NY Banking L § 397 (2021)
2021 New York Laws BNK - Banking Article 10 - Savings and Loan Associations 397 - Number, Qualifications and Disqualifications of Directors; Oath; Quorum; Meeting of Directors.

§ 397.  Number,  qualifications  and  disqualifications  of directors; oath; quorum; meeting of directors. 1. The affairs of every savings  and loan  association shall be managed and its corporate powers exercised by a board of directors, in number  not  less  than  seven  nor  more  than fifteen,  except  that  in the case of the merger of two or more savings and loan associations or one or more savings banks into  a  savings  and loan association and if the merger agreement so provides, the authorized number of directors of the resulting association may be increased to not more  than twenty-four, provided that thereafter the number of directors shall be reduced to fifteen by the elimination of one authorized  office for every two vacancies that occur.   2.  (a)  All  directors of a savings and loan association must be over the age of eighteen years and citizens of the United States.  (b) No person shall be eligible to  election  as  a  director  of  any savings and loan association  (1)  Unless  he is the owner in good faith and in his own right on the books of the association of shares having a book value of not less  than two hundred dollars and every person elected a director, who, after such election  shall  hypothecate, pledge or cease to be the owner in his own right of such qualifying shares, shall thereby vacate  his  office,  and shall  not be eligible for re-election as a director for a period of one year from the date of the next  succeeding  annual  meeting.  Except  as provided  in  paragraphs  (c)  and (d) of this subdivision, every person legally qualified and duly serving as a director at the  time  this  act takes  effect, may continue as such director until the expiration of the term for which he was elected or appointed, but shall  not  be  eligible for   re-election   unless   he  shall  meet  the  requirement  of  this subdivision.  (2) If  he  would,  upon  his  election,  become  the  third  salaried full-time  employee  of the savings and loan association on its board of directors and if such board, with his election,  would  have  twelve  or less  directors,  or  if  he would, upon his election, become the fourth salaried full-time employee of the savings and loan association  on  its board of directors and if such board, with his election, would have more than twelve directors; provided, however, that with the written approval of  the  superintendent,  four salaried full-time employees may serve as directors of a savings and loan association resulting from the merger of two or more savings and loan associations or from the merger of  one  or more  savings  banks into a savings and loan association if, immediately prior to such merger, each such person was a salaried full-time employee and a director or a trustee of a merging institution.   No director in office on April first,  nineteen  hundred  sixty-eight, shall  be  ineligible  for  the  office  of  director  by  reason of the provisions of subparagraph (2) of paragraph (b) of this subdivision.  (3) If: (a) Such person's spouse is a director  or  one  of  the  five highest  paid  salaried  officers of the association; (b) Such person or such person's spouse is  the  grandparent,  parent,  child,  grandchild, brother,  sister,  aunt,  uncle, nephew or neice of a director or one of the five highest paid salaried officers of the  association;  or  (c)  A director  or  one  of  the  five  highest  paid salaried officers of the association is the spouse of such person's child, grandchild, brother or sister.   No director in office on September first, nineteen hundred seventy-one shall be ineligible  for  the  office  of  director  by  reason  of  the provisions of subparagraph three of paragraph (b) of this subdivision.  (c)  The  bylaws  of  a  savings  and loan association may prescribe a maximum age beyond which no person shall be eligible for election to the board of directors, and may prescribe  a  mandatory  retirement  age  of  seventy-five  years  or  less  for  directors,  subject to the following limitations:  (i)  No  person  shall  be eligible for initial election as a director after December thirty-first, nineteen hundred sixty-eight who is seventy years of age or more; and  (ii) No person shall continue to serve as a  director  after  December thirty-first,  nineteen  hundred seventy-three who is seventy-five years of age or more, and the office of any such director shall become  vacant on  the  last  day  of  the  month  in  which  such director reaches his seventy-fifth birthday or on  December  thirty-first,  nineteen  hundred seventy-three, whichever is the later.  (d) In the case of a savings and loan association which does not adopt a  bylaw  prescribing  a mandatory retirement age for directors prior to January first, nineteen hundred sixty-nine, or which does  not  maintain thereafter  a  bylaw  prescribing  such  a mandatory retirement age, the office of a director of such savings and loan association  shall  become vacant  on  the last day of the month in which such director reaches his seventieth birthday,  or  on  December  thirty-first,  nineteen  hundred sixty-eight, whichever is the later.   3. Any director of a savings and loan association who shall default in any  contractual  payment on any obligation to such association for more than ninety days shall by reason of such default vacate  his  office  as director  and  shall not be eligible for re-election for a period of one year from the date of the next succeeding annual meeting and until  such default is cured.   4. Every director of any savings and loan association, before entering upon  his  duties as a director, shall take an oath that he will, so far as the duty devolves upon him, diligently and  honestly  administer  the affairs  of  such  association,  and  will  not  knowingly  violate,  or willingly permit to be violated, any of the provisions of law applicable to such association, and that he is the owner in good faith and  in  his own  right,  of  shares having a book value of not less than two hundred dollars standing in his name on the books of the  association  and  that the same are not hypothecated, or in any way pledged as security for any loan  or  debt, and, in case of re-election or re-appointment, that such shares were not hypothecated, or in any way pledged as security for  any loan  or debt during his previous term. Such oath shall be subscribed by the director making it, certified by an officer  authorized  by  law  to administer oaths, and immediately transmitted to the superintendent.   5.  In  the  absence  of  a provision in the by-laws providing for the number of directors necessary to constitute a quorum, a majority of  the total  number  of  directors  which a savings and loan association would have if there were no  vacancies  shall  constitute  a  quorum  for  the transaction  of  business  or  of  any  specified  item of business. Any reference in this chapter to corporate action to be taken by  the  board shall  mean  such  action at a meeting of the board. Except as otherwise provided in this chapter, the  vote  of  a  majority  of  the  directors present  at  the  time of the vote, if a quorum is present at such time, shall be the act of the board.   6. (a) Unless otherwise provided in the by-laws, regular  meetings  of the  board  may  be  held  without  notice if the time and place of such meetings are fixed by the by-laws or the board. Special meetings of  the board shall be held upon notice to the directors.  (b) The by-laws may prescribe what shall constitute notice of meetings of  the  board.  A  notice,  or  waiver  of notice, need not specify the purpose of any regular or special meeting of the board, unless  required by the by-laws.  (c)  Notice of a meeting need not be given to any director who submits a signed waiver of notice whether before or after  the  meeting  or  who attends  the  meeting  without  protesting,  prior  thereto  or  at  its commencement, the lack of notice to him.  (d)  A  majority  of the directors present, whether or not a quorum is present, may adjourn any meeting to  another  time  and  place.  If  the by-laws  so provide, notice of any adjournment of a meeting of the board to another time or place shall be given to the directors  who  were  not present  at  the time of the adjournment and, unless such time and place are announced at the meeting, to the other directors.   7. Any officer elected or appointed by the board may be removed by the board, or his authority suspended by it, with  or  without  cause.  Such removal or suspension without cause, however, shall be without prejudice to  his contract rights. The election or appointment of an officer shall not be deemed of itself to create contract rights. This subdivision does not affect the powers of the superintendent under section  forty-one  of this chapter.   8.  Upon the petition of any shareholder aggrieved by an election, and upon notice to the persons declared elected  thereat,  the  savings  and loan  association  and  such  other persons as the court may direct, the supreme court at a special term held within the judicial district  where the  office  of  the  savings  and  loan  association  is  located shall forthwith hear the proofs and allegations of the  parties,  and  confirm the election, order a new election, or take such other action as justice may require.