Chapter 215

215.513(1) (1) A mutual association shall indemnify a director or officer, to the extent he or she has been successful on the merits or otherwise in the defense of a proceeding, for all reasonable expenses incurred in the proceeding if the director or officer was a party because he or she is a director or officer of the mutual association.

215.513(2) (2) 

215.513(2)(a) (a) In cases not included under sub. (1), a mutual association shall indemnify a director or officer against liability incurred by the director or officer in a proceeding to which the director or officer was a party because he or she is a director or officer of the mutual association, unless liability was incurred because the director or officer breached or failed to perform a duty he or she owes to the mutual association and the breach or failure to perform constitutes any of the following:

215.513(2)(a)1. 1. A willful failure to deal fairly with the mutual association or its members in connection with a matter in which the director or officer has a material conflict of interest.

215.513(2)(a)2. 2. A violation of criminal law, unless the director or officer had reasonable cause to believe his or her conduct was lawful or no reasonable cause to believe his or her conduct was unlawful.

215.513(2)(a)3. 3. A transaction from which the director or officer derived an improper personal profit.

215.513(2)(a)4. 4. Willful misconduct.

215.513(2)(b) (b) Determination of whether indemnification is required under this subsection shall be made under s. 215.514.

215.513(2)(c) (c) The termination of a proceeding by judgment, order, settlement or conviction, or upon a plea of no contest or an equivalent plea, does not, by itself, create a presumption that indemnification of the director or officer is not required under this subsection.

215.513(3) (3) A director or officer who seeks indemnification under this section shall make a written request to the mutual association.

215.513(4) (4) 

215.513(4)(a) (a) Indemnification under this section is not required to the extent limited by the articles of incorporation under s. 215.516.

215.513(4)(b) (b) Indemnification under this section is not required if the director or officer has previously received indemnification or allowance of expenses from any person, including the mutual association, in connection with the same proceeding.

215.513 History History: 1987 a. 13.

215.513 Annotation Cooperative indemnification. La Rowe and Weine. WBB Sept. 1988.

215.514 215.514 Determination of right to indemnification. Unless otherwise provided by the articles of incorporation or bylaws or by written agreement between the director or officer and the mutual association, the director or officer seeking indemnification under s. 215.513 (2) shall select one of the following means for determining his or her right to indemnification:

215.514(1) (1) By majority vote of a quorum of the board consisting of directors not at the time parties to the same or related proceedings. If a quorum of disinterested directors cannot be obtained, by majority vote of a committee duly appointed by the board and consisting solely of 2 or more directors not at the time parties to the same or related proceedings. Directors who are parties to the same or related proceedings may participate in the designation of members of the committee.

215.514(2) (2) By independent legal counsel selected by a quorum of the board or its committee in the manner prescribed in sub. (1) or, if unable to obtain such a quorum or committee, by a majority vote of the full board, including directors who are parties to the same or related proceedings.

215.514(3) (3) By a panel of 3 arbitrators consisting of one arbitrator selected by those directors entitled under sub. (2) to select independent legal counsel, one arbitrator selected by the director or officer seeking indemnification and one arbitrator selected by the 2 arbitrators previously selected.

215.514(4) (4) By members by an affirmative vote of a majority of votes cast in person or by proxy as provided in s. 215.43 (4). Voting rights owned by, or voted under the control of, persons who are at the time parties to the same or related proceedings, whether as plaintiffs or defendants or in any other capacity, may not be voted in making the determination.

215.514(5) (5) By a court under s. 215.518.

215.514(6) (6) By any other method provided for in any additional right to indemnification permitted under s. 215.517.

215.514 History History: 1987 a. 13.

215.515 215.515 Allowance of expenses as incurred. Upon written request by a director or officer who is a party to a proceeding, a mutual association may pay or reimburse his or her reasonable expenses as incurred if the director or officer provides the mutual association with all of the following:

215.515(1) (1) A written affirmation of his or her good faith belief that he or she has not breached or failed to perform his or her duties to the mutual association.

215.515(2) (2) A written undertaking, executed personally or on his or her behalf, to repay the allowance and, if required by the mutual association, to pay reasonable interest on the allowance to the extent that it is ultimately determined under s. 215.514 that indemnification under s. 215.513 (2) is not required and that indemnification is not ordered by a court under s. 215.518 (2) (b). The undertaking under this subsection shall be an unlimited general obligation of the director or officer and may be accepted without reference to his or her ability to repay the allowance. The undertaking may be secured or unsecured.

215.515 History History: 1987 a. 13.

215.516 215.516 Mutual association may limit indemnification.

215.516(1) (1) A mutual association’s obligations to indemnify under s. 215.513 may be limited as follows:

215.516(1)(a) (a) If the mutual association obtains a certificate of incorporation on or after June 13, 1987, by the articles of incorporation, including any amendments to the articles of incorporation.

215.516(1)(b) (b) If the mutual association has obtained a certificate of incorporation before June 13, 1987, by an amendment to the articles of incorporation with an effective date, as provided in s. 215.41 (5), on or after June 13, 1987.

215.516(2) (2) A limitation under sub. (1) applies if the first alleged act of a director or officer for which indemnification is sought occurred while the limitation was in effect.

215.516 History History: 1987 a. 13.

215.517 215.517 Additional rights to indemnification and allowance of expenses.

215.517(1) (1) Except as provided in sub. (2), ss. 215.513 and 215.515 do not preclude any additional right to indemnification or allowance of expenses that a director or officer may have under any of the following:

215.517(1)(a) (a) The articles of incorporation or bylaws.

215.517(1)(b) (b) A written agreement between the director or officer and the mutual association.

215.517(1)(c) (c) A resolution of the board.

215.517(1)(d) (d) A resolution, after notice, adopted by members by an affirmative vote of a majority of votes cast in person or by proxy as provided in s. 215.43 (4).

215.517(2) (2) Regardless of the existence of an additional right under sub. (1), the mutual association may not indemnify a director or officer, or permit a director or officer to retain any allowance of expenses unless it is determined by or on behalf of the mutual association that the director or officer did not breach or fail to perform a duty he or she owes to the mutual association which constitutes conduct under s. 215.513 (2) (a) 1., 2., 3. or 4. A director or officer who is a party to the same or related proceeding for which indemnification or an allowance of expenses is sought may not participate in a determination under this subsection.

215.517(3) (3) Sections 215.512 to 215.521 do not affect a mutual association’s power to pay or reimburse expenses incurred by a director or officer in any of the following circumstances:

215.517(3)(a) (a) As a witness in a proceeding to which he or she is not a party.

215.517(3)(b) (b) As a plaintiff or petitioner in a proceeding because he or she is or was an employee, agent, director or officer of the mutual association.

215.517 History History: 1987 a. 13.

215.518 215.518 Court-ordered indemnification.

215.518(1) (1) Except as provided otherwise by written agreement between the director or officer and the mutual association, a director or officer who is a party to a proceeding may apply for indemnification to the court conducting the proceeding or to another court of competent jurisdiction. Application shall be made for an initial determination by the court under s. 215.514 (5) or for review by the court of an adverse determination under s. 215.514 (1), (2), (3), (4) or (6). After receipt of an application, the court shall give any notice it considers necessary.

215.518(2) (2) The court shall order indemnification if it determines any of the following:

215.518(2)(a) (a) That the director or officer is entitled to indemnification under s. 215.513 (1) or (2). If the court also determines that the mutual association unreasonably refused the director’s or officer’s request for indemnification, the court shall order the mutual association to pay the director’s or officer’s reasonable expenses incurred to obtain the court-ordered indemnification.

215.518(2)(b) (b) That the director or officer is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, regardless of whether indemnification is required under s. 215.513 (2).

215.518 History History: 1987 a. 13.

215.519 215.519 Indemnification and allowance of expenses of employees and agents. A mutual association may indemnify and allow reasonable expenses of an employee or agent who is not a director or officer to the extent provided by the articles of incorporation or bylaws, by general or specific action of the board or by contract.

215.519 History History: 1987 a. 13.

215.521 215.521 Insurance. A mutual association may purchase and maintain insurance on behalf of an individual who is an employee, agent, director or officer of the mutual association against liability asserted against and incurred by the individual in his or her capacity as an employee, agent, director or officer, or arising from his or her status as an employee, agent, director or officer, regardless of whether the mutual association is required or authorized to indemnify or allow expenses to the individual against the same liability under ss. 215.513, 215.515, 215.517 and 215.519.

215.521 History History: 1987 a. 13.

215.523 215.523 Reliance by directors or officers. Unless the director or officer has knowledge that makes reliance unwarranted, a director or officer of a mutual association organized under this subchapter may, in discharging his or her duties to the mutual association, rely on information, opinions, reports or statements, any of which may be written or oral, formal or informal, including financial statements and other financial data, if prepared or presented by any of the following:

215.523(1) (1) An officer or employee of the mutual association whom the director or officer believes in good faith to be reliable and competent in the matters presented.

215.523(2) (2) Legal counsel, certified public accountants licensed or certified under ch. 442, or other persons as to matters the director or officer believes in good faith are within the person’s professional or expert competence.

215.523(3) (3) In the case of reliance by a director, a committee of the board of which the director is not a member if the director believes in good faith that the committee merits confidence.

215.523 History History: 1987 a. 13; 2001 a. 16.

215.524 215.524 Consideration of interests in addition to members’ interests. In discharging his or her duties to a mutual association organized under this subchapter and in determining what he or she believes to be in the best interests of the mutual association, a director or officer may, in addition to considering the effects of any action on members, consider the following:

215.524(1) (1) The effects of the action on employees, suppliers and customers of the mutual association.

215.524(2) (2) The effects of the action on communities in which the mutual association operates.

215.524(3) (3) Any other factors the director or officer considers pertinent.

215.524 History History: 1987 a. 13.

215.525 215.525 Limited liability of directors and officers.

215.525(1) (1) Except as provided in subs. (2) and (3), a director or officer of a mutual association organized under this subchapter is not liable to the mutual association, its members or creditors, or any person asserting rights on behalf of the mutual association, its members or creditors, or any other person, 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 or officer, unless the person asserting liability proves that the breach or failure to perform constitutes any of the following:

215.525(1)(a) (a) A willful failure to deal fairly with the mutual association or its members in connection with a matter in which the director or officer has a material conflict of interest.

215.525(1)(b) (b) A violation of criminal law, unless the director or officer had reasonable cause to believe his or her conduct was lawful or no reasonable cause to believe his or her conduct was unlawful.

215.525(1)(c) (c) A transaction from which the director or officer derived an improper personal profit.

215.525(1)(d) (d) Willful misconduct.

215.525(2) (2) Except as provided in sub. (3), this section does not apply to any of the following:

215.525(2)(a) (a) A proceeding brought against a director or officer under s. 215.02 (10) or (15), 215.12 or 215.21 (21).

215.525(2)(b) (b) A civil or criminal proceeding, other than a proceeding described under par. (a), brought by or on behalf of any governmental unit, authority or agency.

215.525(2)(c) (c) A proceeding brought by any person for a violation of state or federal law where the proceeding is brought pursuant to an express private right of action created by state or federal statute.

215.525(3) (3) Subsection (2) (b) and (c) does not apply to a proceeding brought by a governmental unit, authority or agency in its capacity as a private party or contractor.

215.525 History History: 1987 a. 13.

215.525 Annotation Cooperative indemnification. La Rowe and Weine. WBB Sept. 1988.

215.528 215.528 General operation of a mutual association. The general operations of a mutual savings and loan association shall comply with this subchapter and the applicable provisions of subch. I.

215.528 History History: 1975 c. 359; 1987 a. 13 s. 26s; Stats. 1987 s. 215.528.

215.53 215.53 Absorption involving mutual associations.

215.53(1) (1) Conditions precedent.

215.53(1)(a) (a) With the consent of the division and subject to any condition that the division prescribes, a mutual association organized under this chapter may, by an affirmative vote of at least two-thirds of the board of each institution, do any of the following:

215.53(1)(a)1. 1. Absorb or be absorbed by any thrift institution.

215.53(1)(a)4. 4. Absorb a mutual savings and loan holding company or mutual savings bank holding company under a plan, approved by the division, that provides that the mutual savings and loan holding company or mutual savings bank holding company ceases to engage in activities that the absorbing association may not engage in and that provides that stock in a subsidiary association that is not held by the absorbed mutual savings and loan holding company or mutual savings bank holding company is redeemed.

215.53(1)(b) (b) The absorbed thrift institution, mutual savings and loan holding company or mutual savings bank holding company shall transfer its assets and liabilities to the absorbing thrift institution but not to defeat or defraud creditors.

215.53(2) (2) Effect of absorption.

215.53(2)(a) (a) All the rights, franchises and property interests of the absorbed thrift institution or, subject to sub. (1) (a) 4., of the absorbed mutual savings and loan holding company or mutual savings bank holding company shall be deemed to be transferred to the absorbing thrift institution, which shall hold and enjoy same and all rights of property, franchises and interest in the same manner and to the same extent as was held and enjoyed by the absorbed thrift institution, mutual savings and loan holding company or mutual savings bank holding company. Except as provided in s. 215.01 (17), the savers of the absorbed thrift institution or of a subsidiary of an absorbed mutual savings and loan holding company or mutual savings bank holding company shall be members of the absorbing thrift institution or, if the absorbing thrift institution is a subsidiary of a mutual savings and loan holding company, members of the mutual savings and loan holding company, and possess and be subject to all rights, privileges and duties as provided in the bylaws of the absorbing thrift institution or mutual savings and loan holding company.

215.53(2)(b) (b) Stockholders of a thrift institution absorbed under this section may be compensated by converting the shares of the absorbed thrift institution into, in whole or in part: obligations or other securities of the absorbing thrift institution or shares, obligations or other securities of any other thrift institution or corporation; or cash or other thing of value.

215.53(3) (3) Withdrawal requests. Any saver in an absorbed thrift institution or in a subsidiary of an absorbed mutual savings and loan holding company or mutual savings bank holding company, who intends to file a written withdrawal request for savings accounts within one year after the date of approval of such absorption by the division, may do so by giving 90 days’ written notice of such intention, and the savings accounts shall be withdrawn as provided in s. 215.17. Any person who has filed such written withdrawal request shall remain a member and be subject to all rights, privileges and duties under this chapter and the bylaws and the rules and regulations of the absorbing thrift institution or, if the absorbing thrift institution is a subsidiary of a mutual savings and loan holding company, of the mutual savings and loan holding company, until the withdrawal value of the savings accounts has been paid to the person.