The opinion of the court was delivered by: Bua, District Judge.
The above-captioned matter comes before the Court on
plaintiffs' motion for preliminary injunction seeking an order
requiring defendants to convene a special meeting of the
shareholders of the Land of Lincoln Savings and Loan. Pursuant to
notice, the matter was heard by the Court on September 19, 1983.
The Court, having considered plaintiffs' motion, defendants'
answer, memoranda, exhibits, and affidavits submitted in support
of and in opposition to said motion, and having heard oral
argument, does hereby enter the findings of fact and conclusions
of law pursuant to Rule 52(a) of the Federal Rules of Civil
1. Plaintiff Treco, Inc. ("Treco") is a Florida corporation
with its principal executive office in Jacksonville, Florida.
2. Plaintiff Wisconsin Real Estate Investment Trust ("WREIT")
is a common law business trust formed under the laws of the State
of Wisconsin with its principal executive office in Chicago,
3. WREIT is in "bad standing" with the Wisconsin Secretary of
State due to its failure to file an annual report required under
4. WREIT is doing business in Illinois without a certificate of
authority from the Illinois Secretary of State.
5. Defendant Land of Lincoln Savings and Loan ("Lincoln") is a
savings and loan association chartered under the laws of
Illinois. Deposits at Lincoln are insured by the Federal Savings
and Loan Insurance Corporation. Lincoln is regulated by the
Federal Home Loan Bank Board.
6. The nine individual defendants are all members of Lincoln's
Board of Directors.
7. Lincoln has 2,470,855 shares of stock outstanding. Treco and
WREIT each own 123,000 common shares of Lincoln. Together, Treco
and WREIT own approximately 9.956 percent of the outstanding
common shares of Lincoln.
9. Lincoln's existing bylaws contain no provision providing for
cumulative voting. In order for the plaintiffs to obtain
representation on Lincoln's Board of Directors based upon their
stock ownership, plaintiffs must propose and have Lincoln's
shareholders adopt an amendment to Lincoln's bylaws to require
cumulative voting of shares at elections for members of the Board
10. Under Lincoln's current bylaws, an amendment to the bylaws
may be proposed by shareholders only at a special meeting of
shareholders called expressly for that purpose. Under Article II,
Section 3 of Lincoln's bylaws, the President of the Association
is required to convene a special meeting of shareholders if he
receives a written request for a special meeting from
shareholders holding not less than 20 percent of all the
outstanding common stock of Lincoln entitled to vote at the
meeting. The written request must state the purpose of the
meeting and must be delivered to the business office of Lincoln
addressed to the Chairman of the Board the President, or the
11. On September 15, 1983, plaintiffs, on behalf of
shareholders holding in excess of 20 percent of Lincoln's common
stock, delivered a written demand to defendant Thomas A. Kinst,
President of Lincoln, requesting him to call a special meeting of
Lincoln's shareholders for October 12, 1983, at 1400 Gannon
Drive, Hoffman Estates, Illinois. The stated purpose for the
special meeting was to consider and vote on a ...