BY-LAWS
OF
VARSITY USA, INC.
ARTICLE 1.
AMENDMENTS
Section 1.1. Amendment of By-Laws. These by-laws may be altered, amended or
repealed, and new by-laws may be adopted by the shareholders or by the board of
directors of the Corporation.
ARTICLE 2.
OFFICES
Section 2.1. Registered Office. The corporation shall continuously maintain
a registered office in the State of Tennessee which may, but need not be, the
same as its place of business, and a registered agent whose business office is
identical with such registered office.
Section 2.2. Other Offices. The corporation may also have offices at such
other places both within and without the State of Tennessee as the board of
directors may from time to time determine or the business of the corporation may
require.
ARTICLE 3.
SHARES
Section 3.1. Form of Shares. Shares either shall be represented by
certificates or shall be uncertificated shares.
3.1.1. Signing of Certificates. Certificates representing shares of
the corporation shall be signed by the appropriate officers and may be
sealed with the seal or a facsimile of the seal of the corporation if the
corporation uses a seal. If a certificate is countersigned by a transfer
agent or registrar, other than an employee of the corporation, any other
signatures may be facsimile. Each certificate representing shares shall be
consecutively numbered or otherwise identified, and shall also state the
name of the person to whom issued, the number and class of shares (with
designation of series, if any), the date of issue, that the corporation is
organized under Tennessee law, and any other information required by law.
3.1.2. Uncertificated Shares. Unless prohibited by the articles of
incorporation, the board of directors may provide by resolution that some
or all of any class or series of shares shall be uncertificated shares. Any
such resolution shall not apply to shares represented by a certificate
until the certificate (or such documentation as may be allowed under
Section 3.2 below) has been surrendered to the corporation. Within a
reasonable time after the issuance or transfer of uncertificated shares,
the corporation shall send the registered owner thereof a written notice of
all information that would appear on a certificate. Except as otherwise
expressly provided by law, the rights and obligations of the holders of
uncertificated shares shall be identical to those of the holders of
certificates representing shares of the same class and series.
3.1.3. Identification of Shareholders. The name and address of each
shareholder, the number and class of shares held and the date on which the
shares were issued shall be entered on the books of the corporation. The
person in whose name shares stand on the books of the corporation shall be
deemed the owner thereof for all purposes as regards the corporation.
Section 3.2. Lost, Stolen or Destroyed Certificates. If a certificate
representing shares has allegedly been lost, stolen or destroyed, the board of
directors may in its discretion, except as may be required by law, direct that a
new certificate be issued upon such indemnification and other reasonable
requirements as it may impose.
Section 3.3. Transfers of Shares. Transfer of shares of the corporation
shall be recorded on the books of the corporation. Transfer of shares
represented by a certificate, except in the case of a lost or destroyed
certificate, shall be made on surrender for cancellation of the certificate for
such shares. A certificate presented for transfer must be duly endorsed and
accompanied by proper guaranty of signature or other appropriate assurances that
the endorsement is effective. Transfer of an uncertificated share shall be made
on receipt by the corporation of an instruction from the registered owner or
other appropriate person. The instruction shall be in writing or a communication
in such form as may be agreed upon in writing by the corporation.
ARTICLE 4.
SHAREHOLDERS
Section 4.1. Annual Meeting. The annual meeting of the shareholders for the
election of directors and the transaction of any other proper business shall be
held in or out of Tennessee at such time, date and place to be designated by the
Board of Directors.
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Section 4.2. Special Meetings. Special meetings of the shareholders may be
called by the president, by the board of directors, by the holders of not less
than one-fifth of all the outstanding shares of the corporation entitled to vote
on the matter for which the meeting is called, or by such other officers or
persons as may be provided for in the articles of incorporation.
Section 4.3. Place of Meeting. The board of directors may designate the
place of meeting for any annual or special meeting of shareholders. In the
absence of any such designation, the place of meeting shall be the principal
place of business of the corporation.
Section 4.4. Notice of Meetings. For all meetings of shareholders, a
written or printed notice of the meeting shall be delivered, personally or by
mail, to each shareholder of record entitled to vote at such meeting, which
notice shall state the place, date and hour of the meeting. For all special
meetings and when and as otherwise required by law, the notice shall state the
purpose or purposes of the meeting. The notice of the meeting shall be given not
less than 10 nor more than 60 days before the date of the meeting, or in the
case of a meeting involving a merger, consolidation, share exchange, dissolution
or sale, lease or an exchange of all or substantially all, of the property or
assets of the corporation not less than 20 nor more than 60 days before the date
of such meeting. If mailed, such notice shall be deemed to have been delivered
when deposited in the United States mail, postage prepaid, directed to the
shareholder at his or her address as it appears on the records of the
corporation. When a meeting is adjourned to another time or place, notice need
not be given of the adjourned meeting if the time and place thereof are
announced at the meeting at which the adjournment is taken unless otherwise
required by law.
Section 4.5. Quorum of Shareholders. The holders of a majority of the
outstanding shares of the corporation entitled to vote on a matter, present in
person or represented by proxy, shall constitute a quorum for consideration of
such matter at any meeting of shareholders unless a greater or lesser number is
required by the articles of incorporation. At any adjourned meeting at which a
quorum is present or represented, any business may be transacted which might
have been transacted at the original meeting, unless otherwise required by law.
Withdrawal of shareholders from any meeting shall not cause failure of a duly
constituted quorum at the meeting, unless otherwise required by law.
Section 4.6. Manner of Acting. The affirmative vote of holders of a
majority of the shares represented at a meeting and entitled to vote on a matter
at which a quorum is present shall be valid action by the shareholders, unless
voting by a greater number of shareholders or voting by class or classes of
shareholders is required by law or the articles of incorporation.
Section 4.7. Fixing of Record Date. If no record date is fixed for the
determination of shareholders entitled to notice of or to vote at a meeting of
shareholders, or shareholders entitled
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to receive payment of a dividend, or in order to make a determination of
shareholders for any other proper purpose, the date on which notice of the
meeting is mailed or the date on which the resolution of the board of directors
declaring such dividend is adopted, as the case may be, shall be the record date
for such determination of shareholders. If a record date is specifically set for
the purpose of determining shareholders entitled to notice of or to vote at any
meeting of shareholders, or shareholders entitled to receive payment of any
dividend, or in order to make a determination of shareholders for any other
proper purpose, the board of directors may fix in advance a date as the record
date for any such determination of shareholders, such date in any case to be not
more than 60 days and, for a meeting of shareholders, not less than 10 days, or
in the case of a merger, consolidation, share exchange, dissolution or sale,
lease or exchange of assets, not less than 20 days, immediately preceding such
meeting. When a determination of shareholders entitled to vote at any meeting of
shareholders has been made as provided in this Section, such determination shall
apply to any adjournment thereof.
Section 4.8. Voting Lists. The officer or agent having charge of the
transfer book for shares of the corporation shall make, within 20 days after the
record date for a meeting of shareholders or 10 days before such meeting,
whichever is earlier, a complete list of the shareholders entitled to vote at
such meeting, arranged in alphabetical order, with the address of and the number
of shares held by each, which list, for a period of 10 days prior to such
meeting, shall be kept on file at the registered office of the corporation and
shall be subject to inspection by any shareholders, and to copying at the
shareholder's expense, at any time during usual business hours. Such list shall
also be produced and kept open at the time and place of the meeting and shall be
subject to the inspection of any shareholder during the whole time of the
meeting. The original share ledger or transfer book, or a duplicate thereof kept
in the State of Tennessee, shall be prima facie evidence as to who are the
shareholders entitled to examine such list or share ledger or transfer book or
to vote at any meeting of shareholders.
Section 4.9. Proxies. A shareholder may appoint a proxy to vote or
otherwise act for him or her by signing an appointment form and delivering it to
the person so appointed. No proxy shall be valid after the expiration of 11
months from the date thereof unless otherwise provided in the proxy. An
appointment of a proxy is revocable by the shareholder unless the appointment
form conspicuously states that it is irrevocable and the appointment is coupled
with an interest in the shares or in the corporation generally.
Section 4.10. Voting of Shares by Certain Holders. Shares of a corporation
held by the corporation in a fiduciary capacity may be voted and shall be
counted in determining the total number of outstanding shares entitled to vote
at any given time.
4.10.1 Shares Held by Corporation. Shares registered in the name of
another corporation, domestic or foreign, may be voted by any officer,
agent, proxy or other legal representative authorized to vote such shares
under the laws of the state of incorporation of
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such corporation. This corporation shall treat the president or other
person holding the chief executive office of such other corporation as
authorized to vote such shares. However, such other corporation may
designate any other person or any other holder of an office of the
corporate shareholder to this corporation as the person or officeholder
authorized to vote such shares. Such persons or offices indicated shall be
registered by this corporation on the transfer books for shares and
included in any voting list prepared in accordance with Section 4.8 of this
Article.
4.10.2. Shares Held by Fiduciary. Shares registered in the name of a
deceased person, a minor ward or a person under legal disability may be
voted by his or her administrator, executor, or court appointed guardian,
either in person or by proxy, without a transfer of such shares into the
name of such administrator, executor, or court appointed guardian. Shares
registered in the name of a trustee may be voted by him or her, either in
person or by proxy.
4.10.3. Shares Held by Receiver. Shares registered in the name of a
receiver may be voted by such receiver, and shares held by or under the
control of a receiver may be voted by such receiver without the transfer
thereof into his or her name if authority so to do is contained in an
appropriate order of the court by which such receiver was appointed.
4.10.4. Shares Pledged. 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, and thereafter the pledgee shall be entitled to
vote the shares so transferred.
Section 4.11. Inspectors. At any meeting of shareholders, the chairman of
the meeting may, or upon the request of any shareholder shall, appoint one or
more persons as inspectors for such meeting. Inspectors shall:
4.11.1. Vote Count and Report. Determine the validity and effect of
proxies; ascertain and report the number of shares represented at the
meeting; count all votes and report the results; and perform such other
acts as are required and appropriate to conduct all elections with
impartiality and fairness to the shareholders.
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4.11.2. Written Reports. Each report shall be in writing and such
report shall be signed by the inspector or by a majority of them if there
be more than one inspector acting at such meeting. If there is more than
one inspector, the report of a majority shall be the report of the
inspectors. The report of the inspector or inspectors on the number of
shares represented at the meeting and the results of the voting shall be
prima facie evidence thereof.
Section 4.12. Informal Action by Shareholders. Any action required to be
taken at any annual or special meeting of the shareholders of the corporation,
or any other action which may be taken at a meeting of the shareholders, may
also be taken without such a meeting if a written consent, setting forth the
action so taken, shall be signed (i) by the holders of outstanding shares having
not less than the minimum number of votes that would be necessary to authorize
or take such action at a meeting at which all shares entitled to vote thereon
were present and voting or (ii) by all of the shareholders entitled to vote with
respect to the subject matter thereof. If such consent is signed by less than
all of the shareholders entitled to vote, then such consent shall become
effective only if at least 5 days prior to the execution of the consent a notice
in writing is delivered to all the shareholders entitled to vote with respect to
the subject matter thereof and, after the effective date of the consent, prompt
notice of the taking of the corporate action without a meeting by less than
unanimous written consent shall be delivered in writing to those shareholders
who have not consented in writing.
Section 4.13. Notice to Shareholders Not Signing. Prompt notice of the
taking of the corporation action by less than unanimous written consent shall be
given in writing to those shareholders who have not consented in writing. In the
event that the action which is consented to is such as would have required the
filing of a certificate under any Section of the Tennessee Business Corporation
Act if such action had been voted on by the shareholders at a meeting thereof,
the certificate filed under such Tennessee Business Corporation Act Section
shall state, in lieu of any statement required by such Section concerning any
vote of shareholders, that written consent has been given in accordance with the
provisions of said Section and that written notice to non-consenting
shareholders has been given as provided by law.
Section 4.14. Waiver of Notice. Whenever any notice whatever is required to
be given under the provisions of the law, the articles of incorporation or these
by-laws, a waiver thereof in writing signed by the person or persons entitled to
such notice, whether before or after the time stated therein, shall be deemed
equivalent to the giving of such notice. Attendance at any meeting shall
constitute waiver of notice thereof unless the person at the meeting objects to
the holding of the meeting because proper notice was not given.
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ARTICLE 5.
DIRECTORS
Section 5.1. General Powers and Qualifications. The business and affairs of
the corporation shall be managed by or under the direction of its board of
directors. Directors need not be residents of the State of Tennessee or
shareholders of the corporation.
Section 5.2. Number, Tenure and Resignation. The number of directors of the
corporation shall be a minimum of one. The number of directors may be increased
or decreased from time to time by resolution of shareholders or directors,
within the minimum and maximum limitations prescribed by this Section without
further amendment to the by-laws; provided, however, that no decrease in the
number of directors shall have the effect of shortening the term of any
incumbent director. Each director shall hold office until the last to occur of
the next annual meeting of shareholders or until his or her successor is elected
and has qualified. A director may resign at any time by written notice to the
board, its chairman, or the president or secretary of the corporation. The
resignation is effective on the date it bears, or its designated effective date.
Section 5.3. Quorum of Directors. A majority of the number of directors
fixed in Section 5.2 of this Article shall constitute a quorum for the
transaction of business at any meeting of the board of directors; provided,
however, that if less than a majority of the number of directors fixed in
Section 5.2 of this Article is present at a meeting, a majority of the directors
present may adjourn the meeting at any time without further notice, unless
otherwise required by law.
Section 5.4. Manner of Acting. The act of a majority of the directors
present at a meeting at which a quorum is present shall be the act of the board
of directors, unless the act of a greater number is required by law or these
by-laws.
Section 5.5. Vacancies. Any vacancy occurring in the board of directors
and any directorship to be filled by reason of an increase in the number of
directors may be filled by election at an annual meeting or at a special meeting
of shareholders called for that purpose. A director elected to fill a vacancy
shall hold office until the next annual meeting of shareholders at which his or
his predecessor's term would have expired.
Section 5.6. Removal of Directors. One or more of the directors may be
removed, with or without cause, at a meeting of shareholders, by the affirmative
vote of the holders of a majority of the outstanding shares then entitled to
vote at an election of directors (or such greater percentage as may be provided
in the articles of incorporation), except as follows:
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5.6.1. Notice of Meeting. No director shall be removed at a meeting of
shareholders unless the notice of such meeting shall state that a purpose
of the meeting is to vote upon the removal of one or more directors named
in the notice. Only the named director or directors may be removed at such
meeting.
Section 5.7. Regular Meetings. A regular meeting of the board of directors
shall be held without other notice than this by-law, immediately after, and at
the same place as, the annual meeting of shareholders. The board of directors
may provide, by resolution, the place, date and hour for the holding of
additional regular meetings of the board of directors, without other notice than
such resolution.
Section 5.8. Special Meetings. Special meetings of the board of directors
may be called by or at the request of the president, any two directors or any
one director if the board of directors consists of two or less members. The
person or persons authorized to call special meetings of the board of directors
may fix the place for holding any special meeting of the board of directors
called by them.
Section 5.9. Notice. Notice of any special meeting of the board of
directors shall be given at least two days prior to the meeting by written
notice delivered personally, by mail, telegram, or telex to each director at his
or her business address. If mailed, such notice shall be deemed to have been
delivered when deposited in the United States mail in a sealed envelope so
addressed, with postage prepaid thereon. If notice is given by telegram, such
notice shall be deemed to have been delivered when the telegram is delivered to
the telegraph company. If notice is given by telex, such notice shall be deemed
to have been delivered when the telex message is delivered to the telex
operator. Neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the board of directors need be specified in the
notice or waiver of notice of such meeting. The attendance of a director at any
meeting shall constitute a waiver of notice of such meeting, except where a
director attends a meeting for the express purpose of objecting to the
transaction of any business because the meeting is not lawfully called or
convened.
Section 5.10. Presumption of Assent. A director of the corporation who has
been present at a meeting of the board of directors at which action on any
corporate matter is taken shall be conclusively presumed to have assented to the
action taken, unless his or her dissent shall have been entered in the minutes
of the meeting or unless he or she shall have filed his or her written dissent
to such action with the person acting as the secretary of the meeting before the
adjournment thereof, or shall have forwarded such dissent by registered mail or
certified mail to the secretary of the corporation immediately after the
adjournment of the meeting. No director who voted in favor of any action may
dissent from such action after adjournment of the meeting.
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Section 5.11. Committees. A majority of the directors may, by resolution
passed by a majority of the number of directors fixed by the shareholders under
Section 5.2 of this Article, create one or more committees and appoint members
of the board to serve on the committee or committees. Each committee shall have
two or more members, who serve at the pleasure of the board.
5.11.1. Quorum. A majority of any committee shall constitute a
quorum and a majority of the quorum is necessary for committee
action. A committee may act by unanimous written consent without a
meeting and, subject to the provisions of the by-laws or action by the
board of directors, the committee, by majority vote of its members,
shall fix the time and place of meetings and the notice required
therefor.
5.11.2. Authority and Restrictions. To the extent specified by
the board of directors, each committee may exercise the authority of
the board of directors, provided, however, a committee may not
exercise the following powers;
5.11.3. Authorize Distributions. Authorize distributions, except
for dividends to be paid with respect to shares of any preferred or
special classes or any series thereof;
5.11.4. Act for Shareholders. Approve or recommend to the
shareholders any act which the Tennessee Business Corporation Act
requires to be approved by shareholders;
5.11.5. Board Vacancies. Fill vacancies on the board or any of
its committees;
5.11.6. Officers and Compensation. Elect or remove officers or
fix the compensation of any member of the committee;
5.11.7. By-Laws. Adopt, amend or repeal the by-laws;
5.11.8 Merger. Approved a plan of merger not requiring
shareholder approval;
5.11.9. Share Reacquisition. Authorize or approve reacquisition
of shares, except according to the general formula or method
prescribed by the board;
5.11.10. Share Sale or Issuance. Authorize or approve the
issuance or sale, or contract for sale, of shares or determine the
designation and relative rights, preferences, and limitations of a
series of shares, except that the board may direct a committee to fix
the specific terms of the issuance or sale or contract for sale, or of
the number of shares to be allocated to particular employees under an
employee benefit plan; or
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5.11.11. Resolution of Board. Amend, alter, repeal, or take
action inconsistent with any resolution or action of the board of
directors when the resolution or action of the board of directors by
its terms states that it shall not be amended, altered or repealed by
action of a committee.
Section 5.12. Informal Action by Directors. Any action required by the
Tennessee Business Corporation Act to be taken at a meeting of the board of
directors of the corporation, or any other action which may be taken at a
meeting of the board of directors or a committee thereof, may be taken without a
meeting if a consent in writing, setting forth the action so taken, shall be
signed by all of the directors entitled to vote with respect to the subject
matter thereof, or by all members of such committee, as the case may be.
5.12.1 Effective Date. The consent shall be evidenced by one or
more written approvals, each of which sets forth the action taken and
bears the signature of one or more directors. All the approvals
evidencing the consent shall be delivered to the secretary to be
filed in the corporate records. The action taken shall be effective
when all the directors have approved the consent unless the consent
specifies a different effective date.
5.12.2. Effect of Consent. Any consent signed by all the
directors or all the members of a committee shall have the same effect
as a unanimous vote, and may be stated as such in any document filed
with the Secretary of State under the Tennessee Business Corporation
Act.
Section 5.13. Meeting by Conference Telephone. Members of the board of
directors or of any committee of the board of directors may participate in and
act at any meeting of the board or committee by means of conference telephone or
other communications equipment through which all persons participating in the
meeting can hear each other. Participation in such a meeting shall be equivalent
to attendance and presence in person at the meeting of the person or persons so
participating.
Section 5.14 Compensation. The board of directors, by the affirmative vote
of a majority of the directors then in office, and irrespective of any personal
interest of any of its members, shall have authority to establish reasonable
compensation of all directors for services to the corporation as directors,
officers, or otherwise.
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ARTICLE 6.
OFFICERS
Section 6.1. Number. The officers of the corporation shall consist of a
president and a secretary and may also consist of one or several vice
presidents, a treasurer, one or more assistant treasurers, one or more assistant
secretaries and such other officers as may be elected in accordance with the
provisions of this Article. Except for the offices of president and secretary,
any two or more offices may be held by the same person.
Section 6.2. Election and Term of Office. The officers of the corporation
shall be elected annually by the board of directors at the first meeting of the
board of directors held after each annual meeting of shareholders. If the
election of officers shall not be held at such meeting, such election shall be
held as soon thereafter as reasonably practicable. Subject to the provisions of
Section 6.3 hereof, each officer shall hold office until the last to occur of
the next annual meeting of the board of directors or until the election and
qualification of his or her successor. Election of an officer shall not of
itself create contract rights.
Section 6.3. Removal of Officers. Any officer elected or appointed by the
board of directors may be removed by the board of directors whenever in its
judgment the best interests of the corporation would be served thereby, but such
removal shall be without prejudice to the contract rights, if any, of the
person so removed.
Section 6.4. Vacancies; New Offices. A vacancy occurring in any office may
be filled and new offices may be created and filled, at any time, by the board
of directors.
Section 6.5. President. The president shall be the chief executive officer
of the corporation. He or she shall be in charge of the day to day business and
affairs of the corporation, subject to the direction and control of the board
of directors. He or she shall preside at all meetings of the board of directors.
He or she shall have the power to appoint such agents and employees as in his or
her judgment may be necessary or proper for the transaction of the business of
the corporation. He or she may sign: (i) with the secretary or other proper
officer of the corporation thereunto authorized by the board of directors, stock
certificates of the corporation the issuance of which shall have been authorized
by the board of directors; and (ii) any contracts, deeds, mortgages, bonds, or
other instruments which the board of directors has authorized to be executed,
according to the requirements of the form of the instrument.
Section 6.6. Vice President(s). The vice president (or in the event there
is more than one vice president, each of them) shall assist the president in the
discharge of his or her duties as the president may direct, and shall perform
such other duties as from time to time may be assigned to
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him or her (or them) by the president or the board of directors. In the absence
of the president, the vice president (or vice presidents, in the order of their
election), shall perform the duties and exercise the authority of the president.
Section 6.7. Treasurer. The treasurer shall have charge and custody of and
be responsible for all funds and securities of the corporation, receive and give
receipts for moneys due and payable to the corporation from any source
whatsoever, and deposit all such moneys in the name of the corporation in such
banks, trust companies or other depositories as shall be selected in accordance
with the provisions of Article 8 of these by-laws, have charge of and be
responsible for the maintenance of adequate books of account for the
corporation, and, in general, perform all duties incident to the office of
treasurer and such other duties not inconsistent with these by-laws as from time
to time may be assigned to him or her by the president or the board of
directors.
Section 6.8. Secretary. The secretary shall keep the minutes of the
shareholders' and the board of directors' meetings, see that all notices are
duly given in accordance with the provisions of these by-laws or as required by
law, have general charge of the corporate records and of the seal of the
corporation, have general charge of the stock transfer books of the
corporation, keep a register of the post office address of each shareholder
which shall be furnished to the secretary by such shareholder, sign with the
president, or any other officer thereunto authorized by the board of directors,
certificates for shares of the corporation, the issuance of which shall have
been authorized by the board of directors, and any contracts, deeds, mortgages,
bonds, or other instruments which the board of directors has authorized to be
executed, according to the requirements of the form of the instrument, and, in
general, perform all duties incident to the office of secretary and other such
duties not inconsistent with these by-laws as from time to time may be assigned
to him or her by the president or the board of directors.
Section 6.9. Assistant Treasurers and Assistant Secretaries. The board of
directors may elect one or more than one assistant treasurer and assistant
secretary. In the absence of the treasurer, or in the event of his or her
inability or refusal to act, the assistant treasurers, in the order of their
election, shall perform the duties and exercise the authority of the treasurer.
In the absence of the secretary, or in the event of his or her inability or
refusal to act, the assistant secretaries, in the order of their election, shall
perform the duties and exercise the authority of the secretary. The assistant
treasurers and assistant secretaries, in general, shall perform such other
duties not inconsistent with these by-laws as shall be assigned to them by the
treasurer or the secretary, respectively, or by the president or the board of
directors.
Section 6.10. Compensation. The compensation of all directors and officers
shall be fixed from time to time by the board of directors. No officer shall be
prevented from receiving such compensation by reason of the fact that he or she
is also a director of the corporation. All
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compensation so established shall be reasonable and solely for services rendered
to the corporation.
6.10.1. Compensation and Expense Disallowance. Unless otherwise
provided by the board of directors, all payments made to a director or
officer of the corporation, including, but not limited to salary,
commission, bonus, interest, travel and entertainment expenses and
deferred compensation payments, which shall be disallowed, in whole or
in part, as a deductible expense by the Internal Revenue Service,
shall be reimbursed by such director or officer of the corporation to
the full extent of such disallowance. The proper corporate officers
are authorized and directed to effect collection on behalf of the
corporation for each amount disallowed. In lieu of a payment by the
director or officer, subject to the determination of the board of
directors, appropriate amounts may be withheld from future
compensation payments paid to such director of officer until the
amount owed the corporation is recovered. This by-law shall be
considered a term and condition of employment for each director and
officer of the corporation, unless specifically waived in writing by
the board of directors.
ARTICLE 7.
INDEMNIFICATION BY CORPORATION
Section 7.1. Indemnification of Directors and Officers. The corporation
shall, to the fullest extent to which it is empowered to do so and in accordance
with the procedures required by the Tennessee Business Corporation Act or any
other applicable laws, as may from time to time be in effect, indemnify any
person who was or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he or she is or was a director or
officer of the corporation, or is or was serving at the request of the
corporation as a director or officer of another corporation, partnership, joint
venture, trust or other enterprise, against all expenses, including attorneys'
fees, judgments, fines and amounts incurred by him or her in connection with
such action, suit or proceeding.
Section 7.2. Contract with the Corporation. The provisions of Section 7.1
of this Article shall be deemed to be a contract between the corporation and
each director or officer who serves in any such capacity at any time while said
Section 7.1 and the relevant provisions of the Tennessee Business Corporation
Act or other applicable laws, if any, are in effect, and any repeal or
modification of any such law or of said Section 7.1 shall not affect any state
of facts then or theretofore existing or any action, suit or proceeding
theretofore existing or thereafter brought or
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threatened based in whole or in part upon any such state of facts. In the event
a person entitled to indemnification under this Article claims indemnification,
the corporation shall take all required action to bring about a prompt and good
faith determination of such person's right to indemnification hereunder.
Section 7.3. Indemnification of Employees and Agents. Persons who are not
covered by the foregoing provisions of this Article and who are or were
employees or agents of the corporation, or are or were serving at the request of
the corporation as employees or agents of another corporation, joint venture,
partnership, trust or other enterprise, may be indemnified to the extent the
corporation is empowered to do so by the Tennessee Business Corporation Act or
any other applicable laws, when and as authorized at any time from time to time
by the board of directors in its sole discretion.
Section 7.4. Advance of Expenses. Expenses incurred in defending a civil or
criminal action, suit or proceeding may be paid by the corporation in advance of
the final dispositon of such action, suit or proceeding upon receipt of a
written agreement by or on behalf of a director and an officer to undertake to
repay such amount, unless it shall ultimately be determined that he or she is
entitled to be indemnified by the corporation as authorized in this article. The
provisions of this Section shall apply to employees or agents when the board of
directors has authorized such indemnification under the provision of Section 7.3
hereof.
Section 7.5. Other Rights of Indemnification. The indemnification provided
or permitted by this Article shall not be deemed exclusive of any other rights
to which those seeking indemnification may be entitled by law, agreement or
otherwise, and shall continue as to a person who ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such person.
Section 7.6. Liability Insurance. The corporation shall have the power to
purchase and maintain, on behalf of any person who is or was a director,
officer, employee or agent of the corporation or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, insurance
against any liability asserted against such person and incurred by such person
in any such capacity, or arising out of such person's status as such whether or
not the corporation would have the power to indemnify such person against such
liability under the provisions of this Article.
Section 7.7. Report to Shareholders. If the corporation has paid indemnity
or has advanced expenses to a director, officer, employee, or agent, the
corporation shall report the indemnification or advance in writing to the
shareholders with or before the notice of the next shareholders' meeting.
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ARTICLE 8.
FISCAL MATTERS
Section 8.1. Fiscal Year. The fiscal year of the corporation shall be fixed
by resolution of the board of directors.
Section 8.2. 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 8.3. Loans and Indebtedness. No substantial or material loans shall
be contracted on behalf of the corporation and no evidences of indebtedness
shall be issued in its name unless authorized by a resolution of the board of
directors. Such authority may be general or confined to specific instances.
Section 8.4. 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 as the board of directors shall from time to time
designate.
Section 8.5. 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 depositories as the board of directors may
select.
ARTICLE 9.
GENERAL PROVISIONS
Section 9.1. Dividends and Distributions. The board of directors may from
time to time declare or otherwise authorize, and the corporation may pay
distributions in money, shares or other property on its outstanding shares in
the manner and upon the terms, conditions and limitations provided by law or
articles of incorporation.
Section 9.2. Corporate Seal. The board of directors may provide a corporate
seal which seal may be used by causing it or a facsimile thereof to be impressed
or affixed or in any manner reproduced. The seal of the corporation shall be in
the form of a circular disk bearing the name of the corporation and a reference
to Tennessee being the state of incorporation.
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Section 9.3. Waiver of Notice. Whenever any notice is required to be given
by law, articles of incorporation or under the provisions of these by-laws, a
waiver thereof in writing, signed by the person or persons entitled to such
notice, whether before or after the time stated therein, shall be deemed
equivalent to the giving of such notice.
Section 9.4. Headings. Section or paragraph headings are inserted herein
only for convenience of reference and shall not be considered in the
construction of any provision hereof.
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