BY-LAWS
OF
AVONDALE INDUSTRIES, INC.
(as adopted on March 20, 1990)
(Section 3.1 of which was amended on June 13, 1994,
Section 5.2 of which was amended and Section 5.4
of which was deleted on December 5, 1994,
Section 2.14 of which was added on July 17, 1995,
Section 12 of which was amended on August 4, 1997 and
Section 5.2 of which was amended on November 3, 1997)
SECTION I
OFFICES
1.1 Principal Office. The principal office of the
Corporation shall be located at 5100 River Road, Avondale,
Louisiana 70094.
1.2 Additional offices. The Corporation may have such
offices at such other places as the Board of Directors may from
time to time determine or the business of the Corporation may
require.
SECTION 2
SHAREHOLDERS MEETINGS
2.1 Place of Meetings. Unless otherwise required by law or
these By-laws, all meetings of the shareholders shall be held at
the principal office of the Corporation or at such other place,
within or without the State of Louisiana, as may be designated by
the Board of Directors.
2.2 Annual Meetings; Notice Thereof. An annual meeting of
the shareholders shall be held on the fourth Monday of April in
each year, at 10:00 a.m., or at such other date or at such other
time specified as the Board of Directors shall designate, for the
purpose of electing directors and for the transaction of such
other business as may be properly brought before the meeting. If
no annual shareholders' meeting is held for a period of eighteen
months, any shareholder may call such meeting to be held at the
registered office of the Corporation as shown on the records of
the Secretary of State of Louisiana.
2.3 Special Meetings. Special meetings of the share-
holders, for any purpose or purposes, may be called by the
Chairman of the Board, Chief Executive Officer and President or
the Board of Directors. At any time, upon the written request of
any shareholder or group of shareholders holding in the aggregate
at least 80% of the Total Voting Power (such term to have the
same meaning in these By-laws as is assigned in Article III of
the Articles of Incorporation), the Secretary shall call a
special meeting of shareholders to be held at the registered
office of the Corporation at such time as the Secretary may fix,
not less than fifteen nor more than sixty days after the receipt
of said request, and if the Secretary shall neglect or refuse to
fix such time or to give notice of the meeting, the shareholder
or shareholders making the request may do so. Such request must
state the specific purpose or purposes of the proposed special
meeting and the business to be conducted thereat shall be limited
to such purpose or purposes.
2.4 Notice of Meetings. Except as otherwise provided by
law, the authorized person or persons calling a shareholders'
meeting shall cause written notice of the time, place and purpose
of the meeting to be given to all shareholders entitled to vote
at such meeting, at least ten days and not more than sixty days
prior to the day fixed for the meeting. Notice of the annual
meeting need not state the purpose or purposes thereof, unless
action is to be taken at the meeting as to which notice is
required by law or the By-laws. Notice of a special meeting shall
state the purpose or purposes thereof, and the business conducted
at any special meeting shall be limited to the purpose or
purposes stated in the notice.
2.5 List of Shareholders. At every meeting of
shareholders, a list of shareholders entitled to vote, arranged
alphabetically and certified by the Secretary or by the agent of
the Corporation having charge of transfers of shares, showing the
number and class of shares held by each such shareholder on the
record date for the meeting, shall be produced on the request of
any shareholder.
2.6 Quorum. At all meetings of shareholders, the holders
of a majority of the Total Voting Power shall constitute a quorum
provided that this subsection shall not have the effect of
reducing the vote required to approve or affirm any matter that
may be established by law, the Articles of Incorporation or these
By-laws.
2.7 Voting. When a quorum is present at any meeting, the
vote of the holders of a majority of the Voting Power (as defined
in Article III of the Articles of Incorporation) present in
person or represented by proxy shall decide each question brought
before such meeting, unless the question is one upon which, by
express provision of law or the Articles of Incorporation, a
different vote is required, in which case such express provision
shall govern and control the decision of such question. Directors
shall be elected by plurality vote.
2.8 Proxies. At any meeting of the shareholders, every
shareholder having the right to vote shall be entitled to vote in
person or by proxy appointed by an instrument in writing
subscribed by such shareholder and bearing a date not more than
eleven months prior to the meeting, unless the instrument
provides for a long period, but in no case will an outstanding
proxy be valid for longer than three years from the date of its
execution, provided that in no event may a proxy be voted at a
meeting called pursuant to La. R.S. 12:138 unless it is executed
and dated by the shareholder within 30 days of the date of such
meeting. The person appointed as proxy need not be a shareholder
of the Corporation.
2.9 Adjournments. Adjournments of any annual or special
meeting of shareholders may be taken without new notice being
given unless a new record date is fixed for the adjourned
meeting, but any meeting at which directors are to be elected
shall be adjourned only from day to day until such directors
shall have been elected.
2.10 Withdrawal. If a quorum is present or represented at a
duly organized meeting, such meeting may continue to do business
until adjournment, notwithstanding the withdrawal of enough
shareholders to leave less than a quorum as fixed in Section 2.6
of these By-laws, or the refusal of any shareholders present to
vote.
2.11 Lack of Quorum. If a meeting cannot be organized
because a quorum has not attended, those present may adjourn the
meeting to such time and place as they may determine, subject,
however, to the provisions of Section 2.9 hereof. In the case of
any meeting called for the election of directors, those who
attend the second of such adjourned meetings, although less than
a quorum as fixed in Section 2.6 hereof, shall nevertheless
constitute a quorum for the purpose of electing directors.
2.12 Presiding officer. The Chairman of the Board, Chief
Executive Officer and President or in his absence, a chairman
designated by the Board of Directors, shall preside at all
shareholders' meetings.
2.13 Definition of Shareholder. As used in these By-laws,
and unless the context otherwise requires, the term shareholder
shall mean a person who is (i) the record holder of shares of the
Corporation's voting stock or (ii) a registered holder of any
bonds, debentures or similar obligations granted voting rights by
the Corporation pursuant to La. R.S. 12:75A.
2.14 Shareholder Proposals. No shareholder proposal shall
be considered by the shareholders at any annual or special
meeting unless such proposal has been properly brought before
such meeting. No shareholder proposal shall be deemed to have
been properly brought before a special meeting of shareholders
unless (i) the proposal is submitted by the person or persons
calling the special meeting and (ii) the proposal is contained in
the notice of the meeting. No shareholder proposal shall be
deemed to have been properly brought before an annual meeting
unless each of the following conditions is satisfied:
(a) Sufficient notice of the proposal must be received
by the Secretary of the Corporation not less than 120 days
in advance of the date in the current year that corresponds
to the date on which proxy materials were first mailed by
the Corporation in connection with the previous year's
annual meeting. In the event of the change of the date of
the annual meeting to a date that is 30 days earlier or
later than the date in the current year that corresponds to
the date on which the annual meeting was held in the
previous year, or if no annual meeting was held in the
previous year, sufficient notice of the proposal must be
received by the Secretary of the Corporation no later than
the date set by the Corporation in a public announcement to
shareholders, which date shall be no earlier than a
reasonable time before the Corporation's proxy solicitation
is first made in connection with the meeting. Notice of the
proposal will be sufficient only if it contains (i) a
complete and accurate description of the proposal; (ii) a
statement that the shareholder intends to attend the meeting
and present the proposal and to hold of record securities of
the Corporation entitled to vote at the meeting through the
meeting date; and (iii) the shareholder's name and address
and the number of shares of the Corporation's voting
securities that the shareholder holds of record or
beneficially as of the notice date. The shareholder shall
continue to hold of record securities of the Corporation
entitled to vote at the meeting through the meeting date.
(b) The Board of Directors shall have the power to
limit the shareholder proposals to be considered at a
meeting to the first ten shareholder proposals of which the
Secretary of the Corporation receives sufficient notice.
(c) If the Secretary of the Corporation has received
sufficient notice of a shareholder proposal that may
properly be brought before the meeting, a shareholder
proposal sufficient notice of which is subsequently received
by the Secretary and that is substantially duplicative of
the first proposal shall not be properly brought before the
meeting. If a shareholder proposal deals with substantially
the same subject matter as a prior proposal submitted to
shareholders at a meeting held within the preceding five
calendar years, it shall not be properly brought before any
meeting held within three calendar years after the latest
such previous submission, provided that:
(i) if the proposal was submitted at
only one meeting during such
preceding period, it received less
than 3% of the total number of
votes cast in regard thereto; or
(ii) if the proposal was submitted at
only two meetings during such
preceding period, it received at
the time of its second submission
less than 6% of the total number of
votes cast in regard thereto; or
(iii) if the proposal was submitted at
three or more meetings during such
preceding period, it received at
the time of its latest submission
less than 10% of the total number
of votes cast in regard thereto.
(d) Notwithstanding compliance with Sections 2.14(a),
(b), and (c), no shareholder proposal shall be deemed to be
properly brought before a shareholders' meeting if it is not
a proper subject for action by shareholders under Louisiana
law or the Articles of Incorporation.
(e) Any proposal failing to comply with Sections
2.14(a), (b), (c), or (d) shall not be considered at the
meeting and, if introduced at the meeting, shall be ruled
out of order. If a shareholder presents a proposal at a
meeting but does not continue to hold of record securities
of the Corporation entitled to vote at the meeting through
the meeting date, as required by Section 2.14(a), no
proposal by that shareholder shall be considered at any
shareholders' meeting held in the following two calendar
years.
(f) Nothing in this Section 2.14 is intended to confer
any rights to have any proposal included in the notice of
any meeting or in proxy materials related to such meeting.
SECTION 3
DIRECTORS
3.1 Number. All of the corporate powers shall be vested
in, and the business and affairs of the Corporation shall be
managed by, a Board of Directors. Except as otherwise fixed by
or pursuant to Article III of the Articles of Incorporation (as
it may be duly amended from time to time) relating to the rights
of the holders of any class or series of stock having a
preference over the Common Stock as to dividends or upon
liquidation to elect, by class vote, additional directors under
particular circumstances, the Board of Directors shall consist of
not less than seven and not more than nine natural persons, as
established from time to time by a resolution of the Board of
Directors provided that, if after proxy materials for any meeting
of shareholders at which directors are to be elected are mailed
to shareholders any person or persons named therein to be
nominated at the direction of the Board of Directors becomes
unable or unwilling to serve, the foregoing number of authorized
directors as provided by the Board resolution then in effect
shall be automatically reduced by a number equal to the number of
such persons unless the Board of Directors, by a majority vote of
the entire Board, selects an additional nominee. The Board of
Directors may, by a two-thirds vote, amend this Section 3.1 to
increase or decrease the number of directors, provided that no
amendment to this Section to decrease the number of directors
shall shorten the term of any incumbent director. No director
need be a shareholder. The Secretary shall have the power to
certify at any time as to the number of directors authorized and
as to the class to which each director has been elected or
assigned.
3.2 Powers. The Board may exercise all such powers of the
Corporation and do all such lawful acts and things which are not
by law, the Articles of Incorporation or these By-laws directed
or required to be done by the shareholders.
3.3 Classes. The Board of Directors, other than those
directors who may be elected by the holders of any class or
series of stock having preference over the Common Stock as to
dividends or upon liquidation, shall be divided into three
classes as nearly equal in number as may be, with the initial
term of office of Class I expiring at the first annual meeting of
shareholders occurring more than nine months after the
incorporation of the Corporation, of Class II expiring at the
first succeeding annual meeting of shareholders and of Class III
expiring at the second succeeding annual meeting of shareholders.
Any increase or decrease in the number of directors shall be
apportioned by the Board of Directors so that all classes of
directors shall be as nearly equal in number as can be.
3.4 General Election. At each annual meeting of share-
holders, directors shall be elected to succeed those directors
whose terms then expire. Such newly elected directors shall serve
until the third succeeding annual meeting of shareholders after
their election and until their successors are elected and
qualified. A director elected to fill a vacancy shall hold office
for a term expiring at the annual meeting at which the term of
the class to which he shall have been elected expires. No
decrease in the number of directors constituting the Board of
Directors shall shorten the term of any incumbent director.
3.5 Vacancies. Except as otherwise provided in the
Articles of Incorporation or these By-laws (a) the office of a
director shall become vacant if he dies, resigns or is removed
from office and (b) the Board of Directors may declare vacant the
office of a director if he (i) is interdicted or adjudicated an
incompetent, (ii) is adjudicated a bankrupt, (iii) in the sole
opinion of the Board of Directors becomes incapacitated by
illness or other infirmity so that he is unable to perform his
duties for a period of six months or longer, or (iv) ceases at
any time to have the qualifications required by law, the Articles
of Incorporation or these By-laws.
3.6 Filling Vacancies. In the event of a vacancy (includ-
ing any vacancy resulting from an increase in the authorized
number of directors, or from failure of the shareholders to elect
the full number of authorized directors) the remaining directors,
even though not constituting a quorum, may fill any vacancy on
the Board for the unexpired term by a vote of at least two-thirds
of the directors remaining in office at any time that there is no
Related Person (as such term is defined in Article V.A.2 of the
Articles of Incorporation) and a two-thirds vote of all
Continuing Directors who remain in office at any time there is a
Related Person, provided that the shareholders shall have the
right, at any special meeting called for the purpose prior to
such action by the Board, to fill the vacancy.
3.7 Directors Elected by Preferred Shareholders. Notwith-
standing anything in the foregoing to the contrary, whenever the
holders of any one or more series of preferred stock of the
Corporation shall have the right, voting separately as a class,
to elect one or more directors of the Corporation, the provisions
of Article III of the Articles of Incorporation (as it may be
duly amended from time to time) fixing the rights and preferences
of such preferred stock shall govern with respect to the
election, removal, vacancies or other related matters with
respect to such directors.
3.8 Notice of Shareholder Nominees. Only persons who are
nominated in accordance with the procedures set forth in this
Section 3.8 shall be eligible for election as directors. Nomina-
tions of persons for election to the Board of Directors of the
Corporation may be made at a meeting of shareholders by or at the
direction of the Board of Directors or by a shareholder of the
Corporation entitled to vote for the election of directors at the
meeting who complies with the notice procedures set forth in this
Section 3.8. Such nominations, other than those made by or at the
direction of the Board of Directors, shall be made pursuant to
timely notice in writing to the Secretary of the Corporation. To
be timely, a shareholder's notice must be delivered or mailed and
received at the principal executive offices of the Corporation
not less than 45 days nor more than 90 days prior to the meeting;
provided, however, that in the event that less than 55 days
notice or prior public disclosure of the date of the meeting is
given or made to shareholders, notice by the shareholder to be
timely must be received no later than the close of business on
the 10th day following the day on which such notice of the date
of the meeting was mailed or such public disclosure was made.
Such shareholder's notice shall set forth the following:
a. as to each person whom the shareholder proposes to
nominate for election or re-election as a director (i) the
name, age, business address and residence address of such
person, (ii) the principal occupation or employment of such
person, (iii) the class and number of shares of the capital
stock of the Corporation of which such person is the
beneficial owner (determined in accordance with Article
V.A.2 of the Articles of Incorporation) and (iv) any other
information relating to such person that would be required
to be disclosed in solicitations of proxies for election of
directors, or would be otherwise required, in each case
pursuant to Regulation 14A under the Securities Exchange Act
of 1934, as amended (including without limitation such
person's written consent to being named in the proxy
statement as a nominee and to serving as a director if
elected); and
b. as to the shareholder giving the notice (i) the
name and address of such shareholder and (b) the class and
number of shares of the capital stock of the Corporation of
which such shareholder is the beneficial owner (determined
in accordance with Article V.A.2 of the Articles of
Incorporation) . If requested in writing by the Secretary
the Corporation at least 15 days in advance of the meeting,
such shareholder shall disclose to the Secretary, within 10
days of such request, whether such person is the sole
beneficial owner of the shares held of record by him; and,
if not, the name and address of each other person known by
the shareholder of record to claim a beneficial interest in
such shares.
At the request of the Board of Directors, any person nominated by
or at the direction of the Board of Directors for election as a
director shall furnish to the Secretary of the Corporation that
information required to be set forth in a shareholder's notice of
nomination which pertains to the nominee. If a shareholder seeks
to nominate one or more persons as directors, the Secretary shall
appoint two Inspectors, who shall not be affiliated with the
Corporation, to determine whether a shareholder has complied with
this Section 3.8. If the Inspectors shall determine that a
shareholder has not complied with this Section 3.8, the
Inspectors shall direct the Chairman of the meeting to declare to
the meeting that a nomination was not made in accordance with the
procedures prescribed by the Articles of Incorporation or these
By-laws; and the Chairman shall so declare to the meeting and the
defective nomination shall be disregarded.
The provisions of this Section 3.8 shall not apply to the
election of any directors which the holders of preferred stock of
the Corporation, voting separately as a class, may be entitled to
elect.
3.9 Compensation of Directors. Directors as such, shall
receive such compensation for their services as may be fixed by
resolution of the Board of Directors and shall receive their
actual expenses of attendance, if any, for each regular or
special meeting of the Board; provided that nothing herein
contained shall be construed to preclude any director from
serving the Corporation in any other capacity and receiving
compensation therefor.
SECTION 4
MEETINGS OF THE BOARD
4.1 Place of Meetings. The meetings of the Board of
Directors may be held at such place within or without the State
of Louisiana as a majority of the directors may from time to time
appoint.
4.2 Initial Meetings. The first meeting of each newly
elected Board shall be held immediately following the share-
holders' meeting at which the Board is elected and at the same
place as such meeting, and no notice of such first meeting shall
be necessary for the newly elected directors in order legally to
constitute the meeting.
4.3 Regular Meetings; Notice. Regular meetings of the
Board may be held at such times as the Board may from time to
time determine. Notice of regular meetings of the Board of
Directors shall be required, but no special form of notice or
time of notice shall be necessary.
4.4 Special Meetings; Notice. Special meetings of the
Board may be called by the Chairman of the Board, Chief Executive
Officer and President on reasonable notice given to each
director, either personally or by telephone, mail or by telegram.
Special meetings shall be called by the Chairman of the Board,
Chief Executive Officer and President, or the Secretary in like
manner and on like notice on the written request of a majority of
the directors and if such officers fail or refuse, or are unable
within 24 hours to call a meeting when requested, then the
directors making the request may call the meeting on two days'
written notice given to each director. The notice of a special
meeting of directors need not state its purpose or purposes, but
if the notice states a purpose or purposes and does not state a
further purpose to consider such other business as may properly
come before the meeting, the business to be conducted at the
special meeting shall be limited to the purposes stated in the
notice.
4.5 Waiver of Notice. Directors present at any regular or
special meeting shall be deemed to have received due, or to have
waived, notice thereof, provided that a director who participates
in a meeting by telephone (as permitted by Section 4.9 hereof)
shall not be deemed to have received or waived due notice if, at
the beginning of the meeting, he objects to the transaction of
any business because the meeting is not lawfully called.
4.6 Quorum. A majority of the Board shall be necessary to
constitute a quorum for the transaction of business, and except
as otherwise provided by law or the Articles of Incorporation or
these By-laws, the acts of a majority of the entire Board of
Directors at a meeting at which a quorum is present shall be the
acts of the Board. If a quorum is not present at any meeting of
the Board of Directors, the directors present may adjourn the
meeting from time to time without notice other than announcement
at the meeting, until a quorum is present.
4.7 Withdrawal. If a quorum is present when the meeting
convened, the directors present may continue to do business,
taking action by vote of a majority of a quorum as fixed in
Section 4.6 hereof, until adjournment, notwithstanding the
withdrawal of enough directors to leave less than a quorum as
fixed in Section 4.6 hereof or the refusal of any director
present to vote.
4.8 Action by Consent. Any action which may be taken at a
meeting of the Board or any committee thereof, may be taken by a
consent in writing signed by all of the directors or by all
members of the committee, as the case may be, and filed with the
records of proceedings of the Board or Committee.
4.9 Meetings by Telephone or Similar
Communication. Members of the Board may participate at and be
present at any meeting of the Board or any committee thereof by
means of conference telephone or similar communications equipment
if all persons participating in such meeting can hear and
communicate with each other.
SECTION 5
COMMITTEES OF THE BOARD
5.1 General. The Board may designate one or more
committees, each committee to consist of two or more of the
directors of the Corporation (and one or more directors may be
named as alternate members to replace any absent or disqualified
regular members), which, to the extent provided by resolution of
the Board or the By-laws, shall have and may exercise the powers
of the Board in the management of the business and affairs of the
Corporation, and may have power to authorize the seal of the
Corporation to be affixed to documents, but no such committee
shall have power or authority in reference to amending the
Articles of Incorporation, adopting an agreement of merger or
consolidation, recommending to the stockholders the sale, lease
or exchange of all or substantially all of the Corporation's
property and assets, recommending to the stockholders a
dissolution of the Corporation or a revocation of dissolution,
removing or indemnifying directors or amending the By-laws; and
unless the resolution expressly so provides, no such committee
shall have the power or authority to declare a dividend or
authorize issuance of stock. Such committee or committees shall
have such name or names as may be stated in the By-laws, or as
may be determined, from time to time, by the Board. Any vacancy
occurring in any such committee shall be filled by the Board, but
the President may designate another director to serve on the
committee pending action by the Board. Each such member of a
committee shall hold office during the term of the Board
constituting it, unless otherwise ordered by the Board.
5.2 Compensation Committee. The Board shall establish a
Compensation Committee consisting of at least two directors. The
Compensation Committee shall administer the Performance Share
Plan, the Stock Appreciation Plan, any incentive compensation
plans involving securities of the Corporation adopted by the
Corporation in the future and employment contracts with any
employee, and shall have plenary authority with respect to all
compensation related matters. Each of the members of the
Compensation Committee shall be a "disinterested person" as
defined in Rule 16b-3 promulgated under the Securities Exchange
Act of 1934 and an "outside director" as defined in the
regulations promulgated under 162(m) of the Internal Revenue
Code. The Compensation Committee shall determine the general
compensation policies of the Corporation and the compensation to
be paid to executive officers of the Corporation. If the
Compensation Committee is composed of an even number of persons,
in the event of a disagreement, which cannot in good faith be
resolved, it will be resolved by the affirmative vote of a
majority of the entire Board.
5.3 Audit Committee. The Board shall establish an Audit
Committee consisting of at least three directors who are not
officers or employees of the Corporation or any of its
affiliates. The Audit Committee shall (i) serve as a focal point
for communication between noncommittee directors, the independent
accountants, internal audit and management, as their duties
relate to financial accounting, reporting and controls, (ii)
assist the Board of Directors in fulfilling its fiduciary
responsibilities as to accounting policies and reporting
practices of the Corporation and all subsidiaries and the
sufficiency of auditing relative thereto and (iii) operate as the
Board's principal agent in ensuring the independence of the
Corporation's independent accountants, the integrity of
management and the adequacy of disclosure to shareholders.
SECTION 6
REMOVAL OF BOARD MEMBER
Any director or the entire Board of Directors may be removed
at any time, but only for cause (as such term is defined in
Article IV.C of the Articles of Incorporation), by the affirma-
tive vote of not less than 80% of the Total Voting Power,
provided that the removal may only be effected at a meeting of
shareholders duly called for that purpose. The shareholders at
such meeting may proceed to elect a successor or successors for
the unexpired term of the director or directors removed. Except
as provided in the Articles of Incorporation and in this Section
6, directors shall not be subject to removal.
SECTION 7
NOTICES
7.1 Form of Delivery. Whenever under the provisions of law
the Articles of Incorporation or these By-laws notice is required
to be given to any shareholder or director, it shall not be
construed to mean personal notice unless otherwise specifically
provided in the Articles of Incorporation or these By-laws, but
said notice may be given by mail, addressed to such shareholder
or director at his address as it appears on the records of the
Corporation, with postage thereon prepaid. Such notices shall be
deemed to have been given at the time they are deposited in the
United States mail. Notice to a director pursuant to Section 4.4
hereof may also be given personally or by telephone or telegram
sent to his address as it appears on the records of the
Corporation.
7.2 Waiver. Whenever any notice is required to be given by
law, the Articles of Incorporation or these By-laws, a waiver
thereof in writing signed by the person or persons entitled to
said notice, whether before or after the time stated therein,
shall be deemed equivalent thereto. In addition, notice shall be
deemed to have been given to, or waived by, any shareholder or
director who attends a meeting of shareholders or directors in
person, or is represented at such meeting by proxy, without
protesting at the commencement of the meeting the transaction of
any business because the meeting is not lawfully called or
convened.
SECTION 8
OFFICERS
8.1 Designations. The officers of the corporation shall be
chosen by the directors and shall be the Chairman of the Board,
Chief Executive officer and President (with all such offices to
be held by one person), a Secretary and a Treasurer. The
directors may elect one or more Vice Presidents. Any two offices
may be held by one person, provided that no person holding more
than one office may sign, in more than one capacity, any
certificate or other instrument required by law to be signed by
two officers.
8.2 Additional Designations. The Board of Directors may
appoint such other officers as it shall deem necessary, who shall
hold their offices for such terms and shall exercise such powers
and perform such duties as shall be determined from time to time
by the Board.
8.3 Term of Office. The officers of the Corporation shall
hold office at the pleasure of the Board of Directors. Except as
otherwise provided in the resolution of the Board of Directors
electing any officer, each officer shall hold office until the
first meeting of the Board of Directors after the annual meeting
of shareholders next succeeding his or her election, and until
his or her successor is elected and qualified or until his or her
earlier resignation or removal. Any officer may resign at any
time upon written notice to the Board, to the Chairman, Chief
Executive Officer and President, or to the Secretary of the
Corporation. Such resignation shall take effect at the time
specified therein as acceptance of such resignation shall be
necessary to make it effective. The Board may remove any officer
with or without cause at any time, except that the removal of the
Chairman of the Board, Chief Executive Officer and President
shall require the vote of at least three-fourths of the entire
Board. Any such removal shall be without prejudice to the
contractual rights of such offices, if any, with the Corporation,
but the election of an officer shall not in and of itself create
contractual rights. Any vacancy occurring in any office of the
Corporation by death, resignation, removal or otherwise may be
filled for the unexpired portion of the term by the Board at any
regular or special meeting.
8.4 The Chairman, Chief Executive Officer, and President.
The Chairman, Chief Executive Officer and President shall have
general and active responsibility for the management of the
business of the Corporation, shall be responsible for implement-
ing all orders and resolutions of the Board of Directors, shall
be the chief operating officer of the Corporation, and shall
supervise the daily operations of the business of the
Corporation. The Chairman of the Board shall preside at meetings
of the Board of Directors and of the shareholders.
8.5 The Vice Presidents. The Vice Presidents (if any) in
the order specified by the Board or, if not so specified, in the
order of their seniority shall, in the absence or disability of
the President, perform the duties and exercise the powers of the
President, and shall perform such other duties as the President
or the Board of Directors shall prescribe.
8.6 The Secretary. The Secretary shall attend all meetings
of the Board of Directors and all meetings of the shareholders
and record all votes and the minutes of all proceedings in a book
to be kept for that purpose. He shall give, or cause to be
given, notice of all meetings of the shareholders and special
meetings of the Board, and shall perform such other duties as may
be prescribed by the Board or President, under whose supervision
he shall be. He shall keep in safe custody the seal of the
Corporation, if any, and affix the same to any instrument
requiring it.
8.7 The Treasurer. The Treasurer shall have the custody of
the corporate funds and shall keep or cause to be kept full and
accurate accounts of receipts and disbursements in books
belonging to the Corporation and shall deposit all monies and
other valuable effects in the name and to the credit of the
Corporation in such depositories as may be designated by the
Board of Directors. He shall keep a proper accounting of all
receipts and disbursements and shall disburse the funds of the
Corporation only for proper corporate purposes or as may be
ordered by the Board and shall render to the President and the
Board at the regular meetings of the Board, or whenever they may
require it, an account of all his transactions as Treasurer and
of the financial condition of the Corporation.
SECTION 9
STOCK
9.1 Certificates. Every holder of stock in the Corporation
shall be entitled to have a certificate signed by the President
or a Vice President and the Secretary or an Assistant Secretary
evidencing the number and class (and series, if any) of shares
owned by him, containing such information as required by law and
bearing the seal of the Corporation. If any stock certificate is
manually signed by a transfer agent or registrar other than the
Corporation itself or an employee of the Corporation, the signa-
ture of any such officer may be a facsimile. In case any officer,
transfer agent or registrar who has signed or whose facsimile
signature has been placed upon a certificate shall have ceased to
be such officer, transfer agent or registrar before such
certificate is issued, it may be issued by the Corporation with
the same effect as if he were such officer, transfer agent or
registrar at the date of issue.
9.2 Missing Certificates. The President or any Vice
President 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, stolen or
destroyed, upon the making of an affidavit of that fact by the
person claiming the certificate of stock to be lost, stolen or
destroyed. As a condition precedent to the issuance of a new
certificate or certificates, the officers of the Corporation
shall, unless dispensed with by the President, require the owner
of such lost, stolen or destroyed certificate or certificates, or
his legal representative, (i) to advertise or give the
Corporation a bond or (ii) enter into a written indemnity
agreement, in each case in an amount appropriate to indemnify the
Corporation against any claim that may be made against the
Corporation with respect to the certificate alleged to have been
lost, stolen or destroyed.
9.3 Transfers. Upon surrender to the Corporation or the
transfer agent of the Corporation, of a certificate for 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, cancel the old certificate and record the transaction
upon its books.
SECTION 10
DETERMINATION OF SHAREHOLDERS
10.1 Record Date. For the purpose of determining share-
holders entitled to notice of and to vote at a meeting, or to
receive a dividend, or to receive or exercise subscription or
other rights, or to participate in a reclassification of stock,
or in order to make a determination of shareholders for any other
proper purpose, the Board of Directors may fix in advance a
record date for determination of shareholders for such purpose,
such date to be not more than sixty days and, if fixed for the
purpose of determining shareholders entitled to notice of and to
vote at a meeting, not less than ten days, prior to the date on
which the action requiring the determination of shareholder is to
be taken.
10.2 Registered Shareholders. Except as otherwise provided
by law, the Corporation, and its directors, officers and agents
may recognize and treat a person registered on its records as the
owner of shares, as the owner in fact thereof for all purposes,
and as the person exclusively entitled to have and to exercise
all rights and privileges incident to the ownership of such
shares, and rights under this Section shall not be affected by
any actual constructive notice which the Corporation, or any of
its directors, officers or agents, may have to the contrary.
SECTION 11
MISCELLANEOUS
11.1 Dividends. Except as otherwise provided by law or the
Articles of Incorporation, dividends upon the stock of the
Corporation may be declared by the Board of Directors at any
regular or special meeting. Dividends may be paid in cash,
property, or in shares of stock.
11.2 Checks. All checks or demands for money and notes of
the Corporation shall be signed by such officer or officers or
such other person or persons as the Board of Directors may from
time to time designate. Signatures of the authorized signatories
may be by facsimile.
11.3 Fiscal Year. The fiscal year of this Corporation will
be a calendar year.
11.4 Seal. The Board of Directors may adopt a corporate
seal, which seal shall have inscribed thereon the name of the
Corporation. Said seal may be used by causing it or a facsimile
thereof to be impressed or affixed or reproduced or otherwise.
Failure to affix the seal shall not, however, affect the validity
of any instrument.
11.5 Gender. All pronouns and variations thereof used in
these By-laws shall be deemed to refer to the masculine, feminine
or neuter gender, singular or plural, as the identity of the
person, persons, entity or entities referred to require.
SECTION 12
INDEMNIFICATION
12.1 Definitions. As used in this section the following
terms shall have the meanings set forth below:
(a) "Board" - the Board of Directors of the Corpora-
tion.
(b) "Claim" - any threatened, pending or completed
claim, action, suit, or proceeding, whether civil, criminal, ad-
ministrative or investigative and whether made judicially or ex-
tra-judicially, or any separate issue or matter therein, as the
context requires.
(c) "Determining Body" - (i) those members of the
Board who are not named as parties to the Claim for which indem-
nification is being sought ("Impartial Directors"), if there are
at least three Impartial Directors, (ii) a committee of at least
three Impartial Directors appointed by the Board (regardless
whether the members of the Board of Directors voting on such
appointment are Impartial Directors) or (iii) if there are fewer
than three Impartial Directors or if the Board of Directors or the
committee appointed pursuant to clause (ii) of this paragraph so
directs (regardless whether the members thereof are Impartial
Directors), independent legal counsel, which may be the regular
outside counsel of the Corporation.
(d) "Disbursing Officer" - the Chief Executive Officer
of the Corporation or, if the Chief Executive Officer is a party
to the Claim for which indemnification is being sought, any offi-
cer not a party to such Claim who is designated by the Chief
Executive Officer to be the Disbursing Officer with respect to in-
demnification requests related to the Claim, which designation
shall be made promptly after receipt of the initial request for
indemnification with respect to such Claim.
(e) "Expenses" - any expenses or costs (including,
without limitation, attorney's fees, judgments, punitive or
exemplary damages, fines and amounts paid in settlement).
(f) "Indemnitee" - each person who is or was a director
or officer of the Corporation.
12.2 Indemnity and Advancement of Expenses.
(a) To the extent such Expenses exceed the amounts reim-
bursed or paid pursuant to policies of liability insurance
maintained by the Corporation, the Corporation shall in-
demnify each Indemnitee against any Expenses actually and
reasonably incurred by him (as they are incurred) in
connection with any Claim either against him or as to which
he is involved solely as a witness or person required to give
evidence, by reason of his position (i) as a director or
officer of the Corporation, (ii) as a director or officer of
any subsidiary of the Corporation, (iii) as a fiduciary with
respect to any employee benefit plan of the Corporation, or
(iv) as a director, officer, partner, employee or agent of
another Corporation, partnership, joint venture, trust or
other for-profit or not-for-profit entity or enterprise, if
such position is or was held at the request of the
Corporation, whether relating to service in such position
before or after the effective date of this Section, if he (i)
is successful in his defense of the Claim on the merits or
otherwise or (ii) has been found by the Determining Body
(acting in good faith) to have met the Standard of Conduct
(defined below); provided that (A) the amount otherwise
payable by the Corporation may be reduced by the Determining
Body to such amount as it deems proper if it determines that
the Claim involved the receipt of a personal benefit by
Indemnitee, and (B) no indemnification shall be made in
respect of any Claim as to which Indemnitee shall have been
adjudged by a court of competent jurisdiction, after exhaus-
tion of all appeals therefrom, to be liable for willful or
intentional misconduct in the performance of his duty to the
Corporation or to have obtained an improper personal benefit,
unless, and only to the extent that, a court shall determine
upon application that, despite the adjudication of liability
but in view of all the circumstances of the case, Indemnitee
is fairly and reasonably entitled to indemnity for such
Expenses as the court deems proper.
(b) The Standard of Conduct is met when the conduct by
an Indemnitee with respect to which a Claim is asserted was
conduct that was in good faith and that he reasonably
believed to be in, or not opposed to, the best interest of
the Corporation, and, in the case of a criminal action or
proceeding, that he had no reasonable cause to believe was
unlawful. The termination of any Claim by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, create a presumption
that Indemnitee did not meet the Standard of Conduct.
(c) Promptly upon becoming aware of the existence of any
Claim as to which he may be indemnified hereunder, Indemnitee
shall notify the Chief Executive Officer of the Corporation
of the Claim and whether he intends to seek indemnification
hereunder. If such notice indicates that Indemnitee does so
intend, the Chief Executive Officer shall promptly advise the
Board thereof and notify the Board that the establishment of
the Determining Body with respect to the Claim will be a
matter presented at the next regularly scheduled meeting of
the Board. After the Determining Body has been established
the Chief Executive Officer shall inform the Indemnitee
thereof and Indemnitee shall immediately provide the De-
termining Body with all facts relevant to the Claim known to
him. Within 60 days of the receipt of such information, to-
gether with such additional information as the Determining
Body may request of Indemnitee, the Determining Body shall
determine, and shall advise Indemnitee of its determination,
whether Indemnitee has met the Standard of Conduct.
(d) During such 60-day period, Indemnitee shall promptly
inform the Determining Body upon his becoming aware of any
relevant facts not therefore provided by him to the
Determining Body, unless the Determining Body has obtained
such facts by other means.
(e) In the case of any Claim not involving a proposed,
threatened or pending criminal proceeding,
(i) if Indemnitee has, in the good faith judgment
of the Determining Body, met the Standard of Conduct, the
Corporation may, in its sole discretion after notice to
Indemnitee, assume all responsibility for the defense of the
Claim, and, in any event, the Corporation and the Indemnitee
each shall keep the other informed as to the progress of the
defense, including prompt disclosure of any proposals for
settlement; provided that if the Corporation is a party to
the Claim and Indemnitee reasonably determines that there is
a conflict between the positions of the Corporation and
Indemnitee with respect to the Claim, then Indemnitee shall
be entitled to conduct his defense, with counsel of his
choice; and provided further that Indemnitee shall in any
event be entitled at his expense to employ counsel chosen by
him to participate in the defense of the Claim; and
(ii) the Corporation shall fairly consider any
proposals by Indemnitee for settlement of the Claim. If the
Corporation (A) proposes a settlement acceptable to the
person asserting the Claim, or (B) believes a settlement
proposed by the person asserting the Claim should be ac-
cepted, it shall inform Indemnitee of the terms thereof and
shall fix a reasonable date by which Indemnitee shall
respond. If Indemnitee agrees to such terms, he shall ex-
ecute such documents as shall be necessary to effect the set-
tlement. If he does not agree he may proceed with the de-
fense of the Claim in any manner he chooses, but if he is not
successful on the merits or otherwise, the Corporation's ob-
ligation to indemnify him for any Expenses incurred following
his disagreement shall be limited to the lesser of (A) the
total Expenses incurred by him following his decision not to
agree to such proposed settlement or (B) the amount the
Corporation would have paid pursuant to the terms of the pro-
posed settlement. If, however, the proposed settlement would
impose upon Indemnitee any requirement to act or refrain from
acting that would materially interfere with the conduct of
his affairs, Indemnitee may refuse such settlement and pro-
ceed with the defense of the Claim, if he so desires, at the
Corporation's expense without regard to the limitations
imposed by the preceding sentence. In no event, however,
shall the Corporation be obligated to indemnify Indemnitee
for any amount paid in a settlement that the Corporation has
not approved.
(f) In the case of a Claim involving a proposed,
threatened or pending criminal proceeding, Indemnitee shall
be entitled to conduct the defense of the Claim, and to make
all decisions with respect thereto, with counsel of his
choice, provided, however, that the Corporation shall not be
obligated to indemnify Indemnitee for an amount paid in
settlement that the Corporation has not approved.
(g) After notifying the Corporation of the existence of
a Claim, Indemnitee may from time to time request the
Corporation to pay the Expenses (other than judgments, fines,
penalties or amounts paid in settlement) that he incurs in
pursuing a defense of the Claim prior to the time that the
Determining Body determines whether the Standard of Conduct
has been met. If the Disbursing Officer believes the amount
requested to be reasonable, he shall pay to Indemnitee the
amount requested (regardless of Indemnitee's apparent ability
to repay such amount) upon receipt of an undertaking by or on
behalf of Indemnitee to repay such amount if it shall
ultimately be determined that he is not entitled to be
indemnified by the Corporation under the circumstances. If
the Disbursing Officer does not believe such amount to be
reasonable, the Corporation shall pay the amount deemed by
him to be reasonable and Indemnitee may apply directly to the
Determining Body for the remainder of the amount requested.
(h) After the Determining Body has determined that the
Standard of Conduct was met, for so long as and to the extent
that the Corporation is required to indemnify Indemnitee
under this Agreement, the provisions of Paragraph (g) shall
continue to apply with respect to Expenses incurred after
such time except that (i) no undertaking shall be required of
Indemnitee and (ii) the Disbursing Officer shall pay to
Indemnitee such amount of any fines, penalties or judgments
against him which have become final as the Corporation is
obligated to indemnify him.
(i) Any determination by the Corporation with respect to
settlements of a Claim shall be made by the Determining Body.
(j) The Corporation and Indemnitee shall keep confiden-
tial, to the extent permitted by law and their fiduciary
obligations, all facts and determinations provided or made
pursuant to or arising out of the operation of this Section,
and the Corporation and Indemnitee shall instruct its or his
agents and employees to do likewise.
12.3 Enforcement.
(a) The rights provided by this Section shall be
enforceable by Indemnitee in any court of competent
jurisdiction.
(b) If Indemnitee seeks a judicial adjudication of his
rights under this Section Indemnitee shall be entitled to
recover from the Corporation, and shall be indemnified by the
Corporation against, any and all Expenses actually and
reasonably incurred by him in connection with such proceeding
but only if he prevails therein. If it shall be determined
that Indemnitee is entitled to receive part but not all of
the relief sought, then the Indemnitee shall be entitled to
be reimbursed for all Expenses incurred by him in connection
with such judicial adjudication if the amount to which he is
determined to be entitled exceeds 50% of the amount of his
claim. Otherwise, the Expenses incurred by Indemnitee in
connection with such judicial adjudication shall be
appropriately prorated.
(c) In any judicial proceeding described in this
subsection, the Corporation shall bear the burden of proving
that Indemnitee is not entitled to any Expenses sought with
respect to any Claim.
12.4 Saving Clause. If any provision of this Section is
determined by a court having jurisdiction over the matter to
require the Corporation to do or refrain from doing any act
that is in violation of applicable law, the court shall be
empowered to modify or reform such provision so that, as
modified or reformed, such provision provides the maximum
indemnification permitted by law, and such provision, as so
modified or reformed, and the balance of this Section, shall
be applied in accordance with their terms. Without limiting
the generality of the foregoing, if any portion of this
Section shall be invalidated on any ground, the Corporation
shall nevertheless indemnify an Indemnitee to the full extent
permitted by any applicable portion of this Section that
shall not have been invalidated and to the full extent per-
mitted by law with respect to that portion that has been in-
validated.
12.5 Non-Exclusivity.
(a) The indemnification and advancement of Expenses
provided by or granted pursuant to this Section shall not be
deemed exclusive of any other rights to which Indemnitee is
or may become entitled under any statute, article of
incorporation, by-law, authorization of shareholders or
directors, agreement, or otherwise.
(b) It is the intent of the Corporation by this Section
to indemnify and hold harmless Indemnitee to the fullest ex-
tent permitted by law, so that if applicable law would permit
the Corporation to provide broader indemnification rights
than are currently permitted, the Corporation shall indemnify
and hold harmless Indemnitee to the fullest extent permitted
by applicable law notwithstanding that the other terms of
this Section would provide for lesser indemnification.
12.6 Successors and Assigns. This Section shall be binding
upon the Corporation, its successors and assigns, and shall
inure to the benefit of the Indemnitee's heirs, personal
representatives, and assigns and to the benefit of the
Corporation, its successors and assigns.
12.7 Indemnification of Other Persons. The Corporation may
indemnify any person not covered by Sections 12.1 through
12.6 to the extent provided in a resolution of the Board or a
separate section of these By-laws.
SECTION 13
AMENDMENTS
13.1 Adoption of By-laws; Amendments Thereof. By-laws of
the Corporation may be adopted only by (i) a majority of the
entire Board of Directors at any time when there is no
Related Person (as defined in Article V.A.2 of the Articles
of Incorporation) or (ii) both a majority of the entire
Board of Directors and a majority of the Continuing
Directors (as defined in Article V.A.4 of the Articles of
Incorporation) at any time when there is a Related Person
Article (as defined in Article V.A.2 of the Articles of
Incorporation). By-laws may be amended or repealed only by
(i) a majority of the entire Board of Directors at any time
when there is no Related Person (except that any amendment
to or repeal of Section 6 of these By-laws shall require an
affirmative vote of at least three-quarters of the entire
Board of Directors), (ii) both a majority of the entire
Board and a majority of the Continuing Directors at any time
when there is a Related Person (as defined in Article V.A.2
of the Articles of Incorporation), or (iii) the affirmative
vote of the holders of at least 80% of the Total Voting
Power at any regular or special meeting of shareholders, the
notice of which expressly states that the proposed amendment
or repeal is to be considered at the meeting.
13.2 Re-Amendment or Re-adoption by Board of Directors. Any
provision of these By-laws amended or repealed by the
shareholders may be re-amended or re-adopted in the manner
provided in Section 13.1.
13.3 New By-laws; Amendments. Any purported amendment to
these By-laws which would add hereto a matter not covered
herein prior to such purported amendment shall be deemed to
constitute the adoption of a By-law provision and not an
amendment to the By-laws.