(vi) to determine who shall be authorized on the association's
behalf to make and sign bills, notes, acceptances, endorsements, checks, releases,
receipts, contracts, and other instruments;
(vii) to delegate any of the powers of the board of directors
in relation to the ordinary business of the association to any standing or
special committee, or to any officer or agent (with power to subdelegate)
upon such terms as they may deem appropriate;
(viii) to contract with a servicing facility to perform such
services for the association as it may deem appropriate;
(ix) to approve expenses, levy assessments, including preliminary
assessments;
(x) to have all other powers and to perform all other duties
reasonably necessary to accomplish the purposes of the Act.
(M) Executive committee. An executive committee shall consist
of at least three, and not more than four, of the directors of the association
and shall include the chair, vice-chair, and secretary-treasurer. At least
one director appointed by the Commissioner must be elected as an officer.
The board of directors may elect an additional director to be a member of
the executive committee for the sole purpose of ensuring the inclusion of
at least one insurer, one agent, and one public member on the executive committee.
To the extent provided by resolution or resolutions of the board of directors,
the executive committee shall have and may exercise the powers delegated by
the board of directors in the day-to-day administrative management of the
association. Such committee shall keep regular minutes of its proceedings
and report the same to the board of directors. The delegation to a committee
of authority consistent with this section shall not operate to relieve the
board of directors, or any member thereof, of any responsibility imposed upon
the board of directors or member by law.
(N) Vacancies.
(i) A particular directorship shall be considered to be vacant
upon the resignation of the member holding such directorship.
(ii) Any vacancy occurring in the directors elected from the
membership may be filled at the next meeting of the board of directors following
the occurrence of such vacancy. Subject to the provisions of subparagraph
(B) of this paragraph, such vacancy shall be filled by the affirmative vote
of a majority of the remaining directors elected from the membership though
less than a quorum. A director elected to fill a vacancy shall be elected
for the unexpired term of the predecessor in such directorship.
(iii) Any vacancy occurring in the directors appointed by the
Commissioner shall be filled by appointment of a new director in accordance
with the provisions of subparagraph (C) of this paragraph.
(3) Officers.
(A) Number. The officers of the association shall be the chair
of the board of directors, the vice chair of the board of directors, and the
secretary-treasurer, all of whom shall be elected by the board of directors.
No two offices may be held by the same person. The chair, vice-chair, and
secretary-treasurer shall serve on the executive committee. At least one director
appointed by the Commissioner must be elected as a member of the executive
committee.
(B) Election and term of office. The officers of the association
may be elected annually by the board of directors at the first meeting of
the board of directors held after each annual meeting of the members. If the
election of officers shall not be held at such meeting, such election shall
be held as soon thereafter as conveniently may be. Each officer shall hold
office until the officer's successor shall have been duly elected and shall
have qualified or until the officer's death or until the officer shall resign
or shall have been otherwise removed. The board of directors shall provide
for a rotation of directors elected as officers at least every two years.
(C) Removal of officers. Any officer or agent elected or appointed
by the board of directors may be removed by the board of directors whenever
in its judgment the best interests of the association would be served thereby
or otherwise in accordance with this section, but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. A vacancy
in any office because of death, resignation, removal, disqualification, or
otherwise may be filled by the board of directors for the unexpired portion
of the term.
(D) Chair of the board of directors. The chair of the board
of directors shall preside at all meetings of the members and at all meetings
of the directors, appoint and discharge employees and persons representing
the association subject to the approval of the directors, fix the compensation
of employees and such representatives, make and sign contracts and agreements
in the name of the association, and appoint committees. The chair shall see
that the books, reports, statements, and certificates are properly kept, made,
and filed if necessary, and shall generally do and perform all acts incident
to the office of chair of the board of directors or which may be authorized
or required by law, by this section, or by the board of directors, not inconsistent
herewith.
(E) Vice chair of the board of directors. The vice chair of
the board of directors elected by the board of directors shall have such powers
and shall perform such duties as shall be assigned by the board of directors
not inconsistent herewith.
(F) Secretary-treasurer. The secretary-treasurer shall:
(i) keep the minutes of the members and of the board of directors'
meetings in one or more books provided for that purpose;
(ii) see that all notices are duly given as required by the
provisions of this plan of operation. In case of the secretary-treasurer's
absence or refusal or neglect to give the required notice, such notice may
be given at the direction of the chair of the board of directors, of the directors,
or of the members upon whose request the meeting is called;
(iii) be custodian of the association's records;
(iv) keep a register of the post office address of each member;
(v) annually determine each member's participation in the association
in the manner required by the Act and shall keep a register of each member's
percentage of participation;
(vi) have the custody of all funds, securities, evidences of
indebtedness, and other valuable documents of the association, the secretary-treasurer
shall receive and give or cause to be given receipts and acquittances for
monies paid in on account of the association and shall pay out of the funds
on hand all just debts of the association of whatever nature upon maturity
of the same, the secretary-treasurer shall enter or cause to be entered in
the books of the association to be kept for that purpose full and accurate
accounts of all monies received and paid out on account of the association,
and whenever required by the board of directors, the secretary-treasurer shall
keep or cause to be kept such other books as would show a true record of
the reserves, expenses, losses, gains, assets, and liabilities of the association;
and
(vii) in general, perform all duties incident to the officer
of secretary-treasurer and such other duties as from time to time may be delegated
by the chair of the board of directors or by the board of directors.
(4) Legal Counsel.
(A) Types of Representation. The association may engage one
or more attorneys to provide the following:
(i) legal representation, in matters other than disputes involving
policyholder claims, before the Commissioner, the Department and the Texas
Legislature;
(ii) legal representation in any dispute involving a policyholder
claim against the association; and
(iii) legal advice and assistance relating to any other matter
within the authority and responsibility of the association.
(B) Legal Representation, in Matters Other than Disputes Involving
Policyholder Claims, Before the Commissioner, the Department and the Texas
Legislature.
(i) Selection. The association board of directors shall select,
in accordance with this plan of operation, legal counsel to provide legal
representation on behalf of the association, in matters other than disputes
involving policyholder claims, before the Commissioner, the Department and
the Texas Legislature.
(ii) Qualifications.
(I) To be engaged to provide such legal representation, an
attorney must:
(-a-) be licensed to practice law in Texas for at least five
years;
(-b-) maintain professional liability insurance with an
insurer authorized to do business in Texas in an amount of not less than $1
million;
(-c-) be experienced in and practice in the areas of insurance
and administrative law;
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