GBU FINANCIAL LIFE AMENDED BYLAWS
GBU FINANCIAL LIFE AMENDED BYLAWS As Approved by the Board of Directors on March 13, 2021 Approved by the Pennsylvania Insurance Department April 16, 2021
ARTICLE I Name Section 1. The name of this society shall be GBU Financial Life hereinafter referred to as “GBU”. ARTICLE II Principal Office Section 1. GBU shall maintain its principal office in the Commonwealth of Pennsylvania. ARTICLE III Purpose Section 1. GBU is a member‐owned fraternal benefit society, founded by German Americans, incorporated April 13, 1892, under the laws of the Commonwealth of Pennsylvania and carried on for the sole benefit of its members and their beneficiaries. This Society is organized as a not‐for‐profit organization and having a district system with a representative form of government. Section 2. The purpose of GBU is to provide financial security to our members and their dependents through insurance, annuities, and fraternal benefits. GBU promotes and encourages charitable community involvement and an appreciation of our members’ culture and heritage. ARTICLE IV Membership Section 1. Applicants eligible for membership must desire to unite with GBU members for: a. Financial security and fraternal benefits, b. Charitable community involvement, c. Share the appreciation of our members’ culture and heritage, and d. Meet any other requirements for membership established by GBU. An adult member shall be sixteen (16) years of age, or older, and be insured by GBU (the term insured includes annuitants). The adult member has a voice and vote in the affairs of GBU. A youth member shall be under age 16 and be insured by GBU (the term insured includes annuitants). A youth member has a voice, but no vote in the affairs of GBU. At age 16 the youth member becomes an adult member. All insured members shall be entitled to the advantages, payments, and privileges of GBU. A social member is a member who is not an insured member. ARTICLE V Board of Directors Section 1. The Directors, together with the Chief Executive Officer, shall constitute the eight (8) member Board of Directors which shall be the governing body of GBU under the laws of the Commonwealth of Pennsylvania. Section 2. The Board of Directors may be expanded for the good of the GBU or as determined by resolution. Section 3. The Board of Directors shall elect a Chair and Vice Chair from among its elected members. The Chair or Vice Chair shall preside at all meetings of the Board of Directors and perform such other duties as may be designated by the Board of Directors.
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Section 4. The Board of Directors shall meet as often as the business of GBU shall require and as may be required by applicable law. Meetings may be conducted in person, by telephone or through the use of any means of communication by which all participants may simultaneously communicate with each other during the meeting. Section 5. Special meetings of the Board of Directors may be called by the Chair or at the call of the Chief Executive Officer upon request of two (2) elected members of the Board of Directors. Notice of a special meeting shall be transmitted to each Director at least seven (7) calendar days before the date of the meeting by electronic means. Such notice shall be deemed to be delivered upon transmission. Section 6. A majority of the Board of Directors shall constitute a quorum, but a smaller number may adjourn a meeting of the Board of Directors for lack of a quorum. The act of a majority of the members present at a meeting at which a quorum is present shall be the act of the Board of Directors, unless the act of a greater number is required by the Articles of Incorporation, Bylaws, or applicable law. Section 7. The Board of Directors and any committee or subcommittee of the Board of Directors, or any other meeting of GBU at which minutes are kept may be conducted in person or through the use of any means of communication by which all participants may simultaneously communicate with each other during the meeting. Section 8. Any action required or permitted to be taken by the Board of Directors or any committee or subcommittee of the Board of Directors may be taken without a meeting by written consent of all of its members then in service. A written consent under this provision shall have the same force and effect as a vote taken at a meeting. Section 9. The Board of Directors will appoint an Audit Committee. Audit Committee members will have a working knowledge of financial matters. The Audit Committee shall be responsible for the oversight of the auditors of GBU and the audit of the financial statements of GBU and such other responsibilities designated to it by the Board from time to time. The Board of Directors will approve additional committees that are vital to the protection of the financial condition of GBU and the fulfillment of GBU’s purpose. Each committee shall consist of at least three (3) Directors, including a committee chair who is appointed by the Chair of the Board. A majority of the members of each committee shall constitute a quorum for the transaction of all committee business. ARTICLE VI ELECTION OF DIRECTORS Section 1. To be eligible to be a candidate for or serve as an elected Director, all individuals must: a. be adult GBU member age 21 years or older and under the age of seventy (70) years on January 1 of the election year; b. not be: (1) a current employee, general agent, or agent of GBU; (2) a former employee, general agent, or agent of GBU unless three years have expired from the termination date of their employment or GBU agent contract; (3) a current corporate officer, field manager, sales agent, broker or director of any other life insurance company or fraternal benefit society, or (4) an immediate family member (parent, spouse, natural or adopted child, sibling) of any person in any of the prohibited categories enumerated above; c. be capable of assuming the responsibilities as outlined herein and as established by GBU from time to time and possess qualifications that reflect the complexity and magnitude of the business affairs of GBU as well as the desire to promote and support the fraternal benefit system within GBU. d. not have been removed from office for cause by action of the Board of Directors; PAGE 2
e. have no criminal history other than matters determined insignificant by the Nominating Committee, such as a minor traffic violation; f. meet all other requirements under the law or established by resolution of the Board of Directors. No elected Director may serve more than three (3) consecutive terms of office. Service prior to January 1, 2022, or service to fill a vacancy in an unexpired term shall not be counted toward the three (3) consecutive term limitation. An elected Director completing three (3) consecutive terms of office shall not be eligible to serve as an elected or appointed Director until the next scheduled election of Directors. Section 2. Elected Directors shall serve the Board for a term of four (4) years (other than the initial election of Directors), or until their successors are elected and qualified. Directors shall hold office for the term for which they were elected, unless a director’s death, resignation or removal occurs during the term, or the term of a successor begins before the end of the term. The terms of elected Directors shall be staggered. For the election of Directors in 2022, the four (4) candidates receiving the highest number votes shall be elected to a four (4) year term of office, and the three (3) candidates receiving the next highest number of votes shall be elected to a two (2) year term. All GBU members seeking candidacy to the Board of Directors must submit their application requests in the manner prescribed by the Board of Directors and published in GBU’s official publication. The office of the CEO shall verify that each candidate meets the qualifications to serve as a Director. For election year 2022, all eligible applicants shall constitute the slate of candidates. For subsequent election years, a Nominating Committee shall be appointed for the purpose of reviewing candidate information as well as recommending a slate of candidates. The Nominating Committee shall be comprised of Directors who are not candidates for the current election. All qualified applicants shall constitute the slate of candidates and the office of the CEO shall prepare a ballot and give notice of the election, specifying the time and procedure for elections. A vote shall be taken on the candidates by direct written or electronic ballot to adult GBU members in good standing. The ballot shall specify the deadline for return of the ballot and no ballots received after such time shall be counted. Each adult member shall have one vote for each Director position and Directors shall be elected by a plurality of the votes cast by GBU members. Cumulative voting or voting by proxy is not permitted. In the event of a vacancy in an elected Director position, such vacancy shall be filled by appointment by the Board of Directors. Such appointment shall be by a majority vote of the Board of Directors and shall only be for the unexpired term of the elected Director. Such Directors shall qualify as elected Directors. A Director may be removed from the Board of Directors “for cause” by a two‐thirds affirmative vote of the elected members of the Board of Directors, excluding the Director whose status is at issue, at a meeting called for that purpose. “For cause,” for purposes of the section shall include: (a) Inability or failure to perform the duties and responsibilities of a Director. (b) Engaging in conduct unbecoming a Director. (c) Absence from two meetings of the Board of Directors during the course of a calendar year, without good cause. (d) Breaching a fiduciary duty owed to GBU, its members or beneficiaries. (e) Materially violating these Bylaws, the Articles of Incorporation, any code of ethics, conflict of interest policy or other policy adopted by GBU, or (f) Failing to meet the qualifications for Directors as specified in Section 1 of this Article. A determination of cause shall be made in the reasonable discretion of the Board of Directors. The Director whose status is at issue shall not be entitled to vote in the matter.
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ARTICLE VII OFFICERS Section 1. The Officers of GBU shall be the Chief Executive Officer (CEO) and other officer(s) as approved by the Board of Directors. Section 2. The CEO shall be selected by and serve at the pleasure of the Board of Directors. The CEO shall be responsible to and report directly to the Board of Directors and will serve as a voting member of the Board of Directors. Section 3. The other officer(s) of GBU shall be selected by the CEO, approved by the Board of Directors, and serve GBU as employee(s). Section 4. The Board of Directors may remove the CEO with or without cause by majority vote of all Directors at a meeting called for that purpose. Other officers may be removed with or without cause by the CEO. Section 5. The Board of Directors shall determine reasonable compensation of the CEO. Reasonable compensation of all principal officers other than the CEO shall be recommended by the CEO and approved by the Board of Directors. In its determination of reasonable compensation, the Board of Directors or a committee delegated authority for officer compensation shall take into account, among others, the services rendered by the officer, the performance of the officers, the performance of GBU and market and industry standards. ARTICLE VIII Districts Section 1. Districts of GBU shall be established to promote GBU’s purpose as stated in Article III. Section 2. Districts may be chartered by resolution of the Board of Directors upon petition to it by GBU members. The Board shall determine the number of required member signatures based on geographical location and/or type of member engagement. Section 3. Districts are largely self‐governing organizations but shall comply with the Articles of Incorporation and Bylaws of GBU, the Rules of Procedure for Districts, and all other requirements adopted by the Board of Directors. Section 4. Meetings of the districts shall be held as frequently as required by applicable law. Section 5. The Board of Directors has the authority to merge any district or to revoke any district charter, place its charter and any assets under its custodial care, or take any other temporary or permanent action when the Board determines it to be in the best interests of GBU. If a district is notified of either a merger or revocation of charter by certified mail from the Home Office, all district funds or assets will become frozen as of that notification date. District funds shall not be dispensed among members and/or officers of the district. All district officers will be notified by certified mail and they will be personally liable for funds or assets dispersed after that notification date. These funds shall be held in escrow by the Home Office until the merger is completed or until a new district is organized. The Board of Directors has full authority over districts, district officers and members. An audit of the district’s financial records can be ordered.
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ARTICLE IX Convention Section 1. GBU shall conduct conventions and other member meetings. Such conventions/meetings shall be held no less frequently than once every four years and shall be at such times, locations and platforms as determined by the Board of Directors. Section 2. The purposes of such meetings may include, but are not limited to, providing education, networking, recognition and other support to districts and district leaders and engaging members and others to carry out the charitable and fraternal missions of the society. ARTICLE X Official Publication Section 1. GBU shall have an official publication. Any notice, report or statement required by law, including notice of election, may be published in the publication. A copy shall be delivered to each member household. The official publication shall be published in such form and at such periods as the Board of Directors may determine. Section 2. All amendments to the Articles of Incorporation or Bylaws of GBU or a synopsis thereof shall be published in the official publication or mailed directly to members within the time required by the laws of the Commonwealth of Pennsylvania. ARTICLE XI Indemnification Section 1. To the extent permitted by law, GBU does hereby agree to indemnify and hold harmless each Director, Officer or employee serving GBU against liability for any claims or causes of action which may be made against any of the above‐stated individuals, of any kind or nature, for such act or omissions which would arise in the performance of their duties. GBU shall agree to pay any damages on behalf of any of the above‐stated individuals for which they may be held liable. GBU shall agree to pay any and all expenses which may be incurred by any of the above‐stated individuals, including, but not limited to, payment of reasonable attorney fees for defense of any claims or cause of action made whatsoever unless there is fraud or outrageous conduct in performance of his/her fiduciary duties. Section 2. GBU shall maintain insurance on Directors, Officers, and employees against liability for acts or omissions in the performance of their duties as determined by the Board of Directors. ARTICLE XII Maintenance of Solvency Section 1. In the event of any impairment of the solvency of GBU, an apportionment will be charged against each outstanding benefit certificate on the basis of its equitable share of the deficiency as determined by the Board of Directors. Any apportionment not paid within sixty (60) days from the date of notice will be charged and carried as a lien against the benefit certificate with an effective interest rate not to exceed the rate specified for certificate loans compounded annually until paid unless the certificate owners will have, within such sixty (60) day period, notified GBU in writing of their election to accept an alternative proportionate reduction in benefits under their benefit certificate. Section 2. Should additional contributions be required, the CEO of GBU will notify in writing at the last address of record all certificate owners sharing in the deficiency. Such notice will include the owner’s proportionate share of the deficiency, the alternatives to payment available to the owner by election and the alternative which will automatically be invoked if no election is made and will constitute sufficient and legal notice to each certificate owner to make the required payment. The CEO of GBU will retain a copy of such notice on file for each benefit certificate.
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ARTICLE XIII Resolution of Disputes Section 1. The purpose of this Article is to prescribe the sole means to present and resolve certain grievances, complaints, or disputes between or among members, insureds, certificate owners, or beneficiaries, their heirs, administrators, guardians, representatives, successors and assigns, and GBU or its Directors, officers, agents, and employees. Procedures set forth in this Article are meant to provide prompt, fair and efficient opportunities for dispute resolution, consistent with the fraternal nature of GBU, without delay and expense of formal legal proceedings. Section 2. Except as expressly limited herein (see Section 5) this Article applies to all past, current, or future benefit certificates, members, insureds, certificate owners, beneficiaries and their heirs, administrators, successors, guardians, representatives, successors and assigns and GBU. It applies to all claims, actions, disputes and grievances of any kind or nature whatsoever. It includes, but is not limited to, claims based on breach of contract, as well as claims based on fraud, misrepresentation, violation of statute, discrimination, denial of civil rights, conspiracy, defamation, and infliction of distress against GBU or its Directors, officers, agents, or employees. To the extent permitted by applicable law, this Article applies to all claims, actions, disputes, and grievances brought by GBU against members, insureds, certificate owners, or beneficiaries and their heirs, administrators, guardians, representatives, successors and assigns. In the event that a court or arbitrator of competent jurisdiction deems any party or claim in a dispute not subject to this Article, this Article will remain in full force and effect as to any remaining parties or claims involved in such dispute. This Article does not apply to any claims or disputes relating to interpleader actions to determine proper owner, beneficiary, or payee. Section 3. No lawsuits or any other actions may be brought for any claims or disputes covered by this Article. The following are the steps and procedures for presenting and resolving disputes: (a) Step 1. Appeal. Any dispute covered by this Article must be submitted to GBU’s compliance officers at its home office at 4254 Saw Mill Run Boulevard, Pittsburgh, PA 15227‐3394, telephone number (800) 765‐4428, for resolution by GBU’s internal review process. (b) Step 2. Mediation. If the parties are unable to resolve the dispute through the GBU’s internal appeal process as described in Section 3(a), either party may have the matter mediated in accordance with the applicable mediation rules of the American Arbitration Association (or other neutral organization as agreed upon by the parties). The mediation shall be administered by a neutral organization agreed upon by the parties. (c) Step 3. Arbitration. If Step 2 does not result in a mutually satisfactory resolution, the matter will be resolved by binding arbitration in accordance with the applicable arbitration rules as prescribed by the American Arbitration Association (or the rules of another neutral organization mutually agreed upon) as applicable to the type of matter in dispute. The arbitration shall be administered by a neutral organization agreed upon by the parties. The decision of the arbitrator shall be final and binding, subject only to the right to appeal such decision as provided in the arbitration rules and applicable laws. The member, insured, certificate owner, beneficiary or other party shall have the right to be represented by legal counsel of his or her choosing at any time at his or her own expense (unless, as provided in Section 6 below, he or she is awarded attorney’s fees). If an issue in dispute is subject to law that prohibits parties from agreeing to submit future disputes to binding arbitration, arbitration results shall be nonbinding, unless the parties agree to binding arbitration after the claim or dispute has arisen. GBU will take reasonable measures to assure that the dispute resolution process proceeds promptly. Section 4. The administrative costs of any mediation or arbitration (including fees and expenses of mediators and arbitrators, filing fees, reasonable and necessary court reporting fees) will be paid by GBU. Except as awarded under Section 6 of this Article, each party will bear its own attorneys’ fees, expert fees, and discovery costs.
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Section 5. The procedures of the Article are designed to afford individual members, benefit certificate owners, beneficiaries, other parties and GBU a prompt, fair, and efficient means of resolving individual disputes. Accordingly, no dispute may be brought forward in a representative group or on behalf of or against any “class” of persons, and the disputes of multiple members or benefit certificate owners or beneficiaries (other than immediate family members) may not be joined together for purposes of these procedures without the express written consent of both (i) all members and benefit certificate owners’ beneficiaries, and other parties affected thereby and (ii) GBU. The restriction on joinder of disputes contained in this Section 5 is a condition upon which the agreement to arbitrate contained in Sections 2 and 3 depends. Thus, should a court or arbitrator of competent jurisdiction deem the restriction on joinder of disputes contained in this Section 5 unenforceable or otherwise void there shall be no agreement to arbitrate. Section 6. This Article applies to any claim or dispute resolved through binding arbitration as provided in Section 3(c) above and to any action in a court of law in the event that a court or arbitrator of competent jurisdiction deems any party or claim in a dispute not subject to binding arbitration. Except as expressly limited in this paragraph, the parties to a dispute may be awarded any or all damages or other relief allowed for the claim in dispute by applicable federal or state law, including attorneys’ fees and expenses if such attorneys’ fees and expenses are deemed appropriate under applicable law. Exemplary or punitive damages may be awarded for claims arising under applicable federal or state statutes to the extent permitted under the applicable statutes or, for claims arising under the common law, exemplary or punitive damages may be awarded not to exceed three times the amount of compensatory damages. In the event that any court or arbitrator of competent jurisdiction deems the foregoing limitation on common law exemplary or punitive damages to be unenforceable or otherwise void under applicable law, the remaining portions of this Article will remain in full force and effect. ARTICLE XIV Rules of Procedure Section 1. If the Articles of Incorporation or Bylaws of the Society are silent as to any procedural aspect of any action or meeting hereunder, the procedures of the latest edition of Robert's Rules of Order shall control such procedure. ARTICLE XV Interpretation of Bylaws Section 1. If any section of these Bylaws should not be explicit, or in case of uncertainty or dispute as to its intent or meaning, the Board of Directors shall have the power to decide upon such situation; and its decision shall remain in force until such decision or section is duly amended. ARTICLE XVI Waiver Section 1. No subordinate body, agents, or any officers or members, shall have the power or authority to waive any of the provisions of the laws of GBU. Such provisions shall be binding on GBU and every member and beneficiary of a member. ARTICLE XVII Amendments Section 1. These Bylaws may be repealed or amended in whole or in part by a two‐thirds majority vote by all members of the Board of Directors. Section 2. Amendments to these Bylaws shall take effect upon their adoption unless another time is specified and upon approval by the Pennsylvania Insurance Department. After filing, the changes shall be published in the official publication as prescribed in these Bylaws.
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