SB494,106,3 21(2) Undertaking to repay. A written undertaking, executed personally or on
22his or her behalf, to repay the allowance and, if required by the bank, to pay
23reasonable interest on the allowance to the extent that it is ultimately determined
24under s. 221.0631 that indemnification under s. 221.0627 (2) is not required and that
25indemnification is not ordered by a court under s. 221.0630 (2) (b). The undertaking

1under this subsection shall be an unlimited general obligation of the director or
2officer and may be accepted without reference to his or her ability to repay the
3allowance. The undertaking may be secured or unsecured.
SB494,106,11 4221.0630 Court-ordered indemnification. (1) Application for
5indemnification.
Except as provided otherwise by written agreement between the
6director or officer and the bank, a director or officer who is a party to a proceeding
7may apply for indemnification to the court conducting the proceeding or to another
8court of competent jurisdiction. Application shall be made for an initial
9determination by the court under s. 221.0631 (5) or for review by the court of an
10adverse determination under s. 221.0631 (1), (2), (3), (4) or (6). After receipt of an
11application, the court shall give any notice that it considers necessary.
SB494,106,13 12(2) When to be ordered by court. The court shall order indemnification if it
13determines any of the following:
SB494,106,1814 (a) That the director or officer is entitled to indemnification under s. 221.0627.
15If the court also determines that the bank unreasonably refused the director's or
16officer's request for indemnification, the court shall order the bank to pay the
17director's or officer's reasonable expenses incurred to obtain the court-ordered
18indemnification.
SB494,106,2119 (b) That the director or officer is fairly and reasonably entitled to
20indemnification in view of all the relevant circumstances, regardless of whether
21indemnification is required under s. 221.0627.
SB494,107,2 22221.0631 Determination of right to indemnification. Unless otherwise
23provided by the articles of incorporation or bylaws or by written agreement between
24the director or officer and the bank, the director or officer seeking indemnification

1under s. 221.0627 (2) shall select one of the following means for determining his or
2her right to indemnification:
SB494,107,9 3(1) Board or committee vote. By a majority vote of a quorum of the board of
4directors consisting of directors who are not at the time parties to the same or related
5proceedings. If a quorum of disinterested directors cannot be obtained, by majority
6vote of a committee duly appointed by the board of directors and consisting solely of
72 or more directors who are not at the time parties to the same or related proceedings.
8 Directors who are parties to the same or related proceedings may participate in the
9designation of members of the committee.
SB494,107,14 10(2) Independent legal counsel. By independent legal counsel selected by a
11quorum of the board of directors or its committee in the manner prescribed in sub.
12(1) or, if unable to obtain such a quorum or committee, by a majority vote of the full
13board of directors, including directors who are parties to the same or related
14proceedings.
SB494,107,18 15(3) Panel of arbitrators. By a panel of 3 arbitrators consisting of one
16arbitrator selected by those directors entitled under sub. (2) to select independent
17legal counsel, one arbitrator selected by the director or officer seeking
18indemnification and one arbitrator selected by the 2 arbitrators previously selected.
SB494,107,22 19(4) Shareholder vote. By an affirmative vote of shares as provided in s.
20221.0501. Shares owned by, or voted under the control of, persons who are at the time
21parties to the same or related proceedings, whether as plaintiffs or defendants or in
22any other capacity, may not be voted in making the determination.
SB494,107,23 23(5) Court order. By a court under s. 221.0630.
SB494,107,25 24(6) Other methods. By any other method provided for in any additional right
25to indemnification permitted under s. 221.0634.
SB494,108,6
1221.0632 Indemnification and allowance of expenses of employes and
2agents. (1)
Mandatory indemnification. Except as provided in sub. (3), a bank shall
3indemnify an employe who is not a director or officer, to the extent that he or she has
4been successful on the merits or otherwise in defense of a proceeding, for all
5reasonable expenses incurred in the proceeding if the employe was a party because
6he or she was an employe of the bank.
SB494,108,11 7(2) Permitted indemnification. Except as provided in sub. (3), in addition to
8the indemnification required by sub. (1), a bank may indemnify and allow reasonable
9expenses of an employe or agent who is not a director or officer to the extent provided
10by the articles of incorporation or bylaws, by general or specific action of the board
11of directors or by contract.
SB494,108,17 12(3) Prohibited indemnification. A bank may not indemnify or allow reasonable
13expenses of an employe or agent who is not a director or officer if the indemnification
14or allowance is expressly prohibited by s. 221.0803, by other provisions of this
15chapter or by applicable federal law or in connection with an administrative
16proceeding or action instituted under ch. 220 which results in a final order against
17an officer or director under s. 220.04 (4), (9) or (10).
SB494,109,2 18221.0633 Insurance. Except as expressly prohibited by other provisions of
19this chapter or applicable federal law or in connection with an administrative
20proceeding or action instituted under ch. 220 which results in a final order against
21an employe, agent, director or officer under s. 220.04 (4), (9) or (10), a bank may
22purchase and maintain insurance on behalf of the employe, agent, director or officer
23against liability asserted against or incurred by the individual in his or her capacity
24as an employe, agent, director or officer or arising from his or her status as an
25employe, agent, director or officer, regardless of whether the bank is required or

1authorized to indemnify or allow expenses to the individual against the same
2liability under ss. 221.0627, 221.0629, 221.0632 and 221.0634.
SB494,109,10 3221.0634 Additional rights to indemnification and allowance of
4expenses. (1)
Provision for additional rights. Except as provided in sub. (2) and
5except as expressly prohibited by other provisions of this chapter or applicable
6federal law or in connection with an administrative proceeding or action instituted
7under ch. 220 which results in a final order against an officer or director under s.
8220.04 (4), (9) or (10), ss. 221.0627 and 221.0629 do not preclude any additional right
9to indemnification or allowance of expenses that a director or officer may have under
10any of the following:
SB494,109,1111 (a) The articles of incorporation or bylaws.
SB494,109,1212 (b) A written agreement between the director or officer and the bank.
SB494,109,1313 (c) A resolution of the board of directors.
SB494,109,1514 (d) A resolution that is adopted, after notice, by a majority vote of all of the
15bank's voting shares then issued and outstanding.
SB494,109,23 16(2) When additional rights prohibited. Regardless of the existence of an
17additional right under sub. (1), the bank may not indemnify a director or officer, or
18permit a director or officer to retain any allowance of expenses, unless it is
19determined by or on behalf of the bank that the director or officer did not breach or
20fail to perform a duty that he or she owes to the bank which constitutes conduct under
21s. 221.0627 (2) (a) 1., 2., 3. or 4. A director or officer who is a party to the same or
22related proceeding for which indemnification or an allowance of expenses is sought
23may not participate in a determination under this subsection.
SB494,110,3
1(3) Reimbursement of certain expenses. Sections 221.0626 to 221.0635 do not
2affect a bank's power to pay or reimburse expenses incurred by a director or officer
3in any of the following circumstances:
SB494,110,44 (a) As a witness in a proceeding to which he or she is not a party.
SB494,110,65 (b) As a plaintiff or petitioner in a proceeding because he or she is or was an
6employe, agent, director or officer.
SB494,110,11 7221.0635 Indemnification and insurance against securities law claims.
8(1)
In general. It is the public policy of this state to require or permit
9indemnification, allowance of expenses and insurance for any liability incurred in
10connection with a proceeding involving securities regulation described under sub. (2)
11to the extent required or permitted under ss. 221.0626 to 221.0634.
SB494,110,15 12(2) Applicability. Sections 221.0626 to 221.0634 apply, to the extent applicable
13to any other proceeding, to any proceeding involving a federal law or regulation or
14a state law or rule that regulates the offer, sale or purchase of securities, securities
15brokers or dealers, or investment companies or investment advisors.
SB494,110,17 16221.0636 Theft. (1) Theft prohibited. (a) An officer, director, employe or
17agent of a bank may not do any of the following:
SB494,110,1918 1. Steal, abstract or wilfully misapply money, funds, credits, or property of the
19bank, whether owned by the bank or held in trust.
SB494,110,2220 2. Without authority of the board of directors, issue or put forth a certificate of
21deposit, draw an order or bill of exchange or make an acceptance, assign a note, bond,
22draft, bill of exchange, mortgage, judgment or decree.
SB494,110,2523 3. Make a false entry in a book, report or statement of the bank with intent to
24injure or defraud the bank or any person, or to deceive an officer of the bank, an agent
25appointed to examine the affairs of the bank, or any other person.
SB494,111,1
1(b) A person may not intentionally aid or abet a violation of par. (a).
SB494,111,3 2(2) Penalty. Any person who violates sub. (1) may be imprisoned for not more
3than 20 years.
SB494,111,9 4221.0637 Bank officers and employes not to take commissions. (1)
5Commissions prohibited. An officer, director, agent or employe of a bank may not,
6directly or indirectly, take, accept or receive, or offer or agree to take, accept or
7receive, a commission, fee, compensation, or thing of material value, from any person
8in consideration of the bank of which he or she is an officer, director, agent or employe,
9doing any of the following:
SB494,111,1010 (a) Loaning any money to a person.
SB494,111,1211 (b) Buying or discounting a note, bond, draft, or bill of exchange from the
12person.
SB494,111,1313 (c) Accepting any draft for, or issuing any letter of credit to, the person.
SB494,111,15 14(2) Penalties. Any person who violates sub. (1) may be fined not more than
15$10,000 or imprisoned for not more than 2 years or both.
SB494,111,1616 SUBSECTION VII
SB494,111,1817 SHARE EXCHANGE, MERGER AND
18 CONSOLIDATION
SB494,112,3 19221.0701 Share exchange. A bank or other corporation may acquire all of the
20outstanding shares of one or more classes or series of a bank organized under this
21chapter, with the approval of the division, if the board of directors of the bank, by
22resolution adopted by the board, approves a plan of share exchange and its
23shareholders also approve a plan of share exchange pursuant to ss. 180.1102 to
24180.1106. This section does not limit the power of a corporation or bank to acquire
25all or part of the shares of one or more classes or series of a bank through a voluntary

1exchange or otherwise. Application for approval of a share exchange shall be made
2to the division on a form prescribed by the division. The application shall be
3accompanied by a fee established by the division.
SB494,112,22 4221.0702 Consolidation or merger of banks. (1) In general. Any 2 or more
5banks may, with the approval of the division, consolidate or merge into one bank
6under the charter of either existing bank. The consolidation or merger shall be done
7on such terms and conditions as may be lawfully agreed upon by a majority of the
8board of directors of each bank proposing to consolidate or merge and as may be
9ratified and confirmed by the affirmative vote of the shareholders of each of the
10banks. The affirmative vote of the shareholders must be by shareholders owning a
11majority of the outstanding capital stock entitled to vote of each bank, or any greater
12percentage specified in the articles of incorporation or the bylaws, and by at least a
13majority of any outstanding preferred stock entitled to vote of each bank, or any
14greater percentage specified in the articles of incorporation or the bylaws. The vote
15must be at a meeting called by the directors, after sending notice of the time, place
16and object of the meeting to each shareholder of record in accordance with s.
17221.0103. The capital stock of the consolidated or merged bank may not be less than
18that required under existing law for the organization of a state bank in the place in
19which it is located. If the consolidation or merger is approved by the division, a
20shareholder of either of the banks who did not vote for the consolidation or merger
21shall be given notice of the approval by the bank in which the shareholder holds an
22interest.
SB494,113,7 23(2) Assets and liabilities of the consolidating or merging bank. The bank
24or banks consolidating or merging with another bank under sub. (1) may not be
25required to go into liquidation but their assets and liabilities shall be reported by the

1bank with which they have consolidated or merged. The rights, franchises and
2interests of the banks so consolidated or merged in and the property, personal and
3mixed, and choses in action belonging to the banks, are transferred to and vested in
4the consolidated or merged bank without any deed or other transfer. The
5consolidated or merged bank holds all rights of property, franchises and interests in
6the same manner and to the same extent as was held by the bank or banks so
7consolidated or merged.
SB494,113,19 8(3) Role of division. After consultation with the banking review board, the
9division may make recommendations to any bank within this state as to the
10advisability of consolidation or merger with other banks and may make
11recommendations as to terms for consolidation or merger of banks in order to avoid
12a condition of oversupply of banks in any community or area of the state. The division
13may also, if requested so to do, act as mediator or arbitrator to fix any of the terms
14of any such consolidation or merger. The board of directors of any bank organized
15under the laws of this state may use a reasonable amount of the assets of the bank
16toward assisting in bringing about a consolidation or merger of banks or to aid in
17reorganization or in avoiding the closing of a bank, if the board considers it to be in
18the interests of safe banking and the maintenance of credit and banking facilities in
19the county in which the bank is located.
SB494,113,25 20(4) Transfer of resources and liabilities. A bank, which is in good faith
21winding up its business, for the purpose of consolidating or merging with another
22bank, may transfer its resources and liabilities to the bank with which it is in process
23of consolidation or merger. A consolidation or merger may not be made without the
24consent of the division, and may not defeat or defraud any of the creditors in the
25collection of their debts against the banks.
SB494,114,3
1(5) Application for consolidation or merger. The banks shall apply for
2approval of a consolidation or merger under sub. (1) on a form prescribed by the
3division. The application shall be accompanied by a fee determined by the division.
SB494,114,6 4221.0703 Cancellation of charter of merged bank. If a bank has merged
5or consolidated with or been absorbed by another bank, the division shall cancel the
6charter of the bank.
SB494,114,13 7221.0704 Interim banks. Subject to the approval of the division, one or more
8banks may consolidate or merge into or with an interim bank organized under this
9chapter under the charter of either the existing bank or banks or the interim bank
10in accordance with the provisions of this chapter for consolidation or merger of a
11bank. The division shall promulgate rules providing for a simple process for the
12organization of interim banks under this chapter. The rules shall permit the
13organization of an interim bank with a minimum of one director.
SB494,114,14 14221.0705 Definitions. In ss. 221.0705 to 221.0718:
SB494,114,18 15(1) "Bank" means the issuer bank or, if a corporate action giving rise to
16dissenters' rights under s. 221.0706 is a merger or share exchange that has been
17effectuated, the surviving bank of the merger or the acquiring corporation or bank
18of the share exchange.
SB494,114,20 19(2) "Beneficial shareholder" means a person who is a beneficial owner of shares
20held by a nominee as the shareholder.
SB494,114,23 21(3) "Dissenter" means a shareholder or beneficial shareholder who is entitled
22to dissent from corporate action under s. 221.0706 and who exercises that right when
23and in the manner required by ss. 221.0709 to 221.0716.
SB494,115,2 24(4) "Fair value", with respect to a dissenter's shares, means the value of the
25shares immediately before the effectuation of the corporate action to which the

1dissenter objects, excluding any appreciation or depreciation in anticipation of the
2corporate action unless the exclusion would be inequitable.
SB494,115,5 3(5) "Interest" means interest from the effectuation date of the corporate action
4until the date of payment, at a rate that is fair and equitable under all of the
5circumstances.
SB494,115,7 6(6) "Issuer bank" means a bank that is the issuer of the shares held by a
7dissenter before the corporate action.
SB494,115,10 8221.0706 Right to dissent. (1) Mandatory dissenters' rights. A shareholder
9or beneficial shareholder may dissent from, and obtain payment of the fair value of
10his or her shares in the event of, any of the following corporate actions:
SB494,115,1111 (a) Consummation of a plan of merger to which the issuer bank is a party.
SB494,115,1412 (b) Consummation of a plan of share exchange if the issuer bank's shares will
13be acquired, and the shareholder or the shareholder holding shares on behalf of the
14beneficial shareholder is entitled to vote on the plan.
SB494,115,1915 (c) Except as provided in sub. (2), any other corporate action taken pursuant
16to a shareholder vote to the extent that the articles of incorporation, the bylaws or
17a resolution of the board of directors provides that the voting or nonvoting
18shareholder or beneficial shareholder may dissent and obtain payment for his or her
19shares.
SB494,115,24 20(2) Permissive dissenters' rights. The articles of incorporation may allow a
21shareholder or beneficial shareholder to dissent from an amendment of the articles
22of incorporation and obtain payment of the fair value of his or her shares if the
23amendment materially and adversely affects rights in respect of a dissenter's shares
24because it does any of the following:
SB494,115,2525 (a) Alters or abolishes a preferential right of the shares.
SB494,116,2
1(b) Creates, alters or abolishes a right in respect of redemption, including a
2provision respecting a sinking fund for the redemption or repurchase, of the shares.
SB494,116,43 (c) Alters or abolishes a preemptive right of the holder of shares to acquire
4shares or other securities.
SB494,116,75 (d) Excludes or limits the right of the shares to vote on any matter or to
6cumulate votes, other than a limitation by dilution through issuance of shares or
7other securities with similar voting rights.
SB494,116,108 (e) Reduces the number of shares owned by the shareholder or beneficial
9shareholder to a fraction of a share if the fractional share so created is to be acquired
10for cash under s. 221.0506.
SB494,116,15 11(3) Rights of dissenter. A shareholder or beneficial shareholder entitled to
12dissent and obtain payment for his or her shares under ss. 221.0701 to 221.0718 may
13not challenge the corporate action creating his or her entitlement unless the action
14is unlawful or fraudulent with respect to the shareholder, beneficial shareholder or
15issuer bank.
SB494,116,24 16221.0707 Dissent by shareholders and beneficial shareholders. (1)
17Partial exercise of dissenters' rights. A shareholder may assert dissenters' rights
18as to fewer than all of the shares registered in his or her name only if the shareholder
19dissents with respect to all shares beneficially owned by any one person and notifies
20the bank in writing of the name and address of each person on whose behalf he or she
21asserts dissenters' rights. The rights of a shareholder, who asserts dissenters' rights
22under this subsection as to fewer than all of the shares registered in his or her name,
23are determined as if the shares as to which he or she dissents and his or her other
24shares were registered in the names of different shareholders.
SB494,117,3
1(2) Rights of beneficial shareholders. A beneficial shareholder may assert
2dissenters' rights as to shares held on his or her behalf only if the beneficial
3shareholder does all of the following:
SB494,117,54 (a) Submits to the bank the shareholder's written consent to the dissent not
5later than the time that the beneficial shareholder asserts dissenters' rights.
SB494,117,76 (b) Submits the consent under par. (a) with respect to all shares of which he or
7she is the beneficial shareholder.
SB494,117,13 8221.0708 Notice of dissenters' rights. (1) Action at shareholder meeting.
9If proposed corporate action creating dissenters' rights under s. 221.0706 is
10submitted to a vote at a shareholders' meeting, the meeting notice shall state that
11shareholders and beneficial shareholders are or may be entitled to assert dissenters'
12rights under ss. 221.0701 to 221.0718 and shall be accompanied by a copy of those
13sections.
SB494,117,18 14(2) Action without shareholder vote. If corporate action creating dissenters'
15rights under s. 221.0706 is authorized without a vote of shareholders, the bank shall
16notify, in writing and in accordance with s. 221.0103, all shareholders entitled to
17assert dissenters' rights that the action was authorized and send them the
18dissenters' notice described in s. 221.0710.
SB494,117,23 19221.0709 Notice of intent to demand payment. (1) Method of asserting
20dissenters' rights.
If proposed corporate action creating dissenters' rights under s.
21221.0706 is submitted to a vote at a shareholders' meeting, a shareholder or
22beneficial shareholder who wishes to assert dissenters' rights shall do all of the
23following:
SB494,118,3
1(a) Deliver to the issuer bank before the vote is taken written notice that
2complies with s. 221.0103 of the shareholder's or beneficial shareholder's intent to
3demand payment for his or her shares if the proposed action is effectuated.
SB494,118,44 (b) Refrain from voting his or her shares in favor of the proposed action.
SB494,118,7 5(2) Failure to comply. A shareholder or beneficial shareholder who fails to
6comply with sub. (1) is not entitled to payment for his or her shares under ss.
7221.0701 to 221.0718.
SB494,118,11 8221.0710 Dissenters' notice. (1) When required. If a proposed corporate
9action creating dissenters' rights under s. 221.0706 is authorized at a shareholders'
10meeting, the bank shall deliver a written dissenters' notice to all shareholders and
11beneficial shareholders who satisfied s. 221.0709 (1).
SB494,118,16 12(2) Timing and content of notice. The dissenters' notice shall be sent no later
13than 10 days after the corporate action is authorized at a shareholders' meeting or
14without a vote of shareholders, whichever is applicable, and all necessary regulatory
15approvals are obtained. The dissenters' notice shall comply with s. 221.0103 and
16shall include or have attached all of the following:
SB494,118,1917 (a) A statement indicating where the shareholder or beneficial shareholder
18must send the payment demand and where and when certificates for certificated
19shares must be deposited.
SB494,118,2120 (b) For holders of uncertificated shares, an explanation of the extent to which
21transfer of the shares will be restricted after the payment demand is received.
SB494,119,222 (c) A form for demanding payment that includes the date of the first
23announcement to news media or to shareholders of the terms of the proposed
24corporate action and that requires the shareholder or beneficial shareholder

1asserting dissenters' rights to certify whether he or she acquired beneficial
2ownership of the shares before that date.
SB494,119,53 (d) A date by which the bank must receive the payment demand, which may
4not be fewer than 30 days nor more than 60 days after the date on which the
5dissenters' notice is delivered.
SB494,119,66 (e) A copy of ss. 221.0701 to 221.0718.
SB494,119,14 7221.0711 Duty to demand payment. (1) Manner of demanding payment. A
8shareholder or beneficial shareholder who is sent a dissenters' notice described in s.
9221.0710, or a beneficial shareholder whose shares are held by a nominee who is sent
10a dissenters' notice described in s. 221.0710, must demand payment in writing and
11certify whether he or she acquired beneficial ownership of the shares before the date
12specified in the dissenters' notice under s. 221.0710 (2) (c). A shareholder or
13beneficial shareholder with certificated shares must also deposit his or her
14certificates in accordance with the terms of the notice.
SB494,119,19 15(2) Effect of demand on holders of certificated shares. A shareholder or
16beneficial shareholder with certificated shares who demands payment and deposits
17his or her share certificates under sub. (1) retains all other rights of a shareholder
18or beneficial shareholder until these rights are canceled or modified by the
19effectuation of the corporate action.
SB494,119,25 20(3) Effect of failure to demand. A shareholder or beneficial shareholder with
21certificated or uncertificated shares who does not demand payment by the date set
22in the dissenters' notice, or a shareholder or beneficial shareholder with certificated
23shares who does not deposit his or her share certificates where required and by the
24date set in the dissenters' notice, is not entitled to payment for his or her shares under
25ss. 221.0701 to 221.0718.
SB494,120,4
1221.0712 Restriction on uncertificated shares. (1) When transfer
2restrictions permitted.
The issuer bank may restrict the transfer of uncertificated
3shares from the date that the demand for payment for those shares is received until
4the corporate action is effectuated or the restrictions released under s. 221.0714.
SB494,120,9 5(2) Effect of demand on holders of uncertificated shares. The shareholder
6or beneficial shareholder who asserts dissenters' rights as to uncertificated shares
7retains all of the rights of a shareholder or beneficial shareholder, other than those
8restricted under sub. (1), until these rights are canceled or modified by the
9effectuation of the corporate action.
SB494,120,14 10221.0713 Payment. (1) When payment made. Except as provided in s.
11221.0715, as soon as the corporate action is effectuated or upon receipt of a payment
12demand, whichever is later, the bank shall pay each shareholder or beneficial
13shareholder who has complied with s. 221.0711 the amount that the bank estimates
14to be the fair value of his or her shares, plus accrued interest.
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