Exhibit 3.4
CharterBank
By-Laws
ARTICLE I - Home Office
The home office of CharterBank (the "Bank") shall be located at 600
Third Avenue, West Point, County of Troup, in the State of Georgia.
ARTICLE II - Shareholders
Section 1. Place of Meetings. All annual and special meetings of
shareholders shall be held at the home office of the Bank or at such other
convenient place as the board of directors may determine.
Section 2. Annual Meeting. A meeting of the shareholders of the
Bank for the election of directors and for the transaction of any other business
of the Bank shall be held annually within 150 days after the end of the Bank's
fiscal year on the third Wednesday in January, if not a legal holiday, and if a
legal holiday, then on the next day following which is not a legal holiday, at
10:00 a.m., local time, or at such other date and time within such 150-day
period as the board of directors may determine.
Section 3. Special Meetings. Special meetings of the shareholders
for any purpose or purposes, unless otherwise prescribed by the regulations of
the Office of Thrift Supervision ("Office") or the Federal Stock Charter of the
Bank, may be called at any time by the chairman of the board, the president, or
a majority of the board of directors, and shall be called by the chairman of the
board, the president, or the secretary upon the written request of the holders
of not less than one-tenth of all of the outstanding capital stock of the Bank
entitled to vote at the meeting. Such written request shall state the purpose
or purposes of the meeting and shall be delivered to the home office of the Bank
addressed to the chairman of the board, the president, or the secretary.
Section 4. Conduct of Meetings. Annual and special meetings shall
be conducted in accordance with the most current edition of Robert's Rules of
Order unless otherwise prescribed by regulations of the Office or these bylaws
or the board of directors adopts another written procedure for the conduct of
meetings. The board of directors shall designate, when present, either the
chairman of the board or president to preside at such meetings. The chairman of
any annual or special meeting of the members shall, unless prescribed by law or
regulation, determine the order of the business and the procedure at the
meeting, including such regulation of the manner of voting and the conduct of
discussion as he or she shall deem appropriate.
Section 5. Notice of Meetings. Written notice stating the place,
day and hour of the meeting and the purpose(s) for which the meeting is called
shall be delivered not fewer than 20 nor more than 50 days before the date of
the meeting, either personally or by mail, by or at the direction of the
chairman of the board, the president, or the secretary, or the directors calling
the meeting, to each shareholder of record entitled to vote at such meeting. If
mailed, such notice shall
-1-
be deemed to be delivered when deposited in the mail, addressed to the
shareholder at the address as it appears on the stock transfer books or records
of the Bank as of the record date prescribed in Section 6 of this Article II
with postage prepaid. When any shareholders' meeting, either annual or special,
is adjourned for 30 days or more, notice of the adjourned meeting shall be given
as in the case of an original meeting. It shall not be necessary to give any
notice of the time and place of any meeting adjourned for less than 30 days or
of the business to be transacted at the meeting, other than an announcement at
the meeting at which such adjournment is taken.
Section 6. Fixing of Record Date. For the purpose of determining
shareholders entitled to notice of or to vote at any meeting of shareholders or
any adjournment, or shareholders entitled to receive payment of any dividend, or
in order to make a determination of shareholders for any other proper purpose,
the board of directors shall fix in advance a date as the record date for any
such determination of shareholders. Such date in any case shall be not more
than 60 days and, in case of a meeting of shareholders, not fewer than 10 days
prior to the date on which the particular action, requiring such determination
of shareholders, is to be taken. When a determination of shareholders entitled
to vote at any meeting of shareholders has been made as provided in this
Section, such determination shall apply to any adjournment.
Section 7. Voting List. At least 20 days before each meeting of
the shareholders, the officer or agent having charge of the stock transfer books
for shares of the Bank shall make a complete list of the shareholders entitled
to vote at such meeting, or any adjournment thereof, arranged in alphabetical
order, with the address and the number of shares held by each. This list of
shareholders shall be kept on file at the home office of the Bank and shall be
subject to inspection by any shareholder of record or the shareholder's agent at
any time during usual business hours for a period of 20 days prior to such
meeting. Such list shall also be produced and kept open at the time and place
of the meeting and shall be subject to inspection by any shareholder during the
entire time of the meeting. The original stock transfer book shall constitute
prima facie evidence of the shareholders entitled to examine such list or
transfer books or to vote at any meeting of shareholders.
In lieu of making the shareholders list available for inspection by
shareholders as provided in the preceding paragraph, the board of directors may
elect to follow the procedures prescribed in (S) 552.6(d) of the Office's
regulations as now or hereafter in effect.
Section 8. Quorum. A majority of the outstanding shares of the
Bank entitled to vote, represented in person or by proxy, shall constitute a
quorum at a meeting of shareholders. If less than a majority of the outstanding
shares is represented at a meeting, a majority of the shares so represented may
adjourn the meeting from time to time without further notice. At such adjourned
meeting at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
notified. The shareholders present at a duly organized meeting may continue to
transact business until adjournment, notwithstanding the withdrawal of enough
shareholders to constitute less than a quorum. If a quorum is present, the
affirmative vote of the majority of the shares represented at the meeting and
entitled to vote on the subject matter shall be the act of shareholders, unless
the vote of a greater number of shareholders voting together or voting by
classes is required by law or the charter. Directors, however, are elected by a
plurality of the votes cast at an election of directors.
-2-
Section 9 Proxies. At all meetings of shareholders, a shareholder
may vote by proxy executed in writing by the shareholder or by his or her duly
authorized attorney in fact. Proxies may be given telephonically or
electronically as long as the holder uses a procedure for verifying the identity
of the shareholders. Proxies solicited on behalf of the management shall be
voted as directed by the shareholder or, in the absence of such direction, as
determined by a majority of the board of directors. No proxy shall be valid more
than eleven months from the date of its execution except for a proxy coupled
with an interest.
Section 10. Voting of Shares in the Name of Two or More Persons.
When ownership stands in the name of two or more persons, in the absence of
written directions to the Bank to the contrary, at any meeting of the
shareholders of the Bank, any one or more of such shareholders may cast, in
person or by proxy, all votes to which such ownership is entitled. In the event
an attempt is made to cast conflicting votes, in person or by proxy, by the
several persons in whose names shares of stock stand, the vote or votes to which
those persons are entitled shall be cast as directed by a majority of those
holding such stock and present in person or by proxy at such meeting, but no
votes shall be cast for such stock if a majority cannot agree.
Section 11. Voting of Shares of Certain Holders. Shares standing
in the name of another corporation may be voted by any officer, agent, or proxy
as the bylaws of such corporation may prescribe, or, in the absence of such
provision, as the board of directors of such corporation may determine. Shares
held by an administrator, executor, guardian, or conservator may be voted by him
or her, either in person or by proxy, without a transfer of such shares into his
or her name. Shares standing in the name of a trustee may be voted by him or
her, either in person or by proxy, but no trustee shall be entitled to vote
shares held by him or her without a transfer of such shares into his or her
name. Shares held in trust in an IRA or Keogh Account, however, may be voted by
the Bank if no other instructions are received. Shares standing in the name of
a receiver may be voted by such receiver, and shares held by or under the
control of a receiver may be voted by such receiver without the transfer into
his name if authority to do so is contained in an appropriate order of the court
or other public authority by which such receiver was appointed.
A shareholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee, and
thereafter the pledgee shall be entitled to vote the shares so transferred.
Neither treasury shares of its own stock held by the Bank nor shares
held by another corporation, if a majority of the shares entitled to vote for
the election of directors of such other corporation are held by the Bank, shall
be voted at any meeting, or counted in determining the total number of
outstanding shares at any given time for purposes of any meeting.
Section 12. Inspectors of Election. In advance of any meeting of
shareholders, the board of directors may appoint any person other than nominees
for office as inspectors of election to act at such meeting or any adjournment.
The number of inspectors shall be either one or three. Any such appointment
shall not be altered at the meeting. If inspectors of election are not so
appointed, the chairman of the board or the president may, or on the request of
not fewer than 10 percent of the votes represented at the meeting shall, make
such appointment at the meeting. If appointed at the meeting, the majority of
the votes present shall determine whether one or three
-3-
inspectors are to be appointed. In case any person appointed as inspector fails
to appear or fails or refuses to act, the vacancy may be filled by appointment
by the board of directors in advance of the meeting or at the meeting by the
chairman of the board or the president.
Unless otherwise prescribed by regulations of the Office, the duties
of such inspectors shall include: determining the number of shares of stock and
the voting power of each share, the shares represented at the meeting, the
existence of a quorum, and the authenticity, validity and effect of proxies;
receiving votes, ballots, or consents; hearing and determining all challenges
and questions in any way arising in connection with the rights to vote; counting
and tabulating all votes or consents; determining the result; and such acts as
may be proper to conduct the election or vote with fairness to all shareholders.
Section 13. Nominating Committee. The board of directors shall act
as a nominating committee for selecting the management nominees for election as
directors. Except in the case of a nominee substituted as a result of the death
or other incapacity of a management nominee, the nominating committee shall
deliver written nominations to the secretary at the principal executive offices
of the Bank at least 20 days prior to the date of the annual meeting. No
nominations for director except those made by the nominating committee shall be
voted upon at the annual meeting unless other nominations by shareholders are
made in writing and delivered to the secretary at the principal executive
offices of the Bank at least five (5) days prior to the date of the annual
meeting. Such shareholder's notice shall set forth (a) as to each person whom
the shareholder proposes to nominate for election or reelection as a director,
(i) the name, age, business address and residence address of such person, (ii)
the principal occupation or employment of such person, and (iii) such person's
written consent to serve as a director, if elected; and (b) as to the
shareholder giving the notice (i) the name and address of such shareholder and
(ii) the class and number of shares of the Bank which are owned of record by
such shareholder. At the request of the board of directors, any person
nominated by the board of directors for election as a director shall furnish to
the secretary that information required to be set forth in a shareholder's
notice of nomination which pertains to the nominee together with the required
written consents. Ballots bearing the names of all the persons nominated by the
nominating committee and by shareholders shall be provided for use at the annual
meeting. However, if the nominating committee shall fail or refuse to act at
least 20 days prior to the annual meeting, nominations for directors may be made
at the annual meeting by any shareholder entitled to vote and shall be voted
upon.
Section 14. New Business. At an annual meeting of shareholders,
only such business shall be conducted, and only such proposals shall be acted
upon, as shall have been properly brought before the meeting. For any business
proposed by management to be properly brought before the annual meeting, such
business shall be approved by the board of directors, either directly or through
its approval of proxy solicitation materials related thereto, and shall be
stated in writing and filed with the secretary at least 5 days before the date
of the annual meeting, and all business so stated, proposed and filed shall be
considered at the annual meeting. Any shareholder may make any other proposal
at the annual meeting and the same may be discussed and considered but unless
stated in writing and filed with the secretary at least 5 days before the
meeting, such proposal shall be laid over for action at an adjourned, special,
or annual meeting of the shareholders taking place 30 days or more thereafter.
A shareholder's notice to the secretary shall set forth as to each matter the
shareholder proposes to bring before the annual meeting (a) a brief description
of the proposal
-4-
desired to be brought before the annual meeting, (b) the business, as well as
the name and address of such shareholder and the class and number of shares of
the Bank which are owned of record by such shareholder. This provision shall not
prevent the consideration and approval or disapproval at the annual meeting of
reports of officers, directors and committees; but in connection with such
reports, no new business shall be acted upon at such annual meeting unless
stated and filed as herein provided.
Section 15. Informal Action by Shareholders. Any action required
to be taken at a meeting of the shareholders, or any other action which may be
taken at a meeting of the shareholders, may be taken without a meeting if
consent in writing, setting forth the action so taken, shall be given by all of
the shareholders entitled to vote with respect to the subject matter.
ARTICLE III - Board of Directors
Section 1. General Powers. The business and affairs of the Bank
shall be under the direction of its board of directors. The board of directors
shall annually elect a chairman of the board and a president from among its
members and shall designate, when present, either the chairman of the board or
the president to preside at its meetings.
Section 2. Number and Term. The board of directors shall consist
of 7 members, and shall be divided into three classes as nearly equal in number
as possible. The members of each class shall be elected for a term of three
years and until their successors are elected and qualified. One class shall be
elected by ballot annually.
Section 3. Regular Meetings. A regular meeting of the board of
directors shall be held without other notice than this bylaw following the
annual meeting of shareholders. The board of directors shall meet regularly
without notice at the home office of the Bank at least once each month at the
hour and date fixed by resolution of the board of directors, provided, that the
place of the meeting may be changed by the directors. Directors may participate
in a meeting by means of conference telephone or similar communications device
by which all persons participating in the meeting can hear each other. Such
participation shall constitute presence in person for all purposes.
Section 4. Qualification. Each director shall at all times be the
beneficial owner of not less than 100 shares of capital stock of the association
unless the association is a wholly owned subsidiary of a holding company.
Section 5. Special Meetings. Special meetings of the board of
directors may be called by or at the request of the chairman of the board, the
president, or one-third of the directors. The persons authorized to call special
meetings of the board of directors may fix any place, within the Bank's normal
lending territory, as the place for holding any special meeting of the board of
directors called by such persons.
Members of the board of directors may participate in special meetings
by means of conference telephone or similar communications equipment by which
all persons participating in the meeting can hear each other. Such participation
shall constitute presence in person for all purposes.
-5-
Section 6. Notice. Written notice of any special meeting shall be
given to each director at least twenty-four (24) hours prior thereto when
delivered personally or by telegram or at least five days prior thereto when
delivered by mail at the address at which the director is most likely to be
reached. Such notice shall be deemed to be delivered when deposited in the mail
so addressed, with postage thereon prepaid if mailed or when delivered to the
telegraph company if sent by telegram, or when the bank receives notice of
delivery if electronically transmitted. Any director may waive notice of any
meeting by a writing filed with the secretary. The attendance of a director at a
meeting shall constitute a waiver of notice of such meeting, except where a
director attends a meeting for the express purpose of objecting to the
transaction of any business because the meeting is not lawfully called or
convened. Neither the business to be transacted at, nor the purpose of, any
meeting of the board of directors need be specified in the notice or waiver of
notice of such meeting.
Section 7. Quorum. A majority of the number of directors fixed by
Section 2 of this Article III shall constitute a quorum for the transaction of
business at any meeting of the board of directors; but if less than such
majority is present at a meeting, a majority of the directors present may
adjourn the meeting from time to time. Notice of any adjourned meeting shall be
given in the same manner as prescribed by Section 6 of this Article III.
Section 8. Manner of Acting. The act of the majority of the
directors present at a meeting at which a quorum is present shall be the act of
the board of directors, unless a greater number is prescribed by regulation of
the Office or by these bylaws.
Section 9. Action Without a Meeting. Any action required or
permitted to be taken by the board of directors at a meeting may be taken
without a meeting if a consent in writing, setting forth the action so taken,
shall be signed by all of the directors.
Section 10. Resignation. Any director may resign at any time by
sending a written notice of such resignation to the home office of the Bank
addressed to the chairman of the board or the president. Unless otherwise
specified, such resignation shall take effect upon receipt thereof by the
chairman of the board or the president. More than three consecutive absences
from regular meetings of the board of directors, unless excused by resolution of
the board of directors, shall automatically constitute a resignation, effective
when such resignation is accepted by the board of directors.
Section 11. Vacancies. Any vacancy occurring on the board of
directors may be filled by the affirmative vote of a majority of the remaining
directors although less than a quorum of the board of directors. A director
elected to fill a vacancy shall be elected to serve only until the next election
of directors by the shareholders. Any directorship to be filled by reason of an
increase in the number of directors may be filled by election by the board of
directors for a term of office continuing only until the next election of
directors by the shareholders.
Section 12. Compensation. Directors, as such, may receive a stated
salary for their services. By resolution of the board of directors, a reasonable
fixed sum, and reasonable expenses of attendance, if any, may be allowed for
attendance at each regular or special meeting of the board of directors. Members
of either standing or special committees may be allowed such compensation for
attendance at committee meetings as the board of directors may determine.
-6-
Section 13. Presumption of Assent. A director of the Bank who is
present at a meeting of the board of directors at which action on any bank
matter is taken shall be presumed to have assented to the action taken unless
his or her dissent or abstention shall be entered in the minutes of the meeting
or unless he or she shall file a written dissent to such action with the person
acting as the secretary of the meeting before the adjournment thereof or shall
forward such dissent by registered mail to the secretary of the Bank within five
days after the date a copy of the minutes of the meeting is received. Such right
to dissent shall not apply to a director who voted in favor of such action.
Section 14. Removal of Directors. At a meeting of shareholders called
expressly for that purpose, any director may be removed for cause by a vote of
the holders of a majority of the shares then entitled to vote at an election of
directors. Whenever the holders of the shares of any class are entitled to elect
one or more directors by the provisions of the charter or supplemental sections
thereto, the provisions of this Section shall apply, in respect to the removal
of a director or directors so elected, to the vote of the holders of the
outstanding shares of that class and not to the vote of the outstanding shares
as a whole.
For purposes of this section, removal for cause includes, as defined in 12
C.F.R. (S)563.39, or any successor regulation enacted by the Office, "personal
dishonesty, incompetence, willful misconduct, breach of fiduciary duty involving
personal profit, intentional failure to perform stated duties, or a willful
violation of any law, rule or regulation (other than traffic violations or
similar offenses) or final cease-and-desist order.
ARTICLE IV - Executive And Other Committees
Section 1. Appointment. The board of directors, by resolution
adopted by a majority of the full board, may designate three or more directors
to constitute an executive committee, two of whom shall be outside directors.
The designation of any committee pursuant to this Article IV and the delegation
of authority shall not operate to relieve the board of directors, or any
director, of any responsibility imposed by law or regulation.
Section 2. Authority. The executive committee, when the board of
directors is not in session, shall have and may exercise all of the authority of
the board of directors, except to the extent, if any, that such authority shall
be limited by the resolution appointing the executive committee; and except also
that the executive committee shall not have the authority of the board of
directors with reference to: the declaration of dividends; the amendment of the
charter or bylaws of the Bank, or recommending to the shareholders a plan of
merger, consolidation, or conversion; the sale, lease, or other disposition of
all or substantially all of the property and assets of the Bank otherwise than
in the usual and regular course of its business; a voluntary dissolution of the
Bank; a revocation of any of the foregoing; or the approval of a transaction in
which any member of the executive committee, directly or indirectly, has any
material beneficial interest.
Section 3. Tenure. Subject to the provisions of Section 8 of this
Article IV, each member of the executive committee shall hold office for a term
as fixed by resolution of the board of directors and until a successor is
designated as a member of the executive committee.
-7-
Section 4. Meetings. Regular meetings of the executive committee may
be held without notice at such times and places as the executive committee may
fix from time to time by resolution. Special meetings of the executive committee
may be called by any member thereof upon not less than one day's notice stating
the place, date, and hour of the meeting, which notice may be written or oral.
Any member of the executive committee may waive notice of any meeting and no
notice of any meeting need be given to any member thereof who attends in person.
The notice of a meeting of the executive committee need not state the business
proposed to be transacted at the meeting.
Section 5. Quorum. A majority of the members of the executive
committee shall constitute a quorum for the transaction of business at any
meeting thereof, and action of the executive committee must be authorized by the
affirmative vote of a majority of the members present at a meeting at which a
quorum is present.
Section 6. Action Without a Meeting. Any action required or
permitted to be taken by the executive committee at a meeting may be taken
without a meeting if a consent in writing, setting forth the action so taken,
shall be signed by all of the members of the executive committee.
Section 7. Vacancies. Any vacancy in the executive committee may be
filled by a resolution adopted by a majority of the full board of directors.
Section 8. Resignations and Removal. Any member of the executive
committee may be removed at any time with or without cause by resolution adopted
by a majority of the full board of directors. Any member of the executive
committee may resign from the executive committee at any time by giving written
notice to the president or secretary of the Bank. Unless otherwise specified,
such resignation shall take effect upon its receipt; the acceptance of such
resignation shall not be necessary to make it effective.
Section 9. Procedure. The executive committee shall elect a
presiding officer from its members and may fix its own rules of procedure which
shall not be inconsistent with these bylaws. It shall keep regular minutes of
its proceedings and report the same to the board of directors for its
information at the meeting thereof held next after the proceedings shall have
occurred.
Section 10. Other Committees. The board of directors may by
resolution establish an audit, loan, or other committee composed of directors as
they may determine to be necessary or appropriate for the conduct of the
business of the Bank and may prescribe the duties, constitution, and procedures
thereof.
ARTICLE V - Officers
Section 1. Positions. The officers of the Bank shall be a president,
one or more vice presidents, a secretary, and a treasurer or comptroller, each
of whom shall be elected by the board of directors. The board of directors also
may designate the chairman of the board as an officer. The president shall be
the chief executive officer, unless the board of directors designates the
chairman of the board as chief executive officer. The president shall be a
director of the Bank. The
-8-
offices of the secretary and treasurer or comptroller may be held by the same
person and a vice president may also be either the secretary or the treasurer or
comptroller. The board of directors may designate one or more vice presidents as
executive vice president or senior vice president. The board of directors also
may elect or authorize the appointment of such other officers as the business of
the Bank may require. The officers shall have such authority and perform such
duties as the board of directors may from time to time authorize or determine.
In the absence of action by the board of directors, the officers shall have such
powers and duties as generally pertain to their respective offices.
Section 2. Election and Term of Office. The officers of the Bank
shall be elected annually at the first meeting of the board of directors held
after each annual meeting of the shareholders. If the election of officers is
not held at such meeting, such election shall be held as soon thereafter as
possible. Each officer shall hold office until a successor has been duly elected
and qualified or until the officer's death, resignation, or removal in the
manner hereinafter provided. Election or appointment of an officer, employee, or
agent shall not of itself create contractual rights. The board of directors may
authorize the Bank to enter into an employment contract with any officer in
accordance with regulations of the Office; but no such contract shall impair the
right of the board of directors to remove any officer at any time in accordance
with Section 3 of this Article V.
Section 3. Removal. Any officer may be removed by the board of
directors whenever, in its judgment, the best interests of the Bank will be
served thereby, but such removal, other than for cause, shall be without
prejudice to any contractual rights, if any, of the person so removed.
For purposes of this section, removal for cause includes, as defined
in 12 C.F.R. (S)563.39 or any successor regulation enacted by the Office,
removal because of the officer's "personal dishonesty, incompetence, willful
misconduct, breach of fiduciary duty involving personal profit, intentional
failure to perform stated duties, willful violation of any law, rule or
regulation (other than traffic violations or similar offenses) or final cease-
and-desist order."
Section 4. Vacancies. A vacancy in any office because of death,
resignation, removal, disqualification, or otherwise, may be filled by the board
of directors for the unexpired portion of the term.
Section 5. Remuneration. The remuneration of the officers shall
be fixed from time to time by the board of directors.
ARTICLE VI - Contracts, Loans, Checks, and Deposits
Section 1. Contracts. To the extent permitted by regulations of
the Office, and except as otherwise prescribed by these bylaws with respect to
certificates for shares, the board of directors may authorize any officer,
employee or agent of the Bank to enter into any contract or execute and deliver
any instrument in the name of and on behalf of the Bank. Such authority may be
general or confined to specific instances.
-9-
Section 2. Loans. No loans shall be contracted on behalf of the
Bank and no evidence of indebtedness shall be issued in its name unless
authorized by the board of directors. Such authority may be general or confined
to specific instances.
Section 3. Checks, Drafts, Etc. All checks, drafts, or other
orders for the payment of money, notes, or other evidences of indebtedness
issued in the name of the Bank shall be signed by one or more officers,
employees, or agents of the Bank in such manner as shall from time to time be
determined by the board of directors.
Section 4. Deposits. All funds of the Bank not otherwise employed
shall be deposited from time to time to the credit of the Bank in any duly
authorized depositories as the board of directors may select.
ARTICLE VII - Certificates for Shares and Their Transfer
Section 1. Certificates for Shares. Certificates representing
shares of capital stock of the Bank shall be in such form as shall be determined
by the board of directors and approved by the Office. Such certificates shall be
signed by the chief executive officer or by any other officer of the Bank
authorized by the board of directors, attested by the secretary or an assistant
secretary, and sealed with the corporate seal or a facsimile thereof. The
signatures of such officers upon a certificate may be facsimiles if the
certificate is manually signed on behalf of a transfer agent or a registrar,
other than the Bank itself or one of its employees. Each certificate for shares
of capital stock shall be consecutively numbered or otherwise identified. The
name and address of the person to whom the shares are issued, with the number of
shares and date of issue, shall be entered on the stock transfer books of the
Bank. All certificates surrendered to the Bank for transfer shall be cancelled
and no new certificate shall be issued until the former certificate for a like
number of shares has been surrendered and cancelled, except that in the case of
a lost or destroyed certificate, a new certificate may be issued upon such terms
and indemnity to the Bank as the board of directors may prescribe.
Section 2. Transfer of Shares. Transfer of shares of capital stock
of the Bank shall be made only on its stock transfer books. Authority for such
transfer shall be given only by the holder of record thereof or by his legal
representative, who shall furnish proper evidence of such authority, or by his
attorney authorized by a duly executed power of attorney and filed with the
Bank. Such transfer shall be made only on surrender for cancellation of the
certificate for such shares. The person in whose name the shares of capital
stock stand on the books of the Bank shall be deemed by the Bank to be the owner
for all purposes.
ARTICLE VIII - Fiscal Year
The fiscal year of the Bank shall end on the 30th day of September of
each year.
-10-
ARTICLE IX - Dividends
Subject only to the terms of the Bank's charter and the regulations
and orders of the Office, the board of directors may, from time to time,
declare, and the Bank may pay, dividends on its outstanding shares of capital
stock.
ARTICLE X - Corporate Seal
The board of directors shall provide a Bank seal which shall be two
concentric circles between which shall be the name of the Bank. The year of
incorporation or an emblem may appear in the center.
ARTICLE XI - Amendments
These bylaws may be amended in a manner consistent with regulations of
the Office and shall be effective after: (i) approval of the amendment by a
majority vote of the authorized board of directors, or by a majority vote of the
votes cast by the shareholders of the Bank at any legal meeting, and (ii)
receipt of any applicable regulatory approval. If the Bank fails to meet its
quorum requirements, solely due to vacancies on the board, then the affirmative
vote of a majority of the sitting board will be required to amend the bylaws.
ARTICLE XII - Indemnification
The Bank shall indemnify its directors, officers and employees in
accordance with the following requirements:
Section 1. Definitions and Rules of Construction. (a) The
following definitions apply for purposes of this Article XII:
(i) Action. The term "action" means any judicial or administrative
proceeding, or threatened proceeding, whether civil, criminal or otherwise,
including any appeal or other proceeding for review;
(ii) Court. The term "court" includes, without limitation, any
court to which or in which any appeal or any proceeding for review is
brought.
(iii) Final judgment. The term "final judgment" means a judgment,
decree or order that is not appealable or as to which the period for appeal
has expired with no appeal taken.
(iv) Settlement. The term "settlement" includes entry of a judgment
by consent or confession or a plea of guilty or nolo contendere.
(b) References in this Article XII to any individual or other
person, including any savings bank, shall include legal representatives,
successors and assigns thereof.
-11-
Section 2. Indemnification. Subject to Sections 3 and 7 of this
Article XII, the Bank shall indemnify any person against whom an action is
brought or threatened because that person is or was a director, officer or
employee of the Bank for:
(a) Any amount for which that person becomes liable under a judgment
in such action; and
(b) Reasonable costs and expenses, including reasonable attorney's
fees, actually paid or incurred by that person in defending or settling
such action, or in enforcing his or her rights under this Article XII if he
or she attains a favorable judgment in such enforcement action.
Section 3. Requirements for Indemnification. Indemnification shall
be made to such person under Section 2 of this Article XII only if:
(a) Final judgment on the merits is in his or her favor; or
(b) In case of:
(i) settlement;
(ii) final judgment against him or her; or
(iii) final judgment in his or her favor, other than on the
merits,
if a majority of the disinterested directors of the Bank determines
that he or she was acting in good faith within the scope of his or her
employment or authority as he or she could have reasonably perceived
it under the circumstances and for a purpose he or she could
reasonably have believed under the circumstances was in the best
interests of the Bank or its shareholders.
However, no indemnification shall be made unless the Bank gives the Office at
least 60 days notice of its intention to make such indemnification. Such notice
shall state the facts on which the action arose, the terms of any settlement and
any disposition of the matter by a court. Such notice, a copy thereof and a
certified copy of the resolution containing the required determination by the
Board shall be sent to the District Director of the Office, who shall promptly
acknowledge receipt thereof. The notice period shall run from the date of such
receipt. No such indemnification shall be made if the Director of the Office
advises the Bank in writing, within such notice period, of his or her objection
thereto.
Section 4. Insurance. The Bank may obtain insurance to protect it
and its directors, officers and employees from potential losses arising from
claims against any of them for alleged wrongful acts, or wrongful acts committed
in their capacity as directors, officers or employees. However, the Bank may not
obtain insurance that provides for payment of losses of any person incurred as a
consequence of his or her willful or criminal misconduct.
-12-
Section 5. Payment of expenses. If a majority of the directors of
the Bank conclude that, in connection with an action, any person ultimately may
become entitled to indemnification under this Article XII, the directors may
authorize payment of reasonable costs and expenses, including reasonable
attorneys' fees, arising from the defense or settlement of such action. Nothing
in this Section 5 shall prevent the directors of the Bank from imposing such
conditions on a payment of expenses as they deem warranted and in the interests
of the Bank. Before making advance payment of expenses under this Section 5, the
Bank shall obtain an agreement that the Bank will be repaid if the person on
whose behalf payment is made is later determined not to be entitled to such
indemnification.
Section 6. Exclusiveness of provisions. The Bank shall not indemnify
any person referred to in Section 2 of this Article XII or obtain insurance
referred to in Section 4 of this Article XII other than in accordance with this
Article XII.
Section 7. Statutory Limitation. The indemnification provided for in
Section 2 of this Article XII is subject to and qualified by 12 U.S.C.
(S)1821(k).
-13-