Chapter 221

221.0614(2) (2) Minimum quorum requirements.

221.0614(2)(a) (a) The articles of incorporation or bylaws may authorize a quorum of a board of directors to consist of no fewer than one-third of the number of directors specified in or fixed in accordance with the articles of incorporation or bylaws.

221.0614(2)(b) (b) The articles of incorporation or bylaws may authorize a quorum of a committee of the board of directors created under s. 221.0615 to consist of no fewer than one-third of the number of directors appointed to serve on the committee.

221.0614(3) (3) Voting requirements generally. Except as provided in ss. 221.0615 (3) and (4), 221.0619 (4) and 221.0631 (1) and (2), if a quorum is present when a vote is taken, the affirmative vote of a majority of directors present is the act of the board of directors or a committee of the board of directors created under s. 221.0615, unless the articles of incorporation or bylaws require the vote of a greater number of directors.

221.0614(4) (4) When assent given.

221.0614(4)(a) (a) Except as provided in par. (b), a director who is present and is announced as present at a meeting of the board of directors or a committee of the board of directors created under s. 221.0615, when corporate action is taken assents to the action taken unless any of the following occurs:

221.0614(4)(a)1. 1. The director objects at the beginning of the meeting or promptly upon his or her arrival to holding the meeting or transacting business at the meeting.

221.0614(4)(a)2. 2. The director dissents or abstains from an action taken and minutes of the meeting are prepared that show the director’s dissent or abstention from the action taken.

221.0614(4)(a)3. 3. The director delivers written notice that complies with s. 221.0103 of his or her dissent or abstention to the presiding officer of the meeting before its adjournment or to the bank immediately after adjournment of the meeting.

221.0614(4)(a)4. 4. The director dissents or abstains from an action taken, minutes of the meeting are prepared that fail to show the director’s dissent or abstention from the action taken and the director delivers to the bank a written notice of that failure that complies with s. 221.0103 promptly after receiving the minutes.

221.0614(4)(b) (b) A director who votes in favor of action taken may not dissent or abstain from that action.

221.0614 History History: 1995 a. 336.

221.0615 221.0615 Committees.

221.0615(1) (1) In general. Unless the articles of incorporation or bylaws provide otherwise, a board of directors may create one or more committees, appoint members of the board of directors to serve on the committees and designate other members of the board of directors to serve as alternates. Each committee shall have 2 or more members. Unless otherwise provided by the board of directors, members of the committee shall serve at the pleasure of the board of directors.

221.0615(2) (2) Creation of a committee and appointment of members. Except as provided in sub. (3), the creation of a committee, appointment of members to it and designation of alternate members, if any, shall be approved by the greater of the following:

221.0615(2)(a) (a) A majority of all the directors in office when the action is taken.

221.0615(2)(b) (b) The number of directors required by the articles of incorporation or bylaws to take action under s. 221.0614.

221.0615(3) (3) Vacancies. The board of directors may provide by resolution that any vacancies on the committee shall be filled by the affirmative vote of a majority of the remaining committee members.

221.0615(4) (4) Applicability of certain provisions. Sections 221.0610 to 221.0613 apply to committees of a board of directors and to committee members.

221.0615(5) (5) Authority which may be exercised by committee. To the extent specified by the board of directors or in the articles of incorporation or bylaws, each committee may exercise the authority of the board of directors, except that a committee may not do any of the following:

221.0615(5)(a) (a) Authorize distributions.

221.0615(5)(b) (b) Approve or propose to shareholders action that this chapter requires be approved by shareholders.

221.0615(5)(c) (c) Fill vacancies on the board of directors or, except as provided in sub. (3), on any of its committees.

221.0615(5)(d) (d) Amend articles of incorporation under s. 221.0211.

221.0615(5)(e) (e) Adopt, amend or repeal bylaws.

221.0615(5)(f) (f) Approve a plan of merger not requiring shareholder approval.

221.0615(5)(g) (g) Authorize or approve reacquisition of shares, except according to a formula or method prescribed by the board of directors.

221.0615(5)(h) (h) Authorize or approve the issuance or sale or contract for sale of shares, or determine the designation and relative rights, preferences and limitations of a class or series of shares, except that the board of directors may authorize a committee or a senior executive officer of the bank to do so within limits prescribed by the board of directors.

221.0615(6) (6) Employment of consultants. Unless otherwise provided by the board of directors in creating the committee, a committee may employ counsel, accountants and other consultants to assist it in the exercise of authority.

221.0615(7) (7) Effect on responsibility of board. The creation of a committee, delegation of authority to a committee or action by a committee does not relieve the board of directors or any of its members of any responsibility imposed upon the board of directors or its members by law.

221.0615 History History: 1995 a. 336.

221.0616 221.0616 Reliance by directors or officers. Unless the director or officer has knowledge that makes reliance unwarranted, a director or officer, in discharging his or her duties to the bank, may rely on information, opinions, reports or statements, which may be written or oral or formal or informal and which may include financial statements, valuation reports and other financial data, if they are prepared or presented by any of the following:

221.0616(1) (1) Officers and employees. An officer or employee of the bank whom the director or officer believes in good faith to be reliable and competent in the matters presented.

221.0616(2) (2) Experts. Legal counsel, certified public accountants licensed or certified under ch. 442, or other persons as to matters that the director or officer believes in good faith are within the person’s professional or expert competence.

221.0616(3) (3) Board committees. In the case of reliance by a director, a committee of the board of directors of which the director is not a member if the director believes in good faith that the committee merits confidence.

221.0616 History History: 1995 a. 336; 2001 a. 16.

221.0617 221.0617 Consideration of interests in addition to shareholders’ interests. In discharging his or her duties to the bank and in determining what he or she believes to be in the best interests of the bank, a director or officer may, in addition to considering the effects of an action on shareholders, consider the following:

221.0617(1) (1) The effects of the action on employees, suppliers and customers of the bank.

221.0617(2) (2) The effects of the action on communities in which the bank operates.

221.0617(3) (3) Other factors that the director or officer considers pertinent.

221.0617 History History: 1995 a. 336.

221.0618 221.0618 Limited liability of directors.

221.0618(1) (1) In general. Except as provided in sub. (2) or s. 221.0803, a director is not liable to the bank, its shareholders, or any person asserting rights on behalf of the bank or its shareholders, for damages, settlements, fees, fines, penalties or other monetary liabilities arising from a breach of, or failure to perform, any duty resulting solely from his or her status as a director, unless the person asserting liability proves that the breach or failure to perform constitutes any of the following:

221.0618(1)(a) (a) A willful failure to deal fairly with the bank or its shareholders in connection with a matter in which the director has a material conflict of interest.

221.0618(1)(b) (b) A violation of criminal law, unless the director had reasonable cause to believe that his or her conduct was lawful or had no reasonable cause to believe that his or her conduct was unlawful.

221.0618(1)(c) (c) A transaction from which the director derived an improper personal profit.

221.0618(1)(d) (d) Willful misconduct.

221.0618(2) (2) Articles of incorporation may limit. A bank may limit the immunity provided under this section by its articles of incorporation. A limitation under this subsection applies if the cause of action against a director accrues while the limitation is in effect.

221.0618 History History: 1995 a. 336.

221.0619 221.0619 Director conflict of interest.

221.0619(1) (1) Definition. In this section, “conflict of interest transaction” means a transaction with the bank in which a director of the bank has a direct or indirect interest.

221.0619(2) (2) When transaction not voidable. A conflict of interest transaction is not voidable by the bank solely because of the director’s interest in the transaction if any of the following is true:

221.0619(2)(a) (a) The material facts of the transaction and the director’s interest were disclosed or known to the board of directors or a committee of the board of directors and the board of directors or committee authorized, approved or specifically ratified the transaction under sub. (4).

221.0619(2)(b) (b) The material facts of the transaction and the director’s interest were disclosed or known to the shareholders entitled to vote and they authorized, approved or specifically ratified the transaction under sub. (5).

221.0619(2)(c) (c) The transaction was fair to the bank.

221.0619(3) (3) Indirect interests. For purposes of this section, the circumstances in which a director of the bank has an indirect interest in a transaction include but are not limited to a transaction under any of the following circumstances:

221.0619(3)(a) (a) Another entity in which the director has a material financial interest or in which the director is a general partner is a party to the transaction.

221.0619(3)(b) (b) Another entity of which the director is a director, officer or trustee is a party to the transaction and the transaction is or, because of its significance to the bank, should be considered by the board of directors of the bank.

221.0619(4) (4) Authorization, approval or ratification by board. For purposes of sub. (2) (a), a conflict of interest transaction is authorized, approved or specifically ratified if it receives the affirmative vote of a majority of the directors on the board of directors or on the committee acting on the transaction, who have no direct or indirect interest in the transaction. If a majority of the directors who have no direct or indirect interest in the transaction vote to authorize, approve or ratify the transaction, a quorum is present for the purpose of taking action under this section. The presence of, or a vote cast by, a director with a direct or indirect interest in the transaction does not affect the validity of any action taken under sub. (2) (a) if the transaction is otherwise authorized, approved or ratified as provided in this section.

221.0619(5) (5) Authorization, approval or ratification by shareholders. For purposes of sub. (2) (b), a conflict of interest transaction is authorized, approved or specifically ratified if it receives the vote of a majority of the shares entitled to be counted under this subsection. Shares owned by or voted under the control of a director who has a direct or indirect interest in the transaction, and shares owned by or voted under the control of an entity described in sub. (3) (a), may not be counted in a vote of shareholders to determine whether to authorize, approve or ratify a conflict of interest transaction under sub. (2) (b). The vote of those shares shall be counted in determining whether the transaction is approved under other sections of this chapter. A majority of the shares, whether or not present, that are entitled to be counted in a vote on the transaction under this subsection constitutes a quorum for the purpose of taking action under this section.

221.0619 History History: 1995 a. 336.

221.0620 221.0620 Officers.

221.0620(1) (1) Creation and appointment. A bank shall have the officers described in its bylaws or appointed by its board of directors by resolution not inconsistent with its bylaws.

221.0620(2) (2) Election of officers. The officers of the bank shall be elected by the board of directors. However, a duly appointed officer may appoint one or more officers or assistant officers if authorized by the bylaws or the board of directors.

221.0620(3) (3) Senior executive officer. The senior executive officer in charge of conducting business shall be chosen from the board of directors.

221.0620(4) (4) Multiple offices. An individual may simultaneously hold more than one office in a bank.

221.0620(5) (5) Ineligibility for office. An individual who has been previously convicted of any crime under federal or state banking laws may not be elected an officer of a bank.

221.0620 History History: 1995 a. 336.

221.0621 221.0621 Duties of officers. Each officer has the authority and shall perform the duties set forth in the bylaws or, to the extent not inconsistent with the bylaws, the duties prescribed by the board of directors or by direction of an officer authorized by the bylaws or by the board of directors to prescribe the duties of other officers.

221.0621 History History: 1995 a. 336.

221.0622 221.0622 Resignation and removal of officers.

221.0622(1) (1) Resignation. An officer may resign at any time by delivering to the bank notice that complies with s. 221.0103. The resignation is effective when the notice is delivered, unless the notice specifies a later effective date and the bank accepts the later effective date. If a resignation is effective at a later date, the bank’s board of directors may fill the pending vacancy before the effective date, if the board of directors provides that the successor may not take office until the effective date.

221.0622(2) (2) Removal. The board of directors may remove an officer and, unless restricted by the bylaws or by the board of directors, an officer may remove an officer or assistant officer appointed by that officer under s. 221.0620 (2), at any time, with or without cause and notwithstanding the contract rights, if any, of the officer removed.

221.0622 History History: 1995 a. 336.

221.0623 221.0623 Contract rights of officers.

221.0623(1) (1) Effect of appointment. The appointment of an officer does not itself create contract rights.

221.0623(2) (2) Effect of resignation or removal. Except as provided in s. 221.0622 (2), an officer’s resignation or removal is subject to any remedies provided by any contract between the officer and the bank or otherwise provided by law.

221.0623 History History: 1995 a. 336.

221.0624 221.0624 Signature of officers. Each document required by this chapter to be signed by an officer or officers of the bank shall be signed by the officer or officers designated in the bylaws or by the board of directors.

221.0624 History History: 1995 a. 336.

221.0625 221.0625 Loans to bank officials; penalty.

221.0625(1) (1) Loans to officers and directors. Except as otherwise provided in this subsection, a bank may not lend to any officer or director of the bank an amount that, when aggregated with the amount of all other extensions of credit to that person exceeds the higher of $25,000 or 5 percent of the bank’s capital, without prior approval of the bank’s board of directors. Prior approval of the bank’s board of directors is also required in all cases when a loan aggregated with all other extensions of credit to the officer or director exceeds $500,000. A bank’s board of directors may give prior approval to a line of credit to an officer or director, and prior approval by the bank’s board of directors is not required for each advance made to the officer or director pursuant to the preapproved line of credit.

221.0625(2) (2) Penalty. An officer or director of a bank who, in violation of this section, directly or indirectly does any of the following is guilty of a Class F felony:

221.0625(2)(a) (a) Borrows or otherwise procures for personal use money, funds or property of the bank.

221.0625(2)(b) (b) Procures money, funds or property of the bank through use of personal credit or accommodation of another person.

221.0625(2)(c) (c) Procures money, funds or property of the bank by acceptance for discount at the bank of any note, bond or evidence of debt that he or she knows or has reason to know is worth less than the price at which it is accepted as an asset.

221.0625 History History: 1995 a. 336; 1997 a. 283; 2001 a. 109.

221.0625 Cross-reference Cross-reference: See also ch. DFI-Bkg 18, Wis. adm. code.

221.0626 221.0626 Definitions applicable to indemnification and insurance provisions. In ss. 221.0626 to 221.0635: