Whereas, The deferred operation of this act would tend to defeat its purpose, which is to immediately indemnify all bank officers, therefore it is hereby declared to be an emergency law, necessary for the immediate preservation of the public convenience.
Be it enacted by the Senate and House of Representatives
in General Court assembled, and by the authority of the same,
SECTION 1. Chapter 44 of the acts of 1932 is hereby amended by striking out section 2, as most recently amended by section 1 of chapter 229 of the acts of 1981, and inserting in place thereof the following section:-
Section 2. The officers of the corporation shall be a president, one or more vice presidents, a treasurer, a clerk and a board of twenty-five directors. All officers shall be elected by the directors. At all meetings each member bank shall be represented by such person as its board of investment shall designate, and each member bank shall have one vote for each ten million dollars or fraction thereof of deposits as shown by its latest annual report to the commissioner. The directors may adopt by-laws and amendments thereto for the conduct of the business of the corporation, but any additions, deletions or other amendments thereto adopted shall be subject to the approval of a majority of the member banks; and by such by-laws may provide for and fix the time and place of meetings of the directors, which shall be at least quarterly, and of the corporation, define the duties of the officers, establish an executive committee of not less than five directors with such powers as the board of directors shall determine, and may provide for such other officers and other committees as they deem advisable. The directors may fill vacancies in the board until the next election. The board of directors shall have full control of the business of the corporation. The executive committee shall have full control of the business of the corporation between meetings of the directors. Any action required or permitted to be taken at any meeting of the directors may be taken without a meeting if all directors entitled to vote on the matter consent to the action in writing, and the written consent or consents are filed with the records of the meetings of directors. Such consents shall be treated for all purposes as votes at a duly called and held meeting. The board of directors of the corporation or any committee thereof may participate in a meeting of such board or committee by means of a conference telephone or similar communication equipment by means of which all persons participating in the meeting can hear each other at the same time, and participation by such means shall constitute presence in person at a meeting.
SECTION 2. Section 3 of said chapter 44, as amended by section 3 of said chapter 229, is hereby further amended by striking out the last sentence and inserting in place thereof the following sentence:- Thereafter each such director shall be elected for a two-year term, such elections to be held at the annual meeting of the corporation, which shall be called by the clerk at such time and place as may be designated by the directors.
SECTION 3. Said chapter 44 is hereby further amended by adding the following section:-
Section 10. The corporation shall have the authority to indemnify its directors, trustees, officers, employees and other agents to whatever extent specified in or authorized by a by-law adopted pursuant to law. Such indemnification may include payment by the corporation of expenses incurred in defending a civil or criminal action or proceeding in advance of the final disposition of such action or proceeding upon receipt of an undertaking by the person indemnified to repay such payment if he shall be adjudicated to be not entitled to indemnification under this section which undertaking may be accepted without reference to the financial ability of such person to make repayment. Any such indemnification may be provided although the person to be indemnified is no longer an officer, director, trustee, employee or agent of the corporation.
No indemnification shall be provided for any person with respect to any matter as to which he shall have been adjudicated in any proceeding not to have acted in good faith in the reasonable belief that his action was in the best interests of the corporation.
The corporation shall have power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or other agent of the corporation, against any liability incurred by him in any such capacity, or arising out of his status as such, whether or not the corporation would have the power to indemnify him against such liability.
SECTION 4. Chapter 178 of the General Laws is hereby further amended by striking out section 34, as inserted by section 6 of chapter 569 of the acts of 1986, and inserting in place thereof the following section:-
Section 34. Any savings and insurance bank which converts or has converted to a federal savings bank charter and has its main office located in the commonwealth or which has merged with a federal savings and loan association which has its main office located in the commonwealth may continue to operate such insurance department in accordance with the provisions of this chapter.