sale shall be filed with and subject to the approval of the Commissioner, together with a fee for review of the transaction as required by rule of the Commissioner, and shall be accompanied by evidence of approval of such stockholders or members thereof in like manner as agreements of merger are filed.  After such approval is given by the stockholders or members, a notice of such sale shall be published once a week for two (2) successive weeks in a newspaper of general circulation in the county in which the selling institution has its main office.  Proof of such publication shall be filed with the Commissioner.  The Commissioner may permit the requirement for publication of notice to be satisfied after the purchase and sale becomes effective if the Commissioner determines that:

1.  The selling institution is solvent, but either is close to insolvency or is experiencing a run on deposits;

2.  The terms of the agreement of purchase and sale are essentially fair to the selling institution; and

3.  The selling institution will remain solvent after the purchase and sale.

D.  Any deposit account which is unconditionally assumed by the purchasing association pursuant to an agreement approved by the Commissioner, and which, after a depositor's preexisting accounts at the purchasing institution are added to the accounts assumed from the selling institution, is fully covered by the Federal Deposit Insurance Corporation insurance limits at the purchasing institution, shall cease to be an obligation of the selling institution after the purchase and sale becomes effective.  Notwithstanding any term of the purchase and sale agreement or of the contract of deposit, a deposit account or other creditor's account shall be deemed to be only conditionally assumed by the purchasing institution if:

1.  The amount of preexisting deposit accounts of a depositor at the purchasing institution, together with accounts of that depositor which are assumed from the selling institution, would exceed the Federal Deposit Insurance Corporation insurance limits of such purchasing institution; or

2.  Claims of a depositor or other creditor against a selling institution and loans of a depositor from the selling institution are not simultaneously assumed by the purchasing institution so as to preserve a right of setoff.  Any depositor or creditor of the selling institution whose business is conditionally sold has the right, after such sale:

a. upon payment of any indebtedness owing by the depositor to the selling institution, to withdraw the deposit in full from the selling institution on demand, unless by dealing with the purchasing institution with knowledge of the purchase the depositor ratifies the transfer, or

b. to exercise the right to setoff of the depositor, unless by dealing with the purchasing institution with knowledge of the purchase the depositor ratifies the transfer.

E.  The agreement of sale may provide for the transfer to the purchasing institution of all fiduciary positions held by the selling institution subject to the right of the district court of the county in which the selling institution is situated, on petition of any interested party, to appoint another or succeeding fiduciary to the positions so transferred.  However, the provisions of the instrument creating the fiduciary position shall control such succession, if it so provides therein.  Until such court appoints another or succeeding fiduciary, the purchasing institution shall, if it has qualified, exercise any fiduciary function vested in the selling institution and the manner of succession of trust powers and successor trustees shall follow the same procedure as set out in subsection F of Section 1109 of Title 6 of the Oklahoma Statutes.

F.  Except as provided for in subsection D of this section, no right against or obligation of the selling institution in respect of the assets or business sold shall be released or impaired by the sale until one (1) year from the last date of publication of the notice pursuant to subsection C of this section, but after the expiration of such year no action can be brought against the selling institution on account of any deposit, obligation, trust or asset transferred to or liability assumed by the purchasing association.

Added by Laws 1988, c. 65, § 32, emerg. eff. March 25, 1988.  Amended by Laws 1990, c. 173, § 28, emerg. eff. May 3, 1990; Laws 2000, c. 81, § 66, eff. Nov. 1, 2000.

NOTE:  Laws 1990, c. 118, § 21 repealed by Laws 1990, c. 337, § 26.

§18381.64.  Authorized foreign associations.

Except as this act otherwise provides, no foreign association shall be granted permission by the State Banking Commissioner or the Secretary of State to do business within this state and each foreign association now holding a certificate of authority issued by the Commissioner may continue to do business through its duly appointed agent but only in the county where it is now operating.  Each such foreign association shall remain subject to supervision, and to examination as deemed necessary, by the Commissioner and to the rules of the Commissioner and shall make no loans in this state and accept no deposit accounts in this state other than loans and deposit accounts of a class which are authorized for Oklahoma chartered associations.  In the event an authorized foreign association fails to comply with the provisions of this act or with the requirements of the Commissioner, or to keep on file with the Commissioner and the Secretary of State a written appointment of its resident agent upon whom service of summons and all other legal process may be had, or to pay the supervisory fees provided by this act, the Commissioner may revoke the certificate of authority of such association and invoke other remedies as provided by law.  In the event of such revocation, the Secretary of State shall revoke and cancel the certificate of domestication of such association.

Added by Laws 1970, c. 101, § 64, eff. June 1, 1970.  Amended by Laws 1986, c. 219, § 6, emerg. eff. June 9, 1986; Laws 1987, c. 61, § 16, emerg. eff. May 4, 1987; Laws 1993, c. 183, § 61, eff. July 1, 1993; Laws 2000, c. 81, § 67, eff. Nov. 1, 2000.

§18381.65.  Limited certificate of authority  Activities of unauthorized associations.

A.  A federal association not having its main office or any branches in this state or any foreign association may apply to the State Banking Commissioner for a limited certificate of authority to transact business in this state.  The application shall explicitly limit the purposes which the federal association not having its main office or any branches in this state or foreign association may pursue in this state.  Such entity may apply to engage in any activity reasonably necessary or desirable in order to deal with loans originated by it in interstate commerce or acquired by it by assignment from an originating lender qualified or otherwise permitted to do business in this state, or any collateral securing such loans, as well as any property, real or personal, acquired by it by foreclosure or otherwise in satisfaction of debt held by it.  Without limitation, a limited certificate of authority shall:

1.  Permit a federal association not having its main office or any branches in this state or a foreign association to have full access to the courts of this state;

2.  Allow it to refinance, renew, extend or work out loans which it has originated in interstate commerce or which it has acquired by assignment;

3.  Allow it to take all steps reasonably necessary to monitor collateral and the credit quality of its debtors; and

4.  Allow it to manage, rent, sell or finance any property acquired by it by foreclosure or otherwise in satisfaction of debt held by it.

The Commissioner shall have authority to approve under a limited certificate of authority other specific purposes that such entity applies to engage in, provided that those purposes are incidental to or reasonably necessary in connection with the purposes more specifically permitted by this subsection.  A federal association not having its main office or any branches in this state, or a foreign association, as part of its application for a limited certificate of authority shall commit that it will not originate loans or solicit or accept applications for loans at any place within this state, nor shall it, directly or indirectly, receive applications for or payments or deposits to deposit accounts or investment securities of any kind at any place within this state.  Such entity shall commit in its application that when doing business in this state it shall use a specified fictitious name not containing any of the terms forbidden by Section 381.23 of this title and, without limitation, it shall not use such terms on any office, advertising, telephone listing or other medium of holding itself out to the public within this state.  However, in executing any legal documents or participating in court proceedings, the federal association not having its main office or any branches in this state or foreign association shall use its actual name.  The Commissioner shall establish a list of items of information required to be contained in or submitted with an application for a limited certificate of authority, and shall fix a reasonable filing fee to defray the cost of processing such applications.  The Commissioner shall act upon and issue an order granting or denying each application for a limited certificate of authority.  If and when all requirements of the Commissioner are met, a limited certificate of authority shall be issued and the applying entity shall comply with all steps necessary in order to qualify to do business in this state in accordance with the provisions of Section 1130 of this title.  The Secretary of State shall not allow such entity to qualify to do business until it furnishes proof that it holds a limited certificate of authority issued by the Commissioner.

B.  A federal association not having its main office or any branches in this state or a foreign association shall not be determined to be transacting or engaging in business in this state, either for the purposes of this act or for the purposes of Sections 1130 and 1131 of this title, solely by reason of the activities of its majorityowned subsidiary which is incorporated or qualified to do business within this state.  The provisions of this subsection shall have no application to the question of whether the majorityowned subsidiary's parent company is:

1.  Subject to service of process and suit in this state pursuant to the laws of this state; or

2.  Subject to the taxation laws of this state.

C.  A foreign association which does not have a certificate of authority or limited certificate of authority from the Commissioner, or a federal association which does not have permission from the Director of the Office of Thrift Supervision to operate its main office or any branches in this state, shall not be deemed to be transacting or engaging in business in this state, for the purposes of this act, by reason of the purchase or acquisition, holding or sale of loans secured by mortgages on Oklahoma real estate, or participating interests therein, or the foreclosure thereof and acquiring of title to such mortgaged real estate in satisfaction of the mortgage indebtedness.

D.  If a certificate of authority or limited certificate of authority to transact business has not been issued by the Commissioner to a federal association not having permission from the Director of the Office of Thrift Supervision to operate its main office or any branches in this state, or to a foreign association, then such unauthorized entity shall not maintain any office in this state and shall not directly or indirectly through brokers, agents or others:

1.  Receive applications for or payments or deposits to deposit accounts or investment securities of any kind at any place within this state;

2.  Assert or imply directly or by means of the mail, radio, television, newspapers, magazines or other media originating from any place within this state that it has agents or representatives in this state with whom its deposit accounts and investments may be discussed;

3.  Distribute any of its advertising material from any place within this state;

4.  Display its name by signs or other wording on windows, doors or placards, or otherwise represent that it does business within this state or is represented for transaction of business at any location in this state; or

5.  Hold assets in this state other than those permitted by subsection C of this section.

E.  The Commissioner may obtain an injunction or take any other action necessary to prevent any federal association not having its main office or any branches in this state or any foreign association from violating any provision of this act or the rules of the Commissioner.  Any such entity which violates any provision of this act and any agent or representative who transacts or solicits business for such entity which is acting in violation of this act shall forfeit and pay to the State of Oklahoma, to be recovered in a civil action in the name of the State of Oklahoma, the sum of Five Thousand Dollars ($5,000.00).

Added by Laws 1970, c. 101, § 65, eff. June 1, 1970.  Amended by Laws 1988, c. 65, § 33, emerg. eff. March 25, 1988; Laws 1990, c. 118, § 22, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 62, eff. July 1, 1993; Laws 2000, c. 81, § 68, eff. Nov. 1, 2000.

§18381.66.  Federal associations.

Federal associations are not deemed to be foreign associations.  Unless federal laws or regulations provide otherwise, federal associations, which have their main office in this state, and members thereof shall possess all of the rights, powers, privileges, benefits, immunities and exemptions which are provided by this act or which are now or may be hereafter provided by laws of this state for associations organized under the laws of this state and for the members thereof.  This provision is additional and supplemental to any section of this act or other law, which by specific reference is applicable to federal associations and the members thereof.

Added by Laws 1970, c. 101, § 66, eff. June 1, 1970.  Amended by Laws 2000, c. 81, § 69, eff. Nov. 1, 2000.

§18-381.66a.  Conversion into national banking association or Oklahoma-chartered bank - Vesting of property rights - Pending actions - Conversion of mutual associations - Disposition of preexisting reserves.

A.  At an annual meeting or at any special meeting of the members or stockholders called to consider such action, any association may convert itself into a national banking association pursuant to federal laws, or may convert itself into an Oklahoma-chartered bank pursuant to the Oklahoma Banking Code, upon a majority vote of the outstanding stock entitled to vote thereon or upon a majority of the total number of votes of the members present in person or by proxy.  An association converting to a state-chartered bank shall file with the State Banking Commissioner an application which shall be the application prescribed in Section 305 of Title 6 of the Oklahoma Statutes.  However, the applicant shall not be required to provide evidence of need of granting authority to convert.  The applicant association shall follow the publication requirements of Section 306.1 of Title 6 of the Oklahoma Statutes.  Issuance of a state bank charter to the converting association by the Oklahoma Banking Board shall follow the prescribed procedure of the Oklahoma Banking Code.  There shall be filed with the Commissioner a copy of the charter issued to such national banking association by the Office of the Comptroller of the Currency or of the certificate of authority issued to such Oklahoma-chartered bank by the Oklahoma Banking Board.  Upon the grant to any association of a charter by the Office of the Comptroller of the Currency or of a certificate of authority by the Oklahoma Banking Board, the association receiving such charter or certificate of authority shall cease to be an association incorporated by this state.  Upon conversion of any association into a national banking association or Oklahoma-chartered bank, such national banking association or Oklahoma-chartered bank shall be deemed to be a continuation of the entity of the association so converted.  All property of the converted association, including its rights, titles and interests in and to all property of whatever kind, whether real, personal or mixed, and 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, shall immediately by operation of law and without any conveyance or transfer and without any further act or deed remain and be vested in and continue and be the property of such national banking association or Oklahoma-chartered bank into which the association has converted itself.  Such national banking association or Oklahoma-chartered bank 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 converting association, and such national banking association or Oklahoma-chartered bank as of the time of the taking effect of such conversion 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 deemed to have abated or to have discontinued by reason of such conversion.  Such pending actions and other judicial proceedings may be prosecuted to final judgment, order or decree in the same manner as if such conversion into such national banking association or Oklahoma-chartered bank had not been made.  The national banking association or Oklahoma-chartered bank resulting from such conversion may continue such action in its corporate name as a national banking association or Oklahoma-chartered bank, and any judgment, order or decree may be rendered for or against it which might have been rendered for or against the converting association theretofore involved in such judicial proceedings.

B.  In the case of a conversion of a mutual association to a national banking association or Oklahoma-chartered bank, the members of the mutual association, at the meeting at which conversion to a national banking association or Oklahoma-chartered bank is voted upon, shall also vote upon the directors who shall be the directors of the national banking association or Oklahoma-chartered bank after the conversion takes place.  The directors shall file with the Commissioner an application for conversion and a firm commitment for, or evidence of, insurance of deposits and other accounts of a withdrawable type by the Federal Deposit Insurance Corporation.  The Commissioner may refuse to approve the application if it has reason to believe that the plan of conversion is not fair and equitable to all of the members and that sufficient provision is not made to protect the interests of the depositors of the prospective national banking association or Oklahoma-chartered bank.  Upon the approval by the Commissioner and by the Office of the Comptroller of the Currency or the Oklahoma Banking Board, the association shall cease to be a mutual association.

C.  The conversion of a mutual association into a national banking association or Oklahoma-chartered bank shall be effected in accordance with a plan of conversion adopted by the members as provided in this section and consistent with the other provisions of this title.  The plan shall provide that:

1.  Each deposit account holder in the converting mutual association shall receive a deposit account in the converted national banking association or Oklahoma-chartered bank equal in amount to the deposit account of such holder in the mutual association;

2.  A record date for determining deposit account holders entitled to purchase stock shall be established which is not less than ninety (90) days prior to the date of adoption of the plan of conversion by the board of directors of such association;

3.  Officers, directors and employees of the association and their associates shall forego any participation in the initial distribution of permanent capital stock to the extent that any such person increased the account of such person by more than Twenty Thousand Dollars ($20,000.00) during the six (6) months preceding the record date established pursuant to this section.  For this purpose the term "associate" shall have the same meaning as in Section 381.50 of this title;

4.  The amount of stock of the converted national banking association or Oklahoma-chartered bank to which a member is entitled to subscribe shall be determined on the basis of the ratio of the deposits of the member with the association on the record date to the total deposits of the association on the record date, as applied to the initial issuance of permanent capital stock.  Each deposit account holder as of the record date may receive warrants authorizing the purchase of shares of permanent capital stock of the converted national banking association or Oklahoma-chartered bank at a price determined by the board of directors of the institution and approved by the Commissioner or the Director of the Office of Thrift Supervision, and scrip denoting fractional stock interests of less than one share.  However, no deposit account holder shall be entitled to scrip representing fractional interests of less than one-fifth (1/5) share of stock; and

5.  In connection with a conversion, deposit account holders shall have a preemptive right to purchase such permanent capital stock for a period of not less than fourteen (14) days from the date the offer to sell permanent capital stock is made.

D.  In no case of conversion of a mutual association to a national banking association or Oklahoma-chartered bank shall any reserves existing at the time of such conversion ever inure to the benefit of the permanent capital stock, but shall be maintained as reserves in accordance with directions of the Commissioner.  The reserves of the converted national banking association or Oklahoma-chartered bank resulting from the conversion of a mutual association shall be not less than the amount necessary to meet the requirements of the Office of the Comptroller of the Currency or of the Federal Deposit Insurance Corporation, respectively.

Added by Laws 1990, c. 173, § 24, emerg. eff. May 3, 1990.  Amended by Laws 1993, c. 183, § 63, eff. July 1, 1993; Laws 2000, c. 81, § 70, eff. Nov. 1, 2000.

§18-381.66b.  Conversion of national banking association or Oklahoma-chartered bank into stock association.

A.  At an annual meeting or at any special meeting of the stockholders called to consider such action, any national banking association or Oklahoma-chartered bank may convert itself into a stock association pursuant to this act upon a majority vote of the outstanding stock entitled to vote thereon, and in compliance with any federal laws, or provisions of the Oklahoma Banking Code, applicable to such a transaction by the converting national banking association or Oklahoma-chartered bank.  Copies of the minutes of the proceedings of such meeting of stockholders, verified by the affidavit of the secretary or an assistant secretary, and verified copies of the plan of conversion shall be filed for approval with the State Banking Commissioner.  At the meeting at which conversion is voted upon, the stockholders shall also vote upon the directors who shall be the directors of the state-chartered association after conversion takes effect.  Such directors then shall execute and file an application for conversion, a proposed certificate of incorporation and proposed bylaws, and the Commissioner shall, upon approval, issue a certificate of authority, all as provided in this act.  The Commissioner shall approve the application for conversion and issue a certificate of authority if it appears that:

1.  The resulting stock association meets all of the requirements of this act as to the formation of a new stock association; and

2.  The resulting stock association will have an adequate capital structure including surplus.  The association shall include in the certificate of incorporation the following, as applicable:  "This association is incorporated by conversion from a national banking association/Oklahoma-chartered bank."  All of the directors who are chosen for the association shall sign and acknowledge the certificate of incorporation as the subscribers.  The Commissioner may provide, by regulation, for any additional procedure to be followed by any such national banking association or Oklahoma-chartered bank converting into an association under this act, including the amount of the application fee to be paid to the Oklahoma State Banking Department.  All the provisions regarding property and other rights and liabilities contained in Section 381.66a of this title shall apply, in reverse order, to the conversion of a national banking association or Oklahoma-chartered bank into an association incorporated under this act, so that the state-chartered association shall be a continuation of the corporate entity of the converting national banking association or Oklahoma-chartered bank.

B.  In connection with the review of the application for conversion, the Commissioner may conduct an examination of the converting institution, and such examination shall be paid for by the converting institution according to the fees prescribed in subsection D of Section 381.15 of this title for special examinations.  The deposit payable by the converting institution pursuant to paragraph 5 of Section 381.16 of this title shall not be a limitation on the examination fee payable by the converting institution.

C.  If a converting national banking association or Oklahoma-chartered bank has assets which do not conform to the requirements of state law for the converted state association, or there are business activities which are not permitted for the converted state association, the Commissioner may permit a reasonable time to conform with state law.

Added by Laws 1990, c. 173, § 25, emerg. eff. May 3, 1990.  Amended by Laws 1993, c. 183, § 64, eff. July 1, 1993; Laws 2000, c. 81, § 71, eff. Nov. 1, 2000.

§18-381.66c.  Merger of national banking associations or Oklahoma-chartered banks into stock association - Approval by boards of directors - Terms of agreement - Approval by Board - Approval by stockholders.

A.  Upon approval of the State Banking Commissioner, one or more national banking associations or Oklahoma-chartered banks may be merged with and into a stock association as hereafter prescribed, except that the action by a constituent national banking association shall be taken in the manner prescribed by and shall be subject to any limitation or requirements imposed by any law of the United States which shall govern the rights of its dissenting shareholders.

B.  The board of directors of each constituent institution shall, by a majority of the entire board, approve a merger agreement which shall contain:

1.  The name of each constituent institution and the location of each office;

2.  With respect to the resulting stock association the name and the location of each proposed office, the name and residence of each director to serve until the next annual meeting of the stockholders, the name and residence of each officer, the amount of capital, the number of shares and the par value of each share, whether preferred stock is to be issued and the amount, terms and preferences and the amendments to the certificate of incorporation and bylaws;

3.  The terms for the exchange of shares of the constituent institutions for the shares or other consideration of the resulting stock association;

4.  A statement that the merger and the merger agreement is subject to approval by the Commissioner and by the stockholders of each constituent institution;

5.  Provisions governing the manner of disposing of the shares of the resulting stock association not taken by dissenting stockholders of the constituent institutions; and

6.  Such other provisions as the Commissioner requires to enable it to discharge its duties with respect to the merger.

C.  After approval by the board of directors of each constituent institution, the merger agreement shall be submitted to the Commissioner for approval, together with a fee for review of the merger as required by rule of the Commissioner which shall be deposited in the Oklahoma State Banking Department revolving fund pursuant to Section 211.1 of Title 6 of the Oklahoma Statutes, certified copies of the authorizing resolutions of the several boards of directors showing approval by a majority of the entire board and evidence of proper action by the board of directors of any constituent national banking association.

D.  Without approval by the Commissioner, no asset shall be carried on the books of the resulting stock association at a valuation higher than that on the books of the constituent bank at the time of the last examination by a state or national bank examiner before the effective date of the merger.

E.  Within thirty (30) days after receipt by the Commissioner of the papers specified in subsection C of this section, the Commissioner shall approve or disapprove the merger agreement.  The Commissioner shall approve the agreement if it appears that:

1.  The resulting stock association meets all of the requirements of this act as to the formation of a new stock association;

2.  The agreement provides an adequate capital structure including surplus;

3.  The agreement is fair; and

4.  The merger is not contrary to the public interest.  If the Commissioner disapproves an agreement, the Commissioner shall state  all objections and give an opportunity to the constituent institutions to amend the merger agreement to obviate such objection.

F.  Where the resulting stock association is not to exercise trust powers, the Commissioner shall not approve a merger until satisfied that adequate provision has been made for successors to fiduciary positions held by constituent banks, and the manner of succession of trust powers and successor trustees shall follow the same procedure as set out in Section 1018 of Title 6 of the Oklahoma Statutes.

G.  To be effective, a merger must be approved by the stockholders of each constituent institution by a majority vote of the outstanding voting stock at a meeting called to consider such action, which vote shall constitute the adoption of the certificate of incorporation and bylaws of the resulting stock association, including the amendments set forth in the merger agreement.

H.  The notice of the meeting of stockholders shall be given by publication in a newspaper of general circulation in the place where the main office of each constituent institution is located, at least once a week for four (4) successive weeks, and by mail, at least fifteen (15) days before the date of the meeting, to each stockholder of record of each constituent institution at the address of such stockholder on the books of the institution, who has not waived such notice in writing.  No notice by publication need be given if written waivers are received from the holders of a majority of the outstanding shares of each class of voting stock.

I.  At the effective time of the merger the charters of the constituent institutions other than the resulting stock association shall be deemed to be surrendered.

J.  The resulting stock association shall be considered the same business and corporate entity as each constituent bank with all of the rights, powers, and duties of each constituent bank, except as limited by the certificate of incorporation and bylaws of the resulting stock association.

K.  Any reference to any constituent bank in any writing, whether executed or taking effect before or after the merger, shall be deemed a reference to the resulting stock association if not inconsistent with the other provisions of such writing.

L.  If a constituent bank has assets which do not conform to the requirements of state law for the resulting stock association, or if there are business activities which are not permitted for the resulting stock association, the Commissioner may permit a reasonable time to conform with state law.

M.  Rights of dissenting stockholders of a constituent bank shall be those described in Section 1104 of Title 6 of the Oklahoma Statutes.

Added by Laws 1990, c. 173, § 26, emerg. eff. May 3, 1990.  Amended by Laws 1993, c. 183, § 65, eff. July 1, 1993; Laws 2000, c. 81, § 72, eff. Nov. 1, 2000.

§18-381.66d.  Merger of stock association into national banking association - Rights and liabilities of association and stockholders - Applicable law.

Nothing in the law of this state shall restrict the right of a stock association to merge with and into a national banking association.  The action to be taken by a constituent stock association and its rights and liabilities and those of its stockholders shall be the same as those prescribed for national banking associations at the time of the action by the applicable laws of the United States and not by the laws of this state.  Upon the completion of the merger with and into a national banking association, the certificate of authority and the certificate of incorporation of any merging stock association shall automatically terminate.

Added by Laws 1990, c. 173, § 27, emerg. eff. May 3, 1990.

§18381.71.  Definitions.

As used in this section and Sections 381.72 and 381.73 of this title:

1.  "Acquire" means:

a. the merger or consolidation of an outofstate savings institution with or into an instate savings institution,

b. the acquisition by an outofstate savings institution of direct or indirect ownership or control of voting shares or, in the case of a mutual savings institution, voting rights of an instate savings institution if, after such acquisition, such outofstate savings institution directly or indirectly owns or controls twentyfive percent (25%) or more of any class of voting shares or voting rights of such instate savings institution, excluding shares or rights owned or held by the United States or by any organization wholly owned by the United States,

c. the acquisition by an outofstate savings institution of the direct or indirect ownership of all or substantially all of the assets, including, if agreed, the assets of any branches and facilities, of an instate savings institution, or

d. any other action that would result in the direct or indirect ownership or control by an outofstate savings institution of an instate savings institution;

2.  "Control" means direct or indirect ownership of or holding with the power to vote twentyfive percent (25%) or more of the voting shares, or in the case of a mutual savings institution, the voting rights, excluding shares or rights owned or held by the United States or by any organization wholly owned by the United States, or the power in any manner to elect a majority of the directors or directly or indirectly to exercise a controlling influence, as determined by the State Banking Commissioner after notice and an opportunity for hearing, on the management or policies of a company;

3.  "Holding company" means a company which owns or controls one or more savings institutions organized under the laws of any state or the laws of the United States;

4.  "Main office" means the office of a savings institution designated by the Commissioner or the Office of Thrift Supervision as the main office of the institution and located within the United States;

5.  "Instate savings institution" means a savings institution organized under the laws of this state or the laws of the United States whose main office is located in Oklahoma;

6.  "Oklahoma holding company" means a holding company organized under the laws of this state;

7.  "Outofstate savings institution" means any savings institution organized under the laws of another state or the laws of the United States whose main office is located in another state;

8.  "Savings institution" means any association or federal association, or as the context requires, any holding company or subsidiary of such savings institution; and

9.  "Subsidiary" means a company which is owned or controlled by a savings institution.

Added by Laws 1986, c. 219, § 1, emerg. eff. June 9, 1986.  Amended by Laws 1987, c. 61, § 17, emerg. eff. May 4, 1987; Laws 1988, c. 65, § 34, emerg. eff. March 25, 1988; Laws 1993, c. 183, § 66, eff. July 1, 1993; Laws 2000, c. 81, § 73, eff. Nov. 1, 2000.

§18-381.72.  Repealed by Laws 1990, c. 118, § 26, emerg eff. April 23, 1990.

§18381.73.  Acquisition of control  Prohibited transactions  Approval of acquisition  Branching, acquisition and conversion by subsidiaries - Limitations and restrictions - Applicable law  Penalties.

A.  An outofstate savings institution, upon approval by the State Banking Commissioner, may acquire direct or indirect control of an unlimited number of instate savings associations for operation as in-state savings institutions, and may acquire any such institutions' parent Oklahoma holding company.  Any acquisition made pursuant to the provisions of this section may include assets and liabilities of the in-state savings institution or its parent Oklahoma holding company and all branches and facilities thereof.

B.  1.  No instate savings institution which becomes a subsidiary of an outofstate savings institution under any extraordinary acquisition provisions of federal law, or which is otherwise controlled by an outofstate savings institution, shall be permitted to acquire direct or indirect ownership or control of, or to convert to a branch, any additional instate savings institution or to establish additional branches or facilities, except as otherwise provided for in this section.

2.  No outofstate savings institution may directly or indirectly acquire control of an instate savings institution or its parent Oklahoma holding company except as otherwise permitted by this section.

C.  No acquisition provided for in this section shall be permitted unless the approval of the Commissioner required pursuant to subsection A of this section:

1.  Includes, for all acquisitions, a finding that:

a. the instate savings institution sought to be acquired or all of the savings institution subsidiaries of the parent Oklahoma holding company sought to be acquired have either been in existence and continuous operation for more than five (5) years, and

b. notice of intent to acquire has been published in a newspaper of general paid circulation in the county or counties where the instate savings institution to be acquired is located and that a notice of intent to acquire has been mailed by certified mail with return receipt requested to each person owning stock in the instate savings institution to be acquired or in its parent Oklahoma holding company or, if the instate savings institution to be acquired is a mutual association, notice has been given as in the case of a proceeding under Section 381.61 of this title;

2.  Includes, for any acquisition of a majority of the voting shares of a stock association or of its parent Oklahoma holding company, or for any acquisition of a mutual association by merger or purchase and assumption transaction with another in-state savings association, a finding that the acquisition has been approved by the board of directors and a majority of the stockholders of or holders of voting rights in the instate savings institution or of its parent Oklahoma holding company, as applicable;

3.  Subjects the acquisition to any conditions, restrictions, and requirements that would be applicable to such an acquisition by an instate savings institution of an outofstate savings institution in the state where the outofstate savings institution has its main office, if such state has enacted and implemented legislation authorizing the acquisition by an instate savings institution of outofstate savings institutions located in that state, but that would not be applicable to acquisitions in that state by an outofstate savings institution all of whose savings institution subsidiaries are located in that state; and

4.  Except when the additional acquisition is of an instate savings institution whose stock is held as stock acquired in the course of realizing upon a security interest which secured a debt previously contracted in good faith prior to the original acquisition by the outofstate savings institution, prohibits additional branching and further acquisitions by an instate savings institution which is a subsidiary of an outofstate savings institution unless and until the earlier of:

a. such time as the Commissioner determines that the state in which the outofstate savings institution has its main office has enacted and implemented legislation authorizing instate savings institutions to acquire savings institutions in that state on a reciprocal basis, or

b. the expiration of a fouryear period commencing on the date of acquisition by the outofstate savings institution.

D.  Any in-state savings institution or its parent Oklahoma holding company which becomes a subsidiary of an out-of-state financial institution under the extraordinary acquisition provisions of federal law, or which is otherwise deemed to be controlled by an out-of-state financial institution, may acquire direct or indirect ownership or control of any additional in-state financial institution or its parent Oklahoma holding company, establish additional branches or facilities, or convert the existing controlled in-state savings institution to branches of another in-state savings institution:

1.  If the Commissioner has determined that the principal place of business of the out-of-state savings institution has enacted and implemented reciprocal acquisition legislation within the purview of this section; or

2.  Upon the expiration of a four-year period commencing on the date of acquisition by the out-of-state savings institution.

E.  All limitations and restrictions of this act applicable to instate savings institutions shall apply to an instate savings institution which becomes a direct or indirect subsidiary of an outofstate savings institution and to the outofstate savings institution.  The provisions of this subsection shall not be construed to prohibit the acquisition by an outofstate savings institution of all or substantially all of the shares of an instate savings institution organized solely for the purpose of facilitating the acquisition of a savings institution which has been in existence and continuous operation as a savings institution for more than five (5) years, if the acquisition has otherwise been approved pursuant to this subsection.  Nor shall the provisions of this subsection be construed to prohibit an outofstate savings institution which acquires an instate savings institution under this section from additional acquisitions under this section, if such acquisition would otherwise be permitted.

F.  Any outofstate savings institution which controls an instate savings institution shall be subject to the laws of this state and the rules of its agencies relating to the acquisition, ownership, and operation of instate savings institutions.  The Commissioner shall make such rules including the imposition of reasonable application and administration fees as it finds necessary to implement the provisions of this act.

G.  The Commissioner may enter into cooperative agreements with other regulatory agencies to facilitate the regulation of savings institutions doing business in this state.  If such agreements result in the payment of fees, however calculated, by any other regulatory agency to the Oklahoma State Banking Department for examination activities conducted by Department personnel, whether such examination activity is conducted inside or outside this state, such fees shall be deposited in the Bank Examination Revolving Fund established in Section 211.2 of Title 6 of the Oklahoma Statutes.  If such agreements result in the payment of fees, however calculated, by the Department to any other bank supervisory agency for examination activities conducted by such other regulatory agency, whether such examination activity is conducted inside or outside this state, such fees shall be paid by the Department from the Bank Examination Revolving Fund established by Section 211.2 of Title 6 of the Oklahoma Statutes.  The Commissioner may accept reports of examinations and other records from such other agencies in lieu of the Commissioner conducting examinations of instate savings institutions controlled by outofstate savings institutions.  The Commissioner may take any action jointly with other regulatory agencies having concurrent jurisdiction over savings institutions doing business in this state or may take such actions independently in order to carry out its responsibilities.

H.  The Commissioner shall have the power to enforce the prohibitions provided for in subsection B of this section by requiring divestiture and through the imposition of fines and penalties, the issuance of cease and desist orders, and such other remedies as are provided by law.

I.  Any organization which intentionally and willfully violates any provision of this section, upon conviction, shall be fined not less than Five Hundred Dollars ($500.00) nor more than Five Thousand Dollars ($5,000.00) for each day during which the violation continues.  Any individual who intentionally and willfully participates in a violation of any provision of this section, upon conviction, shall be fined not more than Ten Thousand Dollars ($10,000.00) or imprisoned not more than one (1) year, or both such fine and imprisonment.

J.  Any final order of the Commissioner pursuant to this section shall be appealable pursuant to Section 207 of Title 6 of the Oklahoma Statutes.

Added by Laws 1986, c. 219, § 3, operative July 1, 1987.  Amended by Laws 1989, c. 292, § 1, operative July 1, 1989; Laws 1990, c. 118, § 23, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 67, eff. July 1, 1993; Laws 2000, c. 81, § 74, eff. Nov. 1, 2000.

§18381.74.  Taking possession by Commissioner.

A.  Except as otherwise provided in this act, the State Banking Commissioner may take possession of a statechartered savings and loan association, if the Commissioner determines that:

1.  The business of the association is being conducted in an unlawful or unsound manner;

2.  The association does not have funds available to pay all withdrawals of savings deposits when due or is otherwise unable to continue normal operations;

3.  The examination of the association has been obstructed or impeded; or

4.  The association is operating in violation of provisions of this act despite written notice to discontinue such violation.

B.  1.  The Commissioner may take possession of any statechartered savings association by posting upon the premises of such association a notice reciting that possession is being assumed pursuant to the provisions of this section and stating when possession shall be deemed effective.  Possession may become effective no earlier than the posting of the notice.  A copy of the notice shall be filed in the district court of the county where the association is located.  The Commissioner shall notify, if applicable, the appropriate district offices of the Director of the Office of Thrift Supervision and the Federal Deposit Insurance Corporation of taking possession of the association.

2. a. Once possession is effective the Commissioner shall be vested with the full and exclusive power of management and control, including the power to:

(1) continue or discontinue the business of the association,

(2) stop or limit the payment of the obligations of the association,

(3) employ any necessary assistants, including legal counsel,

(4) execute any instrument in the name of the association as Commissioner in charge of liquidation,

1. commence, defend or conduct in the name of the association any action or proceeding to which it may be a party,

(6) enforce the liabilities of stockholders, officers and directors of the association,

(7) terminate possession by restoring the assets of the association to its board of directors, and

(8) reorganize or liquidate the association in accordance with this act.

b. As soon as practicable after taking possession the Commissioner shall make an inventory of the assets of the association and file a copy thereof with the district court where the notice of possession was filed.

3.  While the Commissioner is in possession there shall be a postponement of six (6) months after the effective date of possession, of the date upon which any period of limitation fixed by statute or agreement would otherwise expire on a claim or right of action of the association, or upon which a review must be taken or a pleading or other document must be filed by the association in any pending action or proceeding.

4. a. The Commissioner, within two (2) days after taking possession of a stock association, shall call a special meeting of the stockholders to allow the stockholders to retain the incumbent board of directors or to elect a newly constituted board of directors, who may represent the stockholders in the liquidation proceedings and observe, assist and protect the interests of the stockholders.

b. The board of directors of the association is authorized to bring all necessary legal actions for and on behalf of the stockholders and to pay attorney's fees in a reasonable amount, if such action benefits the liquidating account of the failed association.

c. The board of directors, as authorized by the stockholders, shall represent the stockholders in the district court in which the notice of possession was filed by the Commissioner, as to all matters affecting the association.

5.  The association shall continue to exist as a body corporate for all purposes, except for the purpose of continuing the business for which the association was organized, and may function to assist the Commissioner or to protect the stockholders' interests in the assets of the liquidating account.

C.  1.  If the Commissioner determines that an emergency exists which may result in serious losses to the depositors of an association, he may take possession of the association without a prior hearing.  Within ten (10) days after the Commissioner has taken possession any interested person may appeal such action pursuant to the provisions of Section 207 of Title 6 of the Oklahoma Statutes.

2.  If the Commissioner determines that liquidation of the association is warranted, notice of such determination shall be given to such directors, stockholders, depositors and creditors of the association as the Commissioner may prescribe.  The notice shall be by restricted delivery to the directors and stockholders at their lastknown address as shown on the records of the association, and notice to the depositors and creditors shall be published in a newspaper of general circulation in the county where the main office of such association is located.  Any objection to such determination by a person directly affected thereby shall be appealed pursuant to the provisions of Section 207 of Title 6 of the Oklahoma Statutes.  Unless within ten (10) days after the date of publication an order is issued staying the liquidation or unless the Commissioner tenders to the Federal Deposit Insurance Corporation the appointment as liquidator pursuant to Section 381.77 of this title, the Commissioner shall liquidate the association after providing a bond executed by a surety company authorized to do business in this state, for the benefit of the people of this state, for the faithful discharge of the duties of the Commissioner in connection with such liquidation and the accounting for all monies coming into the possession of the Commissioner.  The cost of such bond shall be paid from the assets of the association.  Suit may be maintained on such bond by any person injured by a breach of the conditions thereof.

3.  After the Commissioner takes possession of an association pursuant to the provisions of this section, the stockholders thereof may repair its credit, restore or substitute its reserves, and otherwise improve its condition so that it is qualified to do a general savings and loan business as provided for by law.  Such association shall not reopen its business until the Commissioner issues written permission therefor after an investigation of the affairs of the association and a determination that the board of directors of the association has complied with all applicable laws, that the association's credit and funds are in all respects repaired, and its reserves restored or sufficiently substituted, and that it again should be permitted to reopen for business.  Written permission to reopen to do a general savings and loan business shall be issued in the same manner as is provided by law for granting permission to do business after incorporation.

4.  If the Commissioner determines that reorganization of the association is warranted or if the Supreme Court, after staying the liquidation of the association, orders such reorganization, the Commissioner, after according a hearing to all interested persons, shall enter an order proposing a reorganization plan.  A copy of the plan shall be sent to each depositor and creditor who will not receive full payment of their claim under the plan, together with notice that, unless the plan is disapproved, within fifteen (15) days after the date of the mailing of the plan, in writing by persons holding onethird (1/3) or more of the aggregate amount of such claims, the Commissioner shall proceed to effect the reorganization.  A department, agency, or political subdivision of this state holding a claim which will not be paid in full is authorized to participate in the reorganization as any other creditor.

5. a. Notwithstanding any other provision to the contrary, the Commissioner, upon taking possession of an association, may immediately liquidate said association without giving prior notice to the directors, stockholders, depositors and creditors of such association, if it is determined by order of the district court where notice of possession was filed that the immediate liquidation of the association is necessary to protect the interests of the depositors of the association and is otherwise in the public interest.

b. In proceeding with the immediate liquidation of the association, the Commissioner, in order to facilitate the assumption of the deposit liabilities of the closed insured association by another association, may borrow monies from the Federal Deposit Insurance Corporation and pledge some or all of the assets of the closed insured association as security for such borrowing or may sell some or all of the assets of the closed insured association to the Federal Deposit Insurance Corporation.

6.  Once the Commissioner takes possession of an association for purposes of liquidation, neither the tenday periods provided by subsection C of this section nor the pendency of any proceeding for review of the action of the Commissioner shall operate to defer, delay, impede or prevent the payment by the Federal Deposit Insurance Corporation of the insured deposits of an insured association.

7.  The Commissioner shall make available to the Federal Deposit Insurance Corporation such facilities in or of an insured association and such books, records and other relevant data of the insured association as may be necessary or appropriate to enable the Federal Deposit Insurance Corporation to pay the insured deposits in the insured association as provided in this subsection.  The Federal Deposit Insurance Corporation, its directors, officers, agents, and employees, and the Commissioner, and the agents and employees of the Commissioner, shall be free from any liability to the insured association, its directors, stockholders, and creditors, for any action relating to the payment of insured deposits.

D.  No judgment, lien, or attachment shall be executed upon any asset of the association while it is in the possession of the Commissioner.  The Commissioner, in connection with a liquidation or reorganization may:

1.  Vacate and void any lien or attachment, other than an attorney's or mechanic's lien, obtained upon any asset of the association during the Commissioner's possession or within four (4) months prior to commencement thereof, except liens created by the Commissioner while in possession; and

2.  Void any transfer of an asset of the association made after or in contemplation of its insolvency with intent to effect a preference.

E.  The Commissioner may borrow money in the name of the association and may pledge its assets as security for a loan.

F.  All necessary and reasonable expenses of the Commissioner relating to the possession of an association and of its reorganization or liquidation shall be defrayed from the assets of the association.  Compensation to liquidating agents and employees shall not be in excess of amounts which such individuals would be entitled to in their regular employment or for like services rendered within the area of the insolvent association, and in no event shall a liquidating agent be paid a monthly salary or wage from the assets of the association in excess of the amount of the monthly salary of the highest paid official of the insolvent association.  Any attorney's fee allowed to an attorney representing the liquidating agent shall not exceed the reasonable amount charged by other attorneys of similar competence for like services in regular employment of an attorney in the area of the association.

Added by Laws 1987, c. 61, § 21, emerg. eff. May 4, 1987.  Amended by Laws 1990, c. 118, § 24, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 68, eff. July 1, 1993; Laws 2000, c. 81, § 75, eff. Nov. 1, 2000.

§18381.75.  Reorganization plan.

A.  A plan of reorganization shall not be acceptable unless:

1.  Such plan is feasible and fair to all classes of depositors, creditors and stockholders;

2.  The aggregate face amount of the interest accorded to any class of depositors, creditors or stockholders under the plan does not exceed the value of the assets upon liquidation less the full amount of the claims of all prior classes, subject, however, to any fair adjustment for new capital that any class will pay in under the plan;

3.  Such plan provides for the issuance of capital stock and, if necessary, debentures in an amount that will provide an adequate ratio to deposits;

4.  Any exchange of new common stock for obligations or stock of the association will be effected in inverse order to the priorities in liquidation of the classes that will retain an interest in the association and upon terms that fairly adjust any change in the relative interests of the respective classes that will be produced by the exchange;

5.  The plan assures the removal of any director, officer or employee responsible for any unsound or unlawful practice or the existence of an unsound condition; and

6.  Any merger or consolidation provided by the plan conforms to the requirements of this act.

B.  Whenever, in the course of reorganization, supervening conditions render the plan unfair or its execution impractical, the State Banking Commissioner may modify the plan or liquidate the association.  Any such action shall be taken by order of the Commissioner upon appropriate notice.

Added by Laws 1987, c. 61, § 22, emerg. eff. May 4, 1987.  Amended by Laws 1993, c. 183, § 69, eff. July 1, 1993; Laws 2000, c. 81, § 76, eff. Nov. 1, 2000.

§18381.76.  Liquidation by Commissioner.

A.  In liquidating an association, the State Banking Commissioner may exercise any power of such association, but shall not, without the approval of the district court where notice of possession was filed:

1.  Sell any asset of the association having a value in excess of Five Hundred Dollars ($500.00) or such larger sum as may be determined by the court, but not exceeding One Hundred Thousand Dollars ($100,000.00);

2.  Compromise or release any claim exceeding Five Hundred Dollars ($500.00), exclusive of interest or such larger sum as may be determined by the court, but not exceeding One Hundred Thousand Dollars ($100,000.00); or

3.  Make any payment on any claim, other than a claim upon an obligation incurred by the Commissioner, before preparing and filing a schedule of determinations in accordance with subsection H of this section.

B.  1.  The Commissioner may lease for oil and/or gas purposes any land vested in the Commissioner as assets of an insolvent association.

2.  In making or executing any such lease the Commissioner shall retain and reserve a royalty of not less than oneeighth (1/8) of the oil and/or gas produced from said land.  Said lease shall be made in the same manner as provided for by law for the sale of other assets of statechartered associations in the possession of the Commissioner.

C.  Within six (6) months after the commencement of liquidation proceedings, the Commissioner may terminate any executory contract, including but not limited to contracts for services or advertising, to which the association is a party or any obligation of the association as a lessee.  A lessor who receives at least sixty (60) days' notice of the Commissioner's decision to terminate the lease shall not be entitled to a claim for rent other than rent accrued to the date of termination nor for damages for such termination, except that on building or association premises the lessor may receive damages not exceeding one (1) year's rent as provided in such lease.

D.  As soon after the commencement of liquidation as is practicable, the Commissioner shall take the necessary steps to terminate all fiduciary positions held by the  association and take such action as may be necessary to surrender all property held by the association as a fiduciary and to settle its fiduciary accounts.  The Commissioner may transfer such fiduciary accounts to another qualified corporate fiduciary in the same community without assent of the parties.  Notice of such transfer shall be given by registered mail to the parties, and the manner of succession of trust powers and successor trustees shall be in accordance with the procedure provided in Section 1018 of Title 6 of the Oklahoma Statutes.

E.  The right of any agency of the United States insuring deposits to be subrogated to the rights of depositors upon payment of their claims shall not be less extensive than what the law of the United States requires as a condition of the authority to issue such insurance or make such payments to depositors of federal associations.

F.  Within ten (10) days after taking possession, the Commissioner shall send notice of the liquidation to each known depositor, creditor, lessee of a safe deposit box, and bailor of property held by the association, at the address shown on the books of the association.  The notice shall also be published in a newspaper of general circulation in the county in which the main office of the association is located once a week for three (3) successive weeks.  The Commissioner shall send with each notice a statement of the amount shown on the books of the association to be the claim of the depositor or creditor, with all setoffs and any amounts due to the association.  The notice shall demand that property held by the association as bailee or in a safe deposit box be withdrawn by the person entitled thereto and, if the amount claimed differs from that stated in the statement to be due, that the depositor or creditor file a claim with the Commissioner within sixty (60) days from the date of the first publication of the notice of the liquidation given by the Commissioner, in accordance with the procedure prescribed in the notice.  The failure of any depositor, creditor or claimant to receive a notice, or observe the published notice of the liquidation by the Commissioner, shall not relieve such claimant of the obligation to file a claim, if the amount thereof differs from the amount found by the Commissioner.  If no claim is filed by the claimant within the time specified, then the determination of the Commissioner shall be final and shall constitute the claim of that claimant.

G.  Safe deposit boxes, the contents of which have not been removed within sixty (60) days from the date of first publication of the notice of liquidation, shall be opened by the Commissioner.  Sealed packages containing the contents of such box, with a certificate of inventory of contents, together with any unclaimed property held by the association as bailee and certified inventories thereof, shall be held by the Commissioner and administered in accordance with the provisions of the Uniform Unclaimed Property Act.

H.  The Commissioner shall:

1.  Notify each person whose claim has not been allowed in full, by mailing to the lastknown address of such person, as shown on the records of the association, a notice of the time when and the place where the schedule of determinations will be available for inspection and the date when the Commissioner shall file the schedule in court;

2.  As soon as practical and within one hundred twenty (120) days from the date of first publication of the notice of liquidation, determine the amount, if any, owing to each known creditor or depositor and the priority class of such claim under subsection K of this section, and file such determination in the district court where notice of possession was filed; and

3.  As soon as practical and within sixty (60) days from the date of filing, reject any claim if the Commissioner doubts the validity thereof.

I.  Within twenty (20) days after the filing of the schedule of determinations, any creditor, depositor or stockholder may file an objection to any determination which adversely affects such creditor, depositor or stockholder.  Objections so filed shall be heard and determined by the court.  The clerk of such district court shall enter the objection upon the court docket under the case number assigned to the liquidation proceedings.  The Commissioner and interested claimants as the court determines shall be notified of such objection not less than ten (10) days prior to the hearing on such objection.  The matter shall be tried de novo.  No person having a claim against an insolvent association shall maintain action thereon except as herein provided.

J.  After filing the schedule of determinations and establishing proper reserves for the payment of costs, expenses of liquidation and disputed claims, the Commissioner shall pay to any agency of the United States insuring deposits in the insolvent association such sum as may be then available but not exceeding the amount paid out by such agency as such an insurer of deposits and accounts.  The Commissioner from time to time may also make partial distribution to the holders of claims which are undisputed or which have been allowed by the district court, in the order of their priority as provided in subsection K of this section.  The district court supervising the liquidation, as soon as practicable after the establishment of an adequate and proper reserve for payment of disputed claims, costs and expenses of liquidation, shall direct the Commissioner to make a substantial partial pro rata distribution that will not interfere with orderly liquidation, to the holders of undisputed claims and those allowed by the court in the order of their priority, to the extent that there remains only the determination and settlement of disputed claims and the procedures of the final accounting and final distribution to be made by the Commissioner as provided in this section.

K.  1.  The following claims shall have priority in the order specified:

a. obligations incurred by the Commissioner, fees and assessments due to the Oklahoma State Banking Department, and all expenses of liquidation, all of which may be covered by a proper reserve of funds,

b. approved claims of depositors against the general liquidating account of the association,

c. approved claims of general creditors against the general liquidating account of the association,

d. claims otherwise proper which were not filed within the time prescribed by subsection F of this section, and

e. claims of stockholders of the association.

2.  No claim shall be entitled to interest thereon if it is paid within six (6) months after the first publication of notice of the liquidation by the Commissioner.  If the claim is paid after such period, then the unpaid balance of the claim shall be credited with interest at the rate of six percent (6%) per annum for the expiration of the six (6) months until paid or finally canceled by exhaustion of all assets.

3.  All distribution declared in accordance with subsection J of this section, which shall not be claimed within one (1) year, shall be canceled upon the order of the district court having jurisdiction of the liquidation of such insolvent association, and the proceeds thereof returned to the general liquidating account of the insolvent association.  Provided, that notice of the application of the Commissioner to the district court for permission to cancel such unclaimed distributions shall be given by publication for two (2) successive weeks in a newspaper of general circulation in the county where the main office of the insolvent association is located.  The notice shall describe the unclaimed distributions sought to be canceled, giving the name and location of the insolvent association, the name of the payee and the amount and shall recite the Commissioner has filed an application in the designated district court for cancellation of such distributions and shall refer to the application for further particulars.

4.  Any assets remaining after all partial distributions, after all claims have been paid, or ample provisions for reserves are made for payment thereof by the court, shall be distributed to the stockholders in accordance with their respective interests.

L.  Unclaimed funds, other than unclaimed distributions, remaining after completion of the liquidation shall be retained by the Commissioner and administered in accordance with the Uniform Unclaimed Property Act.

M.  1.  During the liquidation procedure, the Commissioner and the agents and employees of the Commissioner shall prepare an annual report that details all receipts and disbursements made from assets in the possession of the Commissioner.  A copy of the annual report shall be filed with the district court of the county where the notice of taking possession was filed and a hearing shall be held thereon.  Interested parties and the board of directors of the insolvent association shall be given such notice of the hearing as the court directs and shall make such objections as they shall desire to the account.  The failure to object at a hearing shall not prejudice the right of any claimant or interested party to object to items of expense and proceedings in the liquidation upon the final account.

2.  When the assets have been distributed in accordance with this section, except unclaimed funds and contents of safe deposit boxes held by the Commissioner, the Commissioner shall file a final account with the court.  Notice of hearing upon the final account shall be given, of not less than ten (10) days nor more than thirty (30) days prior to the date of the hearing, by registered or certified mail, to all interested persons and to the board of directors of the insolvent association and the notice shall be published for two (2) successive weeks in some newspaper of general circulation published in the county where the association is located, showing the nature of the hearing, the date and time of the hearing and that such account is for final settlement of the liquidating account of such insolvent association.

3.  The final account shall reflect all the acts of the Commissioner as supported by annual reports and such necessary items to support the account, including distribution of such remaining cash to the stockholders in accordance with their interests and all other assets to the board of directors of the association as liquidating agents for the stockholders under the Oklahoma General Corporation Act.

4.  The court shall hear all matters relating to the final account; allow, reduce or reject any item of expense; and determine all matters before it.  Any person aggrieved by the judgment of the court may appeal as in any other civil action.

5.  Upon approval of the final account by the court, the Commissioner shall be relieved of liability in connection with the liquidation and shall cancel the charter upon the records of the Department.

Added by Laws 1987, c. 61, § 23, emerg. eff. May 4, 1987.  Amended by Laws 1991, c. 331, § 50, eff. Sept. 1, 1991; Laws 2000, c. 81, § 77, eff. Nov. 1, 2000.

§18381.77.  Liquidation by Federal Deposit Insurance Corporation.

A.  The Federal Deposit Insurance Corporation (FDIC) may act without bond as the liquidating agent of any insured association closed by the State Banking Commissioner.

B.  The Commissioner, upon closing an insured association, may tender to the FDIC the appointment as liquidator of such association.

C.  Upon being notified in writing of the acceptance of such an appointment, the Commissioner shall immediately file in the office of the county clerk of the county where the main office of the insured association is situated a certificate evidencing the appointment of the FDIC as liquidator.  Upon the filing of the certificate the possession of all the assets, business and property of such association of every kind and nature, wheresoever situated, shall be deemed transferred from such association and the Commissioner to the FDIC.  Without the execution of any instruments of conveyance, assignment, transfer or endorsement, the title to all such assets and property shall be vested in the FDIC and the Commissioner thereafter shall be forever relieved from any and all responsibility and liability with respect to the liquidation of such association.  With respect to a federal association, it shall be sufficient to file a certified copy of the resolution of the Director of the Office of Thrift Supervision appointing a receiver.

D.  When the Director of the Office of Thrift Supervision or FDIC transfers all real property, interests in real property, and liens on real property of a closed insured association or federal association, collectively referred to for the purpose of this subsection as the "transferred property", to a single existing association, federal association or bank or a newly chartered federal association, the Director of the Office of Thrift Supervision or FDIC shall file a memorandum of transfer or a memorandum of assignment so stating in the office of the county clerk of the county where real property records must be recorded with respect to the transferred property.  The memorandum shall be executed by an authorized special representative of the Director of the Office of Thrift Supervision or of the FDIC and shall have attached to it certified copies of the resolutions of the Director of the Office of Thrift Supervision or of the FDIC appointing and authorizing the special representative and authorizing the transfer.  In that event, regardless of whether the date of closing predates this statute, it shall not be necessary for the memorandum to describe the transferred property with specificity, nor shall it be necessary for any of the transferred property to be separately conveyed to the transferee association, federal association or bank by an additional instrument.  Thereafter, when the transferee association, federal association or bank conveys, assigns, or releases any of the transferred property, such conveyances, assignments, and releases shall recite that the transferee association, federal association or bank is successor in title to the closed association as evidenced by the memorandum of transfer or the memorandum of assignment and shall further recite the date and county of filing and the book and page of recording the memorandum.

E.  If the FDIC accepts the appointment as liquidator, it shall have and possess all the powers and privileges provided by the laws of this state with respect to the liquidation of an insured association and with respect to the depositors and other creditors of such an association and shall proceed in liquidation as if it were the Commissioner, and shall have the right and power, upon the order of a court of record of competent jurisdiction, to enforce the individual liability of the directors of any such association.

F.  To the extent that any action is required or permitted to be taken by the FDIC or the Director of the Office of Thrift Supervision pursuant to the terms of this section, any similar action taken by the Federal Savings and Loan Insurance Corporation or the Federal Home Loan Bank Board as predecessor federal agencies, either prior to or subsequent to the effective date of this section, shall be equally legal and effective as if such action were taken by the FDIC or the Director of the Office of Thrift Supervision pursuant to the authorization granted herein.

Added by Laws 1987, c. 61, § 24, emerg. eff. May 4, 1987.  Amended by Laws 1989, c. 292, § 2, operative July 1, 1989; Laws 1990, c. 118, § 25, emerg. eff. April 23, 1990; Laws 1993, c. 183, § 70, eff. July 1, 1993; Laws 2000, c. 81, § 78, eff. Nov. 1, 2000.

§18381.78.  Removal of officer, director or employee by Commissioner.

Any officer, director or employee of an association found by the State Banking Commissioner to be dishonest, reckless, unfit to participate in the conduct of the affairs of the association, or to have engaged or participated in any unsafe or unsound practice in connection with an association, or to be practicing a continuing disregard or violation of laws, rules, regulations or orders which are likely to cause substantial loss to the association or likely to seriously weaken the condition of the association shall be removed immediately from office by the board of directors of the association of which such person is an officer, director or employee on the written order of the Commissioner.  The association or officer, employee or director thereof, within ten (10) days of the date of the written order directing removal, may appeal such removal pursuant to the provisions of Section 207 of Title 6 of the Oklahoma Statutes.  As soon as possible thereafter the Supreme Court shall review the order of the Commissioner and make such findings as it deems proper.  During the pendency of the review of the protest against removal, the officer, employee or director shall not perform any of the duties of such office.

Added by Laws 1987, c. 61, § 25, emerg. eff. May 4, 1987.  Amended by Laws 1993, c. 183, § 71, eff. July 1, 1993; Laws 2000, c. 81, § 79, eff. Nov. 1, 2000.

§18-381.79.  Appeal of orders.

Any final order of the Commissioner issued under this act or rules promulgated under this act shall be appealable pursuant to the provisions and requirements of Section 207 of Title 6 of the Oklahoma Statutes.

Added by Laws 2000, c. 81, § 80, eff. Nov. 1, 2000.

§18-381.80.  Criminal offenses - Penalties.

A.  Any person responsible for an act or omission or a criminal offense expressly declared to be unlawful by this act or rules promulgated under this act shall be guilty:

1.  Of a misdemeanor punishable by imprisonment for a term not exceeding one (1) year or a fine not exceeding Fifty Thousand Dollars ($50,000.00), or both; and

2.  If the act or omission was intended to defraud, of a felony punishable by imprisonment not exceeding five (5) years or a fine not exceeding One Hundred Thousand Dollars ($100,000.00), or both.

B.  An officer, director, employee, agent or attorney of an association shall be responsible for an act or omission of the institution declared to be a criminal offense against this act whenever, knowing that such act or omission is unlawful, such person participates in authorizing, executing, ratifying or concealing such act, or in authorizing or ratifying such omission or, having a duty to take the required action, omits to do so.  A director shall be deemed to participate in any action, of which the director has or should have had knowledge, taken or omitted to be taken by the board of which the director is a member unless the director dissents therefrom in writing and promptly notifies the Commissioner of such dissent.

C.  It shall be a criminal offense against this act to violate any lawful order of the Commissioner.  The Commissioner may refer evidence concerning violations of this act or of any rule or order hereunder to the Attorney General of the State of Oklahoma or to the district attorney for the county where a violation occurred in order that an information or indictment for such violations may be filed.  The Attorney General or district attorney may designate and appoint a lawyer of the Oklahoma State Banking Department as special assistant, if available, for the purpose of assisting in or conducting criminal prosecutions arising because of the proceedings provided for in this section.

D.  Unless otherwise provided in this act, it shall be no defense to a criminal prosecution under this act that the defendant did not know the facts establishing the criminal character of the act or omission charged if the defendant could and should have known such facts in the proper performance of such duty.

E.  This section shall not apply to specific offenses for which criminal sanctions have been imposed in other sections of this act.

Added by Laws 2000, c. 81, § 81, eff. Nov. 1, 2000.

§18-381.81.  Payment or reimbursement by association for fine, penalty or judgment upon another person.

It shall be unlawful for an association to pay a fine or penalty imposed by law upon any other person or any judgment against such person or to reimburse directly or indirectly any person by whom such fine, penalty or judgment has been paid, except as otherwise provided in Section 1411 of Title 6 of the Oklahoma Statutes.

Added by Laws 2000, c. 81, § 82, eff. Nov. 1, 2000.

§18-381.82.  Receipt of deposit after notification of insolvency.

It shall be unlawful for an association to receive any deposit after it has been notified by its primary regulator that it is insolvent or for an officer, director or employee who knows or, in the proper performance of such duty should know of the notification of such insolvency, to receive or authorize the receipt of such deposit, if such deposit, when aggregated together with other funds held by the depositor in the same right and capacity, would exceed the limit of any federal deposit insurance coverage.

Added by Laws 2000, c. 81, § 83, eff. Nov. 1, 2000.

§18-381.83.  Certain persons prohibited from serving as officer or director.

It shall be unlawful for any person to serve as an officer or director of an association who:

1.  Has been convicted of an offense constituting, in the jurisdiction in which the conviction was rendered, a violation of the banking, savings institution or credit union laws or other felony involving dishonesty or a breach of trust; and

2.  Is indebted to the bank for more than thirty (30) days based on a judgment that has become final.

Added by Laws 2000, c. 81, § 84, eff. Nov. 1, 2000.

§18-381.84.  Criminal embezzlement, abstraction, or misapplication of association funds.

It shall be a criminal offense for any officer, director, shareholder or employee of any association to directly or indirectly embezzle, abstract, or misapply, or cause to be embezzled, abstracted or misapplied any of the funds or securities or other property of or under the control of the association with intent to deceive, injure, cheat, wrong, or defraud any person or entity.

Added by Laws 2000, c. 81, § 85, eff. Nov. 1, 2000.

§18-381.85.  Publishing, uttering, or circulating false statement or representation.

It shall be unlawful for any person to publish, utter, or circulate any false, malicious, or unprivileged statement or representation for the purpose of injuring any association chartered, existing and doing business within the State of Oklahoma, under and by virtue of the laws of this state, or under and by virtue of the laws of the United States of America.

Added by Laws 2000, c. 81, § 86, eff. Nov. 1, 2000.

§18-381.86.  Injunctions - Enforcement of orders.

A.  Whenever a violation of this act by an association or any officer, director or employee thereof is threatened or impending and will cause substantial injury to the institution or to the depositors, creditors, or stockholders thereof, the district court of the county in which the association is located shall, upon the suit of the State Banking Commissioner, issue an injunction restraining such violation.

B.  Whenever any corporation, not authorized to carry on association business under this act, shall falsely act as an association, or shall use an artificial or corporate name implying it is a trust company, the district court of the county in which lawful service is obtained shall, upon suit of the Commissioner, issue an injunction restraining such act.

C.  All orders of the Commissioner shall be enforced by the district court of the district of domicile of the person or persons to whom the order is directed.

Added by Laws 2000, c. 81, § 87, eff. Nov. 1, 2000.

§18411.  Reports  Misapplication of funds solicited.

Thirty (30) days after the passage and approval of this bill, all chambers of commerce, commercial clubs, or any such associations organized and doing business in this state as is commonly done by such associations shall make a report to their entire membership, setting forth and itemizing their receipts and disbursements for the year ending at the date of the passage and approval of this bill, and shall thereafter make a like report each year ending June 30th.

Every committee or individual who solicits or receives any funds from the public for such associations herein named shall make a full itemized report of all receipts and disbursements thereof.  The report shall be filed with the city clerk where the committee or person soliciting such fund resides, or where the funds were collected; provided, that any person or committee who diverts the funds so collected from the purposes for which they were solicited or collected shall be guilty of a felony and on conviction therefor shall be punished by confinement in the State Penitentiary for a term of not less than one (1) year nor more than five (5) years.

Added by Laws 1919, c. 260, p. 370, § 1.  Amended by Laws 1997, c. 133, § 140, eff. July 1, 1999; Laws 1999, 1st Ex.Sess., c. 5, § 66, eff. July 1, 1999.

NOTE:  Laws 1998, 1st Ex.Sess., c. 2, § 23 amended the effective date of Laws 1997, c. 133, § 140 from July 1, 1998, to July 1, 1999.

§18421.  Corporations authorized  Formation  Purposes.

Ten or more persons may form a corporation for the purpose of conducting an agricultural, dairy, livestock, irrigation, horticultural, mercantile, mining, manufacturing, mechanical, or industrial business upon a cooperative plan, and with their associates, successors and assigns may become and be a body politic and corporate by complying with the provisions of this act.

Laws 1919, c. 147, p. 211, § 1; Laws 1923, c. 167, p. 269, § 1.  

§18422.  Articles of incorporation.

The incorporators shall sign and acknowledge, in the manner required for the signing and acknowledgment of deeds, a certificate of incorporation showing the following facts:

(1) The corporate name.

(2) The purpose of corporation.

(3) The amount of capital stock.

(4) The number of shares, and the par value of the shares into which the capital stock is divided.

(5) The term of the corporate existence.

(6) The number of directors, not less than five and the names and addresses of the incorporating directors who shall manage the concerns of the corporation for the first corporate year.

(7) The name of the town or post office and the county where the principal office or place of business of the corporation shall be located.

(8) Any further provision, not inconsistent with law, which the incorporators may deem expedient to be embodied in such certificate. Laws 1919, c. 147, p. 211, § 2.  

§18423.  Filing of articles  Certificate  Election by existing corporations.

The articles of incorporation shall be filed with the Secretary of State whereupon he shall issue to the corporation over the Great Seal of the State of Oklahoma, a certificate that the articles containing the required statement of facts have been filed in his office, and thereupon the persons signing the articles and their associates, successors and assigns shall be a body politic and corporate by the name and for the purposes stated in said article. Provided, that any corporation doing business as mentioned in Section One, now operating in the State of Oklahoma, may, at regular or special meeting of the shareholders called for such purpose, by a majority vote elect to operate under the provisions of this act, after the action taken at such meeting shall be properly certified by the secretary of such corporation to the Secretary of State.

Laws 1919, c. 147, p. 212, § 3.  

§18424.  Amendment of articles.

The articles of incorporation may be amended at any time, or from time to time, by the affirmative vote of twothirds of the members present at any annual meeting of the stockholders, if notice of the proposed amendment shall have been given in the call for such meeting.  Such amendments shall be put into effect by the directors, who shall sign and acknowledge and file, as above provided, new or revised articles containing such amendments and superseding the original articles.

Laws 1919, c. 147, p. 212, § 4.  

§18425.  Powers.

Each corporation formed under the provisions of this act shall have power:

(1) To have succession by its corporate name for the period limited in its certificate.

(2) To sue and be sued, complain and defend in any court.

(3) To establish and use a common seal and alter the same.

(4) To hold, purchase and convey such real and personal property as the purpose of the corporation may require, including stock in subsidiary or allied cooperative corporations within or without the state.

(5) To appoint such officers and agents as the business may require, including in every case a president and secretary, and to fix their compensation.

(6) To make bylaws not inconsistent with law for the management of its property, the regulation of its business and the transfer of its stock.

(7) To exercise all other lawful powers necessary or proper for the exercise of the powers herein conferred.

Laws 1919, c. 147, p. 212, § 5.  

§18426.  Stock.

The stock of such corporation shall not be sold at less than its par value.  Twenty percent (20%) of the par value of the stock subscribed for shall be paid in before the corporation shall commence business, and the remainder of such subscriptions shall be paid from time to time upon call of the directors.  No certificate of stock shall be issued to any person until the full amount of the subscription therefor shall have been paid.  No person shall become a shareholder except by consent of the board of directors.  Not more than ten percent (10%) of the stock outstanding at any time, and not more than Three Thousand Dollars ($3,000.00) in par value, shall be held by or for one person, firm or corporation.

Laws 1919, c. 147, p. 212, § 6; Laws 1969, c. 226, § 1.  

§18427.  Voting rights.

Each shareholder or subscriber shall be entitled to one vote, and no more, irrespective of the number of shares owned, at any meeting of the stockholders.  Voting by proxies or absentee voting may be permitted and regulated by the bylaws.  In the absence of such provision in the bylaws, no voting by proxies or absentees shall be allowed.

Laws 1919, c. 147, p. 213, § 7.  

§18428.  Liability of subscribers and shareholders.

All subscribers or shareholders shall be severally and individually liable to the creditors of the corporation, to the amount of the unpaid capital stock subscribed for, or held by them, respectively and to no other or further amount.

Laws 1919, c. 147, p. 213, § 8; Laws 1923, c. 167, p. 269, § 2.  

§18429.  Directors  Selection and term  Quorum.

The stock, property and affairs, of such corporation shall be managed by the board of directors, which shall consist of five (5) members, all of whom must be stockholders, and who shall be elected at the annual meeting of the stockholders.  At the first meeting of the stockholders, there shall be elected five directors, one of whom shall serve one (1) year, two of whom shall serve two (2) years, and the remaining two of whom shall serve three (3) years.  As the term of office of each of these directors expires a successor shall be elected, who shall serve for three (3) years, unless sooner removed, or until his successor is elected and qualified.

Notice of the time and place of holding such election shall be published not less than two (2) weeks previous thereto in the newspaper printed nearest to the place where the principal office or place of business of the corporation is located.  A quorum shall consist of at least ten percent (10%) in number of all the stockholders or subscribers for stock who are entitled to vote.

Laws 1919, c. 147, p. 213, § 9; Laws 1923, c. 167, p. 270, § 3; Laws 1941, p. 58, § 1.  

§18430.  Removal of director or officer  Vacancies.

Any director or officer of such corporation may be removed by a majority vote of the stockholders at any regular or special stockholders' meeting lawfully called, and the vacancy may be filled at such meeting or by the remaining directors at any regular or special meeting thereafter.

Laws 1919, c. 147, p. 213, § 10.  

§18431.  Liability of directors.

If the indebtedness of such corporation shall at any time exceed the amount of its subscribed capital stock and surplus the directors assenting thereto shall be personally and individually liable for such excess to the creditors.  Except any indebtedness created in favor of the State warehouse revolving fund.

Laws 1919, c. 147, p. 231, § 11; Laws 1923, c. 167, p. 270, § 4.  

§18432.  Dividends and profits  Reserve fund.

The directors, subject to revision by the stockholders, at any general or special meeting lawfully called, shall apportion the net earnings and profits thereof from time to time at least once in each year in the following manner:

(1) Not less than ten percent (10%) thereof accruing since the last apportionment shall be set aside in a surplus or reserve fund until such fund shall equal at least fifty percent (50%) of the paid up capital stock.

(2) Dividends at a rate not to exceed eight percent (8%) per annum, may, in the discretion of the directors, be declared upon the paid up capital stock.  Five percent (5%) may be set aside for educational purposes.

(3) The remainder of such net earnings and profits shall be apportioned and paid to its members ratably upon the amounts of the products sold to the corporation by its members, and the amounts of the purchases of members from the corporation: provided, that if the bylaws of the corporation shall so provide the directors may apportion such earnings and profits in part to nonmembers upon the amounts of their purchases and sales from or to the corporation.

Laws 1919, c. 147, p. 213, § 12.  

§18433.  Illegal dividends  Liability of directors.

If the directors of such corporation shall declare and pay any dividend or apportionment of earnings, or profits to members or nonmembers when the corporation is insolvent or when it would be rendered insolvent by such payment, such directors shall be jointly and severally liable for all debts of the corporation then existing and for all such debts as shall be thereafter incurred while they shall respectively continue in office.  Any director may relieve himself from such liability at any time before the time fixed for the payment of such dividend or apportionment by filing a certificate in writing of his objection with the secretary of the corporation, and with the county clerk of the county in which the principal office is located.

Laws 1919, c. 147, p. 214, § 13.  

§18434.  Financial statements.

At the time of each dividend or apportionment of profits and at least once in every year, the directors shall cause to be prepared a statement showing the financial condition of the corporation at the end of the period to which such dividend or apportionment relates, in such form as shall fully exhibit the assets and liabilities of the corporation; its earnings and profits, purchases and sales, expenses and outlays, for the period covered by such dividend or apportionment, in such manner that a good understanding of the condition of the company, may be obtained from such statement, and shall cause such statement to be kept on file with the secretary where the same may be examined by any member of the corporation at all reasonable times.

Laws 1919, c. 147, p. 214, § 14.  

§18435.  Use of word "cooperative".

No person, firm or association, nor any corporation other than such as shall be organized under this act, shall make use of the word "Cooperative", in the name under which its or their business is carried on.  Whoever shall violate the provisions of this act shall be punishable by fine of not exceeding One Hundred Dollars ($100.00) for each offense.  The violation of this section may furthermore be enjoined at the suit of any citizen of the state.

Laws 1919, c. 147, p. 214, § 15.  

§18436.  Forfeiture of charter.

Any corporation organized under this act, which fails to comply with all the provisions of this act, shall thereby forfeit its charter, and the Secretary of State is hereby authorized and directed to recall the charter of any such corporation.

Laws 1919, c. 147, p. 214, § 16.  

§18437.  Short title.

This act may be cited as the "Rural Electric Cooperative Act".

Laws 1939, p. 256, § 1.  

§18437.1.  Rural electric cooperatives authorized.

Cooperative, nonprofit, membership corporations may be organized under this act for the purpose of supplying electric energy and promoting and extending the use thereof in rural areas. Corporations organized under this act and corporations which become subject to this act in the manner hereinafter provided are hereinafter referred to as "cooperatives".

Laws 1939, p. 256, § 2.  

§18-437.2.  Powers.

A cooperative shall have power:

(a) To sue and be sued, in its corporate name;

(b) To have a perpetual existence unless a limited period of duration is stated in its charter;

(c) To adopt a corporate seal and alter the same at pleasure;

(d) To generate, manufacture, purchase, acquire, accumulate and transmit electric energy, and to distribute, sell, supply and dispose of electric energy in rural areas to its members, to governmental agencies and political subdivisions, and to other persons not in excess of ten percent (10%) of the number of its members;

(e) To make loans to persons to whom electric energy is or will be supplied by the cooperative for the purpose of, and otherwise to assist such persons in wiring their premises and installing therein electric and plumbing fixtures, appliances, apparatus and equipment of any and all kinds of character, and to accept and otherwise acquire, and to sell, assign, transfer, endorse, pledge, hypothecate and otherwise dispose of notes, bonds, and other evidences of indebtedness and any and all types of security therefor;

(f) To make loans to persons to whom electric energy is or will be supplied by the cooperative for the purpose of, and otherwise to assist such persons in constructing, maintaining and operating electric refrigeration plants;

(g) To become a member in one or more other cooperatives or corporations or to own stock therein;

(h) To construct, purchase, take, receive, lease as lessee, or otherwise acquire, and to own, hold, use, equip, maintain, and operate and to sell, assign, transfer, convey, exchange, lease as lessor, mortgage, pledge, or otherwise dispose of or encumber, electric transmission and distribution lines or systems, electric generating plants, electric refrigeration plants, lands, buildings, structures, dams, plants, and equipment, and any and all kinds and classes of real or personal property whatsoever, which shall be deemed necessary, convenient or appropriate to accomplish the purpose for which the cooperative is organized; provided, that any and all such electrical construction and maintenance shall conform to the requirements and regulations of the National Electrical Safety Code;

(i) To purchase or otherwise acquire, and to own, hold, use and exercise and to sell, assign, transfer, convey, mortgage, pledge, hypothecate, or otherwise dispose of or encumber, franchises, rights, privileges, licenses, rightsofway and easements;

(j) To borrow money and otherwise contract indebtedness therefor and to secure the payment thereof by mortgage, pledge, deed or trust, or any other encumbrance upon any or all of its then owned or after acquired real or personal property, assets, franchises, revenues or income;

(k) To construct, maintain and operate electric transmission and distribution lines along, upon, under and across all public thoroughfares, including without limitation, all roads, highways, streets, alleys and bridges, and upon, under and across all publicly owned lands, subject, however, to the requirements in respect of the use of such thoroughfares and lands that are imposed by the respective authorities having jurisdiction thereof upon corporations, constructing or operating electric transmission and distribution lines or systems; provided that in case an area has been or shall be included, as a result of incorporation, annexation, population growth, or otherwise, within the boundaries of a city, town or village, a cooperative which was furnishing electric energy, or was constructing or operating electric facilities, in such area, prior to such inclusion, shall be entitled to construct, maintain and operate electric transmission and distribution lines and related facilities along, upon, under and across all existing and future public thoroughfares, and to continue and extend the furnishing of electric energy or the construction and operation of electric facilities in such area without obtaining the consent, franchise, license, permit or other authority of such city, town or village, subject, however, to compliance with the lawful safety requirements of such city, town or village as to the manner of constructing and maintaining facilities on such thoroughfares, and subject to payment of taxes of such city, town or village that may be levied and assessed as provided in Section 1201 of Title 68 of the Oklahoma Statutes; and provided further that if such city, town or village in which an area has been or shall be included, as aforesaid, owns and operates a system for the furnishing of electric energy to its inhabitants, the cooperative furnishing electric energy in such area shall transfer to such city, town or village, upon its request, the cooperative's electric distribution facilities used in furnishing electric energy in said area, other than facilities used in furnishing electric energy for resale or to premises of the cooperative, subject, however, to the following requirement:  The city, town or village shall pay to the cooperative an amount to compensate the cooperative for the fair value of the cooperative's facilities to be acquired by the city, town or village.  If such cooperative and city, town or village cannot agree upon the amount to be paid to the cooperative, the city, town or village is authorized to file a proceeding in the district court of the county in which such city, town or village, or any part thereof, is located, for the acquisition of the cooperative's electric distribution facilities used in furnishing electric energy in said area, other than facilities used in furnishing electric energy for resale or to premises of the cooperative, and the procedure followed and the method of ascertaining just compensation to be paid the cooperative will be as provided in Article 2, Section 24, of the Oklahoma Constitution and Sections 53 to 58, inclusive, of Title 66 of the Oklahoma Statutes.

(l) To conduct its business and exercise any or all of its powers within or without this state;

(m) To adopt, amend and repeal bylaws; and

(n) To do and perform any and other acts and things, and to have and exercise any and all other powers which may be necessary, convenient or appropriate to accomplish the purpose for which the cooperative is organized;

(o) To have and exercise the right of eminent domain in the same manner and by like proceedings as provided for railroad corporations under the laws of this state.   

(p) To participate with, jointly own or operate or enter into loans with any person, firm, corporation, limited liability company or any other kind of business entity including, but not limited to, privately owned electric utilities for the construction, operation or maintenance of electric generation, transmission or distribution facilities.

Added by Laws 1939, p. 256, § 3, emerg. eff. April 14, 1939.  Amended by Laws 1939, p. 271, § 1, emerg. eff. May 12, 1939; Laws 1949, p. 128, § 1, emerg. eff. March 25, 1949; Laws 1961, p. 200, § 1; Laws 1988, c. 323, § 1, eff. Nov. 1, 1988; Laws 2002, c. 32, § 1, emerg. eff. April 10, 2002.

§18437.3.  Name.

The name of each cooperative shall include the words "electric" and "cooperative", provided, however, such limitation shall not apply if, in an affidavit made by the president or vice president of a cooperative and filed with the Secretary of State, it shall appear that the cooperative desires to transact business in another state and is precluded therefrom by reason of its name.  The name of a cooperative shall distinguish it from the name of any other corporation organized under the laws of, or authorized to transact business in, this state.  The words "electric" and "cooperative" shall not both be used in the name of any corporation organized under the laws of, or authorized to transact business in, this state, except a cooperative or a corporation transacting business in this state pursuant to the provisions of this act.

Laws 1939, p. 258, § 4.  

§18437.4.  Incorporators.

Five or more natural persons, or two or more cooperatives, may organize a cooperative in the manner hereinafter provided.

Laws 1939, p. 258, § 5.  

§18437.5.  Articles of incorporation.

(a) The articles of incorporation of a cooperative shall recite in the caption that they are executed pursuant to this act, shall be signed and acknowledged by each of the incorporators, and shall state: (1) The name of the cooperative; (2) The address of its principal office; (3) The names and addresses of the incorporators; (4) The names and addresses of the persons who shall constitute its first board of trustees; and (5) Any provisions not inconsistent with this act deemed necessary or advisable for the conduct of its business and affairs.

(b) Such articles of incorporation shall be submitted to the Secretary of State for filing as provided in this act.

(c) It shall not be necessary to set forth in the articles of incorporation of a cooperative the purpose for which it is organized or any of the corporate powers vested in a cooperative under this act.

Laws 1939, p. 258, § 6.  

§18437.6.  Bylaws.

The original bylaws of a cooperative shall be adopted by its board of trustees.  Thereafter bylaws shall be adopted, amended or repealed by its members.  The bylaws shall set forth the rights and duties of members and trustees and may contain other provisions for the regulation and management of the affairs of the cooperative not inconsistent with this act or with its articles of incorporation.

Laws 1939, p. 259, § 7.  

§18437.7.  Members.

(a) No person who is not an incorporator shall become a member of a cooperative unless such person shall agree to use electric energy furnished by the cooperative when such electric energy shall be available through its facilities.  The bylaws of a cooperative may provide that any person, including a corporation, shall cease to be a member thereof if he shall fail or refuse to use electric energy made available by the cooperative or if electric energy shall not be made available to such person by the cooperative within a specified time after such person shall have become a member thereof. Membership in the cooperative shall not be transferable, except as provided in the bylaws.  The bylaws may prescribe additional qualifications and limitations in respect to membership.

(b) An annual meeting of the members shall be held at such time as shall be provided in the bylaws.

(c) Special meetings of the members may be called by the board of trustees, by any three trustees, by not less than ten percent (10%) of the members, or by the president.

(d) Meetings of members shall be held at such place as may be provided in the bylaws.  In the absence of any such provision, all meetings shall be held in the city or town in which the principal office of the cooperative is located.

(e) Except as hereinafter otherwise provided, written or printed notice stating the time and place of each meeting of members and, in the case of a special meeting, the purpose or purposes for which the meeting is called, shall be given to each member, either personally or by mail, not less than ten (10) nor more than twentyfive (25) days before the date of the meeting.

(f) Five percent (5%) of all members, present in person, shall constitute a quorum for the transaction of business at all meetings of the members, unless the bylaws prescribe the presence of a greater percentage of the members for a quorum.  If less than a quorum is present at any meeting, a majority of those present in person may adjourn the meeting from time to time without further notice.

(g) Each member shall be entitled to one vote on each matter submitted to a vote at a meeting.  Voting shall be in person, but, if the bylaws so provide, may also be by proxy or by mail, or both. If the bylaws provide for voting by proxy or by mail, they shall also prescribe the conditions under which proxy or mail voting shall be exercised.  In any event, no person shall vote a proxy for more than three members at any meeting of the members.

Laws 1939, p. 259, § 8.  

§18437.8.  Board of trustees.

(a)  The business and affairs of a cooperative shall be managed by a board of not less than five (5) trustees, each of whom shall be a member of the cooperative or of another cooperative which shall be a member thereof.  The bylaws shall prescribe the number of trustees, their qualifications, other than those provided for in this act, the manner of holding meetings of the board of trustees and of the election of successors to trustees who shall resign, die, or otherwise be incapable of acting.  The bylaws may also provide for the removal of trustees from office and for the election of their successors.  Without approval of the members, trustees shall not receive any salaries for their services as trustees.  The bylaws may, however, provide that a fixed fee and expenses of attendance, if any, may be allowed to each trustee for attendance at each meeting of the board of trustees and such other meetings, seminars, workshops, conferences or for other business purposes authorized by the board of trustees.

(b)  The trustees of a cooperative named in any articles of incorporation, consolidation, merger or conversion, as the case may be, shall hold office until the next following annual meeting of the members or until their successors shall have been elected and qualified.  At each annual meeting or, in case of failure to hold the annual meeting as specified in the bylaws, at a special meeting called for that purpose, the members shall elect trustees to hold office until the next following annual meeting of the members, except as hereinafter otherwise provided.  Each trustee shall hold office for the term for which he is elected or until his successor shall have been elected and qualified.

(c)  The officers of a cooperative shall consist of a president, secretary and treasurer, who shall be elected annually by and from the board of trustees.  No person shall continue to hold any of the above offices after he shall have ceased to be a trustee.  The offices of secretary and/or treasurer may be held by the same person.  The board of trustees may also elect or appoint a chief executive or operating officer or such other officers, agents, or employees, whether or not such persons are trustees of the cooperative, as it shall deem necessary or advisable and shall prescribe the powers and duties thereof.  Any officer may be removed from office and his successor elected in the manner prescribed in the bylaws.  Vacancies in office may be filled by the board of trustees.

(d)  The bylaws may provide that, in lieu of electing the whole number of trustees annually, the trustees shall be divided into three classes at the first or any subsequent annual meeting, each class to be as nearly equal in number as possible, with the term of office of the trustees of the first class to expire at the next succeeding annual meeting and the term of the second class to expire at the second succeeding annual meeting, and the term of the third class to expire at the third succeeding annual meeting.  At each annual meeting after such classification a number of trustees equal to the number of the class whose term expires at the time of such meeting shall be elected to hold office until the third succeeding annual meeting.

(e)  A majority of the board of trustees shall constitute a quorum.

(f)  If a husband and wife hold a joint membership in a cooperative, either one, but not both, may be elected a trustee.

(g)  The board of trustees may exercise all of the powers of a cooperative except such as are conferred upon the members by this act, or its articles of incorporation or bylaws.

Laws 1939, p. 260, § 9; Laws 1955, p. 151, § 1.  Amended by Laws 1990, c. 202, § 1, emerg. eff. May 10, 1990.

§18437.9.  Voting districts.

Notwithstanding any other provision of this act, the bylaws may provide that the territory in which a cooperative supplies electric energy to its members shall be divided into two or more voting districts and that, in respect of each such voting district, (1) a designated number of trustees shall be elected by the members residing therein, or (2) a designated number of delegates shall be elected by such members, or (3) both such trustees and delegates shall be elected by such members.  In any such case the bylaws shall prescribe the manner in which such voting districts and the members thereof, and the delegates and trustees, if any, elected therefrom shall function and the powers of the delegates, which may include the power to elect trustees.  No member at any voting district meeting and no delegate at any meeting shall vote by proxy or by mail.

Laws 1939, p. 261, § 10.  

§18437.10.  Officers.

The officers of a cooperative shall consist of a president, vice president, secretary and treasurer, who shall be elected annually by and from the board of trustees.  No person shall continue to hold any of the above offices after he shall have ceased to be a trustee.  The offices of secretary and of treasurer may be held by the same person.  The board of trustees may also elect or appoint such other officers, agents, or employees as it shall deem necessary or advisable and shall prescribe the powers and duties thereof.  Any officer may be removed from office and his successor elected in the manner prescribed in the bylaws.  Vacancies in office may be filed by the board of trustees.

Laws 1953, p. 486, § 10.  

§18437.11.  Amendment of articles of incorporation  Change of location without amending articles.

(a) A cooperative may amend its articles of incorporation by complying with the following requirements:

(1) The proposed amendment shall be first approved by the board of trustees and shall then be submitted to a vote of the members at any annual or special meeting thereof, the notice of which shall set forth the proposed amendment.  The proposed amendment, with such changes as the members shall choose to make therein, shall be deemed to be approved on the affirmative vote of not less than twothirds of those members voting thereon at such meeting; and

(2) Upon such approval by the members, articles of amendment shall be executed and acknowledged on behalf of the cooperative by its president or vice president and its corporate seal shall be affixed thereto and attested by its secretary.  The articles of amendment shall recite in the caption that they are executed pursuant to this act and shall state: (a) the name of the cooperative; (b) the address of its principal office; (c) the date of the filing of its articles of incorporation in the office of the Secretary of State; and (d) the amendment to its articles of incorporation.  The president or vice president executing such articles of amendment shall also make and annex thereto an affidavit stating that the provisions of this section were duly complied with. Such articles of amendment and affidavit shall be submitted to the Secretary of State for filing as provided in this act.

(b) A cooperative may, without amending its articles of incorporation, upon authorization of its board of trustees, change the location of its principal office by filing a certificate of change of principal office, executed and acknowledged by its president or vice president under its seal attested by its secretary, in the office of the Secretary of State and also in each county office in which its articles of incorporation or any prior certificate of change of principal office of such cooperative has been filed.  Such cooperative shall also, within thirty (30) days after the filing of such certificate of change of principal office in any county office, file therein certified copies of its articles of incorporation and all amendments thereto, if the same are not already on file therein.

Laws 1939, p. 261, § 12.  

§18437.12.  Consolidation.

Any two or more cooperatives, each of which is hereinafter designated a "consolidating cooperative", may consolidate into a new cooperative, hereinafter designated the "new cooperative", by complying with the following requirements:

(a) The proposition for the consolidation of the consolidating cooperatives into the new cooperative and proposed articles of consolidation to give effect thereto shall be first approved by the board of trustees of each consolidating cooperative.  The proposed articles of consolidation shall recite in the caption that they are executed pursuant to this act and shall state: (1) The name of each consolidating cooperative, the address of its principal office, and the date of the filing of its articles of incorporation in the office of the Secretary of State; (2) the name of the new cooperative and the address of its principal office; (3) the names and addresses of the persons who shall constitute the first board of trustees of the new cooperative; (4) the terms and conditions of the consolidation and the mode of carrying the same into effect, including the manner and basis of converting memberships in each consolidating cooperative into memberships in the new cooperative and the issuance of certificates of membership in respect of such converted memberships; and (5) any provisions not inconsistent with this act deemed necessary or advisable for the conduct of the business and affairs of the new cooperative;

(b) The proposition for the consolidation of the consolidating cooperatives into the new cooperative and the proposed articles of consolidation approved by the board of trustees of each consolidating cooperative shall then be submitted to a vote of the members thereof at any annual or special meeting thereof, the notice of which shall set forth full particulars concerning the proposed consolidation. The proposed consolidation and the proposed articles of consolidation shall be deemed to be approved upon the affirmative vote of not less than twothirds of those members of each consolidating cooperative voting thereon at such meeting; and

(c) Upon such approval by the members of the respective consolidation cooperatives, articles of consolidation in the form approved shall be executed and acknowledged on behalf of each consolidating cooperative by its president or vice president and its seal shall be affixed thereto and attested by its secretary.  The president or vice president of each consolidating cooperative executing such articles of consolidation shall also make and annex thereto an affidavit stating that the provisions of this section were duly complied with by such cooperative.  Such articles of consolidation and affidavits shall be submitted to the Secretary of State for filing as provided in this act.

Laws 1939, p. 262, § 13.

§18437.13.  Merger.

Any one or more cooperatives, each of which is hereinafter designated a "merging cooperative", may merge into another cooperative, hereinafter designated the "surviving cooperative", by complying with the following requirements:

(a) The proposition for the merger of the merging cooperatives into the surviving cooperative and proposed articles of merger to give effect thereto shall be first approved by the board of trustees of each merging cooperative and by the board of trustees of the surviving cooperative.  The proposed articles of merger shall recite in the caption that they are executed pursuant to this act and shall state: (1) the name of each merging cooperative, the address of its principal office, and the date of the filing of its articles of incorporation in the office of the Secretary of State; (2) the name of the surviving cooperative and the address of its principal office; (3) a statement that the merging cooperatives elect to be merged into the surviving cooperative; (4) the terms and conditions of the merger and the mode of carrying the same into effect, including the manner and basis of converting the memberships in the merging cooperative or cooperatives into memberships in the surviving cooperative and the issuance of certificates of membership in respect of such converted memberships; and (6) any provisions not inconsistent with this act deemed necessary or advisable for the conduct of the business and affairs of the surviving cooperative;

(b) The proposition for the merger of the merging cooperatives into the surviving cooperative and the proposed articles of merger approved by the board of trustees of the respective cooperatives, parties to the proposed merger, shall then be submitted to a vote of the members of each such cooperative at any annual or special meeting thereof, the notice of which shall set forth full particulars concerning the proposed merger.  The proposed merger and the proposed articles of merger shall be deemed to be approved upon the affirmative vote of not less than twothirds of those members of each cooperative voting thereon at such meeting; and

(c) Upon such approval by the members of the respective cooperatives, parties to the proposed merger, articles of merger in form approved shall be executed and acknowledged on behalf of each such cooperative by its president or vice president and its seal shall be affixed thereto and attested by its secretary.  The president or vice president of each cooperative executing such articles of merger shall also make and annex thereto an affidavit stating that the provisions of this section were duly complied with by such cooperative.  Such articles of merger and affidavits shall be submitted to the Secretary of State for filing as provided in this act.

Laws 1939, p. 263, § 14.  

§18437.14.  Effect of consolidation or merger.

The effect of consolidation or merger shall be as follows:

(a) The several cooperatives, parties to the consolidation or merger, shall be a single cooperative, which, in the case of a consolidation, shall be the new cooperative provided for in the articles of consolidation, and, in the case of a merger, shall be that cooperative designated in the articles of merger as the surviving cooperative, and the separate existence of all cooperatives, parties to the consolidation or merger, except the new or surviving cooperative, shall cease;

(b) Such new or surviving cooperative shall have all the rights, privileges, immunities, and powers and shall be subject to all the duties and liabilities of a cooperative organized under the provisions of this act, and shall possess all the rights, privileges, immunities, and franchises, as well of a public as of a private nature, and all property, real and personal, applications for membership, all debts due on whatever account, and all other choses in action, of each of the consolidating or merging cooperatives, and furthermore all and every interest of, or belonging or due to, each of the cooperatives so consolidated or merged, shall be taken and deemed to be transferred to and vested in such new or surviving cooperative without further act or deed; and the title to any real estate, or any interest therein, under the laws of this state vested in any such cooperatives shall not revert or be in any way impaired by reason of such consolidation or merger;  (c) Such new or surviving cooperative shall thenceforth be responsible and liable for all of the liabilities and obligations of each of the cooperatives so consolidated or merged, and any claim existing, or action or proceeding pending, by or against any of such cooperatives may be prosecuted as if such consolidation or merger had not taken place, but such new or surviving cooperative may be substituted in its place;

(d) Neither the rights of creditors nor any liens upon the property of any of such cooperatives shall be impaired by such consolidation or merger; and

(e) In the case of a consolidation, the articles of consolidation shall be deemed to be the articles of incorporation of the new cooperative; and in the case of a merger, the articles of incorporation of the surviving cooperative shall be deemed to be amended to the extent, if any, that changes therein are provided for in the articles of merger.

Laws 1939, p. 264, § 15.  

§18437.15.  Conversion of existing corporations.

Any corporation organized under the laws of this state for the purpose, among others, of supplying electric energy in rural areas may be converted into a cooperative and become subject to this act with the same effect as if originally organized under this act by complying with the following requirements:

(a) The proposition for the conversion of such corporation into a cooperative and proposed articles of conversion to give effect thereto shall be first approved by the board of trustees or the board of directors, as the case may be, of such corporation.  The proposed articles of conversion shall recite in the caption that they are executed pursuant to this act and shall state: (1) the name of the corporation prior to its conversion into a cooperative; (2) the address of the principal office of such corporation; (3) the date of the filing of the articles of incorporation of such corporation in the office of the Secretary of State; (4) the statute or statutes under which such corporation was organized; (5) the name assumed by such corporation; (6) a statement that such corporation elects to become a cooperative, nonprofit, membership corporation subject to this act; (7) the manner and basis of converting either memberships in or shares of stock of such corporation into memberships therein after completion of the conversion; and (8) any provisions not inconsistent with this Act deemed necessary or advisable for the conduct of the business and affairs of such corporation;

(b) The proposition for the conversion of such corporation into a cooperative and the proposed articles of conversion approved by the board of trustees or board of directors, as the case may be, of such corporation shall then be submitted to a vote of the members or stockholders, as the case may be, of such corporation at any duly held annual or special meeting thereof, the notice of which shall set forth full particulars concerning the proposed conversion.  The proposition for the conversion of such corporation into a cooperative and the proposed articles of conversion, with such amendments thereto as the members or stockholders of such corporation shall choose to make, shall be deemed to be approved upon the affirmative vote of not less than twothirds of those members of such corporation voting thereon at such meeting, or, if such corporation is a stock corporation, upon the affirmative vote of the holders of not less than twothirds of the capital stock of such corporation represented at such meeting;

(c) Upon such approval by the members or stockholders of such corporation, articles of conversion in the form approved by such members or stockholders shall be executed and acknowledged on behalf of such corporation by its president or vice president and its corporate seal shall be affixed thereto and attested by its secretary.  The president or vice president executing such articles of conversion on behalf of such corporation shall also make and annex thereto an affidavit stating that the provisions of this section with respect to the approval of its trustees or directors and its members or stockholders, of the proposition for the conversion of such corporation into a cooperative and such articles of conversion were duly complied with.  Such articles of conversion and affidavit shall be submitted to the Secretary of State for filing as provided in this act.  The term "articles of incorporation" as used in this act shall be deemed to include the articles of conversion of a converted corporation.

Laws 1939, p. 265, § 16.  

§18437.16.  Initiative by members.

Not withstanding any other provision of this act, any proposition embodied in a petition signed by not less than ten percent (10%) of the members of a cooperative, together with any document submitted with such petition to give effect to the proposition, shall be submitted to the members of a cooperative, either at a special meeting of the members held within fortyfive (45) days after the presentation of such petition or, if the date of the next annual meeting of members falls within ninety (90) days after such presentation or if the petition so requests, at such annual meeting. The approval of the board of trustees shall not be required in respect of any proposition or document submitted to the members pursuant to this section and approved by them, but such proposition or document shall be subject to all other applicable provisions of this act.  Any affidavit or affidavits required to be filed with any such document pursuant to applicable provisions of this act shall, in such case, be modified to show compliance with the provisions of this section.

Laws 1939, p. 266, § 17.  

§18437.17.  Dissolution.

A cooperative may dissolve in the manner provided by law for the dissolution of private corporations.

Laws 1939, p. 267, § 18.  

§18437.18.  Filing of articles  Certificate of incorporation  Filing.

Articles of incorporation, amendment, consolidation, merger or conversion, as the case may be, when executed and acknowledged and accompanied by such affidavits as may be required by applicable provisions of this act, shall be presented to the Secretary of State for filing in the records of his office.  If the Secretary of State shall find that the articles presented conform to the requirements of this act, he shall, upon the payment of the fees as in this act provided, file the articles so presented in the records of his office and shall issue over the Great Seal of the state an appropriate certificate of incorporation, amendment, consolidation, merger or conversion, as the case may be, and thereupon the incorporation, amendment, consolidation, merger or conversion provided for therein shall be in effect.

Laws 1939, p. 267, § 19; Laws 1979, c. 259, § 3.  

§18437.19.  Refunds to members.

Revenues of a cooperative for any fiscal year in excess of the amount thereof necessary:

(a) To defray expenses of the cooperative and of the operation and maintenance of its facilities during such fiscal year;

(b) To pay interest and principal obligations of the cooperative coming due in such fiscal year;

(c) To finance, or to provide a reserve for the financing of, the construction or acquisition by the cooperative of additional facilities to the extent determined by the board of trustees;

(d) To provide a reasonable reserve for working capital;

(e) To provide a reserve for the payment of indebtedness of the cooperative maturing more than one (1) year after the date of the incurrence of such indebtedness in an amount not less than the total of the interest and principal payments in respect thereof required to be made during the next following fiscal year; and

(f) To provide a fund for education in cooperation and for the dissemination of information concerning the effective use of electric energy and other services made available by the cooperative, shall, unless otherwise determined by a vote of the members, be distributed by the cooperative to its members as patronage refunds prorated in accordance with the patronage of the cooperative by the respective members paid for during such fiscal year.  Nothing herein contained shall be construed to prohibit the payment by a cooperative of all or any part of its indebtedness prior to the date when the same shall become due.

Laws 1939, p. 267, § 20.  

§18-437.20.  Disposition of property.

A cooperative may not sell, mortgage, lease or otherwise dispose of or encumber all or any substantial portion of its property unless such sale, mortgage, lease, or other disposition or encumbrance is authorized at a duly held meeting of the members thereof by the affirmative vote of not less than twothirds of all of the members of the cooperative, and unless the notice of such proposed sale, mortgage, lease, or other disposition or encumbrance shall have been contained in the notice of the meeting; provided, however, that notwithstanding anything herein contained, or any other provisions of law, the board of trustees of a cooperative, without authorization by the members thereof, shall have full power and authority upon an affirmative vote of not less than two-thirds (2/3) of the board of trustees to authorize the execution and delivery of a lease and leaseback transaction only where the board of trustees determines that such transaction will not impair the ability of the cooperative to use the assets as needed to serve the members; provided, however, that such transactions shall apply only to the physical assets of a cooperative and shall not be used to effect a sale or other disposition of the cooperative business entity itself; and further, shall have full power and authority to authorize the execution and delivery of a mortgage or mortgages or a deed or deeds of trust upon, or the pledging or encumbering of, any or all of the property, assets, rights, privileges, licenses, franchises and permits of the cooperative, whether acquired or to be acquired, and wherever situated, as well as the revenues and income therefrom, all upon such terms and conditions as the board of trustees shall determine, to secure any indebtedness of the cooperative to the United States of America or any instrumentality or agency thereof or to any corporation or financial institution authorized to assist in the credit and financial needs of rural electric cooperatives.

Added by Laws 1939, p. 268, § 21, emerg. eff. April 14, 1939.  Amended by Laws 1969, c. 53, § 1; Laws 2002, c. 25, § 1, emerg. eff. April 5, 2002.

§18437.21.  Nonliability of members, trustees and officers for debts of cooperative.

No member, trustee or officer of the cooperative shall be liable or responsible individually for any debts of the cooperative.

Laws 1939, p. 268, § 22.  

§18437.22.  Waiver of notice.

Whenever any notice is required to be given under the provisions of this act or under the provisions of the articles of incorporation or bylaws of a cooperative, waiver thereof in writing, signed by the person or persons entitled to such notice, whether before or after the time fixed for the giving of such notice, shall be deemed equivalent to such notice.  If a person or persons entitled to notice of a meeting shall attend such meeting, such attendance shall constitute a waiver of notice of the meeting, except in case the attendance is for the express purpose of objecting to the transaction of any business because the meeting shall not have been lawfully called or convened.

Laws 1939, p. 269, § 23.  

§18437.23.  Foreign corporation.

Any corporation organized on a nonprofit or a cooperative basis for the purpose of supplying electric energy in rural areas and owning and operating electric transmission or distribution lines in a state adjacent to this state may file in the office of the Secretary of State a certified copy of its charter or articles of incorporation which shall be recorded in a book to be kept by the Secretary of State for that purpose, and thereupon, upon payment of the fees required of a cooperative for the filing of articles of incorporation, and the appointment of a service agent as provided by law, such foreign corporation shall be authorized to transact business in this state and shall have all the rights, powers and privileges conferred upon a cooperative under this act.

Laws 1939, p. 269, § 24.  

§18437.24.  Fees.

The Secretary of State shall have charge and collect for:

(a)  Filing articles of incorporation, Twentyfive Dollars ($25.00);

(b)  Filing articles of amendment, Ten Dollars ($10.00);

(c)  Filing articles of consolidation or merger, Twentyfive Dollars ($25.00);

(d)  Filing articles of conversion, Twentyfive Dollars ($25.00);

(e)  Filing certificate of change of principal office, Ten Dollars ($10.00);

(f)  Issuing certificate of incorporation, amendment, consolidation, merger or conversion, or any certified copy thereof, Five Dollars ($5.00).

Amended by Laws 1984, c. 229, § 8, operative July 1, 1984.  

§18437.25.  Exemption from excise and income taxes  License fee.

Each cooperative and each foreign corporation transacting business in this state pursuant to this act shall pay annually, on or before the thirtyfirst day of August, to the Oklahoma Tax Commission, a fee of One Dollar ($1.00) for each one hundred persons or fraction thereof to whom electricity is supplied within the state by it, as of June thirtieth preceding, but shall be exempt from all other excise and income taxes whatsoever.

Laws 1939, p. 270, § 26.  

§18437.27.  Securities Act exemption.

The provisions of the Securities Act, Article 23 of Chapter 24, Oklahoma Statutes 1931, as amended, shall not apply to any note, bond or other evidence of indebtedness issued by any cooperative or foreign corporation transacting business in this state pursuant to this act, to the United States of America or any agency or instrumentality thereof, or to any mortgage or deed of trust executed to secure the same.  The provisions of said Securities Act shall not apply to the issuance of membership certificates by any cooperative or any such foreign corporation.

Laws 1939, p. 270, § 28.  

§18437.28.  Definitions.

In this act, unless the context otherwise requires;

(a) "Rural area" means any area not included within the boundaries of any incorporated or unincorporated city, town or village, having a population in excess of one thousand five hundred (1,500) persons, and any area included within the boundaries of any such city, town or village as a result of incorporation, annexation, population growth, or otherwise, in which area a cooperative commenced or commences the construction or operation of electric facilities or the furnishing of electric energy prior to such incorporation, annexation or population growth.

(b) "Person" includes any natural person, firm, association, corporation, business trust, partnership, federal agency, state or political subdivision or agency thereof, or any body politic; and

(c) "Member" means each incorporator of a cooperative and each person admitted to and retaining membership therein, and shall include a husband and wife admitted to joint membership.

Laws 1939, p. 270, § 29; Laws 1961, p. 201, § 2.  

§18437.29.  Construction of act.

This act shall be construed liberally.  The enumeration of any object, purpose, power, manner, method, or thing shall not be deemed to exclude like or similar object, purposes, powers, manner, methods or things.

Laws 1939, p. 270, § 30.  

§18438.1.  Short title of act.

This act may be cited as the "Telephone Cooperative Corporations  Act".

Laws 1953, p. 484, § 1; Laws 1991, c. 135, § 1, eff. Sept. 1, 1991.

§18438.2.  Organization authorized  Purpose.

Cooperative, nonprofit corporations may be organized under this act for the purpose of furnishing communication services to the widest practicable number of users of such service.

Laws 1953, p. 484, § 2; Laws 1991, c. 135, § 2, eff. Sept. 1, 1991.

§18438.3.  Definitions.

As used in this act:

1.  "Cooperative" means any corporation organized pursuant to or which becomes subject to the provisions of the Telephone Cooperative Corporations Act;

2.  "Person" means any natural person, firm, association, corporation, business trust, or partnership;

3.  "Telephone company" means any natural person, firm, association, corporation, or partnership, other than a cooperative or mutual telephone company, owning, leasing, or operating any line, facility, or system used in furnishing telephone service within this state;

4.  "Communication services" means the transmitting, receiving, or both, of information, signals or messages by wire, radio, cellular radio, microwave, fiber optics or any other means, and includes, but is not limited to, the providing of lines, facilities and systems used in providing the services;

5.  "Member" means the incorporators of a cooperative and each person thereafter lawfully admitted to membership therein pursuant to the provisions contained in the bylaws; and

6.  "Patron" means a member of the cooperative who is eligible to receive patronage dividends or to earn capital credits as a result of the purchase of certain services from the cooperative, as provided by subsection D of Section 438.9 of this title.

Amended by Laws 1983, c. 3, § 1, emerg. eff. Feb. 21, 1983; Laws 1991, c. 135, § 3, eff. Sept. 1, 1991.

§18438.4.  Powers of cooperative.

A cooperative shall have power:

1.  To sue and be sued in its corporate name;

2.  To have a perpetual existence unless a limited period of duration is stated in its articles of incorporation;

3.  To adopt a corporate seal and alter the same;

4.  To furnish, improve and expand any or all communications services to its members, to other persons, and through interconnection of facilities to any number of subscribers of other communications systems, and through pay stations to any number of users; provided, however, that no such regulated communications services, as determined by the Oklahoma Corporation Commission, shall be furnished to persons located within the certified territory of another local exchange telephone company; and provided further that a cooperative which acquires existing communications facilities, systems or territories may continue service to persons who are already receiving service from such facilities and systems or who are located or who become located within the acquired territories.  Such persons may become members as provided in the bylaws;

5.  To construct, purchase, lease as lessee, or otherwise acquire, and to improve, expand, install, equip, maintain, and operate, and to sell, assign, convey, lease as lessor, mortgage, pledge, or otherwise dispose of or encumber, communication lines, facilities or systems, lands, buildings, structures, plants and equipment, exchanges, and any other real or personal property, tangible or intangible, which shall be deemed necessary, convenient or appropriate to accomplish the purpose for which the cooperative is organized; provided, however, that a cooperative shall not duplicate existing telephone lines, facilities or systems providing reasonably adequate service;

6.  To connect and interconnect its communication lines, facilities or systems with other communication lines, facilities or systems; provided that any such connection or interconnection shall be in such manner and according to such specifications as will avoid interference with or hazards to existing communication lines, facilities or systems;

7.  To make its facilities available to persons furnishing communication services within or without this state;

8.  To purchase, lease as lessee, or otherwise acquire, and to use and exercise and to sell, assign, convey, mortgage, pledge or otherwise dispose of or encumber, franchises, rights, privileges, licenses and easements;

9.  To issue membership certificates and nonvoting shares of stock as hereinafter provided;

10.  To borrow money and otherwise contract indebtedness, and to issue or guarantee notes, bonds, and other evidences of indebtedness, and to secure the payment thereof by mortgage, pledge, or deed of trust of, or any other encumbrance upon, any or all of its thenowned or afteracquired real or personal property, assets, franchises, or revenues;

11.  To construct, maintain and operate communication lines and facilities along, upon, under and across publicly owned lands and public thoroughfares, including, without limitation, all roads, highways, streets, alleys, bridges and causeways; subject, however, to the same requirements and limitations with respect to the use or occupancy of such thoroughfares and lands as are now or hereafter imposed by the laws of this state;

12.  To exercise the power of eminent domain in the manner provided by the laws of this state for the exercise of such power by other corporations constructing or operating telephone lines, facilities or systems;

13.  To become a member of other cooperatives, joint ventures, partnerships, corporations or other legal entities or to own stock therein;

14.  To conduct its business and exercise its powers within or without this state;

15.  To adopt, amend and repeal bylaws;

16.  To make any and all legal contracts necessary, convenient or appropriate for the full exercise of the powers herein granted; and

17.  To do and perform any other acts and things, and to have and exercise any other powers which may be necessary, convenient or appropriate to accomplish the purpose for which the cooperative is organized.

Amended by Laws 1988, c. 323, § 2, eff. Nov. 1, 1988; Laws 1991, c. 135, § 4, eff. Sept. 1, 1991.

§18438.5.  Name.

The name of a cooperative shall include the words "telephone" and "cooperative", and the abbreviation "Inc.", unless, in an affidavit made by its president or vice president, and filed with the Secretary of State, or in an affidavit made by a person signing articles of incorporation, consolidation, merger or conversion, which relate to such cooperative, and filed, together with any such articles, with the Secretary of State, it shall appear that the cooperative desires to do business in another state and is or would be precluded therefrom by reason of the inclusion of such words or either thereof in its name.  The name of a cooperative shall be distinct from the name of any other cooperative or corporation organized under the laws of, or authorized to do business in, this state.  This section shall not apply to any corporation which becomes subject to this act by complying with the provisions of Section 20 of this act, or which does business in this state pursuant to Section 29 of this act and which elects to retain a corporate name which does not comply with this section.

Laws 1953, p. 485, § 5.  

§18438.6.  Incorporators.

Five or more natural persons who are residents of the areas in which the principal operations of the cooperative are to be conducted may organize a cooperative in the manner hereinafter provided.

Laws 1953, p. 486, § 6.  

§18438.7.  Articles of incorporation.

Articles of incorporation of a cooperative shall recite that they are executed pursuant to this act and shall state: (1) the name of the cooperative; (2) the address of its principal office; (3) the names and addresses of the incorporators; (4) the names and addresses of its trustees; (5) the purpose for which the cooperative is formed; and (6) the period of its existence and may contain any provisions not inconsistent with this act deemed necessary or advisable for the conduct of its business, including provisions for the issuance of nonvoting shares of stock as hereinafter provided. Such articles shall be signed by each incorporator and acknowledged by at least two of the incorporators, or on their behalf, if they are cooperatives.  If a cooperative desires to issue nonvoting shares of stock, its articles of incorporation shall state: (1) the total number of such shares of stock which may be issued and the par value of each share; (2) the fixed or maximum rate of dividends on the par value of such shares of stock, in either case not exceeding four percent (4%) per annum, and whether dividends shall be cumulative or noncumulative; (3) whether such shares of stock may be issued to members only or to members and nonmembers; (4) the maximum number of such shares of stock which may be owned by any person; and (5) the terms and conditions on which such shares of stock may be transferred, redeemed and retired.

Laws 1953, p. 486, § 7.  

§18438.8.  Bylaws.

The board of trustees shall adopt the first bylaws of a cooperative to be adopted following an incorporation, conversion, combined consolidation and conversion, merger or consolidation. Thereafter the members shall adopt, amend or repeal the bylaws by the affirmative vote of a majority of those members voting thereon at a meeting of the members.  The bylaws shall set forth the rights and duties of members, trustees and shareholders, if any, and may contain other provisions for the regulation and management of the affairs of the cooperative not inconsistent with this act or with its articles of incorporation.

Laws 1953, p. 486, § 8.  

§18438.9.  Membership  Shares of stock - Qualification as patron.

A.  Each incorporator of a cooperative shall be a member thereof but no other person may become a member thereof unless such other person agrees to use communication services furnished by the cooperative when it is made available through its facilities, except as otherwise provided in the bylaws.  Membership in a cooperative may be evidenced by a certificate of membership which shall not be transferable, except as provided by the bylaws.  The bylaws may prescribe additional qualifications and limitations in respect of membership, provided that ownership of shares of stock, if any are authorized, shall not be a condition of membership in the cooperative.

B.  In case the issuance of shares of stock is provided for in the articles of incorporation, ownership thereof shall be evidenced by share certificates.  No share of stock shall be issued except for cash, or for property at its fair value, in an amount equal to the par value of such share of stock.

C.  Membership and share certificates shall contain such provisions, consistent with this act and the articles of incorporation of the cooperative, as shall be prescribed by its bylaws.

D.  Each member who purchases communication services in the ordinary course of business of the cooperative is a patron of the cooperative, except the use of inter-exchange access, payment of inter-exchange access fares or settlements, or the purchase of equipment does not qualify a member or other person as a patron.  The bylaws of the cooperative may provide other circumstances where a member or other person will not qualify to be a patron.

Laws 1953, p. 486, § 9; Laws 1991, c. 135, § 5, eff. Sept. 1, 1991.

§18438.10.  Meetings of members.

A.  An annual meeting of the members of a cooperative shall be held at such time and place as shall be provided in the bylaws.

B.  Special meetings of the members may be called by the president, by the board of trustees, by any three trustees, or by not less than two hundred members or ten percent (10%) of all members, whichever shall be the lesser.

C.  Except as otherwise provided in this act, written or printed notice stating the time and place of each meeting of the members and in the case of a special meeting, the purpose or purposes for which the meeting is called, shall be given to each member, either personally or by mail, not less than ten (10) days nor more than twentyfive (25) days before the date of the meeting.  If mailed, such notice shall be deemed to be given when deposited in the United States mail with postage prepaid, addressed to the member at his address as it appears on the records of the cooperative.

D.  Unless the bylaws prescribe the presence of a greater percentage or number of the members for a quorum, a quorum for the transaction of business at all meetings of the members of a cooperative having not more than five hundred members, shall be ten percent (10%) of all members, present in person, and of a cooperative having more than five hundred members, shall be fifty members or two percent (2%) of all members, whichever is greater, present in person.  If less than a quorum is present at any meeting, a majority of those present in person may adjourn the meeting from time to time without further notice.

E.  Each member shall be entitled to one vote on each matter submitted to a vote at a meeting of the members.  Voting shall be in person, but, if the bylaws so provide, may also be by mail.

Laws 1953, p. 486, § 10; Laws 1991, c. 135, § 6, eff. Sept. 1, 1991.

§18438.11.  Waiver of notice of meeting.

Any person entitled to notice of a meeting may waive such notice in writing either before or after such meeting.  If any such person shall attend such meeting, such attendance shall constitute a waiver of notice of such meeting, unless such person participates therein solely to object to the transaction of any business because the meeting has not been legally called or convened.

Laws 1953, p. 487, § 11.  

§18438.12.  Board of trustees.

A.  The business of a cooperative shall be managed by a board of not less than five (5) trustees, each of whom shall be a member of the cooperative.  The bylaws shall prescribe the number of trustees, their qualifications, other than those prescribed in this act, the manner of holding meetings of the board of trustees and of electing successors to trustees who shall resign, die, or otherwise be incapable of acting.  The bylaws may also provide for the removal of trustees from office and for the election of their successors. Trustees shall not receive any salaries for their services as trustees and, except in emergencies, shall not receive any salaries for their services in any other capacity without the approval of the members.  The cooperative may provide liability, accident, life and health insurance coverage for trustees choosing to have that coverage.  The bylaws may also prescribe a fixed fee for attendance at each meeting of the board of trustees and may provide for reimbursement of actual expenses of attendance.

B.  The trustees of a cooperative named in any articles of incorporation, consolidation, merger, conversion, or combined consolidation and conversion shall hold office until the next annual meeting of the members and until their successors are elected and qualify.  At each annual meeting or, in case of failure to hold the annual meeting as specified in the bylaws, at a special meeting called for that purpose, the members shall elect trustees to hold office until the next annual meeting of the members, except as otherwise provided in this act or the bylaws.  Each trustee shall hold office for the term for which he is elected and until his successor is elected and qualifies.  Vacancies shall be filled in accordance with provisions of the bylaws.

C.  The bylaws may provide that:

1.  In lieu of electing the whole number of trustees annually, the trustees shall be divided into three classes at the first or any subsequent annual meeting, each class to be as nearly equal in number as possible, with the term of office of the trustees of the first class to expire at the next succeeding annual meeting, the term of the second class to expire at the second succeeding annual meeting, and the term of the third class to expire at the third succeeding annual meeting; and

2.  At each annual meeting or at district meetings, after such classification, a number of trustees equal to the number of the class whose term expires at the time of such meeting shall be elected to hold office until the third succeeding annual or district meeting.

D.  A majority of the board of trustees, as determined by the bylaws, shall constitute a quorum.

E.  The board of trustees may exercise all of the powers of a cooperative conferred upon the members by this act, or its articles of incorporation or bylaws.

Laws 1953, p. 487, § 12; Laws 1961, p. 202, § 1; Laws 1991, c. 135, § 7, eff. Sept. 1, 1991.

§18438.13.  Division of territory into districts.

The bylaws may provide for the division of the territory served or to be served by a cooperative into two or more districts for the nomination and election of trustees and the election and functioning of district delegates.  Such delegates, who shall be members, may nominate and elect trustees.  The bylaws shall prescribe the boundaries of the districts, or the manner of establishing such boundaries, and the manner of changing such boundaries, and the manner in which such districts shall function.  No member at any district meeting and no district delegate at any meeting shall vote by proxy or by mail.

Laws 1953, p. 488, § 13.  

§18438.14.  Officers.

The officers of a cooperative shall consist of a president, vice president, secretary and treasurer, who shall be elected annually by and from the board of trustees.  When a person holding any such office ceases to be a trustee he shall cease to hold such office. The offices of secretary and of treasurer may be held by the same person.  The board of trustees may also elect or appoint such other officers, agents, or employees as it deems necessary or advisable and shall prescribe their powers and duties.  Any officer may be removed from office and his successor elected in the manner prescribed in the bylaws.

Laws 1953, p. 488, § 14.  

§18438.15.  Amendment of articles of incorporation.

A cooperative may amend its articles of incorporation by complying with the following requirements, provided, however, that a change of location of principal office may be effected in the manner set forth in Section 16 of this act:  The proposed amendment shall be presented to a meeting of the members, the notice of which shall set forth or have attached thereto the proposed amendment.  If the proposed amendment, with any changes, is approved by the affirmative vote of not less than two thirds of those members voting thereon at such meeting, articles of amendment shall be executed and acknowledged on behalf of the cooperative by its president or vice president and its seal shall be affixed thereto and attested by its secretary.  The articles of amendment shall recite that they are executed pursuant to this act and shall state:  (1) the name of the cooperative; (2) the address of its principal office; and (3) the amendment to its articles of incorporation.  The president or vice president executing such articles of amendment shall make and annex thereto an affidavit stating that the provisions of this section in respect of the amendment set forth in such articles were duly complied with.

Laws 1953, p. 488, § 15.  

§18438.16.  Change of location of principal office.

A cooperative may, upon authorization of its board of trustees or its members, change the location of its principal office in this state by filing a certificate reciting such change of principal office, executed and acknowledged by its president or vice president under its seal attested by its Secretary, in the office of the Secretary of State.

Laws 1953, p. 488, § 16.  

§18438.17.  Consolidation of cooperatives.

Any two or more cooperatives (each of which is hereinafter designated a "consolidating cooperative"), may consolidate into a new cooperative (hereinafter designated the "new cooperative"), by complying with the following requirements:

(a) The proposition for the consolidation of the consolidating cooperatives into the new cooperative and proposed articles of consolidation to give effect thereto shall be submitted to a meeting of the members of each consolidating cooperative, the notice of which shall have attached thereto a copy of the proposed articles of consolidation;

(b) If the proposed consolidation and the proposed articles of consolidation, with any amendments, are approved by the affirmative vote of not less than two thirds of those members of each consolidating cooperative voting thereon at each such meeting, articles of consolidation in the form approved shall be executed and acknowledged on behalf of each consolidating cooperative by its president or vice president and its seal shall be affixed thereto and attested by its secretary.  The articles of consolidation shall recite that they are executed pursuant to this act and shall state: (1) the name of each consolidating cooperative and the address of its principal office; (2) the name of the new cooperative and the address of its principal office; (3) a statement that each consolidating cooperative agrees to the consolidation; (4) the names and addresses of the trustees of the new cooperative; (5) the terms and conditions of the consolidation and the mode of carrying the same into effect, including the manner in which members and shareholders, if any, of the consolidating cooperatives may or shall become members and shareholders, respectively, of the new cooperative; (6) the purpose for which the cooperative is formed; (7) the period of existence of the new cooperative, and may contain any provisions not inconsistent with this act deemed necessary or advisable for the conduct of the business of the new cooperative. The president or vice president of each consolidating cooperative executing such articles of consolidation shall make and annex thereto an affidavit stating that the provisions of this section in respect of such articles were duly complied with by such cooperative.

Laws 1953, p. 488, § 17.  

§18438.18.  Merger of cooperatives.

Any one or more cooperatives (each of which is hereinafter designated a "merging cooperative") may merge into another cooperative (hereinafter designated the "surviving cooperative"), by complying with the following requirements:

(a) The proposition for the merger of the merging cooperative into the surviving cooperative and proposed articles of merger to give effect thereto shall be submitted to a meeting of the members of each merging cooperative and of the surviving cooperative, the notice of which shall have attached thereto a copy of the proposed articles of merger;

(b) If the proposed merger and the proposed articles of merger, with any amendments, are approved by the affirmative vote of not less than two thirds of those members of each cooperative voting thereon at each such meeting, articles of merger in the form approved shall be executed and acknowledged on behalf of each such cooperative by its president or vice president and its seal shall be affixed thereto and attested by its secretary.  The articles of merger shall recite that they are executed pursuant to this act and shall state: (1) the name of each merging cooperative and the address of its principal office; (2) the name of the surviving cooperative and the address of its principal office; (3) a statement that each merging cooperative and the surviving cooperative agree to the merger; (4) the names and addresses of the trustees of the surviving cooperative; and (5) the terms and conditions of the merger and the mode of carrying the same into effect, including the manner in which members and shareholders, if any, of the merging cooperatives may or shall become members and shareholders, respectively, of the surviving cooperative; (6) the period of existence of the new cooperative; and (7) the purpose for which the cooperative is formed; and may contain any provisions not inconsistent with this act deemed necessary or advisable for the conduct of the business of the surviving cooperative.  The president or vice president of each cooperative executing such articles of merger shall make and annex thereto an affidavit stating that the provisions of this section in respect of such articles were duly complied with by such cooperative.

Laws 1953, p. 489, § 18.  

§18438.19.  Effect of consolidation or merger.

(a) In the case of a consolidation the existence of the consolidating cooperative shall cease and the articles of consolidation shall be deemed to be the articles of incorporation of the new cooperative; and in the case of a merger the separate existence of the merging cooperatives shall cease and the articles of incorporation of the surviving cooperative shall be deemed to be amended to the extent, if any, that changes therein are provided for in the articles of merger;

(b) All the rights, privileges, immunities and franchises and all property, real and personal, including without limitation applications for membership, all debts due on whatever account and all other choses in action, of each of the consolidating or merging cooperatives shall be deemed to be transferred to and vested in the new or surviving cooperative without further act or deed;

(c) The new or surviving cooperative shall be responsible and liable for all the liabilities and obligations of each of the consolidating or merging cooperatives and any claim existing or action or proceeding pending by or against any of the consolidating or merging cooperatives may be prosecuted as if the consolidation or merger had not taken place, but the new or surviving cooperative may be substituted in its place; and

(d) Neither the rights of creditors nor any liens upon the property of any of such cooperatives shall be impaired by such consolidation or merger.

Laws 1953, p. 489, § 19.  

§18438.20.  Conversion of other corporations into cooperatives.

A.  Any corporation organized under the laws of this state and furnishing or having the corporative power to furnish communication services may be converted into a cooperative by complying with the following requirements and shall thereupon become subject to this act with the same effect as if originally organized under this act:

1.  The proposition for the conversion of such corporation into a cooperative and proposed articles of conversion to give effect thereto shall be submitted to a meeting of the members or stockholders of such corporation, or in case of a corporation having no members or stockholders, to a meeting of the incorporators of such corporation, the notice of which shall have attached thereto a copy of the proposed articles of conversion; and

2.  If the proposition for the conversion of such corporation into a cooperative and the proposed articles of conversion, with any amendments, are approved by the affirmative vote of not less than two-thirds (2/3) of those members of such corporation voting thereon at such meeting, or, if such corporation is a stock corporation, by the affirmative vote of the holders of not less than two-thirds (2/3) of those shares of the capital stock of such corporation represented at such meeting and voting thereon, or, in the case of a corporation having no members and no shares of its capital stock outstanding, by the affirmative vote of not less than two-thirds (2/3) of its incorporators; articles of conversion in the form approved shall be executed and acknowledged on behalf of such corporation by its president or vice-president and its seal shall be affixed thereto and attested by its secretary.  The articles of conversion shall recite that they are executed pursuant to this act and shall state:

  a. the name of the corporation and the address of its principal office prior to its conversion into a cooperative,

  b. the statute or statutes under which it was organized,

c. a statement that such corporation elects to become a cooperative, nonprofit corporation subject to this  act,

d. its name as a cooperative,

e. the address of the principal office of the cooperative,

  f. the names and addresses of the trustees of the cooperative,

g. the manner in which members, stockholders or incorporators of such corporation may or shall become members of the cooperative,

h. the period of existence of the new cooperative, and

  i. the purpose for which the cooperative is formed;

and may contain any provisions not inconsistent with this act deemed necessary or advisable for the conduct of the business of the cooperative, including provisions for the issuance of nonvoting shares of stock as provided for in Section 348.7 of this title.  If the articles of conversion shall make provision for the issuance of such shares of stock, they shall also state the manner in which members, stockholders or incorporators of such corporation may or shall become shareholders of the cooperative.  The president or vice-president executing such articles of conversion shall make and annex thereto an affidavit stating that the provisions of this section were duly complied with in respect of such articles.  The articles of conversion shall be deemed to be the articles of incorporation of the cooperative.

B.  Any two or more corporations organized under the laws of this state and furnishing or having the corporate power to furnish communication services may, if otherwise permitted to consolidate by the laws of this state, consolidate into a cooperative subject to this act, with the same effect as if originally organized under this act, by complying with the following requirements:

1.  The proposition for the consolidation into a cooperative and the proposed articles of consolidation and conversion, with any amendments, shall be approved by each consolidating corporation in accordance with the statute or statutes under which it was organized and the provisions of subsection A of this section;

2.  The articles of consolidation and conversion in the form approved shall be executed, acknowledged and sealed in the manner prescribed in subsection A of this section and in the statute or statutes under which the consolidating corporations were organized. The articles of consolidation and conversion shall state that they are executed pursuant to this act and such statute or statutes, that each consolidating corporation elects that the new corporation shall be a cooperative, and in addition shall contain all other information required by such statute or statutes and by paragraph 2 of subsection A of this section; and may contain any provisions not inconsistent with this act deemed necessary or advisable for the conduct of the business of the cooperative.  The president or vice-president executing such articles of consolidation and conversion shall make and annex thereto an affidavit stating that the provisions of this section and of the statute or statutes under which the consolidating corporations were organized were duly complied with in respect of such articles.  The articles of consolidation and conversion shall be deemed to be the articles of incorporation of the cooperative and shall be filed both in accordance with the provisions of this act and of the statute or statutes under which the consolidating corporations were organized.

Laws 1953, p. 490, § 20; Laws 1991, c. 135, § 8, eff. Sept. 1, 1991.

§18438.21.  Dissolution.

A.  A cooperative which has not commenced business may be dissolved by delivering to the Secretary of State articles of dissolution which shall be executed and acknowledged on behalf of the cooperative by a majority of the incorporators and which shall state:

1.  The name of the cooperative;

2.  The address of its principal office;

3.  That the cooperative has not commenced business;

4.  That any sums received by the cooperative, less any part thereof disbursed for expenses of the cooperative, have been returned or paid to those entitled thereto;

5.  That no debt of the cooperative is unpaid; and

6.  That a majority of the incorporators elect that the cooperative be dissolved.

B.  1.  A cooperative which has commenced business may be dissolved in the following manner: The proposition to dissolve shall be submitted to the members of the cooperative at any annual or special meeting, the notice of which shall set forth such proposition.  The members at any such meeting shall approve, by the affirmative vote of not less than a majority of all members of the cooperative, the proposition that the cooperative be dissolved.  Upon such approval, a certificate of election to dissolve (hereinafter designated the "certificate"), executed and acknowledged on behalf of the cooperative by its president or vice-president under its seal, attested by its secretary, and stating:

(a) the name of the cooperative,

(b) the address of its principal office, and

(c) that the members of the cooperative have duly voted that the cooperative be dissolved, shall, together with an affidavit made by its president or vice-president executing the certificate, stating that the statements in the certificate are true, be submitted to the Secretary of State for filing.

2.  Upon the filing of the certificate and affidavit with the Secretary of State, the cooperative shall cease to carry on its business except to the extent necessary for the winding up thereof, but its corporate existence shall continue until articles of dissolution have been filed with the Secretary of State.  The board of trustees shall immediately cause notice of the dissolution proceedings to be mailed to each known creditor of and claimant against the cooperative and to be published once a week for two (2) successive weeks in a newspaper of general circulation in the county in which the principal office of the cooperative is located.  The board of trustees shall wind up and settle the affairs of the cooperative, collect sums owing to it, liquidate its property and assets, pay and discharge its debts, obligations and liabilities, other than those to patrons arising by reason of their patronage, and do all other things required to wind up its business, and after paying or discharging or adequately providing for the payment or discharge of all its debts, obligations and liabilities, other than those to patrons arising by reason of their patronage, shall distribute any remaining sums: first, to shareholders, if any, for the pro rata return of the par value of their shares, together with any accrued dividends; second, to patrons for the pro rata return of all amounts standing to their credit by reason of their patronage; and third, to members for the pro rata repayment of membership fees. Any sums then remaining shall be distributed among its members and former members in proportion to their patronage.  The board of trustees shall thereupon authorize the execution of articles of dissolution, which shall be executed and acknowledged on behalf of the cooperative by its president or vice-president, and its seal shall be affixed thereto and attested by its secretary.  The articles of dissolution shall recite that they are executed pursuant to this act and shall state:

a. the name of the cooperative,

b. the address of its principal office,

c. the date on which the certificate of election to dissolve was filed with the Secretary of State,

d. that there are no actions or suits pending against the cooperative,

e. that all debts, obligations and liabilities of the cooperative have been paid and discharged or that adequate provision has been made therefor, and

f. that the preceding provisions of this subsection have been duly complied with.  The president or vice-president executing the articles of dissolution shall make and annex thereto an affidavit stating that the statements made therein are true.

Laws 1953, p. 491, § 21; Laws 1991, c. 135, § 9, eff. Sept. 1, 1991.

§18438.22.  Presentation and filing of papers with Secretary of State.

Articles of incorporation, amendment, consolidation, merger, conversion, combined consolidation and conversion, or dissolution, when executed and acknowledged and accompanied by such affidavits as may be required by applicable provisions of this act, shall be presented to the Secretary of State for filing in the records of his office.  If the Secretary of State shall find that the articles presented conform to the requirements of this act, he shall, upon the payment of the fees as in this act provided, file such articles in the records of his office and upon such filing the incorporation, amendment, consolidation, merger, conversion, combined consolidation and conversion, or dissolution provided for therein shall be in effect.  The provisions of this section shall also apply to certificates of election to dissolve and affidavits executed in connection therewith pursuant to subsection (b) of Section 21 of this act.

Laws 1953, p. 492, § 22.  

§18438.23.  Operation for mutual benefit  Disposition of receipts and revenues.

A cooperative shall be operated on a nonprofit basis for the mutual benefit of its members and patrons.  The bylaws of a cooperative or its contracts with members and patrons shall contain such provisions relative to the disposition of revenues and receipts as may be necessary and appropriate to establish and maintain its nonprofit and cooperative character.  In the case of a cooperative authorized to issue shares of stock, such bylaws or contracts shall provide that no monies shall be paid or credits given on the basis of patronage except after the declaration or payment of dividends on the outstanding shares of stock in accordance with the articles of incorporation of the cooperative, and such bylaws or contracts shall otherwise be consistent with the cooperative's obligations in respect of such shares of stock.

Laws 1953, p. 492, § 23.  

§18438.24.  Mortgages, deeds of trust or pledges  Sale, lease, etc.

A.  The board of trustees of a cooperative shall have full power and authority, without authorization by the members thereof, to authorize the execution and delivery of a mortgage or mortgages or a deed or deeds of trust of, or the pledging or encumbering of, any or all of the property, assets, rights, privileges, licenses, franchises and permits of the cooperative, whether acquired or to be acquired, and wherever situated, as well as the revenues therefrom, all upon such terms and conditions as the board of trustees shall determine, to secure any indebtedness of the cooperative to United States of America or any agency or instrumentality thereof or to any corporation or financial institution permitted to assist in the credit and financial needs of rural telephone cooperative corporations.

B.  A cooperative may not otherwise sell, mortgage, lease or otherwise dispose of or encumber all or a substantial portion of its property unless such sale, mortgage, lease or other disposition or encumbrance is authorized by the affirmative vote of not less than two thirds (2/3) of all the members of the cooperative; provided, however, that notwithstanding any other provision of Section 438.1 et seq. of this title, or any other provision of law, the board of trustees may, upon the authorization of a majority of those members of the cooperative present at a meeting of the members thereof, the notice of which shall have set forth the proposed action, sell, lease or otherwise dispose of all or a substantial portion of its property to another cooperative pursuant to this act or to the holder or holders of any notes, bonds or other evidences of indebtedness to United States of America or any agency or instrumentality thereof or to any corporation or financial institution permitted to assist in the credit and financial needs of rural telephone cooperative corporations.

Amended by Laws 1987, c. 57, § 1, emerg. eff. April 30, 1987.  

§18438.25.  Members and shareholders not liable for debts.

No member or shareholder shall be liable or responsible for any debts of the cooperative and the property of the members and shareholders shall not be subject to execution therefor.

Laws 1953, p. 493, § 25.  

§18438.26.  Recording instruments  Lien.

Any mortgage, deed of trust or other instrument executed by a cooperative or foreign corporation doing business in this state pursuant to this act, which affects real and personal property and which is recorded in the real property records in any county in which such property is located or is to be located, shall have the same force and effect as if the mortgage, deed of trust or other instrument were also recorded, filed or indexed as provided by law in the proper office in such county as a mortgage of personal property.  The lien upon real or personal property of any such mortgage, deed of trust or other instrument shall, after recordation thereof, continue in existence and of record for the period of time specified therein without the refiling thereof of the filing or any renewal certificate, affidavit, or other supplemental information required by the laws relating to the renewal, maintenance or extension of liens upon real or personal property.

Laws 1953, p. 493, § 26; Laws 1991, c. 135, § 10, eff. Sept. 1, 1991.

§18438.27.  Safety standards.

Construction of communication lines and facilities by a cooperative shall, as a minimum requirement, comply with the standards of the National Electrical Safety Code in effect at the time of such construction, and shall be in such manner and according to such specifications as will avoid interference with or hazards to existing communication lines, facilities or systems.

Laws 1953, p. 493, § 27; Laws 1991, c. 135, § 11, eff. Sept. 1, 1991.

§18438.28.  Acknowledgment of instruments.

No person who is authorized to take acknowledgments under the laws of this state shall be disqualified from taking acknowledgments of instruments executed in favor of a cooperative or to which it is a party, by reason of being an officer, trustee, member, or shareholder of such cooperative.

Laws 1953, p. 493, § 28.  

§18438.29.  Foreign nonprofit or cooperative corporation  Extensions of lines into state.

Any foreign nonprofit or cooperative corporation furnishing or authorized to furnish communication services and owning or operating communication lines or facilities in an adjacent state may construct or acquire extensions of such lines in this state and operate such extensions by complying with the statutes of this state pertaining to the qualifications of foreign corporations for the doing of business in this state.  Thereafter, such corporation shall have all the rights, powers, privileges and immunities of a cooperative organized under this act.

Laws 1953, p. 493, § 29; Laws 1991, c. 135, § 12, eff. Sept. 1, 1991.

§18438.30.  Connections with other lines.

Any cooperative or foreign corporation doing business in this state pursuant to this act (such cooperative or corporation being designated in this section as "applicant") shall have the right to require any person furnishing telephone service to the public in this state (such person being designated in this section as "company") to interconnect the company's lines, facilities or systems with, or otherwise make available such lines, facilities or systems to the applicant's telephone lines, facilities or systems, in order to provide a continuous line of communication for the applicant's subscribers.  In the event the connecting company and the applicant shall be unable to agree upon the terms and conditions of such interconnection, including compensation therefor, within thirty (30) days after request by the applicant, the Corporation Commission shall by order direct that such interconnection be made and shall prescribe the terms and conditions thereof, which shall be reasonable and nondiscriminatory.  Nothing in this section shall be deemed to subject a cooperative to the jurisdiction of the Corporation Commission except and only to the extent required to carry out the provisions hereof.

Laws 1953, p. 493, § 30.  

§18438.31.  Rates.

The Corporation Commission shall have the power and authority to prescribe and enforce rates for regulated communication services under this act as may be found to be reasonable and just after due notice and hearing, provided that said commission shall make final determination of rates within ninety (90) days after the request has been received by the Commission.  In the event that said Commission fails to act within the period prescribed above, the rate requested by the applicant in said application shall immediately become effective.  From any action of the Commission prescribing rates and charges under this act, any party aggrieved may appeal to the Supreme Court in the manner now provided by law for appealing cases from the Corporation Commission to the Supreme Court.  Nothing in this section shall be deemed to subject a cooperative to the jurisdiction of the Corporation Commission except and only to the extent required to carry out the provisions thereof.

Laws 1953, p. 494, § 31; Laws 1991, c. 135, § 13, eff. Sept. 1, 1991.

§18438.32.  Approval of Corporation Commission  Orders  Certificate not required.

A.  Subject to paragraph 4 of Section 438.4 of this title, any cooperative may furnish communication services in any territory not already being furnished communication services by a telephone company or another cooperative without approval of the Corporation Commission of this state.

B.  In any matter before the Corporation Commission, to which any cooperative is a party, the Commission shall issue its order determining such matter within ninety (90) days after the application therein has been filed.

C.  Under this act, no certificate of convenience and necessity, as provided in Sections 131 through 133 of Title 17 of the Oklahoma Statutes inclusive, shall be required by the Corporation Commission for a cooperative organized hereunder.

Laws 1953, p. 494, § 32; Laws 1991, c. 135, § 14, eff. Sept. 1, 1991.

§18438.33.  Cooperatives, nonprofit and mutual corporations and associations subject to act - Corrected articles of incorporation.

A.  Existing domestic and domesticated cooperatives, nonprofit and mutual corporations and associations formed to engage in or engaging in the business, undertaking or activity described in or contemplated hereby, shall be deemed, ipso facto, to come under the provisions of this act as of the date this act becomes effective and all provisions hereof shall thereafter fully apply thereto and every such corporation and association shall have the same rights, privileges, powers and immunities as it would possess if respectively created or domesticated hereunder and shall be subject to the same obligations, duties and jurisdictions as cooperatives organized under this act.

B.  In the event any cooperative has filed defective articles of incorporation or has failed to do all things necessary to perfect its corporate organization, it may, nevertheless, file corrected articles of incorporation or amend the original articles and do and perform all acts and things necessary in the premises for the correction of such defects.

Laws 1953, p. 494, § 33; Laws 1991, c. 135, § 15, eff. Sept. 1, 1991.

§18438.34.  Partial invalidity.

If any provision of this act, or the application of such provision to any person or circumstance is held invalid, the remainder of the act and the application of such provisions to other persons or circumstances shall not be affected thereby.

Laws 1953, p. 494, § 34.  

§18439.1.  Conversion of grain elevator corporations to cooperatives  Procedure.

Any corporation organized under the laws of this state for the purpose, among others, of conducting a grain elevator business, may be converted into a cooperative and become subject to this act with the same effect as if originally organized under this act by complying with the following requirements:

1.  The proposition for the conversion of such corporation into a cooperative and proposed articles of conversion to give effect thereto shall be first approved by the board of trustees or the board of directors of the corporation.  The proposed articles of conversion shall state:

a. the name of the corporation prior to its conversion into a cooperative,

b. the address of the principal officer of the corporation,

c. the date of the filing of the articles of incorporation of the corporation in the Office of the Secretary of State,

d. the name assumed by the cooperative,

e. a statement that the corporation elects to become a cooperative, nonprofit, membership corporation subject to this act,

f. the manner and basis of converting either memberships in or shares of stock of the corporation into memberships of the cooperative, and

g. any provisions not inconsistent with this act deemed necessary or advisable for the conduct of the business and affairs of the corporation;

2.  The proposition for the conversion of the corporation into a cooperative and the proposed articles of conversion approved by the board of trustees or the board of directors of such corporation shall then be submitted to a vote of the members or stockholders of the corporation at any duly held annual or special meeting thereof, the notice of which shall set forth full particulars concerning the proposed conversion.  The proposition for the conversion of the corporation into a cooperative and the proposed articles of conversion, with any amendments thereto as the members or stockholders of the corporation shall choose to make, shall be deemed to be approved upon the affirmative vote of a majority of those members of the corporation voting thereon at such meeting, or, if the corporation is a stock corporation, upon the affirmative vote of the holders of a majority of the capital stock of the corporation represented at such meeting;

3.  Upon approval by the members or stockholders of the corporation, articles of conversion in the form approved by such members or stockholders shall be executed and acknowledged on behalf of the corporation by its president or vicepresident and its corporate seal shall be affixed thereto and attested by its secretary.  The president or vicepresident executing such articles of conversion on behalf of the corporation shall also make and annex thereto an affidavit stating that the provisions of this section with respect to the approval of its trustees or directors and its members or stockholders, of the proposition for the conversion of the corporation into a cooperative and such articles of conversion were duly complied with.  Such articles of conversion and affidavit shall be submitted to the Secretary of State for filing as provided in this act.  The term "articles of incorporation", as used in Chapter 10 of Title 18, of the Oklahoma Statutes, shall be deemed to include the articles of conversion of a converted corporation; and

4.  The value of shares in the corporation shall be converted to the value of shares in the cooperative, on a dollarfordollar basis.  Any dividends payable on shares of stock in the cooperative shall be paid on preferred stock before dividends are paid on common stock.

Added by Laws 1983, c. 15, § 2, emerg. eff. March 25, 1983.  

§18439.2.  Filing articles of conversion with Secretary of State  Issuance of certificate of conversion.

Articles of conversion, when executed and acknowledged and accompanied by such affidavits as may be required by applicable provisions of this act, shall be presented to the Secretary of State for filing in the records of his office.  If the Secretary of State shall find that the articles conform to the requirements of this act, he shall, upon the payment of the fees specified by him file the articles so presented in the records of his office and shall issue over the Great Seal of the State an appropriate certificate of conversion, and thereupon the conversion provided for therein shall be in effect.

Added by Laws 1983, c. 15, § 3, emerg. eff. March 25, 1983.  

§18471.  Venue of actions.

Any foreign corporation, doing business in the State of Oklahoma, and any person now or hereafter having any cause of action against such corporation, arising on contract, tort, or otherwise, may file suit in any county in the State of Oklahoma where the plaintiff resides or where said corporation has its principal place of business, or has property, or in any county where said corporation has an agent appointed upon whom service of summons or other process may be had.

Laws 191011, c. 26, p. 46, § 1.  

§18-476.  Repealed by Laws 1998, c. 104, § 40, eff. Nov. 1, 1998.

§18-477.  Repealed by Laws 1998, c. 104, § 40, eff. Nov. 1, 1998.

§18-478.  Repealed by Laws 1998, c. 104, § 40, eff. Nov. 1, 1998.

§18481.  Corporation surety authorized.

Whenever any recognizance, stipulation, bond, or undertaking conditioned for the faithful performance of any duty or for the doing or refraining from doing anything in such recognizances, stipulation, bond or undertaking specified, is by law of the State of Oklahoma required or permitted to be given with one surety, or with two or more sureties, the execution of the same or the guaranteeing of the performance of the conditions thereof shall be sufficient when executed or guaranteed solely by a corporation incorporated under the laws of the United States, or of any state, having power to guarantee the fidelity of persons holding positions of public or private trust, and to execute and guarantee bonds and undertakings in judicial proceedings: Provided, that such recognizance, stipulation, bond or undertaking be approved by the head of department, court, judge, officer, board or body executive, legislative or judicial, required to approve or execute the same.

R.L.1910, § 1344.  

§18482.  Permission to do business  Statements  Deposit.

Every company, before transacting any business in the State of Oklahoma, under Section 481 et seq. of this title, shall deposit with the Insurance Commissioner of the state a copy of its charter or articles of incorporation and a statement signed and sworn to by its president and secretary, showing the assets and liabilities.  If said Insurance Commissioner shall be satisfied that such company has authority under its charter to do the business provided for in this article, and that it has a paidup capital of not less than Five Hundred Thousand Dollars ($500,000.00) in cash or its equivalent, and is able tokeep and perform its contracts and has a good reputation for the prompt and equitable settlement and adjustment of liabilities accruing upon its undertakings, he shall grant authority in writing to such company to do business in this state, but before granting such authority the said corporations shall also be required to comply with the requirements of Section 613 of Title 36 of the Oklahoma Statutes, relating to insurers issuing policies of surety insurance.  Provided however, the deposit requirements of subsection A of Section 613 of Title 36 of the Oklahoma Statutes shall not apply to companies that solely write bonds that cover grain warehouse storage.

Amended by Laws 1986, c. 129, § 1, emerg. eff. April 14, 1986; Laws 1988, c. 291, § 1, eff. Nov. 1, 1988.  

§18483.  Surety contracts, liberal construction of.

The rule of the common law requiring a strict construction of the obligations of a surety shall have no application to the obligations of a surety or guarantor or indemnitor for hire, but all such obligations shall be liberally construed in accordance with the rules of the general law applicable to policies of insurance.

R.L.1910, § 1346.  

§18484.  Quarterly reports  Revocation of authority  Inquiry into solvency  Additional security.

Every such corporation shall, in the months of January, April, July and October of each year, file with the Insurance Commissioner of the state a statement signed and sworn to by its president and secretary, showing its assets and liabilities as required by Section 1345.  And the Insurance Commissioner shall have the power, and it shall be his duty, to revoke the authority of any such company to transact any business under this article whenever, in his judgment, said company is not solvent, or is conducting its business in violation of this article.  He may institute inquiry, at any time, into the solvency of such company, and may require that additional security be given, at any time, upon any obligation to the state when he deems such company no longer sufficient security.

R.L.1910, § 1347.  

§18485.  Actions  Venue  Bond considered made where.

Any surety company doing business under the provisions of this article, may be sued in respect thereof, in any court of the United States or the State of Oklahoma, which has jurisdiction of actions on suits upon such recognizances, stipulations, bond, or undertaking, was made or guaranteed.  And for the purpose of this article, such recognizance, stipulation, bond, or undertaking, shall be treated as made or guaranteed in the county in which the office is located, to which it is returnable, or in which it is filed, or in the county in which the principal of such recognizance, stipulation, bond or undertaking, resided when it was made or guaranteed.

R.L.1910, § 1348.  

§18486.  Failure to pay judgment.

If any such company shall neglect or refuse to pay any final judgment or decree rendered against it, upon any such recognizance, stipulation, bond, or undertaking made or guaranteed by it under the provisions of this article, from which no appeal, writ of error or supersedeas has been taken for sixty (60) days after the rendition of such judgment or decree, it shall forfeit all right to do business under this act.

R.L.1910, § 1349.  

§18487.  Estopped to deny liability.

Any company which shall execute or guarantee any recognizance, stipulation, bond, or undertaking under the provisions of this article, shall be estopped in any such proceeding to deny the liability which it shall have assumed to incur, or to deny its corporate power to execute or guarantee any such instrument, or assume such liability.

R.L.1910, § 1350.  

§18488.  Penalty for failure to comply.

Any company doing business under the provisions of this article, which shall fail to comply with any of its provisions, shall forfeit to the State of Oklahoma for every such failure not less than Five Hundred Dollars ($500.00) nor more than Five Thousand Dollars ($5,000.00) to be recovered by suit in the name of the State of Oklahoma, in the same court in which suit may be brought against such company under the provisions of this article, and such failure shall not affect the validity of any contract entered into by such company.

R.L.1910, § 1351.  

§18489.  Fiduciaries  Cost of bond as lawful expense  Amount of bond.

That any receiver, assignee, guardian, trustee, executor, administrator or other fiduciary, required by law or the order of any court or judge, to give a bond or other obligations as such, may include as a part of the lawful expense of executing his trust, such reasonable sum paid a company authorized under the laws of this state so to do, for becoming his surety on such bond as may be allowed by the court in which or a judge before whom, he is required to account, and when any such bond is signed by a surety company as surety, the penalty must not be in excess of the value of the personal property and the probable value of the annual rents, profits and issues of real property, which are likely to come into the hands of such receiver, assignee, guardian, trustee, executor, administrator or other fiduciary.  But when real estate is to be sold an additional bond shall be required in amount equal to the probable value of such real estate.

R.L.1910, § 1352; Laws 1913, c. 86, p. 139, § 1.  

§18490.  Cancellation of bond  Grounds  Notice.

Where any surety company bond is required to be executed by any county, district, or state officer or his deputy or by any county employee who has in his custody any money or property belonging to the county for the purposes of his employment, whether said bond is required by law or by the board of county commissioners or by the principal officer, such surety or sureties may, if they deem themselves unsafe or insecure, upon thirty (30) days written notice given to the Secretary of State as to state and district officers and as to county officers the board of county commissioners, withdraw and cancel their obligations as surety or sureties on said bond; provided that such cancellation shall not relieve the surety company from any liability previously incurred, and said pro rata share of the unearned premium shall be returned.

Laws 1957, p. 450, § 1.  

§18491.  Agreement between principal and surety for deposit of monies and assets.

It shall be lawful for any party of whom a bond, undertaking or other obligation is required, to agree with his surety or sureties for the deposit of any or all monies and assets for which he and his surety or sureties are or may be held responsible, with a bank, savings bank, safedeposit or trust company, authorized by law to do business as such, or with other depository approved by a court or a judge thereof, if such deposit is otherwise proper, for the safekeeping thereof, and in such manner as to prevent the withdrawal of such money or assets or any part thereof, without the written consent of such surety or sureties, or an order of court, or a judge thereof made on such notice to such surety or sureties as such court or judge may direct; provided, however, that such agreement shall not in any manner release from or change the liability of the principal or sureties as established by the terms of the said bond.

Laws 1959, p. 81, § 1.  

§18543.  Right to hold real property limited.

All corporations organized for religious, charitable, educational or scientific purposes may hold all the property of the association owned prior to incorporation, as well as that acquired thereafter in any manner and transact all business relative thereto; but no such corporation shall own or hold more real property than may be reasonably necessary for the business and objects of the said association.

Amended by Laws 1986, c. 292, § 146, eff. Nov. 1, 1986.  

§18549.  Charitable and educational corporations may engage in business.

Any corporation heretofore or hereafter organized under the laws of the State of Oklahoma for charitable or educational purposes may maintain and carry on any and all kinds of business enterprises that an individual or corporation may lawfully carry on under the laws of the State of Oklahoma as auxiliary enterprises and may do so either directly or through any other corporation or corporations, a majority of whose stock it lawfully owns, in order that additional funds may be obtained with which to carry out only the charitable or educational purposes of such corporation.

Amended by Laws 1983, c. 100, § 8, emerg. eff. May 9, 1983.  

§18550.  Power to borrow money and incur indebtedness  Mortgage or pledge of property  Liability of property to taxation.

Any such charitable or educational corporation may borrow money and incur debts either for its principal purposes, or for the furtherance of any or all its business enterprises or both.  In case money is borrowed to aid any corporation, a majority of whose stock is lawfully owned by such charitable or educational  corporation, it may loan or advance the same to such controlled corporation on such terms as may seem advisable to its trustees.  Any such charitable or educational corporation so borrowing money to aid any other corporation as aforesaid, may evidence its indebtedness by notes or bonds and secure their payment by mortgaging and pledging all or any part of its property, real, personal and mixed, except the real estate, buildings and personal property consisting of household goods, farm implements and domestic animals used for the ordinary conduct and operation of the institution of such corporations, which lastnamed property shall never be liable, or in any manner taken for indebtedness, charge or lien of any nature whatsoever contracted by such corporation, to aid another corporation as aforesaid, provided that if any charitable or educational corporation shall maintain or carry on any auxiliary business under the terms of Section 549 of this title, either directly or through any other corporation or corporations, such fact shall be held to be an agreement on its part and on the part of such other corporation or corporations that all property owned by, devoted to, or used in such auxiliary business hereunder, shall be subject to taxation for all purposes in the same manner as taxable property generally and that such property shall not be exempt from taxation by reason of the fact that the revenues or profits or a portion thereof, are used or intended to be used as additional funds for carrying out the charitable or educational purposes of such corporation or for reinvestment by or in behalf of such charitable or educational corporation; and it is hereby declared that no such property shall be exempt from taxation; and provided, further, that the real estate, buildings, and personal property consisting of household goods, farming implements and domestic animals necessary for the ordinary conduct and operation of such charitable or educational corporations, shall be exempt from taxation.

Amended by Laws 1983, c. 100, § 9, emerg. eff. May 9, 1983.  

§18552.1.  Citation.

This act may be cited as the Oklahoma Solicitation of Charitable Contributions Act.

Laws 1959, p. 88, § 1.  

§18-552.2.  Definitions.

As used in this act:

1.  "Person" means any individual, organization, group, association, partnership or corporation;

2.  "Charitable organization" means any philanthropic, patriotic, eleemosynary, educational, social, civic, recreational, religious or any other person performing or purporting to perform acts beneficial to the public;

3.  "Contribution" means the promise or grant of any money or property of any kind or value;

4.  "Professional fund raiser" means any person who for compensation or other consideration plans, conducts or manages in this state the solicitation of contributions for or on behalf of any charitable organization or any other person, or who engages in the business of or holds himself out to persons in this state as independently engaged in the business of soliciting contributions for such purpose;  

5.  "Professional solicitor" means any person who is employed or retained for compensation or other consideration of any kind whatsoever by a professional fund raiser to solicit contributions in this state for or on behalf of any charitable organization or any other person; and

6.  "Professional fund raising counsel" means an entity that, alone or through its employees and agents, provides services for compensation to a charitable organization in the solicitation of contributions, including, but not limited to, planning, managing, or preparing materials to be used in conjunction with any solicitation; provided, that the entity does not:

a. directly or indirectly solicit contributions alone or through its employees and agents, or

b. receive, have access to, or control any contribution generated by the solicitation activity.

Amended by Laws 1983, c. 100, § 10, emerg. eff. May 9, 1983; Laws 1999, c. 421, § 1, eff. Nov. 1, 1999.

§18-552.3.  Registration - Fee - Information to be filed - Out-of-state organizations.

A.  No charitable organization, except those specifically exempt under Section 552.4 of this title, shall solicit or accept contributions from any person in this state by any means whatsoever until the charitable organization shall have registered with the Office of the Secretary of State and filed information, as required by this act, on forms approved by that office.  At the time of registration, each charitable organization shall pay a fee of Fifteen Dollars ($15.00), which shall be deposited to the General Revenue Fund of the State Treasury.  Registration shall be valid for a period of one (1) year from the date of filing with the Secretary of State, and shall be subject to annual renewal.  This registration shall not be deemed to constitute endorsement by the state or by the Secretary of State of the charitable organizations so registered.  The information so filed shall be available to the general public as a matter of public record.  The forms containing the information shall be signed and acknowledged by a party duly authorized to sign on behalf of the charitable organization and shall include the following:

1.  The legal name of the charitable organization, any other name the organization may be identified as or known as, and any distinctive names the organization uses for purposes of public solicitation;

2.  The street address and the mailing address, if different, of the charitable organization;

3.  The name and street address of:

a. each officer, including each principal salaried executive staff officer,

b. each director,

c. each trustee,

d. each person who will have custody of the contributions, and

e. each person responsible for the distribution of funds collected;

4.  The purposes for which the contributions solicited or accepted are to be used; provided, however, no contribution or any portion thereof shall inure to the private benefit of any voluntary solicitor;

5.  A copy of Internal Revenue Form 990 as filed by the charitable organization for the most recently completed fiscal year; or, for the initial registration of a newly formed organization, a copy of a letter from the Internal Revenue Service, or other evidence, showing the tax exempt status of the charitable organization;

6.  The period of time during which the solicitation is to be conducted;

7.  A description of the specific method or methods of solicitation;

8.  Whether the solicitation is to be conducted by voluntary unpaid solicitors, by paid solicitors, or both;

9.  If in whole or in part by paid solicitors, the name and address of each professional fund-raiser supplying the solicitors, which includes any professional fund-raising counsel who is acting or has agreed to act on behalf of the organization; the basis of payment and the nature of the arrangement, including a copy of the contract or other agreement between the charitable organization and the professional fund-raiser or fund-raising counsel relating to financial compensation or profit to be derived by the fund-raisers or fund-raising counsel, the specific amount or percentage of compensation, or property of any kind or value to be paid or paid to the professional fund-raiser, the percentage value of compensation as compared:

a. to the total contributions received, and

b. to the net amount of the total contributions received; and

10.  Additional information as may be deemed necessary and appropriate by the Secretary of State in the public interest or for the specific protection of contributors.

B.  Any fraternal or membership organization not based in Oklahoma which solicits contributions from any person of this state by telephone, or contracts with professional fund-raisers to solicit such contributions, shall be required to have at least one member or employee of the fraternal or membership organization residing within the county where the call is received.

Added by Laws 1959, p. 88, § 3, emerg. eff. May 8, 1959.  Amended by Laws 1976, c. 200, § 1, emerg. eff. June 4, 1976; Laws 1978, c. 244, § 2, eff. July 1, 1978; Laws 1980, c. 364, § 1, eff. Oct. 1, 1980; Laws 1984, c. 79, § 1, emerg. eff. April 3, 1984; Laws 1991, c. 320, § 1, eff. Sept. 1, 1991; Laws 1994, c. 235, § 9, eff. Sept. 1, 1994; Laws 1997, c. 334, § 1, eff. July 1, 1997; Laws 1999, c. 421, § 2, eff. Nov. 1, 1999; Laws 2000, c. 6, § 2, emerg. eff. March 20, 2000; Laws 2005, c. 366, § 1, emerg. eff. June 6, 2005.

NOTE:  Laws 1999, c. 377, § 2 repealed by Laws 2000, c. 6, § 33, emerg. eff. March 20, 2000.

§18-552.3a.  Execution and acknowledgement of registration.

Every registration instrument required to be filed with the Secretary of State pursuant to the Oklahoma Solicitation of Charitable Contributions Act shall be executed and acknowledged as follows:

1.  By formal acknowledgment of the person or persons signing the instrument that it is that person's act and deed or the act and deed of the organization, and that the facts stated therein are true.  The acknowledgment shall be made before a person who is authorized by the law of the place of execution to take acknowledgments of deeds and if that person has a seal of office, that person shall affix it to the instrument; or

2.  By signature, without more, of the person or persons signing the instrument, in which case the signature or signatures shall constitute the affirmation or acknowledgment of the signatory, under penalties of perjury, that the instrument is that person's act and deed or the act and deed of the organization, and that the facts stated therein are true.

Added by Laws 1999, c. 421, § 3, eff. Nov. 1, 1999.

§18552.4.  Persons and organizations exempt.

Except as otherwise specifically provided in this act, the provisions of Sections 552.3 and 552.5 of this title shall not apply to the following persons:

(1)  Organizations incorporated for religious purposes and actually engaged in bona fide religious programs, and other organizations directly operated, supervised, or controlled by a religious organization;

(2)  Educational institutions which have a faculty, regularly enrolled students and offer courses of study leading to the granting of recognized degrees when solicitations of contributions are confined to its student body and their families, alumni, faculty and trustees;

(3)  Fraternal organizations, when soliciting from their own members, and patriotic and civic organizations, when solicitation of contributions is confined to the membership of said organizations, and the solicitation is managed by their own membership without paid solicitors;

(4)  Persons soliciting contributions for a named individual person, when such individual person is specified by name at the time of solicitation, the purpose for such contribution is clearly stated, and if the gross contributions collected, without any deductions whatsoever for the benefit of the solicitor or any other person, be deposited directly to an account in the name of the beneficiary established for that purpose at a licensed local bank, and if such contributions are used for the direct benefit of the named individual person as beneficiary; and

(5)  Any organization which collects from charitable solicitations less than Ten Thousand Dollars ($10,000.00) per year.

Laws 1959, p. 89, § 4; Laws 1974, c. 70, § 1; Laws 1980, c. 364, § 2, eff. Oct. 1, 1980.  

§18-552.5.  Financial statement - Initial registration and annual renewals - Name and address changes.

A.  Every charitable organization subject to the provisions of Section 552.1 et seq. of this title which has received contributions during the previous calendar year shall file a statement with the Secretary of State, executed and signed by a party duly authorized to act on behalf of the charitable organization, which contains the most recent information, as follows:

1.  The name, street address, and telephone number of the charitable organization;

2.  The gross amount of the contributions pledged or collected;

3.  The gross amount given or to be given to the charitable purpose represented;

4.  The aggregate amount paid and to be paid for the expenses of solicitation; and

5.  The aggregate amount paid to and to be paid to professional fund raisers and solicitors.

B.  The financial statement prescribed in subsection A of this section shall be submitted with the initial registration, and with each annual renewal, thereafter.

C.  Every charitable organization registered with the Secretary of State to solicit contributions in the State of Oklahoma which shall change its name or the mailing address of its principal office, prior to its annual renewal date shall file with the Secretary of State a statement executed by an authorized officer of the organization setting forth its new name and/or mailing address and pay a filing fee of Fifteen Dollars ($15.00).

Added by Laws 1959, p. 89, § 5, emerg. eff. May 8, 1959.  Amended by Laws 1978, c. 244, § 3, eff. July 1, 1978; Laws 1984, c. 79, § 2, emerg. eff. April 3, 1984; Laws 1994, c. 235, § 10, eff. Sept. 1, 1994; Laws 1997, c. 334, § 2, eff. July 1, 1997; Laws 1999, c. 421, § 4, eff. Nov. 1, 1999; Laws 2001, c. 406, § 6, emerg. eff. June 4, 2001.

§18-552.6.  Records - Inspection.

Every charitable organization shall keep a full and true record in such form as will enable such charitable organization to accurately provide the information required herein. All records required hereunder shall be open to inspection at all times by the Office of the Secretary of State and its employees, and upon demand shall be presented to that office for inspection.

Added by Laws 1959, p. 89, § 6, emerg. eff. May 8, 1959.  Amended by Laws 1978, c. 244, § 4, eff. July 1, 1978; Laws 1984, c. 79, § 3, emerg. eff. April 3, 1984; Laws 1994, c. 235, § 11, eff. Sept. 1, 1994; Laws 1997, c. 334, § 3, eff. July 1, 1997.

§18-552.7.  Professional fund raisers - Registration - Fees - Bond - Name and address changes.

A.  No person shall act as a professional fund-raiser for any charitable organization, including those organizations listed under Section 552.4 of this title, until the person has first registered with the Office of the Secretary of State.  Applications for registrations, signed and acknowledged by a party duly authorized to act on behalf of the fund-raiser, shall state the full, legal name of the professional fund-raiser, the street address of the principal place of business of the fund-raiser, the full, legal names and street addresses of the charitable organizations with which it has entered into contracts or agreements, and shall be accompanied by an annual fee in the sum of Fifty Dollars ($50.00), to be deposited to the General Revenue Fund of the State Treasury.  The applicant shall, at the time of making application, file with the Secretary of State a bond in which the applicant shall be the principal obligor, in the sum of Two Thousand Five Hundred Dollars ($2,500.00), with one or more sureties whose liability in the aggregate as sureties shall at least equal that sum.  The bond shall run to the Secretary of State for the use of the state and to any person, including a charitable organization, who may have a cause of action against the obligor of the bond for any malfeasance or misfeasance of the obligor or any professional solicitor employed by him or her in the conduct of the solicitation.  Registration shall be valid for a period of one (1) year from the date of filing with the Secretary of State, and may be renewed annually upon the filing of a renewal application accompanied by the bond and fee prescribed herein.

B.  No professional fund-raiser or solicitor shall engage in fund-raising activities for a charitable organization which is not registered with the Secretary of State unless the organization is exempt from registration.

C.  Every professional fund-raiser registered with the Secretary of State which shall change its name or the mailing address of its principal office, prior to its annual renewal date shall file with the Secretary of State a statement executed by an authorized officer of the organization setting forth its new name or mailing address and pay a filing fee of Twenty-five Dollars ($25.00).

Added by Laws 1959, p. 90, § 7, emerg. eff. May 8, 1959.  Amended by Laws 1978, c. 244, § 5, eff. July 1, 1978; Laws 1984, c. 79, § 4, emerg. eff. April 3, 1984; Laws 1994, c. 235, § 12, eff. Sept. 1, 1994; Laws 1997, c. 334, § 4, eff. July 1, 1997; Laws 1999, c. 421, § 5, eff. Nov. 1, 1999; Laws 2000, c. 6, § 3, emerg. eff. March 20, 2000; Laws 2001, c. 406, § 7, emerg. eff. June 4, 2001.

NOTE:  Laws 1999, c. 325, § 7 and Laws 1999, c. 377, § 3 repealed by Laws 2000, c. 6, § 33, emerg. eff. March 20, 2000.

§18-552.8.  Contracts.

All contracts or other agreements entered into by professional fund raisers and charitable organizations shall be in writing and true and correct copies thereof shall be kept on file in the offices of the charitable organization and the professional fund raiser for a period of three (3) years from the date of solicitation of contributions provided for therein actually commences.  These contracts shall be available for inspection and examination by the Office of the Secretary of State and other authorized agencies.  At least one copy of every contract or other agreement shall be on file at all times in that office and shall be available to the general public as a matter of public record.

Added by Laws 1959, p. 90, § 8, emerg. eff. May 8, 1959.  Amended by Laws 1978, c. 244, § 6, eff. July 1, 1978; Laws 1984, c. 79, § 5, emerg. eff. April 3, 1984; Laws 1994, c. 235, § 13, eff. Sept. 1, 1994; Laws 1997, c. 334, § 5, eff. July 1, 1997; Laws 1999, c. 421, § 6, eff. Nov. 1, 1999.

§18-552.9.  Professional solicitors - Registration - Fees.

Every professional solicitor employed or retained by a professional fund raiser required to register shall, before accepting employment by the professional fund raiser, register with the Office of the Secretary of State.  An application for registration, signed by the solicitor and acknowledged, shall state the full, legal name and street address of the professional fund raiser that employs the solicitor and shall be accompanied by a fee in the sum of Ten Dollars ($10.00), to be deposited to the General Revenue Fund of the State Treasury.  Registration shall be for a period of one (1) year from the date of filing by the Secretary of State, and may be renewed annually upon the filing of a renewal application accompanied by a payment of the fee prescribed herein.

Added by Laws 1959, p. 90, § 9, emerg. eff. May 8, 1959.  Amended by Laws 1978, c. 244, § 7, eff. July 1, 1978; Laws 1984, c. 79, § 6, emerg. eff. April 3, 1984; Laws 1994, c. 235, § 14, eff. Sept. 1, 1994; Laws 1997, c. 334, § 6, eff. July 1, 1997; Laws 1999, c. 421, § 7, eff. Nov. 1, 1999; Laws 2000, c. 6, § 4, emerg. eff. March 20, 2000.

NOTE:  Laws 1999, c. 377, § 4 repealed by Laws 2000, c. 6, § 33, emerg. eff. March 20, 2000.

§18552.10.  Duplicate receipts.

Every person soliciting or accepting funds for charitable purposes shall issue a receipt in duplicate when the amount of such contribution exceeds the sum of Two Dollars ($2.00).  The original receipt shall be given to the donor and the copy shall be forwarded to the charitable organization and retained for a period of three (3) years.

Laws 1959, p. 90, § 10.  

§18552.11.  Use of names without consent  Similar names prohibited  Penalties.

A.  1.  No charitable organization, professional fund raiser, or professional solicitor seeking to raise funds for charitable purposes shall use the name of any other person (except that of an officer, director or trustee of the charitable organization by or for which contributions are solicited) for the purpose of soliciting contributions in this state without the written consent of such other person.  Nothing herein contained shall prevent the publication of names of contributors, without their written consent, in an annual or other periodic report issued by a charitable organization for the purpose of reporting to its membership or for the purpose of reporting contributions to contributors.

2.  No charitable organization soliciting or accepting contributions shall use a name so closely related or similar to other charitable organizations or governmental agencies or subdivisions that the use thereof would tend to confuse or mislead the public.

B.  Any person who uses the name of or a name deceptively similar to any other person, charitable organization, professional fund raiser, professional solicitor or governmental agency or subdivision to solicit or accept contributions, money or property under false pretense, representation or promise, upon conviction, shall be guilty of a felony and punished by a fine not more than Ten Thousand Dollars ($10,000.00) or by imprisonment for not more than five (5) years, or by both such fine and imprisonment.

Added by Laws 1959, p. 90, § 11, emerg. eff. May 8, 1959.  Amended by Laws 1986, c. 88, § 1, eff. Nov. 1, 1986; Laws 1997, c. 133, § 141, eff. July 1, 1999; Laws 1999, 1st Ex.Sess., c. 5, § 67, eff. July 1, 1999.

NOTE:  Laws 1998, 1st Ex.Sess., c. 2, § 23 amended the effective date of Laws 1997, c. 133, § 141 from July 1, 1998, to July 1, 1999.

§18552.12.  Use of names on stationery, advertisements, etc.

It shall be deemed to be a violation of this act to use the name of any person (except that of an officer, director, or trustee of the charitable organization by or for which contributions are solicited) for the purpose of soliciting contributions if such person's name is listed on any stationery, advertisement, brochure or correspondence in or by which a contribution is solicited by or on behalf of a charitable organization or his name is listed or referred to in connection with a request for a contribution as one who has contributed to, sponsored, or endorsed the charitable organization or its activities.

Laws 1959, p. 91, § 12.  

§18-552.13.  Reciprocal agreements with other states.

The Secretary of State may enter into reciprocal agreements with a like authority of any other state or states for the purpose of exchanging information made available to the Secretary of State.  Pursuant to such agreements the Secretary of State may accept information filed by a charitable organization with another state in lieu of the information required to be filed by a charitable organization in accordance with the provisions of Section 552.3 of this title, if such information is substantially similar to the information required to be filed under Section 552.3 of this title.

Added by Laws 1959, p. 91, § 13, emerg. eff. May 8, 1959.  Amended by Laws 1978, c. 244, § 8, eff. July 1, 1978; Laws 1984, c. 79, § 7, emerg. eff. April 3, 1984; Laws 1994, c. 235, § 15, eff. Sept. 1, 1994; Laws 1997, c. 334, § 7, eff. July 1, 1997.

§18-552.14.  Prosecutions - Injunctions.

A.  An action for violation of this act may be prosecuted by any district attorney of this state or by the Attorney General.

Whenever a district attorney or the Attorney General of this state shall have reason to believe that any person, charitable organization, professional fund raiser or professional solicitor is operating in violation of these provisions or there is employed or is about to be employed in any solicitation or collection of contributions for a charitable organization any device, scheme or artifice to defraud or for obtaining money or property by means of any false pretense, representation or promise, in addition to any other action authorized by law, he or she shall institute in any district court of this state an injunctive action in the name and on behalf of the people of the state against such person or charitable organization and any other person who has participated or is about to participate in such solicitation or collection by employing such device, scheme, artifice, false representation or promise.  Said action shall be for the purpose of enjoining such person or charitable organization or other participant from continuing such solicitation or collecting or engaging therein or doing any acts in furtherance thereof, or to cancel any registration statement previously filed with the Office of the Secretary of State.

B.  Any district attorney or the Attorney General shall exercise the authority granted in this section against any charitable organization which operates under the guise or pretense of being an organization exempted by the provisions of Section 552.4 of this title and is not in fact an organization entitled to such exemption.

Added by Laws 1959, p. 91, § 14, emerg. eff. May 8, 1959.  Amended by Laws 1978, c. 244, § 9, eff. July 1, 1978; Laws 1984, c. 79, § 8, emerg. eff. April 3, 1984; Laws 1986, c. 88, § 2, eff. Nov. 1, 1986; Laws 1994, c. 235, § 16, eff. Sept. 1, 1994; Laws 1997, c. 334, § 8, eff. July 1, 1997.

§18552.15.  Service of process upon Secretary of State.

Any charitable organization, professional fund raiser or professional solicitor, resident or having his or its principal place of business without the State of Oklahoma or organized under and by virtue of the laws of a foreign state who or which shall solicit contributions from people in this state, shall be deemed to have irrevocably appointed the Secretary of State as his or its agent upon whom may be served any summons, subpoena, subpoena duces tecum or other process directed to such charitable organization, or any partner, principal, officer, or director thereof or to such professional solicitor, in any action or proceeding brought by the Attorney General under the provisions of this act.  Service of such process upon the Secretary of State shall be made by personally delivering to and leaving with him or an assistant Secretary of State a copy thereof at the office of the Secretary of State in the city of Oklahoma City, and such service shall be sufficient service provided that notice of such service and a copy of such process are forthwith sent by the Attorney General to such charitable organization, professional fund raiser or professional solicitor by registered mail with return receipt requested, at his or its office as set forth in the registration form required to be filed by this act or, in default of the filing of such form, at the last address known to the Attorney General.  Service of such process shall be complete ten (10) days after the receipt by the Attorney General of a return receipt purporting to be signed by the addressee or a person qualified to receive his or its registered mail, in accordance with the rules and customs of the post office department, or, if acceptance was refused by the addressee or his or its agent, ten (10) days after the return to the Attorney General of the original envelope bearing a notation by the postal authorities that receipt thereof was refused.

Laws 1959, p. 91, § 15.  

§18552.16.  Powers and duties not restricted.

This act shall not be construed to limit or to restrict the exercise of the powers or the performance of the duties of the Attorney General or of any county attorney of this state which they otherwise are authorized to exercise or perform under any other provision of law.

Laws 1959, p. 92, § 16.  

§18552.17.  Nonexemption from ordinances and restrictions of political subdivisions.

The provisions of this act shall not exempt any person from any ordinances and restrictions of political subdivisions of this state regulating solicitations for charitable purposes.

Laws 1959, p. 92, § 17.  

§18552.18.  Penalties.

Any person who solicits or attempts to solicit any contribution as a charitable organization or for a charitable purpose by means of knowingly false or misleading representation, advertisement or promise or any person violating the provisions of this act, including the filing of false information hereunder, shall lose its status as a taxexempt organization, and shall be taxed in the same manner and at the same rate as any other corporation, and shall upon conviction be guilty of a felony punishable by a fine not to exceed One Thousand Dollars ($1,000.00) or by imprisonment in the State Penitentiary for not more than two (2) years, or by both such fine and imprisonment, and every officer or agent of a charitable organization who authorizes or conducts illegal solicitations shall be jointly and severally liable for such fine.

Added by Laws 1959, p. 92, § 18.  Amended by Laws 1976, c. 200, § 2, emerg. eff. June 4, 1976; Laws 1980, c. 364, § 3, eff. Oct. 1, 1980; Laws 1997, c. 133, § 142, eff. July 1, 1999; Laws 1999, 1st Ex.Sess., c. 5, § 68, eff. July 1, 1999.

NOTE:  Laws 1998, 1st Ex.Sess., c. 2, § 23 amended the effective date of Laws 1997, c. 133, § 142 from July 1, 1998, to July 1, 1999.

§18553.1.  Solicitation under certain promises prohibited.

It shall be unlawful for any person, organization, group, association, partnership, corporation, or combination thereof, to conduct or carry on any drive for, or to solicit or invite, contributions of funds for the purpose of or under the guise or representation or promise of being able to secure old age or other assistance for any person, under any state or federal law, or of securing for such person or persons higher or additional assistance.

Laws 1959, p. 220, § 1; Laws 1978, c. 244, § 10, eff. July 1, 1978.  

§18553.2.  Solicitations by regulated organizations not prohibited.

Provided that nothing in this act shall be construed to prohibit solicitations or other activity by any organization whose activities are regulated by any law or laws of the federal government or any professional organization of the State of Oklahoma.

Laws 1959, p. 221, § 2.  

§18553.3.  Penalties.

Any violation of the provisions of Sections 553.1 and 553.2 of this title shall constitute a felony and any person guilty thereof shall, upon conviction, be fined not more than Ten Thousand Dollars ($10,000.00) and may be confined in the State Penitentiary for a period of not to exceed ten (10) years, or by both such fine and imprisonment.  Any such prohibited communication by any agent or servant of a corporation shall subject such corporation to the fine above specified in addition to whatever penalty is imposed upon such agent or servant.  Any corporation may be enjoined in the manner provided in Section 12, Chapter 70, Title 21, Page 193, Oklahoma Session Laws 1955, when any of the conditions herein set forth are found to exist with respect to a violation of this act, or it may be subject to the cancellation therein specified.

Added by Laws 1959, p. 221, § 3.  Amended by Laws 1997, c. 133, § 143, eff. July 1, 1999; Laws 1999, 1st Ex.Sess., c. 5, § 69, eff. July 1, 1999.

NOTE:  Laws 1998, 1st Ex.Sess., c. 2, § 23 amended the effective date of Laws 1997, c. 133, § 143 from July 1, 1998, to July 1, 1999.

§18561.  Trustees of religious corporations, selection.

The board of trustees, or other officers of any religious corporation, may be chosen at such times and in such manner as may be in conformity to the rules, usage or general discipline of such corporation.

R.L.1910, § 1467.  

§18-562.  Alternative articles for religious association - Recording - Powers.

The members of any church or religious society, not less than three, who by its rules, usage and general discipline, or otherwise, do not desire to organize and become incorporated under the foregoing provisions relating to corporations may organize and become corporate, capable of suing and being sued, holding, purchasing and receiving title to real estate and other property by devise, gift, grant or other conveyance, with power to mortgage, sell or convey the same or any part, parcel or portion thereof, by adopting and signing articles containing:

First.  The name of the church, society, association or corporation, its general purpose and plan of operation and its place of location.

Second.  The terms of admission and qualifications of membership, and the selection of officers and the filling of vacancies, and the manner in which the same is to be governed and managed.  Such articles shall be filed in the office of the Secretary of State and a filing fee of Twenty-five Dollars ($25.00) shall be paid to the Secretary of State.  The articles shall also be filed in the office of the register of deeds of the county in which such church, society, association or corporation is located; and thereupon such church, society, association or corporation shall have all the powers hereinbefore provided, and may adopt and establish bylaws and make all rules and regulations deemed necessary and expedient for the management of its affairs in accordance with law.

R.L. 1910, § 1468.  Amended by Laws 1996, c. 69, § 1, eff. Nov. 1, 1996.

§18563.  Title vests in successors in trust.

All grants or deeds from private individuals, or acts of legislative bodies, transferring, conveying or granting real estate in this state to any bishop, dean, rector, vestryman, deacon, director, minister or any other officer or officers of any church or organized religious society in trust for the use and benefit of such society of which they are such officer or officers, which have been or may be made, done or executed, shall vest in their successor or successors in office, or other officer which such society may at any time designate, all the legal or other title, to the same extent and in all respects the same, as trustee of such trust, for the use and benefit of such society, which such bishop, dean, rector, vestryman, deacon, director, minister or other officer or officers, had under such grant, deed or act; and all transfers or sales made by such officer or officers so acquiring title by virtue of this article, by succession in office shall have all the validity, force and effect that it would have had had it been made by such bishop, dean, rector, vestryman, deacon, director, minister or other officer or officers, while holding under and by virtue of such grant, deed or act of such legislative body.

R.L.1910, § 1469.  

§18564.1.  Extinct church, religious corporation, etc.  Preservation and protection of property.

The property, both real and personal, belonging to or held in trust by or for any church, religious corporation, association, organization, or society, that has or shall become extinct, or that has or shall cease to function and use its property, shall be preserved and protected from waste and dilapidation.

Laws 1943, p. 39, § 1.  

§18564.2.  Association, etc. of same denomination or creed to have jurisdiction.

If there is no superior body, presbytery, synod, conference, diocese, convention, or other ecclesiastical body having jurisdiction to take charge of, protect and preserve such property, then, any statewide religious association, organization, society, or corporation of the same or similar denomination, faith, creed, practice or doctrine, shall have and is hereby given jurisdiction to take charge of and preserve such property.

Laws 1943, p. 39, § 2.  

§18564.3.  Petition to district court  Final order  Transfer of title and possession.

When the condition of being extinct or of ceasing to function and use its property has existed for two (2) years or longer, and there is no superior body having jurisdiction, the district court of any county where any such property is located, upon petition therefor, after the notice hereinafter provided, and, after hearing and inquiry into the merits, shall make a final order, declaring such church or society extinct and dissolving the same; and shall make a final order transferring the title and possession of all property which may belong to such church or society or which may be held in trust for such church or society to a statewide religious association, organization, society, or corporation of the same or similar denomination, faith, creed, practice, or doctrine.

Laws 1943, p. 39, § 3.  

§18564.4.  Notice of hearing.

Notice of hearing of said petition shall be given by publication in a newspaper published in the town or city where the church or religious organization was located if there be one, and if there be none, then in a newspaper at the county seat of the county, for two (2) consecutive weekly issues, the first publication being at least fifteen (15) days prior to the day of the hearing.

Laws 1943, p. 39, § 4.  

§18564.5.  Lien or reversionary interest not affected.

This act shall not affect or impair any valid lien or any reversionary interest.

Laws 1943, p. 39, § 5.  

§18571.  School property  How held.

Any corporation formed for the purpose of establishing an institution of learning shall hold the property of the institution solely for the purpose of education, and not for the individual benefit of itself or any contributor to the endowment thereof.

R.L.1910, § 1470.  

§18572.  Objects of expenditure.

The trustees or directors of any such corporation shall faithfully apply all the funds collected, or the proceeds of the property belonging to the institution, according to their best judgment, in erecting, completing or repairing suitable buildings, in supporting necessary officers, instructors, agents and employees, and in procuring books, maps, charts, globes and philosophical, chemical and other apparatus or cabinets, necessary to the objects and success of the institution; and all donations, devises or bequests made to it for particular purposes when accepted, shall be applied in conformity with the express condition of the donor or devisor.

R.L.1910, § 1471.  

§18573.  Powers of corporation.

Such corporation has power to appoint a president or principal for the institution, and such professors, tutors and other agents and officers, as may be necessary, and to displace any of them as the interests of the institutions may require; to fill vacancies, to prescribe and direct the course of studies and the discipline to be pursued and observed in the institution, and the rates of tuition in the same; and the president and professors shall constitute the faculty of such institution; and they have power to enforce the rules and regulations enacted for the government and discipline of the students, and to suspend and expel offenders, as may be deemed expedient.

R.L.1910, § 1472.  

§18574.  Degrees conferred.

Every such corporation having the rank of a college or university, has power to confer, on the recommendation of the faculty, all such degrees or honors as are usually conferred by colleges and universities in the United States, and such others, having reference to the course of studies and the worth and accomplishment of the student, as may be deemed proper.

R.L.1910, § 1473.  

§18575.  Mechanics and agriculture.

Such corporation may connect with its institution, to be used as a part of its course of education, any mechanical shops or machinery, or lands for agricultural purposes, not exceeding three hundred and twenty (320) acres, to which may be attached all necessary buildings for carrying on the mechanical and agricultural purposes of such institution.

R.L.1910, § 1474.  

§18581.  Benevolent and charitable corporations  Purposes.

The following associations for charitable purposes may become incorporated, as provided in this article, as follows:

1.  To establish and maintain hospitals and infirmaries for the cure of the sick and support of the aged and indigent, and asylums for orphans;

2.  For the mutual assistance of the members in time of sickness or necessity, and to provide a fund for this purpose by contributions of the members thereof from time to time, and for the like incidental charitable purposes;

3.  To establish and maintain lodges, chapters and encampments, of fraternities or associations commonly known as Free Masons, the Independent Order of Odd Fellows, Good Templars, Sons of Temperance, and other like charitable orders or societies;

4.  To establish and maintain fire companies in any incorporated city or town; and

5.  To establish and maintain youth organizations to promote the ideals of good sportsmanship, honesty, loyalty, courage and reverence by providing supervised competitive athletic games.

Amended by Laws 1983, c. 100, § 11, emerg. eff. May 9, 1983.  

§18582.  Transfer of membership.

Any regularly incorporated fraternal beneficiary society shall, on application of its governing body, be permitted to transfer its membership to any other society doing business in this state, and such membership may be accepted without restriction, upon age limit and without new medical examination on the part of the membership so transferred where the entrance age limit of fiftyfive (55) years and a medical examination was required and made by the society so transferring its membership.

R.L.1910, § 1476.  

§18583.  Fraternal beneficiary societies  Change of name.

Any fraternal beneficiary society incorporated under the laws of this state may change its corporate name on application by its governing body to the Insurance Commissioner of the state.  The name selected shall not be such as will appear to be so near the name of any other association or society now doing business in this state as to cause confusion in the minds of the people, or to interfere with the corporate name of such existing association or corporation.  On the approval of the Insurance Commissioner the Secretary of State shall cause an amended charter to issue, signed by the Governor and attested by the seal of state, changing the name of such beneficiary society in accordance with the recommendation of the Insurance Commissioner, and such change of name shall have the same effect as if originally set forth in the original articles of incorporation.

R.L.1910, § 1477.  

§18584.  Use of society name exclusive.

No person, society, association or corporation shall assume, adopt or use the name of a humane, fraternal or charitable organization, incorporated under the laws of this or of any other state of the United States, or a name so nearly resembling the name of such incorporated organization as to be a colorable imitation thereof, or calculated to deceive persons not members, with respect to such corporation.  In all cases where two or more of such societies, associations or corporations claim the right to the same name, or to names substantially similar as above provided, the organization which was first organized and used the name, and first became incorporated under the laws of the United States or of any state of the Union, shall be entitled in this state to the prior and exclusive use of such name, and the rights of such societies, associations or corporations, and of their individual members shall be fixed and determined accordingly.

Amended by Laws 1983, c. 100, § 12, emerg. eff. May 9, 1983.  

§18585.  Persons not entitled to wear insignia, use name or claim membership.

No person shall wear or exhibit the badge, button, emblem, decoration, insignia or charm or shall assume or use the name of any humane, fraternal or charitable corporation, incorporated under the laws of this or any other state or of the United States or shall assume or claim to be a member thereof, or of a humane, fraternal or charitable corporation, the name of which shall so nearly resemble the name of any other corporation existing prior to the organization of the corporation or association of which such person may claim to be a member, the name whereof may be calculated to deceive the people with respect to any such prior corporation, unless he shall be authorized under the laws, statutes, rules, regulations and bylaws of such former corporation, to wear such badge, button, emblem, decoration, insignia or charm, or to use and assume such name as a member thereof.

Amended by Laws 1983, c. 100, § 13, emerg. eff. May 9, 1983.  

§18586.  Violation enjoined.

Whenever there shall be an actual or threatened violation of Sections 584 and 585 of this title, an application may be made to the court or judge having jurisdiction, to issue an injunction upon notice to the defendant of not less than five (5) days, for an injunction so restraining such actual or threatened violation, or if it shall appear to such court or justice that the defendant is in fact using the name of a humane, fraternal or charitable corporation, incorporated as aforesaid, or a name so nearly resembling it as to be calculated to deceive the public, or is wearing or exhibiting the badge, insignia or emblem of such corporation without authority thereof, and in violation of Sections 584 and 585 of this title, an injunction may be issued by said court or justice, enjoining or restraining such actual or threatened violation, without requiring proof that any person has in fact been misled or deceived thereby.

Amended by Laws 1983, c. 100, § 14, emerg. eff. May 9, 1983.  

§18587.  Penalty.

Any person violating the provisions of Sections 1478 and 1479 of this article, shall be deemed guilty of a misdemeanor, and upon upon conviction thereof, shall be fined not exceeding Fifty Dollars ($50.00), or imprisoned in the county jail not exceeding thirty (30) days, or may be punished by both such fine and imprisonment.

R.L. 1910, § 1481.  

§18588.  Benevolent corporations may own real or personal property.

Any charitable corporation, including chartered fraternal, grand and subordinate lodges and societies, are hereby empowered to receive, either by way of gift, purchase, grant, devise or by will, real or personal property, and to hold the same, and to dispose of the same in the carrying out of the purposes of the corporation, society or lodge.

Amended by Laws 1983, c. 100, § 15, emerg. eff. May 9, 1983.  

§18589.  Charter as benevolent corporation  Trustees  Bylaws.

Before being competent to so receive such property, such society shall obtain a charter as a charitable corporation in the manner provided by law from the Secretary of State, and elect trustees, who may be the same trustees already elected under their fraternal rules, and whose bylaws may, so far as they do not contravene the statute laws of the state, be substituted for the bylaws required to be adopted upon obtaining a charter.

Amended by Laws 1983, c. 100, § 16, emerg. eff. May 9, 1983.  

§18590.  Community fund or chest corporations  Notice of meetings  Quorum.

Any corporation organized under the laws of this state as a community fund or community chest, or that may hereafter be so organized, may give notice of the time and place of any regular or special meeting of its members by publication for not less than two (2) weeks previous thereto in a newspaper of general circulation in the city or town where the principal office or place of business of the corporation is located.  At any such regular or special meeting, the members present in person shall constitute a quorum, and a vote of a majority of such quorum shall be sufficient to transact any or all business properly before such meeting, including the adoption or amendment of bylaws.

Laws 1945, p. 48, § 1.  

§18591.  Community fund or chest corporations  Amendment of articles of incorporation.

Any community fund or community chest corporation organized under the laws of this state for which a charter has been issued may amend its articles of incorporation in any particular competent to have been embodied or inserted in the original articles of incorporation of such company, including any provision authorized by this act.   In order to amend its articles of incorporation, it shall be necessary for such amendment to have been authorized at any regular meeting of its members, or at a special meeting of such members called for the purpose of making such amendment.  When so authorized, new articles signed by the president and secretary of the corporation and entitled "Amended Articles of Incorporation" shall be filed with the Secretary of State, who upon the payment of the fees provided by Section 541, of Title 18, O.S. 1951, shall cause an amended charter to issue, signed by him as Secretary of State and attested by the seal of the state, for which date the amendment shall relate back and be considered a part of the original articles of incorporation to the same effect as if originally set forth therein.

Laws 1945, p. 48, § 2.  

§18592.  Fire departments for unincorporated areas  Incorporation.

The authority of persons associated together to become incorporated as a charitable corporation for the purpose of providing either a volunteer or fulltime fire department for an unincorporated area or place is hereby ratified and confirmed.  Such a corporate fire department shall have authority to provide fire protective service both to its members and to nonmembers, either within or without the unincorporated area wherein it is situated.

Amended by Laws 1983, c. 100, § 17, emerg. eff. May 9, 1983.  

§18593.  Fire departments for unincorporated areas  Service fees  Insurance.

A.  Any charitable corporation formed for the purpose of providing either a volunteer or a fulltime fire department, pursuant to Section 592 of this title, shall have authority to establish a reasonable schedule of fees to be charged for its services in extinguishing fires of its members and nonmembers who utilize such fire department to extinguish or control a fire either within or without the unincorporated area wherein it is situated.  Such schedule of fees may contain one fee for members and another fee for nonmembers, except that no fee shall be established in excess of the approximate cost of providing the service.  Any member or nonmember utilizing the services of such a fire department to extinguish or control a fire shall be liable to said corporation in the amount of the established fee.  However, no fee shall be charged by a fire department for merely appearing at the scene of a controlled fire unless called by the person setting the fire or at such person's request.  If it is necessary for suit to be brought for collection of such amount due, such liability shall include costs of suit and a reasonable attorney's fee.

B.  If insurance coverage is provided for the fee specified in subsection A of this section or for the cost of providing the service rendered by the fire department and an insurer makes payment for the service it shall be the duty of the insured party or the responding fire department to notify the insurer of services rendered.  The instrument of payment for the services of the fire department shall be made to the order of the responding fire department and the insured.

Added by Laws 1957, p. 143, § 2.  Amended by Laws 1983, c. 100, § 18, emerg. eff. May 9, 1983; Laws 1989, c. 172, § 1, emerg. eff. May 8, 1989; Laws 1993, c. 8, § 1, eff. Sept. 1, 1993.

§18594.  Fire departments for unincorporated areas  Status as state agency  Nonliability for tort.

Any charitable corporation formed in an unincorporated area for the purpose of providing either a volunteer or a fulltime fire department, such as is mentioned in Section 592 of this title, shall be considered an agency of the State of Oklahoma while actually performing the function of providing fire protective services either within or without the unincorporated area wherein it is situated, and while so engaged such corporation shall not be liable in tort for the acts of its members or its firemen.

Amended by Laws 1983, c. 100, § 19, emerg. eff. May 9, 1983.  

§18601.  Right of way  Use of public ground, streets and highways  Use of railroad property  Interstate highway system.

(a) There is hereby granted to the owners of any telegraph or telephone lines operated in this state the rightofway over lands and real property in this state, and the right to use public grounds, streets, alleys and highways in this state, subject to control of the proper municipal authorities as to what grounds, streets, alleys or highways said lines shall run over or across, and the place the poles to support the wires are located; also the right to condemn and cross over or under, or build their lines along any railroad property or rightofway, subject to the necessary use of such property or rightofway by the railroad company; the rightofway over real property granted in this section may be acquired in the same manner and by like proceedings as provided for railroad corporations.

(b) Provided, however, the State Highway Commission, in the exercise of reasonable discretion, may prevent the installation of such facilities upon limited access highways which are a part of the National System of Interstate and Defense Highways, or such Commission may permit the installation of such facilities on such portion of Interstate and Defense Highways under such reasonable regulations as it may prescribe.  Provided, further, nothing herein contained shall affect the right of the owners of telephone and telegraph lines to cross such Interstate and Defense Highways and to build their lines either aerial or underground along and upon any extension of said interstate and defense highways within urban areas in accordance with Federal Aid Regulations.

§18671.  Sharepurchase options or warrants and shares issued pursuant thereto.

Any option or warrant for the purchase of shares of any domestic corporation heretofore issued by such corporation, although not issued in connection with the allotment of shares or the issuance of bonds or other securities, and any share issued by such corporation pursuant to the exercise of such option or warrant is hereby validated if the issuance of such warrant or option was heretofore expressly authorized, or hereafter is ratified, by the holders of a majority of the shares of such corporation having voting power with respect thereto.

Laws 1961, p. 199, § 1.  

§18-801.  Short title.

This act is known and may be cited as the "Professional Entity Act".

Added by Laws 1961, p. 204, § 1, emerg. eff. July 26, 1961.  Amended by Laws 1995, c. 339, § 1, eff. Nov. 1, 1995.

§18802.  Statutory policy.

This act shall be so construed as to effectuate its general purpose of making available to professional persons the benefits of the corporate form for the business aspects of their practices while preserving the established professional aspects of the personal relationship between the professional person and those he serves.

Laws 1961, p. 204, § 2.  

§18-803.  Definitions.

A.  As used herein, unless the context clearly indicates that a different meaning is intended:

1.  "Associated act" means the Oklahoma General Corporation Act, in the case of a corporation; the Oklahoma Revised Uniform Limited Partnership Act, in the case of a limited partnership; or the Oklahoma Limited Liability Company Act, in the case of a limited liability company;

2.  "Interest" means a share of stock in a corporation, a partnership interest in a limited partnership or a membership interest in a limited liability company;

3.  "Owner" means a shareholder in the case of a corporation, a general or limited partner in the case of a limited partnership or a member in the case of a limited liability company;

4.  "Manager" means a director or officer in the case of a corporation, a general partner in the case of a limited partnership or a manager in the case of a limited liability company;

5.  "Professional entity" means a domestic corporation, limited partnership or limited liability company formed for the purpose of rendering professional service;

6.  "Professional service" means the personal service rendered by:

a. a physician, surgeon or doctor of medicine pursuant to a license under Sections 481 through 524 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of medicine,

b. an osteopathic physician or surgeon pursuant to a license under Sections 620 through 645 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of osteopathy,

c. a chiropractic physician pursuant to a license under Sections 161.1 through 161.20 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of chiropractic,

d. a podiatric physician pursuant to a license under Sections 135.1 through 160.2 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of podiatric medicine,

e. an optometrist pursuant to a license under Sections 581 through 606 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of optometry,

f. a veterinarian pursuant to a license under Sections 698.1 through 698.18 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of veterinary medicine,

g. an architect pursuant to a license under Sections 46.1 through 46.37 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of architecture,

h. an attorney pursuant to his authority to practice law granted by the Supreme Court of the State of Oklahoma,

i. a dentist pursuant to a license under Sections 328.1 through 328.51a of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of dentistry,

j. a certified public accountant or a public accountant pursuant to his or her authority to practice accounting under Sections 15.1 through 15.35 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of public accountancy,

k. a psychologist pursuant to a license under Sections 1351 through 1376 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of psychology,

l. a physical therapist pursuant to a license under Sections 887.1 through 887.18 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of physical therapy,

m. a registered nurse pursuant to a license under Sections 567.1 through 567.16a of Title 59 of the Oklahoma Statutes, and any other subsequent laws regulating the practice of nursing,

n. a professional engineer pursuant to a license under Sections 475.1 through 475.22a of Title 59 of the Oklahoma Statutes, and any subsequent laws relating to the practice of engineering,

o. a land surveyor pursuant to a license under Sections 475.1 through 475.22a of Title 59 of the Oklahoma Statutes, and any subsequent laws relating to the practice of land surveying,

p. an occupational therapist pursuant to Sections 888.1 through 888.15 of Title 59 of the Oklahoma Statutes and any subsequent law regulating the practice of occupational therapy,

q. a speech pathologist or speech therapist pursuant to Sections 1601 through 1622 of Title 59 of the Oklahoma Statutes, and any subsequent law regulating the practice of speech pathology,

r. an audiologist pursuant to Sections 1601 through 1622 of Title 59 of the Oklahoma Statutes, and any subsequent law regulating the practice of audiology,

s. a registered pharmacist pursuant to Sections 353 through 366 of Title 59 of the Oklahoma Statutes, and any subsequent law regulating the practice of pharmacy,

t. a licensed perfusionist pursuant to Sections 2051 through 2071 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of perfusionists,

u. a licensed professional counselor pursuant to Sections 1901 through 1920 of Title 59 of the Oklahoma Statutes, and any subsequent law regulating the practice of professional counseling,

v. a licensed marital and family therapist pursuant to Sections 1925.1 through 1925.18 of Title 59 of the Oklahoma Statutes, and any subsequent law regulating the practice of marital and family therapy,

w. a dietitian licensed pursuant to Sections 1721 through 1739 of Title 59 of the Oklahoma Statutes and any subsequent laws regulating the practice of dietitians, or

x. a social worker licensed pursuant to Sections 1250 through 1273 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of social work;

7.  "Related professional services" means those services which are combined for professional entity purposes as follows:

a. any combination of the following professionals:

(1) a physician, surgeon or doctor of medicine pursuant to a license under Sections 481 through 524 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of medicine,

(2) an osteopathic physician or surgeon pursuant to a license under Sections 620 through 645 of Title 59 of the Oklahoma Statutes, and any subsequent laws relating to the practice of osteopathy,

(3) a dentist pursuant to a license under Sections 328.1 through 328.51a of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of dentistry,

(4) a chiropractic physician pursuant to a license under Sections 161.1 through 161.20 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of chiropractic,

(5) a psychologist pursuant to a license under Sections 1351 through 1376 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of psychology,

(6) an optometrist pursuant to a license under Sections 581 through 606 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of optometry,

(7) a podiatric physician pursuant to a license under Sections 135.1 through 160.2 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of podiatric medicine, or

(8) a dietitian licensed pursuant to Sections 1721 through 1739 of Title 59 of the Oklahoma Statutes and subsequent laws regulating the practice of dietitians, or

b. any combination of the following professions:

(1) an architect pursuant to a license under Sections 46.1 through 46.37 of Title 59 of the Oklahoma Statutes, and any subsequent laws regulating the practice of architecture,

(2) a professional engineer pursuant to a license under Sections 475.1 through 475.22a of Title 59 of the Oklahoma Statutes, and any subsequent laws relating to the practice of engineering, or

(3) a land surveyor pursuant to a license under Sections 475.1 through 475.22a of Title 59 of the Oklahoma Statutes, and any subsequent laws relating to the practice of land surveying;

8.  "Regulating board" means the board which is charged with the licensing and regulation of the practice of the profession which the professional entity is organized to render;

9.  "Individual", "incorporator" and "shareholder" each include the trustee of an express trust created by a person duly licensed to render a professional service who has the right to revoke said trust and who is serving as the trustee of said trust.  Any certificate required by the Professional Entity Act to be issued to an individual incorporator or shareholder may be issued to the grantor on behalf of a trust.  All references in the Professional Entity Act to death and incapacity of a shareholder shall include the death and incapacity of the grantor of a trust which own stock in a professional corporation;

10.  "Incapacity" of a shareholder means a determination by a court of competent jurisdiction, or otherwise by two independent licensed physicians, that the share holder is fully incapacitated or is partially incapacitated to the extent that the shareholder is not capable of rendering the professional service for which the professional corporation was organized; and

11.  "Other personal representative" includes the successor trustee of an express trust owning stock in a professional corporation, which trust was created by a person duly licensed to render the professional service for which the professional corporation was organized who has the right to revoke the trust and who is the original trustee of the trust.

B.  The definitions of the applicable associated act shall apply to this act, unless the context clearly indicates that a different meaning is intended.

Added by Laws 1961, p. 204, § 3, emerg. eff. July 26, 1961.  Amended by Laws 1963, c. 342, § 1, emerg. eff. June 24, 1963; Laws 1970, c. 95, § 1, emerg. eff. March 30, 1970; Laws 1971, c. 164, § 1, emerg. eff. May 25, 1971; Laws 1976, c. 27, § 1; Laws 1981, c. 312, § 1, eff. Oct. 1, 1981; Laws 1983, c. 4, § 1, eff. Nov. 1, 1983; Laws 1986, c. 292, § 147, eff. Nov. 1, 1986; Laws 1990, c. 328, § 1, eff. Sept. 1, 1990; Laws 1993, c. 345, § 1, eff. Sept. 1, 1993; Laws 1994, c. 216, § 1, emerg. eff. May 20, 1994; Laws 1995, c. 339, § 2, eff. Nov. 1, 1995; Laws 1996, c. 226, § 22, eff. July 1, 1996; Laws 1998, c. 25, § 1, eff. Nov. 1, 1998; Laws 2001, c. 307, § 1, eff. Nov. 1, 2001; Laws 2003, c. 151, § 1, eff. Nov. 1, 2003.

§18-804.  Formation of professional entity.

A professional entity may be formed by filing the appropriate instrument required by the associated act with the Secretary of State.  The individual or individuals forming the professional entity shall be duly licensed in accordance with the provisions of this state's licensing laws for the profession and in good standing within the profession to be practiced through the professional entity.  Such instrument shall meet the requirements of the applicable associated act and shall also contain the following:

1.  The profession or related professions to be practiced through the professional entity; and

2.  A certificate by the regulating board of the profession or related professions involved that each of the persons who are to become owners or managers of the professional entity and who are to engage in the practice of the profession or related profession is duly licensed in accordance with the provisions of this state's licensing laws for the profession or related profession to practice such profession.

Added by Laws 1961, p. 205, § 4, emerg. eff. July 26, 1961.  Amended by Laws 1981, c. 312, § 2, eff. Oct. 1, 1981; Laws 1986, c. 292, § 148, eff. Nov. 1, 1986; Laws 1995, c. 339, § 3, eff. Nov. 1, 1995.

§18-805.  Applicability of associated acts.

The respective associated act shall be applicable to each professional entity, and each professional entity shall enjoy the powers and privileges and be subject to the duties, restrictions, and liabilities of other similarly situated business entities, except where inconsistent with this act.  This act shall take precedence in the event of any conflict with provisions of the applicable associated act or other laws.

Added by Laws 1961, p. 205, § 5, emerg. eff. July 26, 1961.  Amended by Laws 1986, c. 292, § 149, eff. Nov. 1, 1986; Laws 1995, c. 339, § 4, eff. Nov. 1, 1995.

§18-806.  Purpose of formation of professional entity.

A professional entity may be formed for the purpose of rendering one specific type of professional service or related professional services and services ancillary thereto and shall not engage in any business other than rendering the professional service or services which it was organized to render and services ancillary thereto; provided, however, that a professional entity may own real and personal property necessary or appropriate for rendering the type of professional services it was organized to render and may invest its funds in real estate, mortgages, stocks, bonds and any other type of investments.

Added by Laws 1961, p. 205, § 6, emerg. eff. July 26, 1961.  Amended by Laws 1981, c. 312, § 3, eff. Oct. 1, 1981; Laws 1995, c. 339, § 5, eff. Nov. 1, 1995.

§18-807.  Name of professional entity.

The name of every professional entity shall end with one or more of the words or abbreviations permitted in the applicable associated acts; provided, that such words or abbreviations shall be modified by the word "professional" or some abbreviation of the combination, with or without punctuation, including, without limitation: "P.C.", "P.L.P." or "P.L.L.C.".  Provided further, each of the regulating boards may by rule adopt further requirements as to the names of professional entities organized to render professional services within the jurisdiction of such regulating board.

Added by Laws 1961, p. 205, § 7, emerg. eff. July 26, 1961.  Amended by Laws 1981, c. 312, § 4, eff. Oct. 1, 1981; Laws 1995, c. 339, § 6, eff. Nov. 1, 1995; Laws 1996, c. 69, § 2, eff. Nov. 1, 1996; Laws 2001, c. 406, § 8, emerg. eff. June 4, 2001.

§18-808.  Office.

The principal office of the professional business entity shall be designated by street address in the formation instrument and shall not be changed without amendment of the formation instrument.

Added by Laws 1961, p. 205, § 8, emerg. eff. July 26, 1961.  Amended by Laws 1970, c. 95, § 2, emerg. eff. March 30, 1970; Laws 1986, c. 292, § 150, eff. Nov. 1, 1986; Laws 2001, c. 406, § 9, emerg. eff. June 4, 2001.

§18-809.  License requirement.

Except as provided in Section 815 of this title, no person shall hold an interest in a professional entity who is not duly licensed in accordance with the provisions of this state's licensing laws for the profession or related profession to render the same professional services or related professional services as those for which the entity is organized.

Added by Laws 1961, p. 206, § 9, emerg. eff. July 26, 1961.  Amended by Laws 1981, c. 312, § 5, eff. Oct. 1, 1981; Laws 1993, c. 345, § 2, eff. Sept. 1, 1993; Laws 1995, c. 339, § 7, eff. Nov. 1, 1995.

§18-810.  Managers and stockholders.

No person may be a manager of a professional entity who is not a person duly licensed in accordance with the provisions of this state's licensing laws for the profession or related profession to render the same professional services or related professional services as those for which the entity is formed.  No person may be a shareholder of a professional corporation who is not an individual duly licensed to render the same professional services or related professional services as those for which the corporation is organized.

Added by Laws 1961, p. 206, § 10, emerg. eff. July 26, 1961.  Amended by Laws 1963, c. 281, § 1; Laws 1971, c. 30, § 1, emerg. eff. March 22, 1971; Laws 1979, c. 6, § 1; Laws 1981, c. 312, § 6, eff. Oct. 1, 1981; Laws 1993, c. 345, § 3, eff. Sept. 1, 1993; Laws 1995, c. 339, § 8, eff. Nov. 1, 1995.

§18-811.  Professional services through owners, managers, employees and agents.

A professional entity may render professional services only through its owners, managers, employees and agents who are duly licensed in accordance with the provisions of this state's licensing laws to render professional services; provided, however, this provision shall not be interpreted to include in the term "employee", as used herein, clerks, secretaries, bookkeepers, technicians and other assistants who are not usually and ordinarily considered by custom and practice to be rendering professional services to the public for which a license is required.

Added by Laws 1961, p. 206, § 11, emerg. eff. July 26, 1961.  Amended by Laws 1981, c. 312, § 7, eff. Oct. 1, 1981; Laws 1995, c. 339, § 9, eff. Nov. 1, 1995.

§18812.  Professional relationship preserved.

This act does not alter any law applicable to the relationship between a person rendering professional services and a person receiving such services, including liability arising out of such professional services.

Laws 1961, p. 206, § 12.  

§18813.  Professional regulation.

Subject to the provisions of Section 819 of this title, nothing in this act shall restrict or limit in any manner the authority and duty of the regulating boards for the licensing of individual persons rendering professional services or the practice of the profession which is within the jurisdiction of such regulating board, notwithstanding that such person is an owner, manager or employee of a professional entity and rendering such professional services or engaging in the practice of such profession through such professional entity.

Added by Laws 1961, p. 206, § 13, emerg. eff. July 26, 1961.  Amended by Laws 1995, c. 339, § 10, eff. Nov. 1, 1995.

§18814.  Prohibited acts.

No professional entity may do any act which is prohibited to be done by individual persons licensed to practice a profession which the professional entity is organized to render.

Added by Laws 1961, p. 206, § 14, emerg. eff. July 26, 1961.  Amended by Laws 1981, c. 312, § 8, eff. Oct. 1, 1981; Laws 1995, c. 339, § 11, eff. Nov. 1, 1995.

§18-815.  Death or disqualification of shareholders - Sole shareholder - Withdrawal.

A.  1.  If the professional entity is a corporation, the certificate of incorporation, bylaws or other agreement may provide for the purchase or redemption of the shares of any shareholder upon the death, incapacity, disqualification or ending of employment of such shareholder.  In the absence of a provision in the certificate of incorporation, or the bylaws, or other agreement, the professional corporation shall purchase the shares of a deceased shareholder, a shareholder who is incapacitated or who is no longer qualified to own shares in such corporation or a shareholder whose employment has ended, within ninety (90) days after such shareholder's death, incapacity or disqualification or ending of employment, as the case may be.

2.  The price for such shares shall be the book value as of the end of the month immediately preceding such shareholder's death, incapacity, disqualification or ending of employment of the shareholder.  Book value shall be determined from the books and records of the professional corporation in accordance with the regular method of accounting used by the corporation.  If the corporation shall fail to purchase the shares by the end of the ninety day period, then the executor or administrator or other personal representative of the deceased, incapacitated or disqualified shareholder may bring an action in the district court of the county in which the principal office or place of practice of the professional corporation is located for the enforcement of this provision.  If the plaintiff is successful in such action, he shall be entitled to recover the book value of the shares involved, a reasonable attorney's fee and costs.  The professional corporation shall repurchase such shares without regard to restrictions upon the repurchase of shares provided for in the Oklahoma General Corporation Act.

3.  If there is only one shareholder of a professional corporation, and the shareholder dies or becomes incapacitated, the executor or administrator or other personal representative of the shareholder shall have the authority to sell the shares of capital stock owned by the shareholder to a qualified purchaser, or to cause a dissolution of the professional corporation as provided by law.  The vesting of ownership of shares of stock in a professional corporation in the executor or administrator or other personal representative shall be solely for the purposes set forth above and shall not be deemed to contravene any other provisions of this act.

B.  If the professional entity is a limited partnership or a limited liability company, an owner's disqualification shall be deemed a withdrawal, and the professional entity shall respond to the disqualification as it would any other withdrawal.

Added by Laws 1961, p. 206, § 15, emerg. eff. July 26, 1961.  Amended by Laws 1974, c. 52, § 1; Laws 1986, c. 292, § 151, eff. Nov. 1, 1986; Laws 1993, c. 345, § 4, eff. Sept. 1, 1993; Laws 1995, c. 339, § 12, eff. Nov. 1, 1995.

§18817.  Prior corporation.

This act shall not apply to any persons within this state who prior to the passage of this act were permitted to organize a corporation and perform professional services by the means of such corporation, and this act shall not apply to any corporation organized by such persons prior to the passage of this act; provided, however, any such persons or any such corporation may bring themselves and such corporation within the provisions of this act by amending the certificate of incorporation in such a manner so as to be consistent with all of the provisions of this act and by affirmatively stating in the amended certificate of incorporation that the shareholders have elected to bring the corporation within the provisions of this act.

Amended by Laws 1986, c. 292, § 152, eff. Nov. 1, 1986.  

§18818.  Certificates.

The regulating boards of the respective professions described in Section 803 of this title are hereby authorized and directed to issue the certificates required by Section 804 of this title upon receipt of an affidavit or other instrument reciting the names and addresses of the prospective owners and managers.  The regulating boards may charge and collect a reasonable fee for such issuance.  The fee shall be deposited and expended as provided by law for other fees collected by each respective regulating board.

Added by Laws 1961, p. 207, § 18, emerg. eff. July 26, 1961.  Amended by Laws 1988, c. 323, § 3, eff. Nov. 1, 1988; Laws 1995, c. 339, § 13, eff. Nov. 1, 1995.

§18-819.  Inapplicability of conflicting laws and rules.

All laws and rules and parts of laws and rules in conflict with any of the provisions of this act or otherwise restricting the forms of organization available to persons providing professional services shall be inapplicable to professional entities formed under this act; provided, however, that nothing in this act shall be construed to supersede the provisions of 59 O.S. 1951, Sections 581 through 592, both inclusive, Sections 601 through 606, both inclusive, or Sections 941 through 947, of Title 59 of the Oklahoma Statutes, both inclusive, as amended.  In the event of the conflict of any of the provisions of this act with any of the above cited sections, then cited sections shall take precedence over this act and this act shall be construed accordingly.

Added by Laws 1961, p. 207, § 20, emerg. eff. July 26, 1961.  Amended by Laws 1995, c. 339, § 14, eff. Nov. 1, 1995.

§18863.  Nonprofit corporations for creating rural water and sewer districts  Exemption from taxation and assessments.

A corporation organized not for profit pursuant to the provisions of the Oklahoma General Corporation Act for the purpose of developing and providing rural water supply and sewage disposal facilities to serve rural residents shall be exempt from all excise taxes of whatsoever nature, and shall be exempt from payment of assessments in any general or special taxing district levied upon the property of said corporation, whether real, personal or mixed; such exemption shall include, but not be limited to, franchise taxes, assessments or fees levied by any county or municipality for inspections of the facilities of the corporation which were not requested by the corporation.  Said corporations shall have the right of eminent domain in the same manner and according to the procedures provided for in Sections 51 through 65 of Title 66 of the Oklahoma Statutes, provided, that the use of said eminent domain provisions shall be restricted to the purpose of developing and providing rural gas distribution, water supply and sewage disposal facilities.  Provided, however, no personal or real property, easement or rightofway of any utility may be acquired by eminent domain.

Added by Laws 1970, c. 328, § 1, emerg. eff. April 28, 1970.  Amended by Laws 1986, c. 53, § 1, eff. Nov. 1, 1986; Laws 1986, c. 292, § 153, eff. Nov. 1, 1986; Laws 1987, c. 124, § 1; Laws 1998, c. 283, § 1, emerg. eff. May 27, 1998.

§18865.  Liability of directors  Findings of Legislature.

The Legislature finds that nonprofit corporations serve important functions in providing services and assistance to persons in the state and that in order for these nonprofit corporations to function effectively, persons serving on the board of directors should not be subject to vicarious liability for the negligence of corporate employees or other directors.  The Legislature finds that potential exposure to vicarious liability has a detrimental effect on the participation of persons as directors of nonprofit corporations and that providing immunity to directors of such corporations for certain types of liability will promote the general health, safety and welfare of citizens in the state.

Added by Laws 1986, c. 195, § 1, eff. Nov. 1, 1986.  

§18-866.  Immunity of directors - Scope and extent.

A.  Except as otherwise provided by this section, no member of the board of directors of a nonprofit corporation that holds a valid exemption from federal income taxation issued pursuant to Section 501(a) of the Internal Revenue Code (26 U.S.C. Section 501(a)) or Section 528 of the Internal Revenue Code (26 U.S.C. Section 528) and is listed as an exempt organization in Section 501(c) of the Internal Revenue Code (26 U.S.C. Section 501(c)) or files as such pursuant to Section 528 of the Internal Revenue Code shall be held personally liable for damages resulting from:

1.  any negligent act or omission of an employee of the nonprofit corporation; or

2.  any negligent act or omission of another director.

B.  The immunity provided by subsection A of this section shall not extend to intentional torts or grossly negligent acts or omissions personal to any director of the nonprofit corporation.

C.  If a nonprofit corporation transfers assets to a member of the board of directors of such corporation or to another nonprofit corporation in order to avoid claims against corporate assets resulting from a judgment rendered as a result of a suit to recover damages for the negligence of the corporation, a corporate employee or a director, the director to whom the asset is transferred or any director of the corporation from which assets are transferred to avoid such claims may be held personally liable for any such judgment rendered and the immunity provided by this section shall be of no force or effect.

D.  The provisions of this section shall only apply to suits for recovery of damages based upon causes of action that accrue on or after the effective date of this act.

Added by Laws 1986, c. 195, § 2, eff. Nov. 1, 1986.  Amended by Laws 1988, c. 125, § 1, emerg. eff. April 8, 1988; Laws 2004, c. 255, § 1, eff. Nov. 1, 2004.

§18867.  Director  Breach of fiduciary duty  Liability.

In addition to the immunity provisions of Section 866 of Title 18 of the Oklahoma Statutes, no member of the board of directors of a nonprofit corporation shall be personally liable to the corporation, or members thereof, for monetary damages for breach of fiduciary duty as a director, provided that such immunity from liability shall not extend to:

1.  any breach of the director's duty of loyalty to the corporation; or

2.  any acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of the law; or

3.  any transaction from which the director derived an improper personal benefit.

Added by Laws 1987, c. 166, § 1, eff. Nov. 1, 1987.  

§18-868.  Nonprofit corporations for benefit of towns, cities and counties - Issuance of indebtedness - Exemption from taxation.

A.  A corporation organized not for profit pursuant to the provisions of the Oklahoma General Corporation Act and that holds a valid exemption from federal income taxation issued pursuant to Section 501(a) of the Internal Revenue Code (26 U.S.C. Section 501(a)) and is listed as an exempt organization in Section 501(c) of the Internal Revenue Code (26 U.S.C. Section 501(c)) is hereby authorized to issue indebtedness for the purpose of providing funds for the benefit of and on behalf of Oklahoma educational institutions, towns, cities and counties and their citizens throughout the state and to issue such indebtedness on a tax-exempt or taxable basis, as applicable under the Internal Revenue Code (26 U.S.C. Section 1, et seq.) as amended.  Such not for profit corporations shall not be subject to the provisions of Sections 695.7, 695.8 and 695.9 of Title 62 of the Oklahoma Statutes, or similar laws thereto.

B.  The interest on any indebtedness or obligations issued by any public trust or other entity authorized to issue obligations on which the interest thereon is exempt from federal income taxation and whose purpose includes providing safe, decent and affordable single family or multifamily housing, shall not be subject to taxation by the State of Oklahoma or by any county, municipality, or political subdivision therein when such indebtedness or obligation is issued to provide decent and affordable single family or multifamily housing.

Added by Laws 1998, c. 283, § 2, emerg. eff. May 27, 1998.  Amended by Laws 1998, c. 400, § 6, emerg. eff. June 10, 1998; Laws 2000, c. 351, § 13, eff. July 1, 2001.

§18901.  Short title.

This act shall be known and may be cited as the "Oklahoma Business Development Corporation Act".

Laws 1970, c. 187, § 1, emerg. eff. April 13, 1970.  

§18902.  Definitions.

As used in this act, unless a different meaning is required by the context, the following words and phrases shall have the following meanings:

(1) "Corporation" means the Oklahoma Business Development Corporation created under the provisions of this act.

(2) "Financial institution" means any bank, trust company, savings and loan association, insurance company, or other institution engaged in lending or investing funds.

(3) "Member" means any financial institution which shall undertake to lend money to a corporation created under the provisions of this act.

(4) "Board of directors" means the board of directors of a corporation created under this act.

(5) "Loan limit" for any member means the maximum amount permitted to be outstanding at one time on loans made by such member to a corporation as determined under the provisions of this act.

(6) "Shareholder" means the holder of record of shares in the corporation.

Laws 1970, c. 187, § 2, emerg. eff. April 13, 1970.  

§18903.  Organization  Purpose.

A business development corporation may be incorporated in this state pursuant to the provisions of this act and all the provisions of the Oklahoma General Corporation Act not in conflict with or inconsistent with the provisions of this act shall apply to such corporation except as hereinafter otherwise provided.

Ten or more persons, a majority of whom shall be residents of this state, who desire to create a business development corporation under the provisions of this act, shall by certificate of incorporation filed with the Secretary of State, under their hands and seal, set forth:

(1) The name of the corporation, which shall include the words "Oklahoma Business Development Corporation".

(2) The location of the principal office of the corporation, but such corporation may have offices in such other places within the state as may be fixed by the board of directors.

(3) The purpose for which the corporation is founded, which shall include the following:

The purposes of the corporation shall be to promote, stimulate, develop and advance to business prosperity and economic welfare of the State of Oklahoma and its citizens; to encourage and assist through loans, investments or other business transactions in the location of new business and industry in this state and to improve and assist existing business and industry, and so to stimulate and assist in the expansion of all kinds of business activity which will tend to promote the business development and maintain the economic stability of this state and provide maximum opportunities for employment; to cooperate and act in conjunction with other organizations, public or private, in the promotion and advancement of industrial, commercial, agricultural and recreational developments in this state; and to provide financing for the promotion, development, and conduct of all kinds of business activity in this state.

Amended by Laws 1986, c. 292, § 154, eff. Nov. 1, 1986.  

§18904.  Powers.

To accomplish its purposes, the corporation shall, subject to the restrictions and limitations herein contained, have the following powers:

(1) To elect, appoint, and employ officers, agents and employees and to make contracts and incur liabilities for any of the purposes of the corporation.

(2) To borrow money from its members, any agency or governmental entity of the Federal Government or the State of Oklahoma or any agency or department thereof or any other corporation or person, for any of the purposes of the corporation; to issue therefor its bonds, debentures, notes or other evidence of indebtedness, whether secured or unsecured, and to secure the same by mortgage, pledge, deed of trust or other lien on its property, franchises, rights, and privileges of every kind and nature, or any part thereof or interest therein, without securing stockholder or member approval.

(3) To make loans to any person, firm, corporation, association or trust, and to establish and regulate the terms and conditions with respect to any such loans, provided however, that the corporation shall not approve any application for a loan unless and until the person applying for said loan shall show that he has applied for the loan through ordinary banking channels and that the loan has been refused by at least one bank or other financial institution.

(4) To mortgage, hold, pledge or otherwise dispose of the stock, shares, bonds, debentures, notes or other securities and evidences of interest in, or indebtedness of, any person, firm, corporation, jointstock company, association or trust, and allow the owner or holder thereof to exercise all the rights, powers and privileges of ownership, including the right to vote thereon.  In the event of default, the Business Development Corporation must divest itself of the acquired assets within a reasonable period of time.

(5) To cooperate with and avail itself of the facilities of the United States Department of Commerce, the Oklahoma Parks and Industries Board and any other similar state or federal governmental agency; and to cooperate with and assist, and otherwise encourage organizations in the various communities of the state in the promotion, assistance and development of the business prosperity and economic welfare of such communities or of this state or of any part thereof.

(6) To do all acts and things necessary or convenient to carry out the powers expressly granted in this act.

Laws 1970, c. 187, § 4, emerg. eff. April 13, 1970.  

§18905.  Limitation on amount of capital stock acquired by member  Minimum capital stock.

(1) Notwithstanding any other provision of law, any person, corporation, public utility, financial institution, or labor union, may acquire, hold, sell, assign, transfer, mortgage, pledge, or otherwise dispose of any bonds, notes, debentures, securities, or other evidences of indebtedness, or the shares of capital stock of a corporation created hereunder; provided that the amount of capital stock which may be acquired by any member of such corporation shall not exceed ten percent (10%) of the loan limit of such member.

(2) The capital stock of any such corporation shall be not less than Two Hundred Fifty Thousand Dollars ($250,000.00) to be evidenced by two thousand five hundred (2,500) shares, having a par value of One Hundred Dollars ($100.00) each, at least ten percent (10%) of the capital stock of any such corporation shall be paid into the treasury before it is authorized to transact any business other than such as relates to its organization.

Laws 1970, c. 187, § 5, emerg. eff. April 13, 1970.  

§18906.  Members  Acceptance of loans.

(1) All financial institutions as defined herein are hereby authorized to become members of the corporation and to make loans to the corporation as provided herein.

(2) Any financial institution may request membership in the coporation by making application to the board of directors on such form and in such manner as said board of directors may require, and membership shall become effective upon acceptance of such application by the board.

(3) Each member of the corporation shall make loans to the corporation as and when called upon by it to do so on such terms and other conditions as shall be approved from time to time by the board of directors, subject to the following conditions:

(a) All loan limits shall be established at the thousanddollar amount nearest to the amount computed in accordance with the provisions of this section.

(b) No loan to the corporation shall be made if immediately thereafter the total amount of the obligations of the corporation would exceed ten times the amount then paid in an outstanding capital stock, reserves or earned surplus of the corporation.

(c) The total amount outstanding at any one time on loans to a development corporation made by any member shall not exceed: (i) twenty percent (20%) of the total amount then outstanding on loans to such development corporation by all members thereof, (ii) the following limit, to be determined as of the time such member becomes a member, on the basis of figures contained in the most recent yearend statement prior to its application for membership; three percent (3%) of the capital and permanent surplus of banks, trust companies; three percent (3%) of the total reserve and surplus accounts of a savings and loan association; one percent (1%) of the capital and unassigned surplus of stock insurance companies, except fire insurance companies; one percent (1%) of the unassigned surplus of mutual insurance companies, except fire insurance companies; onetenth of one percent (1/10 of 1%) of the assets of fire insurance companies; comparable limits for other financial institutions as established by the board of directors of the development corporation.  All loan limits shall be recomputed as of the first day of January of each evennumbered year, but no member's loan limit shall be increased as the result of such recomputation without the consent of such member.

(d) Each call made by the corporation shall be prorated among the members of the corporation in substantially the same proportion that the adjusted loan limit of each member bears to the aggregate of the adjusted loan limits of all members.  The adjusted loan limit of a member shall be the amount of such member's loan limit, reduced by the balance of outstanding loans made by such member to the corporation and the investment in capital stock of the corporation held by such member at the time of such call.

(e) All loans to the corporation by members shall be evidenced by bonds, debentures, notes, or other evidence of indebtedness of the corporation, which shall be freely negotiable at all times, and which shall bear interest at a rate of not less than onehalf of one percent (1/2 of 1%) in excess of the rate of interest determined by the board of directors at the date of issuance to be the prime rate prevailing on unsecured commercial loans.

(f) Membership in the corporation shall be for the duration of the corporation provided that: (i) upon written notice given to the corporation one (1) year in advance, a member may withdraw from membership in the corporation at the expiration date of such notice, (ii) a member shall not be obligated to make any loans to the corporation pursuant to calls made subsequent to the receipt of notice of the withdrawal of said member.

Laws 1970, c. 187, § 6, emerg. eff. April 13, 1970.  

§18907.  Board of directors.

The business and affairs of a corporation shall be conducted by a board of directors.  The number of directors shall be a multiple of three with a minimum of fifteen and a maximum of twentyone. Twothirds of the directors shall be elected by the members, and onethird shall be elected by the stockholders.  Onethird of the original board shall be elected for a term of one (1) year, onethird for a term of two (2) years, and onethird for a term of three (3) years; all directors subsequently elected shall serve for a term of three (3) years.  Any vacancy in the office of a director elected by the members shall be filled by the directors elected by the members, and any vacancy in the office of a director elected by the stockholders shall be filled by the directors elected by the stockholders.

Laws 1970, c. 187, § 7, emerg. eff. April 13, 1970.  

§18908.  Voting rights.

Each stockholder shall be entitled to one vote, in person or by proxy, for each share of capital stock held, and each member shall be entitled to one vote, in person or by proxy, for each One Thousand Dollars ($1,000.00) of the outstanding loan limit of each member.

Laws 1970, c. 187, § 8, emerg. eff. April 13, 1970.  

§18909.  Retention of certain earnings.

Each year the corporation shall set apart as earned surplus not less than ten percent (10%) of its net earnings for the preceding fiscal year until such surplus shall be equal in value to onehalf of the amount paid in on the capital stock then outstanding. Whenever the amount of surplus so established shall become impaired, it shall be built up again to the required amount in the manner provided for its original accumulation.

Laws 1970, c. 187, § 9, emerg. eff. April 13, 1970.  

§18910.  Deposit of funds.

No corporation organized under the provisions of this act shall at any time be authorized to receive money on deposit.  The corporation shall not deposit any of its funds in any banking institution unless such institution has been designated as a depository by a vote of a majority of the directors present at an authorized meeting of the board of directors, exclusive of any director who is an officer or director of the depository so designated.

Laws 1970, c. 187, § 10, emerg. eff. April 13, 1970.  

§18911.  Amendment of articles of incorporation.

No amendment to the certificate of incorporation shall be made which increases the obligation of a member to make loans to the corporation or which makes any change in the principal amount, interest rate, maturity date, or in the security or credit position of any outstanding loan made by a member to the corporation or which affects the right of a member to withdraw from membership or the voting rights of such member, without the consent of each member who would be affected by such amendment.

Amended by Laws 1986, c. 292, § 155, eff. Nov. 1, 1986.  

§18912.  Audits and reports.

Such corporation shall be subject to an annual examination and audit by one or more certified public accountants to be selected by the board of directors, sufficient to reflect the result of the operations during and the condition of the corporation at the end of the fiscal year.  A report of such examination, audit and condition of such corporation shall be made in writing to each of the members and stockholders of such corporation on or before the one hundred twentieth day of each succeeding fiscal year of said corporation.

Laws 1970, c. 187, § 12, emerg. eff. April 13, 1970.  

§18951.  Prohibition on forming  Exceptions.

A.  It is hereby declared to be the public policy of this state and shall be the prohibition of this act that, notwithstanding the provisions of Section 5 of this act, no foreign corporation shall be formed or licensed under the Oklahoma General Corporation Act for the purpose of engaging in farming or ranching or for the purpose of owning or leasing any interest in land to be used in the business of farming or ranching.  A domestic corporation may, however, be formed under the Oklahoma General Corporation Act to engage in such activity if the following requirements are met by that domestic corporation:

1.  There shall be no shareholders other than (a) natural persons; (b) estates; (c) trustees of trusts for the benefit of natural persons, if such trustees are either (i) natural persons or (ii) banks or trust companies which either have their principal place of business in Oklahoma or are organized under the laws of the State of Oklahoma; or (d) corporations owned by no shareholders other than those described in paragraph 1 (a), (b) or (c) of this section and meeting the requirements of paragraph 3 of this section.

2.  Not more than thirtyfive percent (35%) of the corporation's annual gross receipts shall be from any source other than (a) farming or ranching or both, as the case may be, or (b) allowing others to extract from the corporate lands any minerals underlying the same, including, but not limited to, oil and gas.  Provided, however, in the event a corporation does not comply with the thirtyfive percent (35%) annual gross receipt test, then, in that event the corporation may furnish records of its gross receipts for each of the previous five (5) years, or for each year that it has been in existence if less than five (5) years, and the average of said annual gross receipts shall be used in lieu of the corporation's annual gross receipts for purposes of complying with this section.

3.  Except as otherwise provided in this paragraph, there shall not be more than ten shareholders unless said shareholders in excess of ten are related as lineal descendants or are or have been related by marriage to lineal descendants or persons related to lineal descendants by adoption or any combination of same.  For a corporation incorporated for the purpose of breeding horses, there shall not be more than twenty-five shareholders.

4.  Certificates of incorporation for domestic corporations which intend to engage in farming or ranching or owning or leasing any interest in land to be used in the business of farming or ranching shall initially be approved by the State Board of Agriculture concerning the purpose prior to filing in the office of the Secretary of State.  No stated purpose is to be disapproved by the Board of Agriculture unless such stated purpose violates existing civil or criminal code.

B.  The Secretary of State shall provide the State Department of Agriculture a list of corporations registering in the state that list farming or ranching or owning or leasing any interest in land to be used in the business of farming or ranching at least weekly.

Amended by Laws 1986, c. 292, § 156, eff. Nov. 1, 1986; Laws 1991, c. 38, § 2, emerg. eff. April 3, 1991.

§18952.  Revocation of license  Vacation of franchise  Penalties.

A.  Any license issued after June 1, 1971, under the Oklahoma Business Corporation Act to a foreign corporation for the purpose of engaging in farming or ranching or for the purpose of owning or leasing any interest in land to be used in the business of farming or ranching shall be revoked within five (5) years of the effective date of this act.

B.  The corporate franchise of any existing domestic corporation  formed under the Oklahoma Business Corporation Act after June 1,  1971, for the purpose of engaging in farming or ranching or for the  purpose of owning or leasing any interest in land to be used in the  business of farming or ranching shall be vacated within five (5) years of the effective date of this act unless its articles of incorporation comply with Section 951 of this title.

C.  The corporate franchise of any domestic corporation governed by the Oklahoma General Corporation Act formed for the purpose of farming or ranching or for the purpose of owning or leasing any interest in land to be used in the business of farming or ranching and permitted to engage in such activity under this act shall be vacated promptly in the manner prescribed by Section 104 of this act, if the corporation has pers