UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For Quarterly period ended March 31, 1995
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File No. 0-13888
CHEMUNG FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
New York 16-1237038
(State or other jurisdiction of I.R.S. Employer
incorporation or organization) Identification No.
One Chemung Canal Plaza, Elmira, NY 14902
(Address of principal executive offices) (Zip Code)
(607) 737-3711
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES XX NO
Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of March 31, 1995:
Common Stock, $5 par value -- outstanding 2,093,481 shares
CHEMUNG FINANCIAL CORPORATION AND SUBSIDIARY
INDEX
PAGE
PART I. FINANCIAL INFORMATION
Item 1: Financial Statements
Condensed Consolidated Statements of Condition 1
Condensed Consolidated Statements of Income 2
Condensed Consolidated Statements of Cash Flow 3
Notes to Condensed Consolidated Financial Statements 4
Item 2: Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
PART II. OTHER INFORMATION
Item 4: Submission of Matters to a Vote of
Security Holders 10
Item 5: Other Information 11
Item 6: Exhibits and Reports on Form 8-K 11
All other items required by Part II are
either inapplicable or would require an
answer which is negative.
SIGNATURES 31
PART I. FINANCIAL INFORMATION
Item 1: Financial Statements
CHEMUNG FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION
March 31 Dec 31
1995 1994
ASSETS Unaudited Audited
Cash and due from Banks $ 45,732,536 $ 24,380,592
Federal Funds Sold 18,000,000 8,000,000
Investment Securities Held to Maturity 16,581,888 15,168,682
(aggregate market value 1995 - $16,563,802
1994 - $15,012,570
Investment Securities Available for Sale 174,070,209 189,123,633
Allowance Valuation - Securities Available for Sale 2,510,238 (295,349)
----------- -----------
Total Investment Securities AFS - Adj. to Market 176,580,447 188,828,284
Loans 245,380,501 236,497,448
Less: Allowance for Loan Losses 3,736,798 3,599,968
----------- -----------
Loans, Net 241,643,703 232,897,480
Bank Premises and Equipment, Net 9,440,036 8,527,302
Goodwill and deposits base Intangible,
net of accumulated amortization 8,430,714 8,577,540
Other Assets 8,103,736 7,952,438
----------- -----------
Total Assets $524,513,060 $494,332,318
LIABILITIES
Deposits: Non-interest Bearing $ 74,712,042 $ 81,135,334
Interest Bearing 375,998,572 351,135,386
----------- -----------
Total Deposits 450,710,614 432,270,720
Securities sold under Agreement to Repurchase 19,677,060 10,203,785
Other Liabilities 5,963,297 6,119,067
----------- -----------
Total Liabilities 476,350,971 448,593,572
----------- -----------
SHAREHOLDERS' EQUITY
Common Stock (Authorized 3,000,000; Issued 2,150,067) 10,750,335 10,750,335
Surplus 10,068,563 10,068,563
Retained Earnings 27,126,274 26,374,590
Cost of Treasury Shares (Deduction) 56,586-1995
56,586-1994 (1,279,549) (1,279,549)
Unrealized G/L Security Valuation-Avail. for Sale 1,496,466 (175,193)
----------- -----------
Total Shareholders' Equity 48,162,089 45,738,746
Total Liabilities & Shareholders' Equity $524,513,060 $494,332,318
See Accompanying Notes to Condensed Consolidated Financial Statements
CHEMUNG FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Unaudited
3 Months Ended 3 Months Ended
March 31 Sept. 30
INTEREST INCOME 1995 1994 1994 1993
------------------------- -------------------------
Interest and Fees on Loans $5,583,389 $4,878,699 $5,042,237 $5,234,053
Interest and Dividends on
Investment Securities 3,104,730 1,753,439 2,453,560 1,788,063
Interest on Federal Funds Sold 115,658 91,777 139,667 117,030
Income Interest Bearing Deposits 39,212 5,849 69,370 28,138
---------- ---------- ---------- ----------
Total Interest Income 8,842,989 6,729,764 7,704,834 7,167,284
INTEREST EXPENSE
Deposits $3,308,164 $2,113,732 $2,646,355 $2,383,300
Securities Sold Under Agreements
to Repurchase and Funds Borrowed 235,872 71,126 82,538 70,933
---------- ---------- ---------- ----------
Total Interest Expense $3,544,036 $2,184,858 $2,728,893 $2,454,233
Net Interest Income $5,298,953 $4,544,906 $4,975,941 $4,713,051
Provision for Loan Losses 200,000 125,000 125,000 250,000
---------- ---------- ---------- ----------
Net Interest Income after
Provision for Loan Losses 5,098,953 4,419,906 4,850,941 4,463,051
Other Operating Income 1,514,495 1,345,551 1,498,327 1,951,454
---------- ---------- ---------- ----------
$6,613,448 $5,765,457 $6,349,268 $6,414,505
Other Operating Expenses $4,773,572 $4,043,160 $4,433,990 $3,902,575
---------- ---------- ---------- ----------
Income before Taxes 1,839,876 1,722,297 1,915,278 2,511,930
Income Taxes 585,755 575,500 640,202 911,200
---------- ---------- ---------- ----------
Net Income $1,254,121 $1,146,797 $1,275,076 $1,600,730
Net Income per Share $.60 $.60 $.67 $.85
See Accompanying Notes to Condensed Consolidated Financial Statements
CHEMUNG FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Three Months Ended
March 31
1995 1994
---------------------------
OPERATING ACTIVITIES
Net Income $ 1,254,121 $ 1,146,797
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
Amortization of Deposit Base Intangible 146,826 0
Provision for Loan Losses 200,000 125,000
Provision for Depreciation and Amortization 275,944 229,592
Amortization for Investment Securities, Net (210,157) (277,934)
(Gain) Loss on Investment Security Sales, Net (45,279) (7)
(Increase) Decrease in Accrued Interest Receivable
and Other Assets (151,298) (602,587)
Increase (Decrease) in Accrued Interest Payable,
Taxes and Other Liabilities (202,178) 3,640,650
------------ -----------
Net Cash Provided by Operating Activities 1,267,979 4,261,511
INVESTING ACTIVITIES
Proceeds from Maturities of Securities - AFS 28,820,204 4,172,095
Proceeds from Maturities of Securities -HTM 2,048,498 864,889
Proceeds from Sales of Securities - AFS 84,512 3,218
Purchases of Securities - AFS (14,725,054) (41,210,245)
Purchases of Securities - HTM (3,466,434) (1,816,510)
Purchases of Bank Premises and Equipment, Net (1,188,678) (173,622)
Loan Originations, Net of Repayments
and Other Reductions (9,369,000) 1,940,844
Proceeds from Sale of Student Loans 422,777 335,845
------------ -----------
Net Cash Used by Investing Activities 2,626,825 (35,883,486)
FINANCING ACTIVITIES
Net Increase (Decrease) in Demand Deposits, NOW,
Savings and Insured Money Market Accounts 7,874,836 9,519,038
Net Increase (Decrease) in Certificates of Deposit
and Individual Retirement Accounts 10,565,057 (1,023,994)
Net Increase (Decrease) in Short term Borrowings 9,473,274 (3,924,137)
Sale of Treasury Shares 0 172,500
Cash Dividends Paid (456,027) (430,569)
------------ -----------
Net Cash Provided by Financing Activities 27,457,140 4,312,838
Net Increase (Decrease) in Cash and Cash Equivalents 31,351,944 (27,309,137)
Cash and Cash Equivalents at Beginning of Year 32,380,592 65,055,776
------------ -----------
Cash and Cash Equivalents at End of Period $63,732,536 $37,746,639
See Accompanying Notes to Condensed Consolidated Financial Statements
CHEMUNG FINANCIAL CORPORATION AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Chemung Financial Corporation, a one-bank holding company, commenced
operations on June 1, 1985 for the purpose of acquiring all the
outstanding shares of the Chemung Canal Trust Company, Elmira, NY. The
Trust Company's stock was acquired through the issuance of 431,498 shares
of the Corporation's stock in a transaction accounted for as a pooling of
interests.
2. In the opinion of management, the consolidated financial statements
included herein contain all adjustments necessary to present fairly the
financial position as of March 31, 1995 and December 31, 1994, the
results of operations for the three month period ending March 31, 1995
and 1994 and the changes in cash flow position for the three-month period
ending March 31, 1995 and 1994.
3. Net income per share for the periods presented have been computed by
dividing net income by 2,093,481 average shares outstanding on March 31,
1995 and 1,897,613 average shares outstanding on March 31, 1994.
4. In 1990, the FASB issued Statement of Financial Accounting Standards No.
106 (SFAS 106), entitled Employers, Accounting for Postretirement
Benefits Other Than Pensions, SFAS 106 significantly changes the prior
practice of accounting for postretirement benefits on a pay-as-you-go
(cash) basis by requiring accrual, during the years that the employee
renders the necessary service, of the expected cost of providing those
benefits to an employee and the employee's beneficiaries and covered
dependents.
5. The Corporation adopted the new standard effective Jan. 1, 1993 and
immediately recognized the entire obligation in Other Liabilities.
Net Periodic Postretirement Benefit Cost
Immediate Recognition Approach Benefit
Assets $ 0
Funded Status (1,577,122)
Transition Obligation $ 1,577,122
- -------------------------------------------------------------------------------------
ONE TIME BOOKED TRANSITION
OBLIGATION $ 1,577,122
Less: Deferred Tax Credit 643,939
Reduction in earnings due to change in
Accounting Principle $ 933,183
6. In February 1992, the FASB issued Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes". Statement 109 requires
a change from the deferred method of accounting for income taxes of APB
Opinion 11 to the asset and liability method of accounting for income
taxes. Under the asset and liability method of Statement 109, deferred
tax assets and liabilities are recognized for the estimated future tax
consequences attributable to differences between the financial statement
carrying amounts of consequences attributable to differences between the
financial statement carrying amounts of existing assets and liabilities
and their respective tax bases. Deferred tax assets and liabilities are
measured using enacted tax rates in effect for the year in which those
temporary differences are expected to be recovered or settled. Under
Statement 109, the effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes
the enactment date.
Pursuant to the deferred method under APB Opinion 11, which was applied
in 1992 and prior years, deferred income taxes are recognized for income
and expense items that are reported in different years for financial
reporting purposes and income tax purposes using the tax rate applicable
for the year of calculation. Under the deferred method, deferred taxes
are not adjusted for subsequent changes in tax rates.
The Corporation adopted Statement 109 in 1993. The cumulative effect of
this change in accounting for income taxes determined at December 31,
1993 was immaterial as was the effect of applying Statement 109 on pretax
income from continuing operations for the period ended March 31, 1994.
Prior years' financial statements have not been restated to apply the
provisions of Statement 109.
The change in tax effects of temporary differences between December 31,
1992, the date Statement 109 was adopted, and March 31, 1994 was
primarily due to differences in the Provision for Loan Losses. The tax
effects of temporary differences that give rise to the deferred tax asset
and liability at March 31, 1995 are as follows:
(In Thousands) Federal State Total
Deferred Tax Asset
Loan Origination Fees 140 46 186
Deferred Directors Fees 179 59 238
Deferred Compensation 64 21 85
Allowance for Loan Losses 783 259 1042
Pension Adjustments 11 4 15
FASB 106 525 174 699
Other 67 22 89
----- --- -----
Total gross deferred tax asset 1,769 585 2,354
Deferred tax liability
Discount Accretion 76 25 101
Depreciation 256 70 326
Deferred Gain 36 12 48
FASB 115 761 253 1,014
Other 33 11 44
----- --- -----
Total Gross Deferred Tax
Liabilities 1,162 371 1,533
----- --- -----
Net deferred tax 607 214 821
----- --- -----
7. The Financial Accounting Standards Board issued Statement 114 Accounting
by Creditors for Impairment of a Loan as amended by Statement 118,
Accounting by Creditors for Impairment of a Loan - Income and Disclosure.
These statements prescribe recognition criteria for loan impairment,
generally related to commercial type loans, and measurement methods for
certain impaired loans and all loans whose terms are modified in troubled
debt restructuring subsequent to the adoption of these statements. A
loan is considered impaired when it is probable that the borrower will be
unable to repay the loan according to the original contractual terms of
the loan agreement.
As of January 1, 1995, the Company has adopted the provisions of SFAS No.
114 and SFAS No. 118 and has provided the required disclosures. The
effect of adoption was not material to the consolidated financial
statements. As of January 1, 1995, the company had no in substance
foreclosed assets to be reclassified into impaired loan status as
required by SFAS No. 114. For all prior periods presented, there were no
in substance foreclosures to be reclassified.
As a result of the adoption of SFAS No. 114, the allowance for possible
loan losses related to impaired loans that are identified for evaluation
in accordance with SFAS No. 114 is based on the present value of expected
cash flows discounted at the loan's initial effective interest rate,
except that as a practical expedient, impairment may be measured at the
loan's observable market price, or the fair value of the collateral for
certain loans where repayment of the loan is expected to be provided
solely by the underlying collateral (collateral dependent loans). The
Company considers estimated costs to sell, on a discounted basis, when
determining the fair value of collateral in the measurement of impairment
if those costs are expected to reduce the cash flows available to repay
or otherwise satisfy the loans. Prior to the adoption of SFAS No. 114
and 118, the allowance for possible loan losses related to these loans
was based on estimated undiscounted cash flows or the fair value of the
collateral, less estimated costs to sell for collateral dependent loans.
Other real estate owned included only formally foreclosed, and no in-
substance foreclosed real properties. In accordance with SFAS No. 114, a
loan is classified as an in-substance foreclosure when the Company has
taken possession of the collateral regardless of whether formal
foreclosure proceedings have taken place. Prior to the adoption of SFAS
No. 114 and SFAS No. 118, in-substance foreclosed properties included
those properties where the borrower had little or no remaining equity in
the property considering its fair value remaining equity; where repayment
was only expected to come from the operation or sale of the property; and
where the borrower had effectively abandoned control of the property or
it was doubtful that the borrower would be able to rebuild equity in the
property.
Changes in the allowance for possible loan losses for the three months
ended March 31, 1995 is as follows:
Amount (000's)
--------------
Balance at beginning of period 3,600
Provisions for possible loan losses 200
Loans charged off (84)
Recoveries on loans previously charged off 21
Balance at end of period 3,737
At March 31, 1995, the recorded investment in loans that are considered
to be impaired under SFAS No. 114 totaled $666,073. Included in this
amount is $507,413 of impaired loans for which the related allowance for
credit losses is $269,867. In addition, included in the total impaired
loans at March 31, 1995 is $158,660 of impaired loans that as a result of
the adequacy of collateral values, do not have an allowance for credit
losses determined in accordance with SFAS No. 114. The average recorded
investments in impaired loans during the three months ended March 31,
1995 was approximately $737,069.
Impaired loans are included in non-performing loans, generally as non-
accrual loans. Commercial type loans past due greater than 90 days and
still accruing are generally not considered to be impaired as the Company
expects to collect all amounts due, including interest accrued at the
contractual interest rate for the delinquent period. The Company had no
restructured loans prior to the adoption of SFAS No. 114.
In general, interest income on impaired loans is recorded on a cash basis
when collection in full is reasonably expected. If full collection is
uncertain, cash receipts are applied first to principal, then to interest
income.
For the three months ended March 31, 1995 the Company recognized interest
income on those impaired loans of $2,720 which included $1,827 of
interest income recognized using the cash basis method of income
recognition.
Item 2: Management's Discussion and Analysis of Financial
Condition and Results of Operations
On March 31, 1995, the school districts holding deposit accounts with the
Corporation's banking subsidiary received and deposited their State aid checks.
Interest-bearing deposit ledgers increased on that day by approximately $25
million. The offsetting debit was to "checks in transit" and appears in the
Cash and Due From Banks line on the balance sheet. This is considered "hot"
money ans was wired out within a few days. While total deposits at month-end
were $451 million, average deposits during the quarter totaled $423 million.
This compares with total deposits of $432 million at the beginning of the year.
The Available for Sale segment of the securities portfolio was $174
million, compared to $189 million at the beginning of the year. Interest rates
trended lower during the quarter, causing the Allowance Valuation to increase to
$2.5 million. At the beginning of the period, the allowance valuation was a
negative $295 thousand. The Held to Maturity portion of the securities
portfolio was $16.5 million versus $15.2 million at the beginning of the year.
Total loans at the end of March 1995 were $245.3 million, up $8.9 million
(3.76%) from the beginning of the period. As mentioned above, average deposits
remained relatively flat during the period due to management's strategy of
focusing upon increasing the loan to deposit ratio from 54.7% to more desirable
levels of 70% plus within two years. We noted particular strength in Commercial
and Consumer lending during the first quarter. Commercial loans increased $7.1
million (9.71%) during the first three months of 1995. The major loan demands
in this area are for business expansion. Consumer installment loans were up $3
million (7.50%), primarily due to auto loan demand fueled by significant
marketing efforts in that area. Mortgage and Home equity lending were both flat
during the period.
Consolidated net earnings for the first quarter of 1995 were $1.254
million, up $107 thousand (9.36%) from the prior year. Net earnings per share
for the period were $0.60 on 2,093,481 average shares outstanding versus $0.60
on 1,897,613 shares outstanding. Realized capital gains on common stocks sold
at the holding company level were $45 thousand ($0.01 per share). The 195,868
additional shares were issued in connection with the acquisition of the Owego
National Bank in a tax exempt transaction which became effective on the first
day of business of 1995. Due to the sustained increase in loan demand,
management decided to increase the loan loss provision to $200 thousand during
the quarter versus $125 thousand a year ago. The loan loss reserve remained at
1.52% of total loans and 311% of non-performing loans. Management feels this is
adequate coverage.
The Owego acquisition was accounted for on a "purchase" accounting basis,
a treatment which resulted in a good will intangible amounting to $2.8 million
at 3/31/95. This intangible is being amortized on a straightline basis over
fifteen years. The amortization of good will is an after-tax expense.
The core deposit intangible in the amount of $5,634,360 at 3/31/95, which
accounts for the premium paid in connection with the acquisition of three
branches from the Resolution Trust Corporation in June of last year, is being
amortized over 15 years for both book and tax purposes. Our actual experience
with the deposit accounts acquired in this transaction is under continuing
review.
On March 31, 1995, the Corporation's consolidated leverage ratio was
7.52% versus 7.51% at the beginning of the year. The Tier I and Total Risk
Adjusted Capital ratios were 13.02% and 14.30%, respectively.
PART II. OTHER INFORMATION
Item 4: Submission of Matters to a Vote of Security Holders
The Annual Meeting of Shareholders was held on April 11, 1995 for the
sole purpose of electing eight members, all currently serving, to the board of
directors. Seven of the nominees were proposed for three-year terms and one
nominee was proposed for a one-year term. Proxies for the meeting were
solicited pursuant to Section 14(a) of the Securities Exchange Act of 1934 and
there was no solicitation in opposition to management's proposal.
Voting at said meeting for the proposed election of directors was as
follows:
Shares
Voted Shares
Nominee "For" "Withheld"
- ------- -------- ----------
Three-Year Terms:
John W. Bennett 1,843,894 3,069
Robert H. Dalrymple 1,843,894 3,069
Natalie B. Kuenkler 1,843,894 3,069
Ralph H. Meyer 1,832,111 14,852
Samuel J. Semel 1,843,894 3,069
Richard W. Swan 1,843,894 3,069
William A. Tryon 1,843,894 3,069
One-Year Term:
Stephen M. Lounsberry III 1,843,894 3,069
Of the 2,093,481 outstanding shares eligible for voting at said meeting,
246,518 were not voted.
The following are members of the board of directors whose terms had not
expired and who continued in office following the meeting: Robert E. Agan,
Donald L. Brooks, Jr., David J. Dalrymple, Richard H. Evans, Edward B. Hoffman,
Boyd McDowell, II, Thomas K. Meier, John F. Potter, Whitney S. Powers, Charles
M. Streeter, Jr., William C. Ughetta, and Nelson Mooers van den Blink.
Item 5. Other Information
ELECTION OF NEW MEMBERS TO THE BOARD OF DIRECTORS
During the reporting period the board of directors approved amendments to
the corporation's bylaws increasing the number of board positions from eighteen
to twenty and elected Robert H. Dalrymple and Stephen M. Lounsberry III to fill
the vacancies created.
Mr. Dalrymple, a former director of Owego National Financial Corporation
and Owego National Bank, is Secretary of Dalrymple Holding Corporation, parent
company for several construction companies.
Mr. Lounsberry, also a former director of Owego National Financial
Corporation and Owego National Bank, is President of Moore & Steele Corporation,
a manufacturer of railroad lubrication systems.
Both Messrs. Dalrymple and Lounsberry were elected for three-year and
one-year terms respectively by the shareholders of the corporation at its annual
meeting held on April 11, 1995.
Item 6. Exhibits and Reports on Form 8-K
(a) Applicable Exhibits
(3.1) Certificate of Incorporation is filed as Exhibit 3.1 to
Registrant's Registration Statement on Form S-14,
Registration No. 2-95743, and is incorporated herein by
reference.
Certificate of Amendment to the Certificate of
Incorporation, filed with the Secretary of State of New
York on April 1, 1988, is incorporated herein by reference
to Exhibit A of the registrant's Form 10-K for the year
ended December 31, 1988, File No. 0-13888.
(3.2) Bylaws of the Registrant, as amended to March 8, 1995.
EXHIBIT A
(27) Financial Data Schedule (EDGAR version only)
(b) Reports on Form 8-K
The registrant filed one report on Form 8-K during the quarter ended
March 31, 1995. The report dated January 3, 1995 filed required information
relating to the consummation of an acquisition by the Registrant pursuant to a
merger agreement between it and the Owego National Financial Corporation.
FORM 10-Q
QUARTERLY REPORT
EXHIBIT INDEX
FOR PERIOD ENDING MARCH 31, 1995
CHEMUNG FINANCIAL CORPORATION
ELMIRA, NEW YORK
- ---------------------------------
EXHIBIT A Amended Bylaws Effective March 8, 1995
EXHIBIT A
CHEMUNG FINANCIAL CORPORATION
BY-LAWS
Amended to March 8, 1995
ARTICLE I
OFFICES
SECTION 1. Principal Office
The principal office of the corporation shall be located in the City of
Elmira, County of Chemung and State of New York.
SECTION 2. Other Offices
The corporation may also have such other offices, either within or
without the State of New York, as the Board of Directors may from time to time
determine or the business of the corporation may require.
ARTICLE II
Shareholders
SECTION 1. Place of Meetings of Shareholders
Meetings of shareholders may be held at such place, within or without the
State of New York, as may be fixed by the Board of Directors.
SECTION 2. Annual Meeting of Shareholders
A meeting of shareholders shall be held annually on such date and at such
place and time as may be fixed by the Board of Directors for the election of
directors and the transaction of other business.
SECTION 3. Special Meetings of Shareholders
Special meetings of the shareholders may be called by the Board of
Directors or by the chairman of the board or by the president. Such call shall
state the purpose or purposes of the proposed meeting. Business transacted at
any special meeting shall be confined to the purpose or purposes for which the
meeting is called.
SECTION 4. Fixing Record Date
The Board of Directors may fix, in advance, a date as the record date for
purpose of determining the shareholders entitled to notice of or to vote at any
meeting of shareholders or any adjournment thereof, or to express consent to or
dissent from any proposal without a meeting, or for the purpose of determining
shareholders entitled to receive payment of any dividend or the allotment of
any rights, or for the purpose of any other action. Such date shall be not
more than fifty (50) nor less than ten (10) days before the date of such
meeting nor more than fifty (50) days before any other action. If no record
date is fixed, the record date for the purpose of determining shareholders
entitled to notice of or to vote at a meeting of shareholders shall be at the
close of business on the day next preceding the day on which notice is given
and for all other purposes shall be at the close of business on the day on
which the resolution of the Board of Directors relating thereto is adopted.
SECTION 5. Notice of Meetings of Shareholders
Written notice of every meeting of shareholders shall state the place,
date and hour of the meeting and unless it is the annual meeting, indicate that
it is being issued by or at the direction of the person or persons calling the
meeting. Notice of a special meeting shall also state the purpose or purposes
for which the meeting is called. If, at any meeting, action is proposed to be
taken which would, if taken, entitle shareholders fulfilling the statutory
requirements to receive payment for their shares, the notice of such meeting
shall include a statement of that purpose and to that effect. A copy of the
notice of any meeting shall be given, personally or by mail, not less than ten
(10) nor more than fifty (50) days before the date of the meeting, to each
shareholder entitled to vote at such meeting. If mailed, such notice shall be
deemed given when deposited in the United States mail, with postage thereon
prepaid, directed to the shareholder at his address as it appears on the record
of shareholders or, if he shall have filed with the secretary of the
corporation a written request that notices to him be mailed to some other
address, then directed to him at such other address.
SECTION 6. Adjourned Meetings
When a determination of shareholders entitled to notice of or to vote at
any meeting of shareholders has been made, such determination shall apply to
any adjournment thereof, unless the Board of Directors fixes a new record date
for the adjourned meeting. When a meeting is adjourned to another time or
place, it shall not be necessary to give any notice of the adjourned meeting if
the time and place to which the meeting is adjourned are announced at the
meeting at which the adjournment is taken, and at the adjourned meeting the
corporation may transact any business that might have been transacted on the
original date of the meeting. However, if after the adjournment the Board of
Directors fixes a new record date for the adjourned meeting, a notice of the
adjourned meeting shall be given to each shareholder of record on the new
record date entitled to notice.
SECTION 7. List of Shareholders at Meeting
A list of shareholders as of the record date, certified by the secretary
or by the transfer agent, shall be produced at any meeting of shareholders upon
the request thereat or prior thereto of any shareholder. If the right to vote
at any meeting is challenged, the inspectors of election, or person presiding
thereat, shall require such list of shareholders to be produced as evidence of
the right of the persons challenged to vote at such meetings, and all persons
who appear from such list to be shareholders entitled to vote thereat may vote
at such meeting.
SECTION 8. Quorum of Shareholders
The holders of a majority of the shares entitled to vote thereat shall
constitute a quorum at a meeting of shareholders for the transaction of any
business. When a quorum is once present to organize a meeting, it is not
broken by the subsequent withdrawal of any shareholders. Despite the absence
of a quorum, the shareholders present may adjourn the meeting.
SECTION 9. Proxies
Every shareholder entitled to vote at a meeting of shareholders or to
express consent or dissent without a meeting may authorize another person or
persons to act for him by proxy. Every proxy must be signed by the shareholder
or his attorney-in-fact. No proxy shall be valid after the expiration of
eleven (11) months from the date thereof unless otherwise provided in the
proxy. Every proxy shall be revocable at the pleasure of the shareholder
executing it, except in those cases where an irrevocable proxy is provided by
law.
SECTION 10. Inspectors at Shareholders Meetings
The Board of Directors, in advance of any shareholders meeting, may
appoint one or more inspectors to act at the meeting or any adjournment
thereof. If inspectors are not so appointed, the person presiding at a
shareholders meeting may, and on the request of any shareholder entitled to
vote thereat shall, appoint inspectors. If appointed on the request of one or
more shareholders, the holders of a majority of shares present and entitled to
vote thereat shall determine the number of inspectors to be appointed. In case
any person appointed fails to appear or act, the vacancy may be filled by
appointment made by the Board of Directors in advance of the meeting or at the
meeting by the person presiding thereat. Each inspector, before entering upon
the discharge of his duties, shall take and sign an oath faithfully to execute
the duties of inspector at such meeting with strict impartiality and according
to the best of his ability. The inspectors shall determine the number of
shares outstanding and the voting power of each, the shares represented at the
meeting, the existence of a quorum, the validity and effect of proxies, and
shall receive votes, ballots or consents, hear and determine all challenges and
questions arising in connection with the right to the result, and do such acts
as are proper to conduct the election or vote with fairness to all
shareholders. On request of the person presiding at the meeting or any
shareholder entitled to vote thereat, the inspectors shall make a report in
writing of any challenge, question or matter determined by them and execute a
certificate of any fact found by them. A report or certificate made by then
shall be prima facie evidence of the facts stated and of the vote as certified
by them.
SECTION 11. Qualifications of Voters
Every shareholder of record shall be entitled at every meeting of
shareholders to one vote for every share standing in his name on the record of
shareholders.
Neither treasury shares nor shares held by another domestic or foreign
corporation of any type or kind, if a majority of the shares entitled to vote
in the election of directors of such other corporation is held by the
corporation, shall be voted at any meeting or counted in determining the total
number of outstanding shares.
Shares held by an administrator, executor, guardian, conservator,
committee, or other fiduciary, except a trustee, may be voted by him, either in
person or by proxy, without transfer of such shares into his name. Shares held
by a trustee may be voted by him, either in person or by proxy, only after the
shares have transferred into his name as trustee or into the name of his
nominee.
Shares held by or under the control of a receiver may be voted by him
without the transfer thereof into his name if authority so to do is contained
in an order of the court by which such receiver was appointed.
A shareholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee, or
a nominee of the pledgee.
Shares standing in the name of another domestic or foreign corporation of
any type or kind may be voted by such officer, agent or proxy as the Bylaws of
such corporation may provide or, in the absence of such provision, as the Board
of Directors of such corporation may determine.
SECTION 12. Vote of Shareholders
Directors shall, except as otherwise required by law, be elected by a
plurality of the votes cast at a meeting of shareholders by the holders of
shares entitled to vote in the election. Any other corporate action by vote of
the shareholders shall, except as otherwise required by law, these Bylaws or
the certificate of incorporation, be authorized by a majority of the votes cast
at a meeting of shareholders by the holders of shares entitled to vote thereon.
SECTION 13. Conduct of Shareholders' Meetings
The Officer presiding over the shareholders' meeting may establish such
rules and regulations for the conduct of the meeting as the presiding Officer
may deem to be reasonably necessary or desirable for the orderly and
expeditious conduct of the meeting.
SECTION 14. Shareholder Proposals
No shareholder shall be entitled to submit a proposal to a meeting of
shareholders unless at the time of submitting the proposal, the shareholder
shall be a record or beneficial owner of at least 1% or $1,000 in market value
of shares entitled to be voted at the meeting, and shall have held such shares
for at least one year and shall continue to own such shares through the date on
which the meeting is held. A shareholder meeting the above requirements shall
deliver to the secretary of the corporation not later than 120 days prior to
the date on which the corporation's proxy statement was mailed to stockholders
in connection with the previous year's annual meeting, the text of any proposal
which he intends to propose at an annual meeting of shareholders and a notice
of the intention of the shareholder to present such proposal at the meeting. A
proposal to be presented at any meeting of shareholders other than an annual
meeting shall be delivered to the secretary a reasonable time before the
mailing of the corporation's proxy material.
ARTICLE III
Directors
SECTION 1. Board of Directors
The business of the corporation shall be managed under the direction of
its Board of Directors.
SECTION 2. Qualifications of Directors
Each director shall be at least 18 years of age and shall automatically
cease to be a director on the last day of the month during which he or she
attains the age of seventy-two (72) years. At the time of taking an office,
each director shall be a stockholder of the corporation owning in his or her
own right, free from pledge, lien or charge, the number of shares of capital
stock of the corporation while each director of a New York bank or trust
company is required to own in such bank or trust company or a holding company
of such bank or trust company by the New York State Banking law. If a director
shall cease to own the required number of shares, he or she automatically
ceases to be a director of the corporation and his or her office shall be
vacant, and he or she 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 of
stockholders of the corporation.
SECTION 3. Number of Directors
The number of directors constituting the entire Board shall be twenty
(20). This number may be increased or decreased from time to time by amendment
of these By-Laws, provided, however, that the number may not be decreased to
less than three (3). No decrease in the number of directors shall shorten the
term of any incumbent director.
SECTION 4. Election and Term of Directors
The directors shall be classified by the Board of Directors with respect
to the time for which they severally hold office, into three classes, as nearly
equal in number for a term of one (1) year, the second class shall be
originally elected for a term of two (2) years, and the third class shall be
originally elected for a term of three (3) years, with the directors of each
class to hold office until their successors are elected and qualified. Newly
created directorships resulting from an increase in the number of directors
shall be classified by the Board of Directors when the directorship is created.
At each annual meeting of the stockholders of the corporation, the successors
of the class of directors whose term expire at that meeting shall be elected to
hold office for a term expiring at the annual meeting of stockholders held in
the third year following the year of their election or until their successors
are elected and have qualified.
SECTION 5. Nominations for Directors
Nominations of candidates for election as directors of the corporation at
any meeting of stockholders called for the election of directors may be made by
the Board of Directors or by any stockholder entitled to vote at such meeting.
Nominations made by the Board of Directors shall be made at a meeting of the
Board of Directors, or by written consent of directors in lieu of a meeting,
not later than 60 days prior to the date of any meeting of stockholders called
for the election of directors. The secretary of the corporation shall request
that each such proposed nominee provide the corporation with such information
concerning himself as is required, under the rules of the Securities and
Exchange Commission, to be included in the corporation's proxy statement
soliciting proxies for his election as a director. Any stockholder who intends
to make a nomination at any annual meeting of stockholders shall deliver to the
secretary of the corporation not later than 120 days prior to the date on which
the corporation's proxy statement was mailed to stockholders in connection with
the previous year's annual meeting, or if such nomination is to be made at a
meeting of shareholders other than an annual meeting, a reasonable time before
the mailing of the corporation's proxy material, a notice setting forth (i) the
name, age, business address and residence address of each nominee proposed in
such notice, (ii) the principal occupation or employment of each such nominee,
(iii) the number of shares of capital stock of the corporation which are owned
of record and beneficially by each such nominee and (iv) such other information
concerning each such nominee as would be required, under the rules of the
Securities and Exchange Commission, in a proxy statement soliciting proxies for
the election of such nominees. Such notice shall include a signed consent of
such nominee to serve as a director of the corporation, if elected. In the
event that a person is validly designated as a nominee in accordance with the
provisions of this section and shall thereafter become unable or unwilling to
stand for election to the Board of Directors, the Board of Directors or the
stockholder who proposed such nominee, as the case may be, may designate a
substitute nominee. If the secretary of the meeting of stockholders called for
the election of directors determines that a nomination was not made in
accordance with the foregoing procedures, such nomination shall be void.
SECTION 6. Newly Created Directorships and Vacancies
Newly created directorships resulting from an increase in the number of
directors and vacancies occurring in the Board of Directors for any reason may
be filled by vote of a majority of the directors then in office, although less
than a quorum exists. A director elected to fill a newly created directorship
or a vacancy, shall be elected to hold office until the next meeting of
shareholders at which the election of directors is in the regular order of
business, and until his successor has been elected and qualified.
SECTION 7. Removal of Directors
Any director, an entire class of directors or the entire Board of
Directors may be removed from office, with or without cause, only by the
affirmative vote of the holders of at least 75% of the outstanding shares of
stock of the corporation entitled to vote generally in the election of
directors, voting together as a single class.
SECTION 8. Quorum of Directors
One-third (1/3) of the entire Board of Directors or seven directors,
whichever number is greater, shall constitute a quorum for the transaction of
business or of any specified item of business.
SECTION 9. Action by the Board of Directors
The vote of the majority of the directors present at a meeting of the
Board of Directors at the time of the vote, if a quorum is present at such
time, shall, except as otherwise provided by law, these Bylaws or the
certificate of incorporation, be the act of the Board of Directors.
SECTION 10. Written Consent of Directors Without A Meeting
Any action required or permitted to be taken by the Board of Directors or
a committee thereof may be taken without a meeting if all members of the Board
or the committee consent in writing to the adoption of a resolution authorizing
the action. The resolution and the written consents thereto by the members of
the board or committee shall be filed with the minutes of the proceedings of
the Board or committee.
SECTION 11. Place and Time of Meetings of Board of Directors
Meetings of the Board of Directors, regular or special, may be held at
any place, within or without the State of New York and at any time, fixed by the
Board of Directors or by the person or persons calling the meeting. Such
meetings may be held by means of a conference telephone or similar
communications equipment allowing all persons participating in the meeting to
hear each other at the same time.
SECTION 12. Notice of Meetings of the Board of Directors
Regular meetings of the Board of Directors may be held without notice if
the time and place of such meetings are fixed by the Board of Directors.
Special meetings of the Board of Directors shall be held upon notice to the
directors and may be called by the chairman of the board, the president, the
executive vice president, or any two directors. This notice shall be given
personally including by telephone or mail, telegram, cable or other public
instrumentality. If given personally or by telephone, such notice shall be
given not less than 48 hours before the meeting to each director. If given by
mail, cable, telegram or other public instrumentality, such notice shall be
given not less than five (5) days before the date of the meeting, to each
director. Such notice shall be deemed given, if mailed, when deposited in the
United States mail, with postage thereon prepaid or, if telegraphed, cabled or
sent by other public instrumentality, when given to the telegraph company,
cable company, or other public instrumentality, directed to the director at his
business address or, if he shall have filed with the secretary of the
corporation, a written request that notices to him be mailed or telegraphed,
cabled or sent to some other address, then directed to him at such other
address. The notice need not specify the purpose of any regular or special
meeting of the Board of Directors.
SECTION 13. Interested Directors
No contract or other transaction between a corporation and one or more of
its directors, or between a corporation and any other corporation, firm,
association or other entity in which one or more of its directors, or officers,
are directors or have a substantial financial interest, shall be either void or
voidable for this reason alone or by reason alone that such director or
directors are present at the meeting of the Board, or of a committee thereof,
which approves such contract or transaction, or that his or their votes are
counted for such purpose:
1) If the material facts as to such director's interest in such
contract or transaction and as to any such common directorship, officership or
financial interest are disclosed in good faith or known to the Board or
committee, and the Board or committee approves such contract or transaction by a
vote sufficient for such purpose without counting the vote of such interested
director or, if the votes of the disinterested directors are insufficient to
constitute an act of the Board as defined in Section 9 of this Article, by
unanimous vote of the disinterested directors; or
2) If the material facts as to such directors interest in such
contract or transaction and as to any such common directorship, officership or
financial interest are disclosed in good faith or known to the shareholders
entitled to vote thereon, and such contract or transaction is approved by vote
of such shareholders; or
3) If the contract or transaction is affirmatively established by the
party or parties thereto to be fair and reasonable as to the corporation at the
time it was approved by the Board, a committee thereof, or the shareholders.
Common or interested directors may be counted in determining the presence of a
quorum at a meeting of the Board or a committee thereof which approves such
contract or transaction.
The Board of Directors shall have authority to fix the compensation of
directors for services in any capacity.
A loan shall not be made by the corporation to any director unless it is
authorized by vote of the shareholders. For this purpose, the shares of the
director who would be the borrower shall not be shares entitled to vote.
SECTION 14. Reimbursement and Compensation of Directors
The directors may be paid their expenses of attendance at each meeting of
the Board of Directors and may be paid a fixed sum for attendance at each
meeting of the Board of Directors or a stated salary as director. No such
payment shall preclude any director from serving the corporation in any other
capacity and receiving compensation therefor. Members of the executive
committee or other committees may be allowed similar reimbursement and
compensation for their services as such.
SECTION 15. Executive Committee and Other Committees
The Board of Directors by resolution adopted by a majority of the entire
Board, may designate from among its members an executive committee and other
committees, each consisting of three or more directors, and each of which shall
have and may exercise such powers as shall be conferred or authorized by the
resolution appointing it, except that no such committee shall have authority as
to the following matters:
1) The submission to shareholders of any action that needs
shareholders' approval;
2) The filling of vacancies in the Board of Directors or in any
committee;
3) The fixing of compensation of the directors for serving on the
Board of Directors or on any committee;
4) The amendment or repeal of the Bylaws or the adoption of new
Bylaws;
5) The amendment or repeal of any resolution of the Board of
Directors.
Each such committee shall serve at the pleasure of the Board. The Board
of Directors shall have the power at any time to fill vacancies in, to change
the size or membership of, and to discharge any such committee.
A majority of any such committee may determine its action and may fix the
time and place of its meetings, unless provided otherwise by the Board of
Directors. Each such committee shall keep a written record of its acts and
proceedings and shall submit such record to the Board of Directors at each
regular meeting thereof and at such other times as requested by the Board of
Directors. Failure to submit such record, or failure of the Board to approve
any action indicated therein will not, however, invalidate such action to the
extent it has been carried out by the corporation prior to the time the record
of such action was, or should have been, submitted to the Board of Directors as
herein provided.
ARTICLE IV
Officers
SECTION 1. Number
The Board of Directors may elect a chairman of the board who shall be a
member of the Board of Directors and shall elect a president, one or more vice
presidents, a secretary and a treasurer, who need not be members of the Board
of Directors and such other officers and assistant officers who need not be
members of the Board of Directors as the Board of Directors may from time to
time deem proper. Any two or more offices may be held by the same person,
except the offices of president and secretary.
SECTION 2. Election and Term of Office
The officers of the corporation to be elected or appointed by the Board
of Directors shall be elected or appointed annually by the Board of Directors at
the first meeting of the Board of Directors held after each annual meeting of
the shareholders. Subject to the provisions of Section 3 of this Article, each
officer shall hold office until the first meeting of the Board of Directors
following the next annual meeting of shareholders and until his successor has
been elected or appointed and qualified.
SECTION 3. Removal
Any officer or agent elected or appointed by the Board of Directors may
be removed by the Board of Directors with or without cause, but such removal
shall be without prejudice to the contract rights, if any, of the person so
removed. The election or appointment of an officer shall not of itself create
contract rights.
SECTION 4. New Offices and Vacancies
Newly created offices and vacancy in any office because of death,
resignation, removal, disqualification or otherwise, may be filled from time to
time by the Board of Directors for the unexpired portion of the term.
SECTION 5. Chief Executive Officer
The Board of Directors shall appoint either the chairman of the board, if
any, or the president the chief executive officer of the corporation ("the
CEO") who, subject to the control of the Board of Directors, shall direct and
control all the business and affairs of the corporation.
SECTION 6. Chairman of the Board
The chairman of the board, if any, and if so designated by the Board of
Directors, shall be the chief executive officer of the corporation and, subject
to the control of the Board of Directors, shall in general perform all duties
incident to the office of chief executive officer. He shall, when present,
preside at all meetings of the shareholders and of the Board of Directors. He
may sign, with the secretary or any other proper officer of the corporation
thereunto authorized by the Board of Directors, certificates representing
shares of the corporation, any deeds, mortgages, bonds, contracts or other
instruments which the Board of Directors has authorized to be executed, except
in cases where the signing and execution thereof shall be expressly delegated
by the Board of Directors or by these Bylaws to some other officer or agent of
the corporation, or shall be required by law to be otherwise signed or
executed; and shall perform such other duties as may be prescribed by the Board
of Directors from time to time.
SECTION 7. President
The president shall be the chief operating officer of the corporation
and, subject to the control of the Board of Directors and the chairman of the
board (if he is the CEO), shall direct the conduct and operation of the business
and properties of the corporation. If so designated by the Board of Directors,
he shall also be the chief executive officer of the corporation and shall
perform all duties incident to that office. He shall, in the absence of the
chairman of the board, preside at all meetings of the shareholders and of the
Board of Directors. He may sign, with the secretary or any other proper officer
of the corporation thereunto authorized by the Board of Directors, certificates
representing shares of the corporation, any deeds, mortgages, bonds, contracts
or other instruments which the Board of Directors has authorized to be
executed, except in cases where the signing and execution thereof shall be
expressly delegated by the Board of Directors or by these Bylaws to some other
officer or agent of the corporation, or shall be required by law to be
otherwise signed or executed; and shall perform such other duties as may be
prescribed by the Board of Directors from time to time.
SECTION 8. Vice President
In the absence of the chairman of the board and the president or in the
event of their death or inability to act, the executive vice president (or in
the event of the death or inability to act of the executive vice president, the
vice president designated by the Board of Directors, if any, or if none, the
vice president having the greatest seniority) shall perform the duties of the
chairman of the board and the president, and when so acting shall have the
authority of and be subject to all the restrictions upon the chairman of the
board and the president. Any vice president may sign, with the secretary or
any other proper officer of the corporation thereunto authorized by the Board
of Directors, certificates representing shares of the corporation; and shall
perform such other duties as from time to time may be assigned to him by the
chairman of the board (if he is the CEO) or by the president or by the Board of
Directors.
SECTION 9. Secretary
The secretary shall: 1) keep the minutes of the proceedings of its
shareholders, Board of Directors and executive committee and other committees,
if any, in one or more books provided for that purpose; 2) see that all notices
are duly given in accordance with the provisions of these Bylaws or as required
by law; 3) be custodian of the corporate records and of the seal of the
corporation and see that the seal of the corporation is affixed to all
documents and execution of which on behalf of the corporation under its seal is
duly authorized; 4) file each written request by a shareholder that notices to
him be mailed to some address other than this address as it appears on the
record of shareholders; 5) sign with the chairman of the board or the president
or a vice president certificates representing shares of the corporation, the
issuance of which shall have been authorized by resolution of the Board of
Directors; 6) have general charge of the record of shareholders of the
corporation; and 7) in general perform all duties incident to the office of
secretary and such other duties as from time to time may be assigned to him by
the chairman of the board (if he is the CEO) or by the president or by the
Board of Directors.
SECTION 10. Treasurer
If required by the Board of Directors, the treasurer shall give a bond
for the faithful discharge of his duties in such sum and with such surety or
sureties as the Board of Directors shall determine. He shall: 1) have charge
and custody of and be responsible for all funds and securities of the
corporation, receive and give receipts for monies due and payable to the
corporation from any source whatsoever, and deposit all such monies in the name
of the corporation in such banks, trust companies or other depositaries as
shall be selected in accordance with the provisions of these Bylaws; 2) have
charge and custody of and be responsible for the keeping of correct and
complete books and records of account of the corporation; sign with the
chairman of the board, or the president or a vice president, certificates
representing shares of the corporation, the issuance of which shall have been
authorized by resolution of the Board of Directors; and 3) in general perform
all of the duties incident to the office of treasurer and such other duties as
from time to time may be assigned to him by the chairman of the board (if he is
the CEO) or by the president or by the Board of Directors.
SECTION 11. Assistant Secretaries and Assistant Treasurers
The assistant secretaries, when authorized by the Board of Directors, may
sign with the chairman of the board or the president or a vice president,
certificates representing shares of the corporation, the issuance of which
shall have been authorized by a resolution of the Board of Directors. The
assistant treasurers shall, if required by the Board of Directors, give bonds
for the faithful discharge of their duties in such sums and with such sureties
as the Board of Directors shall determine. Assistant secretaries and assistant
treasurers, in general, shall perform such duties as shall be assigned to them
by the secretary or the treasurer, respectively, or by the chairman of the
board (if he is the CEO) or the president or the Board of directors. In the
absence of the secretary or in the event of his death, inability or refusal to
act,the assistant secretary (or in the event there be more than one assistant
secretary, the assistant secretaries in the order of their appointment or as
determined by the chairman of the board (if he is the CEO) or the president or
the Board of Directors), shall perform the duties and exercise the authority of
the secretary. In the absence of the treasurer or in the event of his death,
inability or refusal to act, the assistant treasurer, (or in the event there be
more than one assistant treasurer, the assistant treasurers in the order of
their appointment or as determined by the chairman of the board (if he is the
CEO) or the president or the Board of Directors) shall perform the duties and
exercise the authority of the treasurer.
SECTION 12. Compensation of Officers
The compensation of the officers shall be fixed from time to time by the
Board of Directors and no officer shall be prevented from receiving such
compensation by reason of the fact that he is also a director of the
corporation.
ARTICLE V
Contracts, Checks and Deposits
SECTION 1. Contracts
The Board of Directors may authorize any officer or officers, agent or
agents, to enter into any contract or execute and deliver any instrument in the
name of and on behalf of the corporation and such authority may be general or
confined to specific instances.
SECTION 2. Checks, Drafts, etc.
All checks, drafts or other orders for the payment of money, notes or
other evidences of indebtedness issued in the name of the corporation, shall be
signed by such officer or officers, agent or agents of the corporation and in
such manner as shall from time to time be determined by resolution of the
Board of Directors.
SECTION 3. Deposits
All funds of the corporation not otherwise employed shall be deposited
from time to time to the credit of the corporation in such banks, trust
companies or other depositaries as the Board of Directors may select.
ARTICLE VI
Certificates Representing Shares, Record
of Shareholders, Transfer of Shares
SECTION 1. Issuance of Shares
No shares of any class of the corporation or any obligations or other
securities convertible into or carrying options to purchase any such shares of
the corporation, or any options or rights to purchase any such shares or
securities of the corporation, shall be issued or sold unless such issuance or
sale is approved by the affirmative vote of at least 80% of the entire Board of
Directors.
SECTION 2. Certificates Representing Shares
The shares of the corporation shall be represented by certificates which
shall be in such form as shall be determined by the Board of Directors. All
such certificates shall be consecutively numbered or otherwise identified.
Such certificates shall be signed by the Chairman of the Board or the president
or a vice president and the secretary or an assistant secretary or the
treasurer or an assistant treasurer, and may, but need not, be sealed with the
seal of the corporation or a facsimile thereof. The signature of the officers
upon the certificate may be facsimiles if the certificate is countersigned by a
transfer agent or an assistant transfer agent, or registered by a registrar
other than the corporation itself or its employee. In case any officer who
has signed or whose facsimile signature has been placed upon a certificate
shall have ceased to be such officer before such certificate is issued, it may
be issued by the corporation with the same effect as if he were such officer at
the date of issue. Each certificate shall state upon the face thereof; 1) that
the corporation is formed under the laws of New York; 2) the name of the person
or persons to whom issued; 3) the number and class of shares and the par value
of each share represented by such certificate.
SECTION 3. Lost, Destroyed or Wrongfully Taken Certificates
The Board of Directors may direct a new certificate or certificates to be
issued in place of any certificate or certificates theretofore issued by the
corporation, alleged to have been lost, apparently destroyed or wrongfully
taken upon the making of an affidavit of that fact by the person claiming the
certificate to be lost, apparently destroyed or wrongfully taken. When
authorizing such issue of a new certificate or certificates, the Board of
Directors may, in its discretion and as a condition precedent to the issuance
thereof, require the owner of such lost, apparently destroyed or wrongfully
taken certificate or certificates, or his legal representative to advertise the
same in such manner as it shall require and/or give the corporation a bond in
such sum and with such surety or sureties as it may direct as indemnity against
any claim that may be made against the corporation with respect to the
certificate alleged to have been lost, apparently destroyed or wrongfully
taken.
SECTION 4. Record of Shareholders
The corporation shall keep at its principal office, or at the office of
its transfer agent in the State of New York, a record containing the names and
addresses of all shareholders, the number and class of shares held by each and
the dates when they respectively became the owners of record thereof. The
corporation shall be protected in treating the persons in whose names shares
stand on the record of shareholders as the owners thereof for all purposes.
SECTION 5. Transfer of Shares
Upon surrender to the corporation or the transfer agent of the
corporation of a certificate representing shares duly endorsed or accompanied by
proper evidence of succession, assignment or authority to transfer, it shall be
the duty of the corporation to issue a new certificate to the person entitled
thereto, and cancel the old certificate. Every such transfer of shares shall
be entered on the record of shareholders of the corporation.
ARTICLE VII
Fiscal Year
The fiscal year of the corporation shall be determined by resolution of
the Board of Directors.
ARTICLE VIII
Dividends
The Board of Directors may from time to time declare, and the corporation
may pay, dividends on its outstanding shares in the manner and upon the terms
and conditions provided by law and its certificate of incorporation.
ARTICLE IX
Seal
The seal of the corporation shall be circular in form and contain the
name of the corporation, the year when it was formed, and the words "New York."
The corporation may use the seal causing it or a facsimile to be affixed or
impressed or reproduced in any other manner.
ARTICLE X
Waiver of Notice
SECTION 1. Waiver of Notice to Shareholders
Notice of meeting need not be given to any shareholder who signed a
waiver of notice, in person or by proxy, whether before or after the meeting.
The attendance of any shareholder at a meeting, in person or by proxy, without
protesting prior to the conclusion of the meeting the lack of notice of such
meeting, shall constitute a waiver of notice by him.
SECTION 2. Waiver of Notice to Director
Notice of meeting need not be given to any director who signs a 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. A
waiver of notice need not specify the purpose of any regular or special meeting
of the Board of Directors.
SECTION 3. Notice Dispensed with When Delivery Prohibited
Whenever communication to any shareholder or any director is unlawful
under any statute of the State of New York or of the United States or any
regulation, proclamation or order issued under said statutes, the giving of any
notice to such shareholder or such director shall not be required and there
shall be no duty to apply for license or other permission to do so.
ARTICLE XI
Indemnification
To the fullest extent permitted by law, either directly or by the
purchase of insurance or in part directly and in part by the purchase of
insurance, the corporation shall indemnify each natural person, or if deceased,
his personal representative made or threatened to be made a party to any action
or proceeding civil or criminal, including an appeal therein against the
reasonable expenses, attorneys' fees, judgments, fines and amounts paid in
settlement if such person is made or threatened to be made a party by reason of
the fact that he or his testator or intestate is or was: 1) an officer,
director or employee of the corporation or 2) an officer, director or employee
of or served in any capacity in any other corporation, partnership, joint
venture, trust or other enterprise, at the request of this corporation,
provided that in the case of a person serving as an employee or in any capacity
in any other corporation, that such person was at the time he was so designated
to serve by this corporation, an employee of this corporation, or 3) the
occupant of a position or a member of a committee or Board or a person having
responsibilities under federal or state law, including but not limited to
responsibilities under the Employee Retirement Income Security Act of 1974, who
was appointed to such position or to such committee or Board by the Board of
this corporation or by an officer of this corporation or who served in such
position or on such committee or Board at the request or direction of the Board
of this corporation or an officer of this corporation or who assumed such
responsibilities at the request or direction of the Board of this corporation
or of any officer of this corporation, provided only that such person acted in
good faith for a purpose which he reasonably believed would be in the best
interest of the corporation or in the case of service for any other corporation
or any partnership, joint venture, trust, employee benefit plan or other
enterprise, not opposed to the best interests of the corporation, and in
criminal proceedings had no reasonable cause to believe that his conduct was
unlawful.
The corporation's obligations under this Article shall be reduced by the
amount of any insurance which is available to any such person whether such
insurance is purchased by the corporation or otherwise. The right of indemnity
created herein shall be personal to the officer, director, employee or other
person and their respective legal representatives and in no case shall any
insurance carrier be entitled to be subrogated to any rights created herein.
Nothing contained herein shall obligate the corporation to indemnify any
person against any claim arising out of personal injuries, bodily injuries or
property damage.
ARTICLE XII
Amendment and Repeal
SECTION 1. Amendment and Repeal by the Shareholders
These Bylaws may be amended or repealed by vote of the shareholders
entitled to vote generally in the election of directors, provided that notice
of meeting states such purpose, and provided further that the provisions of
Article III may be amended or repealed only by the affirmative vote of holders
of at least 75% of the outstanding shares of stock of the corporation entitled
to vote generally in the election of directors.
SECTION 2. Amendment and Repeal by the Board of Directors
These Bylaws may also be amended or repealed by a majority of the entire
Board of Directors provided that the provisions of Article III may be amended
only by the affirmative vote of at least 75% of the entire Board of Directors
and further provided that Section 1 of Article VI may be amended only by the
affirmative vote of at least 80% of the entire Board of Directors.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned there to duly authorized.
CHEMUNG FINANCIAL CORPORATION
DATE: May 12, 1995 "SIGNATURE"
John W. Bennett
President & CEO
DATE: May 12, 1995 "SIGNATURE"
Jan P. Updegraff
Vice President &
Treasurer