Current Boston Firefighters Credit Union By-Laws Proposed Amendments Boston Firefighters Credit Union By-Laws ARTICLE I Name and Object Section 1 - This Corporation shall be known as the Boston Firefighters Credit Union. Section 2 - The credit union shall conduct the business of a state chartered credit union and shall have and may exercise all the powers, privileges and authority, express or implied, now or hereafter conferred by Massachusetts General Laws Chapter 171, as amended, and by any and all other statutes, laws and regulations relating in whole or in part to the business of credit unions. Its purpose shall be to deliver financial services through the promotion of thrift amongst its members by affording them the opportunity to accumulate savings and to create for its members a source of credit for provident or productive purposes. ARTICLE II Membership Section 1 - Membership in this credit union shall be limited to: (a) the employees and retirees of the Boston Fire Department; (b) employees of the Boston Firefighters Credit Union; (c) employees of Local 718, a Massachusetts labor union comprised primarily of Boston Firefighters and any successor organization; (d) employees of Florian Associates, a subsidiary of Local 718 which manages and operates the function facility located at 55 Hallet St, Dorchester, MA 02124; (e) employees and retirees of the fire departments whose members comprise the Professional Fire Fighters Of Massachusetts (PFFM), a labor organization affiliated with the International Association of Fire Fighters (IAFF) and (f) the family members of those persons listed above. ARTICLE I Name and Object Section 1 - This Corporation shall be known as the Boston Firefighters Credit Union. Section 2 - The Credit Union shall conduct the business of a state chartered credit union and shall have and may exercise all the powers, privileges and authority, express or implied, now or hereafter conferred by Chapter 171 of the Massachusetts General Laws, as amended, and by any and all other statutes, laws and regulations relating in whole or in part to the business of credit unions. Its purpose shall be to deliver financial services through the promotion of thrift amongst its members by affording them the opportunity to accumulate savings and to create for its members a source of credit for provident or productive purposes. ARTICLE II Membership Section 1 - Membership in this Credit Union shall be limited to: (a) the employees and retirees of the Boston Fire Department; (b) employees of the Boston Firefighters Credit Union; (c) employees of Local 718, a Massachusetts labor union comprised primarily of Boston Firefighters and any successor organization; (d) employees of Florian Associates, a subsidiary of Local 718 which manages and operates the function facility located at 55 Hallet St, Dorchester, MA 02124; (e) employees and retirees of the fire departments whose members comprise the Professional Fire Fighters Of Massachusetts (PFFM), a labor organization affiliated with the International Association of Fire Fighters (IAFF) and (f) the family members of those persons listed above. For the purposes of this section, the term family member shall be defined to include spouses, domestic partners, sharing a principal residence in the same household as the member, and children as well as parents, grandparents, grandchildren, siblings, nieces 1 For the purposes of this section, the term family member shall be defined to include spouses, domestic partners, sharing a principal residence in the same household as the member, and children as well as parents, grandparents, grandchildren, siblings, nieces
and nephews whether related by blood or marriage. Once a member becomes a member, then that person may remain a member until the person or organization chooses to withdraw or is expelled in accordance with applicable provisions of these by-laws and state law. Section 2 - Applications for membership must be made in writing, and approved by the Board of Directors at the next regular meeting. Section 3 - A person admitted to membership by the Board of Directors shall not become a member until he/she has qualified by subscribing and paying in full for at least one (1) share of the capital. Section 4 - No member may resign while a borrower, and endorser or a guarantor on any loan due to the credit union. Section 5 - A member engrossed in the sphere of operation of the corporation may retain all of his/her rights and privileges as a member except as otherwise limited under the by-laws and such regulations as established by the Board and approved by the Commissioner of Banks. Said regulations shall be of uniform general application to all those in the class affected thereby. Section 6 - The officers and directors shall hold all transactions of the shareholders with the credit union in strict confidence. ARTICLE III Shares Section 1 - Shares may be subscribed for and paid for in any amount subject to statutory limitations and regulations of the Board of Directors. Section 2 - Shares may be transferred from one member to another only in writing and in such form as the Board of Directors may approve. and nephews whether related by blood or marriage. Once a member becomes a member, then that person may remain a member until the person or organization chooses to withdraw or is expelled in accordance with applicable provisions of these by-laws and state law. Section 2 - Applications for membership must be made in a form which is approved by the Board of Directors. Membership is subject to approval by the Board of Directors. Section 3 - A person admitted to membership of the Credit Union shall not become a member until he/she has qualified by subscribing and paying in full for at least one (1) share of the capital. Section 4 - No member may resign while a borrower, and endorser or a guarantor on any loan due to the Credit Union. Section 5 - A member engrossed in the sphere of operation of the Credit Union may retain all of his/her rights and privileges as a member except as otherwise limited under the by-laws and such regulations as established by the Board and approved by the Commissioner of Banks. Said regulations shall be of uniform general application to all those in the class affected thereby. Section 6 - A member may be expelled in accordance with Section 14 of Chapter 171 of the Massachusetts General Laws. Section 7 - Except as otherwise required by law, the officers and directors shall hold all transactions of the members with the Credit Union in strict confidence. ARTICLE III Shares Section 1 - Shares may be subscribed for and paid for in any amount subject to statutory limitations and regulations of the Board of Directors. Section 2 - Shares may be transferred from one member to another in such form as the Board of Directors may approve. 2
ARTICLE IV Deposits Section 1 - A member may make deposits in any amount subject to statutory limitations and regulations of the Board of Directors. Section 2 - Deposits may be withdrawn on any day on which the corporation is open for business but the directors may at any time require the depositor to give sixty (60) days notice in writing of his/her intention to withdraw the whole or any part of his/her deposit. Section 3 - Deposits will be placed on interest as of the day of deposit. Section 4 - Interest shall be computed periodically as authorized by the Board of Directors on money which has remained on deposit. Section 5 - Christmas Clubs, Vacation Clubs, and other thrift clubs may be carried by members when authorized by the Board of Directors ARTICLE IV Deposits Section 1 - A member may make deposits in any amount subject to statutory limitations and regulations of the Board of Directors. Section 2 - Deposits may be withdrawn on any day on which the Credit Union is open for business but the directors may at any time require the depositor to give sixty (60) days notice in writing of his/her intention to withdraw the whole or any part of his/her deposit. Section 3 - Deposits will be placed on interest as of the day of deposit. Section 4 - Interest shall be computed periodically as authorized by the Board of Directors, and in accordance with applicable law, on money which has remained on deposit. Section 5 - Christmas Clubs, Vacation Clubs, and other thrift clubs may be carried by members when authorized by the Board of Directors. ARTICLE V Loans Section 1 - All loans that are written shall require an application in a form approved by the Board of Directors which contains all of the information required by law and the Board of Directors. Section 2 - A member may not borrow from the credit union when not in good standing, nor if the member has failed to pay any of his/her obligations to the credit union. ARTICLE VI Board of Directors Section 1 - The Board of Directors shall consist of fifteen (15) members divided into three (3) groups, each consisting of five (5) members, the term of each group to expire in successive years. At each annual meeting of the members, successors to the retiring group shall be elected by plurality for a term of three (3) years. 3 ARTICLE V Loans Section 1 - All loans that are written shall require an application in a form approved by the Board of Directors which contains all of the information required by law and the Board of Directors. Section 2 - A member may not borrow from the Credit Union when not in good standing, nor if the member has failed to pay any of his/her obligations to the Credit Union. ARTICLE VI Board of Directors Section 1 - The Board of Directors shall consist of fifteen (15) members divided into three (3) groups, each consisting of five (5) members, the term of each group to expire in successive years. At each annual meeting of the members, successors to the retiring group shall be elected by plurality for a term of three (3) years. Section 2 - Any vacancy occurring between annual
Section 2 - Any vacancy occurring between annual meetings may be filled by the Board of Directors, who shall appoint a member of the credit union to serve as director until the next annual meeting, at which time a successor shall be chosen by the membership to fill the unexpired term. Section 3 - All members nominated as Director must be members in good standing and must be supported by at least twenty-five (25) signatures of members which must be submitted to the Nominating/Election Committee not later than thirty (30) days before the annual election. There shall be no nominations from the floor. Section 4 - The Board of Directors shall have the responsibility to manage the annual election of directors. Section 5 - Nomination papers will be made available no less than fourteen (14) days prior to the deadline for submission. Papers may be taken out by the candidate in person or by an authorized proxy for the candidate. Candidates will acknowledge receipt by their signature and in the case of a proxy the candidate will acknowledge their interest by telephone to the President/CEO or a member of the Nominating/Election Committee. Section 6 - Regular meetings of the Board of Directors shall be held the third Tuesday of each month. The meeting date may be changed by a majority vote of the Board to another day in that month to accommodate holidays, or other circumstances. When circumstances preclude voting at a regular meeting to reschedule a Board Meeting, voting may be done by telephone, and notification of the rescheduled meeting may be done by telephone or electronic communication with no less than forty-eight (48) hours advance notice. Other meetings of the Board may be called by the Chairperson or upon petition of three (3) members of the Board. Notice of special meetings shall be mailed not less than seven (7) days prior to the special meeting unless the chairperson determines the special meeting to be an emergency in which notice may be made by telephone with not less than twenty-four (24) hours advance notice. Section 7 - The Board of Directors shall perform the following duties in addition to those enumerated in the 4 meetings may be filled by the Board of Directors, who shall appoint a member of the credit union to serve as director until the next annual meeting, at which time a successor shall be chosen by the membership to fill the unexpired term. Section 3 - All members nominated as Director must be members in good standing and must be supported by at least twenty-five (25) signatures of members which must be submitted to the Nominating/Election Committee not later than thirty (30) days before the annual election. There shall be no nominations from the floor. Section 4 - The Board of Directors shall have the responsibility to manage the annual election of directors. Section 5 - Nomination papers will be made available no less than fourteen (14) days prior to the deadline for submission. Papers may be taken out by the candidate in person or by an authorized proxy for the candidate. Candidates will acknowledge receipt by their signature and in the case of a proxy the candidate will acknowledge their interest by telephone to the President/CEO or a member of the Nominating/Election Committee. Section 6 - Regular meetings of the Board of Directors shall be held the third Tuesday of each month. The meeting date may be changed by a majority vote of the Board to another day in that month to accommodate holidays, or other circumstances. When circumstances preclude voting at a regular meeting to reschedule a Board Meeting, voting may be done by telephone, and notification of the rescheduled meeting may be done by telephone or electronic communication with no less than forty-eight (48) hours advance notice. Other meetings of the Board may be called by the Chairperson or upon petition of three (3) members of the Board. Notice of special meetings shall be mailed not less than seven (7) days prior to the special meeting unless the chairperson determines the special meeting to be an emergency in which notice may be made by telephone with not less than twenty-four (24) hours advance notice. Section 7 - The Board of Directors shall perform all duties as prescribed in applicable state and federal law and regulation including but not limited to the
statutes: (a) Designate the bank or banks in which funds of the corporation shall be deposited provisions of Sections 13 through 18 of Chapter 171 of the Massachusetts General Laws. (b) Authorize the investments, other than loans to members (c) Appoint the person who with the treasurer shall have joint control of the securities (d) Take all measures for the interest of the corporation not within the jurisdiction of the general meeting and not inconsistent with the laws of the Commonwealth or these by-laws (e) Fix the rate of dividend to be paid on shares (f) Appoint loan officers pursuant to provisions of M.G.L. Chapter 171 (g) Appoint the Chief Executive Officer, who shall serve as the active manager of the corporation under the general direction of the Board of Directors (h) Elect from their own number a Credit Committee of not less than three (3) nor more than five (5) members, an Audit Committee of not less than three (3) nor more than five (5) members and an Investment Committee of not less than three (3) nor more than five (5) members. No member of the Board of Directors shall be a member of both the Credit Committee and the Audit Committee. Section 8 - A quorum shall consist of not less than a majority of the directors. If there be less than a quorum, those present shall adjourn the meeting until the next regular meeting or until another time or times thereto. Section 9 - If a member of the Board of Directors fails to attend its regular meetings or to perform any of the duties devolving upon him/her as a director for three (3) consecutive meetings, the position may be declared vacant by the board, and the vacancy filled as herein provided. Section 10 - During the absence or disability of any officer, the Board of Directors may appoint another member to act temporarily in his/her stead. Section 8 - A quorum shall consist of not less than a majority of the directors. If there be less than a quorum, those present shall adjourn the meeting until the next regular meeting or until another time or times thereto. Section 9 - If a member of the Board of Directors fails to attend its regular meetings or to perform any of the duties devolving upon him/her as a director for three (3) consecutive meetings, the position may be declared vacant by the board, and the vacancy filled as herein provided. Section 10 - The office of any director who ceases to be a member of the Credit Union shall thereby be vacated. 5 Section 11 - During the absence or disability of any
officer, the Board of Directors may appoint another member to act temporarily in his/her stead. ARTICLE VII Credit Committee Section 1 - The credit committee shall consist of not less than three (3) nor more than five (5) members elected annually by the Board of Directors from their own number. No member of the Board of Directors shall be a member of both the credit and the auditing committee. Section 2 - The committee shall meet weekly at a time to be determined by the committee. Other meetings may be called by the chairperson or on petition of two (2) members of the committee. Section 3 - A quorum shall consist of two (2) members. Section 4 - The committee shall inquire carefully into the personal habits and financial condition of borrowers and their securities to ascertain their ability to repay fully and promptly the obligations assumed by them and whether the loan promises to be of benefit to the borrower. ARTICLE VII Credit Committee Section 1 - The credit committee shall consist of not less than three (3) nor more than five (5) members elected annually by the Board of Directors from their own number. No member of the Board of Directors shall simultaneously be a member of both the credit committee and the auditing committee. Section 2 - The committee shall meet monthly at a time to be determined by the committee. Other meetings may be called by the chairperson or on petition of two (2) members of the committee. Section 3 - The Committee shall perform all tasks as prescribed in applicable state and federal law and regulation including but not limited to the provisions of Section 17 of Chapter 171 of the Massachusetts General Laws. Section 5 - The credit committee shall determine the security or guarantors required for each loan and the terms upon which it shall be repaid. When the security is nearly equal, preference shall be given to the smaller loan. ARTICLE VIII Auditing Committee Section 1 - The Auditing Committee shall consist of not less than three (3) nor more than five (5) members elected annually by the Board of Directors from their own number. No member of the Board of Directors shall be a member of both the credit committee and the auditing committee. Section 2 - The auditing committee shall be kept fully informed as to the financial condition of the credit union, by examinations and audits as required by the statutes and regulations. They shall examine all 6 ARTICLE VIII Auditing Committee Section 1 - The Auditing Committee shall consist of not less than three (3) nor more than five (5) members elected annually by the Board of Directors from their own number. No member of the Board of Directors shall simultaneously be a member of both the credit committee and the auditing committee. Section 2 - The auditing committee shall meet monthly at a time to be determined by the committee.
applications for loans made during the period under examination and satisfy themselves that for each loan made an application is on file and that each application states the purpose for which the loan is made, a description of the security offered and that it bears the approval of at least two-thirds of the members of the credit committee. At least one member of the committee shall attest to the statement of condition which the treasurer is required to prepare each month. Section 3 - The auditing committee shall meet monthly at a time to be determined by the committee. Section 3 - The auditing committee shall perform all tasks as prescribed in applicable state and federal law and regulation including but not limited to the provisions of Section 16 of Chapter 171 of the Massachusetts General Laws. ARTICLE IX Investment Committee Section 1 - The Investment Committee shall consist of not less than three (3) nor more than five (5) members elected annually by the Board of Directors from their own number. Section 2 - The investment committee shall meet monthly at a time to be determined by the committee. Section 3 - Investments authorized by M.G.L. Section 67 and by applicable sections of M.G.L. Chapter 171 and/or other applicable laws and regulations may be made under the direction of the investment committee. A report of any such investments shall be made, by the committee, to the Board of Directors a its regularly scheduled meeting in the month following the investment activity. ARTICLE IX Investment Committee Section 1 - The Investment Committee shall consist of not less than three (3) nor more than five (5) members elected annually by the Board of Directors from their own number. Section 2 - The Investment Committee shall meet monthly at a time to be determined by the committee. Section 3 - The Investment Committee shall perform all tasks as prescribed in applicable state and federal law and regulation including but not limited to the provisions of Section 18 of Chapter 171 of the Massachusetts General Laws. Section 4 - Investments authorized by Section 67 of Chapter 171 of the Massachusetts General Laws and by applicable sections of Chapter 171 of the Massachusetts General Laws and/or other applicable laws and regulations may be made under the direction of the Investment Committee. A report of any such investments shall be made, by the Committee, to the Board of Directors at its regularly scheduled meeting in the month following the investment activity. 7
ARTICLE X Officers and their Duties Section 1 - The officers of this credit union shall be a chairperson, vice-chairperson, a clerk and a treasurer who shall be elected at the first regular meeting of the Board of Directors following the annual meeting of the members. They shall hold office until the Board of Directors chooses their successors as herein provided. Section 2 - It shall be the duty of the chairperson to preside at meetings of the members and the Board of Directors, to countersign all notes and drafts drawn by the corporation, and to perform such other duties as appertain to the office. Section 3 - It shall be the duty of the vice-chairperson to perform the duties of the chairperson in the event of the absence or disability of that officer. Section 4 - It shall be the duty of the clerk to keep a correct record of all meetings of the members and of the Board of Directors. He/she shall give notice of all meetings of members in the manner prescribed by the by-laws, and shall perform all other duties incident to his/her office. Section 5 - It shall be the duty of the treasurer: (a) To sign all checks, notes and drafts drawn by the corporation (b) To have custody of the cash, securities, books of account and other valuable papers of the credit union (c) To prepare a statement of condition within seven (7) days after the close of each month, which statement should be attested by at least one (1) member of the auditing committee and shall be posted in a conspicuous place in the office of the credit union until replaced by the statement of the succeeding month ARTICLE X Officers and their Duties Section 1 - The officers of this Credit Union shall be a chairperson, vice-chairperson, a president, a clerk and a treasurer who shall be elected at the first regular meeting of the Board of Directors following the annual meeting of the members. Such officers are referred to herein as the Senior Officers. The Board of Directors may also elect one or more vice presidents. All officers shall hold office until the Board of Directors chooses their successors as herein provided. Section 2 - It shall be the duty of the chairperson to preside at meetings of the members and the Board of Directors, and to perform such other duties as appertain to the office as prescribed in applicable state and federal laws and regulations. Section 3 - It shall be the duty of the vice-chairperson to perform the duties of the chairperson in the event of the absence or disability of that officer. Section 4 - The president shall have such powers and duties as from time to time may be conferred upon him by law or by the Board of Directors. Section 5 - It shall be the duty of the clerk to keep a correct record of all meetings of the members and of the Board of Directors. He/she shall give notice of all meetings of members in the manner prescribed by the by-laws, and shall perform all other duties incident to his/her office as prescribed in applicable state and federal laws and regulations including but not limited to Chapter 171 of the Massachusetts General Laws. (d) To deposit all funds within forty-eight (48) hours after receipt in the banks of deposit prescribed by the Board of Directors (e) To make all payments or withdrawals of money for any purpose by check, except that disbursements in 8
an amount to be determined by the Board of Directors may be made in cash and a proper receipt taken. ARTICLE XI Meetings of Members Section 1 - The annual meeting of the members shall be held at Boston, Massachusetts on the fourth Monday of April. Section 2 - The Clerk shall give notice of all regular and special meetings by sending written notice thereof to each member, at least seven (7) days before the date of such meeting and by posting and maintaining a notice of such meeting in the main office of the credit union and at other locations as determined by the Board of Directors at least seven (7) days before the date of such meeting. Such notice shall state the day, hour and place of the meeting and shall contain a brief statement of the nature of the business to be acted upon, except as hereinafter provided with respect to the removal of officers and directors. In case of death, absence, incapacity or refusal to act of the Clerk, notice of a regular or special meeting may be given as hereinabove provided by any other Officer of the credit union. Section 6 - It shall be the duty of the treasurer to act as chief financial officer of the Credit Union and to perform the duties and functions usually performed by the treasurer of a credit union as prescribed in applicable state and federal laws and regulations including but not limited to Chapters 167 and 171 of the Massachusetts General Laws. ARTICLE XI Meetings of Members Section 1 - The annual meeting of the members shall be held at Boston, Massachusetts during the month of April. Section 2 - The Clerk shall give notice of all regular and special meetings by sending written notice thereof to each member, at least seven (7) days before the date of such meeting and by posting and maintaining a notice of such meeting in the main office of the credit union and at other locations as determined by the Board of Directors at least seven (7) days before the date of such meeting. Such notice shall state the day, hour and place of the meeting and shall contain a brief statement of the nature of the business to be acted upon, except as hereinafter provided with respect to the removal of officers and directors. In case of death, absence, incapacity or refusal to act of the Clerk, notice of a regular or special meeting may be given as hereinabove provided by any other Officer of the Credit Union. Section 3 - At annual or special meetings twenty-one (21) members shall constitute a quorum. If no quorum is present an adjournment shall be taken to a date not less than seven (7) days thereafter and the decisions of the adjourned meeting shall be binding regardless of the number of members present. Notice of the adjournment meeting shall be given by the clerk as required by Section 2 not less than five (5) days previous to the date of the meeting. All elections shall be by ballot. Section 4 - The members at each annual meeting shall: (a) Fix subject to the provisions of existing statutes the maximum amount of credit which may be extended to any one (1) member, either as borrower or endorser or 9 Section 3 - At annual or special meetings twenty-one (21) members shall constitute a quorum. If no quorum is present an adjournment shall be taken to a date not less than seven (7) days thereafter and the decisions of the adjourned meeting shall be binding regardless of the number of members present. Notice of the adjournment meeting shall be given by the clerk as required by Section 2 not less than five (5) days previous to the date of the meeting. All elections shall be by ballot. Section 4 - Special meetings may be called by the Board of Directors or by the Clerk in accordance with the provisions of Section 11 of Chapter 171 of the Massachusetts General Laws.
both. (b) Elect the Directors (c) Vote on proposed amendments to the by-laws (d) Approve the expenses of the Board of Directors (e) Act on such other matters as may come before it in accordance with these by-laws and/or as required by law. Section 5 - No member shall be entitled to vote until he/she has been a member for more than three (3) months. No member shall be entitled to vote by proxy. No member shall have more than one (1) vote, regardless of number and type of account(s). Section 5 - The members at each annual meeting shall: (a) Fix subject to the provisions of existing statutes the maximum amount of credit which may be extended to any one (1) member, either as borrower or endorser or both; (b) Elect the Directors; (c) Vote on proposed amendments to the by-laws; (d) Approve the expenses of the Board of Directors; and (e) Act on such other matters as may come before it in accordance with these by-laws and/or as required by law. Section 6 - No member shall be entitled to vote until he/she has been a member for more than three (3) months. No member shall be entitled to vote by proxy. No member shall have more than one (1) vote, regardless of number and type of account(s). ARTICLE XII Amendment of By-Laws Section 1 - These by laws may be amended by the members at an annual meeting or special meeting, by a majority of those present and entitled to vote, provided that a copy of the proposed amendment and a notice of the meeting shall have been posted and maintained for at least seven days before the date of such meeting in the office of the credit union, and on bulletin boards of all fire facilities. ARTICLE XII Amendment of By-Laws Section 1 - These by laws may be amended by the members at an annual meeting or special meeting, by a majority of those present and entitled to vote, provided that a copy of the proposed amendment and a notice of the meeting shall have been posted and maintained for at least seven days before the date of such meeting in the office of the Credit Union, and on the internet site of the credit union. Section 2 - Unless otherwise specified, all amendments Section 2 - Unless otherwise specified, all amendments to the by-laws, affirmatively adopted by the members, 10
to the by-laws, affirmatively adopted by the members, shall take effect immediately upon adoption, not withstanding the provisions of Section 3. Section 3 - No amendment or amendments containing a change in the conditions of residence, occupation, or association which qualify persons for membership, or change in location or change in name shall become operative until approved in writing by the Commissioner of Banks. shall take effect immediately upon adoption, not withstanding the provisions of Section 3. Section 3 - No amendment or amendments containing a change in the conditions of residence, occupation, or association which qualify persons for membership, or change in location or change in name shall become operative until approved in writing by the Commissioner of Banks. ARTICLE XIII Execution of Instruments Section 1 - All conveyances of real estate, all assignments, extensions, discharges and releases in whole or in part of mortgages, and all other instruments to which the credit union may be a party, shall be executed by the President and Chief Executive Officer, a Vice-President, the Treasurer or an Assistant Treasurer, or any one of them or by such other Officer or Officers as from time to time may be authorized by the Board of Directors. ARTICLE XII Execution of Instruments All conveyances of real estate, all assignments, extensions, discharges and releases in whole or in part of mortgages, and all other instruments to which the Credit Union may be a party, shall be executed by the president and chief executive officer, a vice-president, the treasurer or an assistant treasurer, or any one of them or by such other officer or officers as from time to time may be authorized by the Board of Directors ARTICLE XIV Indemnification 11 Section 1 - Except as set forth below, the Credit Union shall indemnify each of its Directors and Senior Officers (including persons who serve at its request as directors, officers, or trustees of another organization in which it has any interest, direct or indirect, as a shareholder, partner, member, creditor, or otherwise, or who serve at its request in any capacity with respect to any employee benefit plan) (the Indemnitee ), against all charges reasonably incurred by the Indemnitee in connection with any claim, action, suit, or other proceeding or investigation, whether civil or criminal and including appeals (the Proceeding ), in which the Indemnitee may be involved or with which the Indemnitee may be threatened to be made a party, while in office or thereafter, by reason of the Indemnitee s being or having been such a director or officer, including without limitation any such claims, actions, suits, proceedings or investigations made or brought against the Indemnitee by reason of any act or omission, or alleged act or omission (including all such antedating the adoption of this By-law) in any such capacity. No indemnification shall be provided with respect to any matter as to which the Indemnitee shall
12 have been adjudicated in any Proceeding not to have acted in good faith in the reasonable belief that the Indemnitee s action was in the best interests of the Credit Union (or, to the extent that such matter relates to service with respect to an employee benefit plan, in the best interests of the participants or beneficiaries of such employee benefit plan) (the Indemnification Standard ). If in any Proceeding, there is no adjudication as to the issue of whether the Indemnification Standard was met, the question shall be determined (g) by a majority vote of a quorum consisting of Directors who were not parties to such Proceeding or (h) if such quorum is not obtainable, by independent legal counsel in a written opinion that the Indemnitee did or did not meet the Indemnification Standard. There shall be no indemnification for charges with respect to any matter disposed of by a settlement, pursuant to a consent decree or otherwise, unless such settlement shall be approved as in the best interests of the credit union, by a majority vote of a quorum consisting of Directors who were not parties to such Proceeding, or if such quorum is not obtainable, by independent legal counsel in a written opinion to the effect that the Indemnitee acted in accordance with the Indemnification Standard. Section 2 - The Board of Directors may, by general vote or by vote pertaining to a specific employee or agent or class thereof, authorize indemnification of the Credit Union s employees and agents, other than those Directors, Senior Officers, and persons referred to in Article XII Section 1, (g) above, to whatever extent they may determine, which may be in the same manner and to the same extent provided above. Section 3 - Expenses, including attorneys fees, reasonably incurred by an Indemnitee in connection with the defense or disposition of any Proceeding shall be paid by the Credit Union, in advance of the final disposition thereof, no later than 45 days after the written request of the Indemnitee for such advance, unless it is determined (i) by a majority vote of a quorum consisting of Directors who were not parties to such proceeding or (j) if such quorum is not obtainable, by independent legal counsel in a written opinion that the Indemnitee did not meet the Indemnification Standard. Such advances shall be made only upon receipt of an undertaking by the Indemnitee to repay to the Credit Union the amounts so paid if it is ultimately determined that indemnification for such expenses is
not authorized under this Article XII, which undertaking may be accepted without reference to the financial ability of the Indemnitee to make repayment. Section 4 - The rights of indemnification provided by this Article XII shall not be deemed exclusive of any other rights to which any Indemnitee seeking indemnification may be entitled under any bylaw, agreement, vote of disinterested Directors, or otherwise, both as to action in the Indemnitee s official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a Director, officer, employee or agent and shall inure to the benefit of the heirs, executors, and administrators of such Indemnitee. All rights to indemnification under this Article XII shall be deemed to be in the nature of a contractual obligation of the Credit Union bargained for by each Indemnitee who serves in such capacity at any time while these bylaws are in effect. No repeal or modification of these by-laws shall adversely affect any such rights or obligations with respect to any state of facts then or theretofore existing, or any Proceeding previously or subsequently brought, based in whole or in part upon any such state of facts. The Credit Union shall also indemnify any Indemnitee for attorneys fees, costs, and expenses in connection with the successful enforcement of the Indemnitee s rights under this Article XII. Section 5 - As used in this Article XII the term Charges shall include all liabilities and expenses, including, without limitation, judgment awards, amounts paid in settlement, excise taxes, awards by other tribunals or bodies, attorneys fees, costs, fines, penalties, and other liabilities actually and reasonably incurred by any Indemnitee in connection with any Proceeding. Section 6 - The Board of Directors may authorize the purchase and maintenance of insurance, in such amounts as the Board of Directors may from time to time deem appropriate, on behalf of any person who is or was an Indemnitee against any liability incurred by such Indemnitee in any such capacity, or arising out of such person s status as Indemnitee, whether or not such person is entitled to indemnification by the credit union pursuant to this Article XII or otherwise and whether or not the Credit Union would have the power to 13
indemnify the person against such liability. Section 7 - Notwithstanding anything herein to the contrary, the Credit Union shall not indemnify any person or pay expenses of any person pursuant to this Article XII if such indemnification or payments are prohibited by 12 U.S.C. 1786(t), the regulations issued thereunder by the National Credit Union Administration (12 CFR Part 750), or other applicable law or regulations, or orders issued by, or agreements with, governmental agencies with authority to issue such orders against the Credit Union. Section 8 - If this Article XII or any portion thereof shall be invalidated on any ground by any court of competent jurisdiction, the validity of the remaining portions or provisions of these by-laws (including any remaining provisions of this Article XII) shall not be affected, and the terms thereof shall be enforced as if the by-laws did not contain the particular provisions held to be invalid. 14