(A) Election. At the first annual meeting of members and at
each annual meeting thereafter, the members shall elect the appropriate number
of directors from the membership of the association in accordance with subparagraph
(B) of this paragraph. Directors, other than from the membership, shall be
appointed in accordance with subparagraph (C) of this paragraph. The total
number of directors of the association shall be nine.
(B) Directors elected from the membership.
(i) Five directors shall be five different insurers licensed
in Texas and members of the association and elected by the members. No member
shall fill more than one seat on the board of directors.
(ii) No later than 60 days prior to the annual meeting in March
1992, the board of directors shall nominate the five-member companies to serve
on the board of directors. In making such nominations, the board of directors
shall consider the following factors in nominating a member to serve.
(I) A minimum of three members shall be companies with multistate
operations.
(II) A minimum of one member shall be a company domiciled in
the State of Texas.
(III) Consideration should be given to voluntary market shares
of members; voluntary participation in the catastrophe area; specific expertise
in the underwriting, claims handling, or reinsurance of insurance required
to be provided by the association; companies that represent as far as possible
the view of the member companies; and other factors deemed relevant by the
board of directors.
(iii) No later than 60 days prior to the annual meetings, the
chair shall appoint a nominating committee of not less than three, nor more
than seven, member companies, each to act through its designated representative,
said committee to represent as far as possible the view of the member companies.
Said committee shall prepare and present to member companies a list of nominations
for the board of directors.
(iv) Members also have the right to nominate any member by
submitting such nominee's name to the nomination committee. In order to be
eligible for election to the board of directors, a member must be nominated
at least 30 days prior to the annual meeting at which directors are elected.
(C) Directors appointed by the Commissioner. The number of
directors composed of licensed local recording agents and members of the public
shall be four. Each of these directors must be from different counties in
the designated catastrophe area.
(i) The Commissioner shall appoint two public representatives
nominated by the Office of the Public Insurance Counsel to serve on the board
of directors. The public representatives shall be persons who are policyholders
of the association as of the date of appointment.
(ii) The Commissioner shall appoint two licensed local recording
agent representatives to serve on the board of directors.
(D) Term of office. Each director shall hold office for the
term of three years from the date of the election or appointment or until
a successor shall have been elected or appointed. The terms of the directors
shall be staggered so that three directors shall be elected by the membership
of the association and/or appointed by the Commissioner annually. A person
may hold a seat on the board of directors for not more than three consecutive
full terms, not to exceed nine years.
(E) Regular meetings. A regular meeting of the board of directors
shall be held with notice to the directors at least ten days before each regular
meeting as provided for in this subsection. Notice of any regular meeting
of the directors shall also be given to the Department in care of the associate
commissioner of property-casualty, or such other person as may be designated
by the Commissioner, as required by the Texas Insurance Code, Article 21.49, §5(k).
Public notice of meetings shall be given as required by the Government Code,
Chapter 551.
(F) Notice of regular or emergency meeting.
(i) Notice of any regular meeting shall be given to the directors
at least ten days prior thereto by notice delivered personally or mailed to
each director at his/her business address or by telegram, or such other reasonable
means of notice to provide actual notice to each director. If mailed, such
notice shall be deemed to be delivered when deposited in the United States
mail, so addressed with postage thereon prepaid. If the notice be given by
telegram, such notice shall be deemed to be delivered when the telegram is
delivered to the telegraph company. If the notice is by other reasonable means,
the association shall maintain a written record of the method of notification.
Any director may waive notice of any meeting. The attendance of a director
at a meeting shall constitute a waiver of notice to the director of such
meeting, except where a director attends a meeting for the express purpose
of objection to the transaction of any business because the meeting is not
lawfully called or convened.
(ii) In case of emergency or urgent public necessity, notice
to directors and to the Department shall be given at least two hours before
a meeting is convened. Notice to the public shall be given as required for
an emergency meeting pursuant to the Government Code, §551.045.
(iii) Any meeting of the board of directors of the association
conducted by conference call is subject to the same requirements applicable
to other meetings of the board of directors.
(G) Regular or emergency meetings. Regular or emergency meetings
of the board of directors may be called by the chair of the board or at the
request of any two directors. The person or persons authorized to call a meeting
of the board of directors may fix any place as the place for holding any meeting
of the board of directors called by them. If no place is designated, then
the office of the association shall serve as the place of such meeting.
(H) Statement of purpose of meeting required. The business
to be transacted at, and the purpose of, any regular or emergency meeting
of the board of directors shall be specified in the notice to directors and
in notice required by statute as required by the Government Code, Chapter
551.
(I) Quorum. A majority of the number of directors fixed by
this section shall constitute a quorum for the transaction of business at
any meeting of the board of directors. Action taken by a majority of the directors
present at a meeting at which a quorum is present shall be the act of the
board of directors. If at any meeting of the board of directors there shall
be less than a quorum present, a majority of those present may adjourn the
meeting from time to time until a quorum is obtained.
(J) Presumption of assent. A director of the association who
is present at the meeting of the board of directors at which action on any
matter is taken shall be presumed to have assented to the action taken unless
the director's dissent shall be entered in the minutes of the meeting, or
unless the director shall file a written dissent to such action with the person
acting as secretary of the meeting before the adjournment thereof, or shall
forward such dissent by registered mail to the secretary of the association
immediately after the adjournment of the meeting. Such right to dissent shall
not be available to a director who voted in favor of such action.
(K) Compensation. By resolution of the board of directors,
the directors may be reimbursed for their actual expenses. No other payment
shall be made to directors other than provided herein, except however, that
nothing herein shall be construed as preventing any director from serving
the association in any other capacity and receiving reimbursement for actual
expenses incurred.
(L) General powers. The board of directors shall have the management
of the business and affairs of the association and may exercise all of the
powers herein enumerated and all other powers incidental or appropriate thereto,
subject only to the restrictions imposed by law. Included among the powers
of the board of directors, but not in limitation thereof, are the following:
(i) to make and change regulations not inconsistent with this
section for the management of the business affairs of the association;
(ii) to purchase or otherwise acquire for the association any
property, rights, or privileges which the association is authorized to acquire;
(iii) to remove any officer for cause, summarily without cause,
and in their discretion, from time to time, to dissolve the powers and duties
of any officer and to confer such powers and duties upon any other person
for the time being;
(iv) to appoint and remove or suspend such subordinate officers,
attorneys, or representatives as they may deem necessary and to determine
their duties, and fix, and from time to time change their salaries or remuneration,
and to require security as and when they think fit;
(v) to confer upon any officer of the association the power
to appoint, remove, and suspend subordinate officers, employees, and representatives;
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