FOURTH AMENDED AND RESTATED
BY-LAWS
OF
FRONT ROYAL, INC.
Table of Contents
ARTICLE I
Offices
Section 1.1 Principal Office
Section 1.2 Registered Office
Section 1.3 Other Offices
ARTICLE II
Meetings of Shareholders
Section 2.1 Place of Meetings
Section 2.2 Annual Meetings
Section 2.3 Substitute Annual Meetings
Section 2.4 Special Meetings
Section 2.5 Notice of Meetings
Section 2.6 Voting Lists
Section 2.7 Quorum
Section 2.8 Proxies
Section 2.9 Voting of Shares
Section 2.10 Presiding Officer
Section 2.11 Inspectors of Voting
ARTICLE III
Directors
Section 3.1 General Powers
Section 3.2 Number and Qualifications
Section 3.3 Terms of Directors
Section 3.4 Nomination and Election of Directors
Section 3.5 Removal
Section 3.6 Vacancies
Section 3.7 Chairman and Vice-Chairman of the Board
Section 3.8 Compensation
ARTICLE IV
Meetings of Directors
Section 4.1 Regular Meetings
Section 4.2 Special Meetings
Section 4.3 Notice of Meetings
Section 4.4 Waiver of Notice
Section 4.5 Quorum
Section 4.6 Manner of Acting
Section 4.7 Presumption of Assent
Section 4.8 Informal Action by Directors
Section 4.9 Participation by Audio Medium
ARTICLE V
Committees
Section 5.1 Executive Committee
Section 5.2 Other Committees
Section 5.3 Vacancy
Section 5.4 Removal
Section 5.5 Committee Membership and Procedures
Section 5.6 Responsibility of Directors
ARTICLE VI
Officers
Section 6.1 Offices
Section 6.2 Appointment and Term
Section 6.3 Removal and Resignation
Section 6.4 Compensation by Contract Rights
Section 6.5 Chairman and Vice-Chairmen of the Board
Section 6.6 Chief Executive Officer
Section 6.7 President
Section 6.8 Secretary
Section 6.9 Duties of Other Officers
Section 6.10 Bonds
ARTICLE VII
Contracts, Loans, Checks and Deposits
Section 7.1 Contracts
Section 7.2 Loans
Section 7.3 Checks and Drafts
Section 7.4 Deposits
ARTICLE VIII
Shares and Their Transfer
Section 8.1 Certificates for Shares
Section 8.2 Transfer of Shares
Section 8.3 Closing Transfer Books and
Fixing Record Date
Section 8.4 Lost Certificates
Section 8.5 Holder of Record
Section 8.6 Transfer Agent and Registrar
Section 8.7 Control Shares Acquisitions Act
ARTICLE IX
Indemnification of Directors, Officers and Others
Section 9.1 Definitions
Section 9.2 Indemnification
Section 9.3 Determination
Section 9.4 Advances For Expenses
Section 9.5 Reliance and Consideration
Section 9.6 Insurance
Section 9.7 Continuation of Prior Provisions
ARTICLE X
General Provisions
Section 10.1 Distributions
Section 10.2 Seal
Section 10.3 Waiver of Notice
Section 10.4 Amendments
Section 10.5 Fiscal Year
Section 10.6 Succession Order
Section 10.7 Voting of Shares
Section 10.8 Definitions
ARTICLE I
Offices
Section 1.1. Principal Office. The principal office of the
Corporation shall be located in the City of Morrisville, County of Wake, State
of North Carolina or at such other location as determined by the Board of
Directors.
Section 1.2. Registered Office. The registered office of the
Corporation required by law to be maintained in the State of North Carolina
may be, but need not be, identical with the principal office, and the address
of the registered office may be changed from time to time as provided in the
Act.
Section 1.3. Other Offices. The Corporation may have offices at such
other places, either within or without the State of North Carolina, as the
Board of Directors from time to time may determine or as the affairs of the
Corporation may require.
ARTICLE II
Meetings of Shareholders
Section 2.1. Place of Meetings. All meetings of shareholders shall be
held at the principal office of the Corporation or at such other place, either
within or without the State of North Carolina, as shall be designated by the
Board of Directors or, upon the failure of the Board to make such designation,
by the Chairman of the Board and set forth in the notice of the meeting.
Section 2.2. Annual Meeting. The annual meeting of shareholders shall
be held at the designated location within two hundred and ten (210) days of
the close of each fiscal year and at a date and an hour fixed by the Board of
Directors for the purpose of electing directors of the Corporation and for the
transaction of such other business as may be properly brought before the
meeting. Any matters to be brought forth and considered at the annual meeting,
other than such matters brought forth at the direction of the Board of
Directors, shall be presented in writing in a timely notice to the Secretary
of the Corporation. To be timely, a shareholder's notice must be received at
the principal office of the Corporation not less than fifty (50) nor more than
seventy-five (75) days prior to the annual meeting.
Section 2.3. Substitute Annual Meeting. If the annual meeting shall
not be held during the period established in Section 2.2, a substitute annual
meeting may be called in accordance with the provisions of Section 2.4 or as
provided by the Act. A meeting so called shall be designated and treated for
all purposes as the annual meeting.
Section 2.4. Special Meetings. Special meetings of the shareholders
may be called at any time by a majority of the Board of Directors of the
Corporation, by the Chairman of the Board, or by any shareholder pursuant to
the written request of the holders of not less than ten percent (10%) of all
the votes entitled to be cast on any issue proposed to be considered at such
meeting; provided, however, that the right of shareholders to call a special
meeting shall be suspended and without effect at all times that the
Corporation is a "public corporation," as defined in the Act.
Section 2.5. Notice of Meetings. Written or printed notice stating
the time and place of a meeting of shareholders shall be delivered not less
than ten (10) nor more than sixty (60) days before the date thereof, either
personally or by mail, by or at the direction of the Chairman of the Board,
the Board of Directors, or such other person calling the meeting, to each
shareholder of record entitled to vote at such meeting and each
other person specifically entitled to receive such notice under the Act. If
mailed, such notice shall be deemed to be delivered when deposited in the
United States mail, addressed to the shareholder's address as it appears on
the record of the shareholders of the Corporation with postage thereon
prepaid. Notices to non-shareholders shall be deemed to be delivered as
provided by the Act.
In the case of an annual meeting, the notice of meeting need not
specifically state the business to be transacted thereat unless such a
statement is expressly required by the provisions of the Act or applicable
federal laws. In the case of a special or substitute annual meeting, the
notice shall describe the purpose or purposes for which the meeting is being
called. Only the business within the purpose or purposes described in the
special or substitute annual meeting notice may be conducted at such meeting.
Unless a meeting is adjourned (a) to a new date, time or place, and
such new date, time or place is not announced at the meeting prior to
adjournment or (b) to a date more than 120 days after the date fixed for the
original meeting, notice of the adjourned meeting need not be given.
Section 2.6. Voting Lists. The Secretary of the Corporation shall
prepare an alphabetical list by "voting group" (and within each "voting group"
by class or series of shares) of the shareholders entitled to vote at each
meeting, or any adjournment thereof, with the address of and number of shares
held by each shareholder, which list shall be kept on file at the principal
office of the Corporation for a period beginning two (2) business days after
notice of such meeting is given and continuing through such meeting. Such list
shall be subject to inspection and copying (at the shareholder's expense),
during the time it is kept on file under the provisions of the preceding
sentence, by any shareholder at the Corporation's principal office at any time
during regular business hours. This list shall also be produced and kept open
at the time and place of the meeting and shall be subject to inspection by any
shareholder at any time during the meeting or any adjournment.
Section 2.7. Quorum. The holders of a majority of the shares of each
"voting group" entitled to vote on a matter, represented in person or by
proxy, shall constitute a quorum for action on such matter by such "voting
group". If there is no quorum at the opening of a meeting of shareholders,
such meeting may be adjourned from time to time by the vote of a majority of
the shares voting on the motion to adjourn; and, at any adjourned meeting at
which a quorum is present, any business may be transacted which might have
been transacted at the original meeting. Once a share is represented for any
purpose at a meeting, it is deemed present for the remainder of the meeting
and any adjournment thereof unless a new record is or, under the Act, must be
set for that adjourned meeting.
Section 2.8. Proxies. Shares may be voted either in person or by one
or more agents authorized by a proxy in a form permissible under the Act and
executed by the shareholder or by the shareholder's duly authorized
attorney-in-fact. An appointment of proxy is effective when received by the
Secretary of the Corporation or other officer or agent of the Corporation
authorized to tabulate votes. An appointment of proxy is not valid after the
expiration of eleven (11) months from the date it is deemed effective unless
the person executing it expressly specifies therein the length of time for
which it is to continue in force or limits its use to a particular meeting. An
appointment of proxy is revocable by the shareholder unless the appointment
form conspicuously states that it is irrevocable and the appointment form is
"coupled with an interest" as provided in the Act.
Section 2.9. Voting of Shares. Subject to the provisions of Section
3.4 hereof, each outstanding share having voting rights shall be entitled to
one vote on each matter submitted to a vote at a meeting of shareholders.
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Except in the election of directors as provided in Section 3.4 and
the removal of the directors pursuant to Section 3.5, the vote of a majority
of the shares of a "voting group" voted on any matter at a meeting of
shareholders at which a quorum of that "voting group" was initially present
shall be the act of the shareholders of that "voting group" on that matter,
unless the vote of a greater number is required by the Act, the Articles of
Incorporation, or these By-Laws. Voting on all matters shall be by voice vote
or by a show of hands unless federal law applicable to the Corporation shall
require a secret ballot vote on that particular matter.
Shares of its own stock held by the Corporation, directly or
indirectly, or through a subsidiary corporation, in a fiduciary capacity may
be voted and shall be counted in determining the total number of shares
entitled to vote. Except as provided in the preceding sentence and absent
special circumstances, shares of the Corporation are not entitled to vote if
they are owned directly or indirectly, by another corporation in which the
Corporation owns, directly or indirectly, a majority of the shares entitled to
vote for directors of that second corporation.
The Chairman of the Board and the Secretary of the Corporation are
authorized to establish all reasonable and necessary procedures to permit the
voting by beneficial owners of their shares registered in the names of
nominees. The determination of whether acceptable evidence has been presented
by a person or entity to establish his, her or its beneficial ownership of,
and authority to vote, shares of the Corporation shall be made by the Chairman
of the Board, and his decision shall be final.
Section 2.10. Presiding Officer. The Chairman of the Board shall
preside at the shareholders' meetings. In his absence, the provisions of
Section 10.6 of these By-Laws shall control. The Secretary or, in the absence
of the Secretary, any person designated by the Chairman of the Board shall act
as secretary of such meetings.
Section 2.11. Inspectors of Voting. At each meeting of the
shareholders the proxies shall be received and be taken in charge, and all
questions touching qualifications of voters or the validity of proxies, the
presence of a quorum, the acceptance of votes and the results of shareholder
votes shall be decided, by voting inspectors who shall act in accordance with
Section 55-7-24 of the Act. Such voting inspectors (who may not be nominees
for election to office at such meeting) shall be appointed prior to the
meeting by the Chairman of the Board.
ARTICLE III
Directors
Section 3.1. General Powers. All corporate powers shall be exercised
by and under the authority of, and the business and affairs of the Corporation
shall be managed under the direction of, the Board of Directors.
Section 3.2. Number and Qualifications. The number of directors of
the Corporation shall be not less than seven (7) nor more than eleven (11),
which number may be fixed or changed from time to time, within the minimum and
the maximum, by the Board of Directors; provided, however, that a decrease in
the number of directors shall not shorten the term of any director in office
at the time of such decrease. Directors need not be residents of the State of
North Carolina. Each director of the Corporation shall at all times meet
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all statutory and regulatory qualifications applicable by virtue of the nature
of the business of the Corporation or as a result of the Corporation having a
class of securities registered under the Securities Exchange Act of 1934, as
amended (the "1934 Act").
Section 3.3. Terms of Directors. The directors of the Corporation
shall be divided into three (3) classes, as nearly as equal as possible in
number as may be, to serve in the first instance for terms of one (1), two (2)
and three (3) years, respectively, or until their earlier death, resignation,
retirement, removal or disqualification or until their successors shall be
elected and shall qualify, and thereafter, the successors in each class of
directors shall be elected to serve for terms of three (3) years or until
their earlier death, resignation, retirement, removal or disqualification or
until their successors shall be elected and shall qualify. In the event of an
increase or decrease in the number of directors, the additional or eliminated
directorship shall be so classified that all class of directors remain or
become as nearly equal in number as may be.
Section 3.4. Nomination and Election of Directors. Nominations of
persons for election to the Board of Directors of the Corporation at a meeting
of the shareholders held to elect directors may be made by or at the direction
of the Board of Directors or may be made at such shareholders meeting by any
share holder of the Corporation entitled to vote for the election of directors
at such meeting who complies with the notice procedures set forth in this
Section 3.4. Such nominations, other than those made by or at the direction of
the Board, shall be made pursuant to timely notice in writing to the Secretary
of the Corporation. To be timely, a shareholder's notice must be received at
the principal office of the Corporation not less than fifty (50) days nor more
than seventy-five (75) days prior to the shareholders meeting; provided,
however, that in the event that such applicable shareholders meeting is not an
annual meeting of shareholders, notice by the shareholder to be timely must be
so received no later than the close of business on the tenth (10th) day
following the day on which such notice of the date of the shareholders meeting
was mailed or public disclosure of such meeting was made, whichever first
occurs. Such shareholder's notice to the Secretary shall set forth (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 the person, (ii) the principal occupation or employment of the
person, (iii) the class and number of shares of capital stock of the
Corporation which are beneficially owned by the person, and (iv) any other
information relating to the person that is required to be disclosed in
solicitations for proxies for election of directors pursuant to applicable
regulations promulgated under the 1934 Act; and (b) as to the shareholder
giving the notice (i) the name and record address of the shareholder and (ii)
the class and number of shares of capital stock of the Corporation which are
beneficially owned by the shareholder. The Corporation may require any
proposed nominee to furnish such other information as may reasonably be
required by the Corporation to determine the eligibility of such proposed
nominee to serve as a director of the Corporation. No person shall be eligible
for election as a director of the Corporation at a shareholders meeting unless
nominated in accordance with the procedures set forth herein. The Chairman of
the Board shall, if the facts warrant, determine and declare to the
shareholders meeting that a nomination was not made in accordance with the
foregoing procedure and, accordingly, shall be disregarded.
Except as provided in Section 3.6, the directors (or, if applicable,
each director in a class) shall be elected at the annual meeting of the
shareholders; and those persons who receive a plurality of the votes cast
by the shares entitled to vote in the election of directors at such meeting
shall be deemed to have been elected. If federal law applicable to the
Corporation so requires, election of directors shall be by secret ballot.
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Section 3.5. Removal and Resignation. A director may be removed by
the stockholders of the Corporation only for cause by an affirmative vote of
the holders of at least 66.67% of the voting power of the then outstanding
shares of any class or series of capital stock of the Corporation entitled to
vote generally in the election of the Board of Directors, voting together as a
single class. If any director is removed, a successor director shall be
elected pursuant to Section 3.6. A director may not be removed at a meeting
(other than an annual meeting at which election of directors normally occurs)
unless the notice of the meeting states that one of the purposes of the
meeting is the removal of the director. A director may resign at any time by
communicating his resignation to the Board of Directors, its Chairman, or the
Corporation. Such resignation is effective when communicated unless it
specifies in writing a later date or subsequent event upon which it will
become effective.
Section 3.6. Vacancies. A vacancy occurring in the Board of Directors
shall be filled by a vote of the majority of the remaining directors, though
less than a quorum, or by the sole remaining director. A director elected to
fill a vacancy shall serve until the expiration of such term for which the
vacancy occurred.
Section 3.7. Chairman and Vice-Chairmen of the Board. There shall be
a Chairman of the Board of Directors and may be one or more Vice-Chairmen of
the Board of Directors, each elected by the directors from their number at any
meeting of the Board. In addition to his duties expressly set forth in these
Bylaws, the Chairman of the Board shall perform such other duties as may be
directed by the Board. In his absence or disability, the provisions of Section
10.6 shall control. The Vice-Chairmen of the Board shall perform such duties
as may be directed by the Board.
Section 3.8. Compensation. The Board of Directors may compensate
directors for their services as such, may compensate the Chairman of the Board
and the Vice-Chairmen of the Board for their services as such, and may provide
for the payment of all expenses incurred by the directors in attending regular
and special meetings of the Board or any committee thereof.
ARTICLE IV
Meetings of Directors
Section 4.1. Regular Meetings. A regular meeting of the Board of
Directors shall be held immediately after, and at the same or some other
designated place as, the annual meeting of shareholders. In addition, the
Board of Directors may provide, by resolution, the time and place, either
within or without the State of North Carolina, for the holding of additional
regular meetings. Unless otherwise provided by the Board of Directors, the
Board shall meet at least as often as once each fiscal quarter, on the dates
and at the time established as customary by the Board of Directors.
Section 4.2. Special Meetings. Special meetings of the Board of
Directors may be called by or at the request of the Chairman of the Board, the
Chief Executive Officer or any three (3) directors. Such meetings may be held
either within or without the State of North Carolina as fixed by the person or
persons calling any such meeting.
Section 4.3. Notice of Meetings. When held on the dates and at the
time established as customary by the Board of Directors, regular meetings of
the Board of Directors may be held without notice. The person or persons
calling a special meeting of the Board of Directors shall, at least
twenty-four (24) hours
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before the date of such meeting, give notice thereof by telephone, telegraph,
teletype or other form of wire or wireless communication, including facsimile
communication, or by written communication delivered by hand, United States
mail, or private carrier. Written notice of a special meeting of the directors
is effective at the earliest of the following: (a) when received; (b) upon
transmission if sent by facsimile and if completed transmission is evidenced
by a sender's confirmation report generated by the sender's facsimile machine;
(c) on the date shown on the confirmation of delivery issued by a private
carrier, if sent by private carrier to the address of the director last known
to the Corporation; or (d) upon its deposit in the United States mail, as
evidenced by the postmark, if mailed by first class mail, with postage thereon
prepaid, and correctly addressed; provided, however, that in order for such
notice to be effective by this Subsection 4.4(d), the special meeting must be
scheduled no earlier than three (3) days from the date such notice is mailed.
Oral notice is effective when actually communicated to the director. Notice of
an adjourned meeting of directors need not be given if the time and place are
fixed at the meeting adjourning and if the period of adjournment does not
exceed ten (10) days in any one adjournment. Such notice need not specify the
purpose for which the meeting is called. Special meetings may be held without
notice upon the unanimous consent of the directors.
Section 4.4. Waiver of Notice. Any director may waive notice of any
meeting by filing a written and signed waiver with the minutes of the meeting
or in the Corporation's corporate records. A director's attendance at or
participation in a meeting shall constitute a waiver of notice of such
meeting, unless the director at the beginning of the meeting (or promptly upon
his arrival) objects to holding the meeting or transacting any business at the
meeting and does not thereafter vote for or assent to any action taken at the
meeting.
Section 4.5. Quorum. The presence of a majority of the number of
directors prescribed by the Board of Directors under Section 3.2 and in office
immediately prior to a meeting shall constitute a quorum for the transaction
of business at that meeting of the Board.
Section 4.6. Manner of Acting. Except as otherwise provided in these
By-Laws, or by the Act, the act of the majority of the directors attending or
participating in a meeting at which a quorum is present shall be the act of
the Board of Directors, unless the act of a greater number is required by the
Corporation's Restated Articles of Incorporation (as hereafter further
amended) or these By-Laws.
Section 4.7. Presumption of Assent. A director of the Corporation who
is present at a meeting of the Board of Directors at which action on any
corporate matter is taken shall be presumed to have assented to the action
taken unless (a) the director objects at the beginning of the meeting (or
promptly upon the director's arrival) to holding such meeting or transacting
business at it, (b) the director shall file a written dissent or abstention to
such action with the presiding officer of the meeting before the adjournment
thereof or with the Corporation immediately after the adjournment of the
meeting, or (c) the director's contrary vote or abstention is entered in the
minutes of the meeting at the request of such dissenting or abstaining
director. Such right to dissent or abstain shall not apply to a director who
voted in favor of such action.
Section 4.8. Informal Action by Directors. Action taken by the
directors without a meeting is never theless Board action, and may be
described as such, if one or more written consents to the action in question,
describing the action taken, are signed by all the directors and filed with
the minutes of the proceedings of the Board of Directors or in the records of
the Corporation, whether done before or after the action so taken. Action
taken pursuant to this Section 4.8 shall be effective when the last director
signs a written consent to such action, unless the consent specifies a
different effective date.
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Section 4.9. Participation by Audio Medium. Upon approval by the
Board of Directors, any one or more directors may participate in any meeting
of the Board or its committees by means of a conference telephone or similar
communications medium allowing all directors participating in the meeting to
hear one another simultaneously throughout the meeting. Participation by such
means shall constitute presence in person at a meeting.
ARTICLE V
Committees
Section 5.1. Executive Committee. The Board of Directors, by proper
resolution and by the vote required under Section 4.6, may appoint an
Executive Committee which shall be composed of at least three (3) directors
who shall serve at the pleasure of the Board of Directors and which shall have
and exercise the powers of the Board of Directors in the direction of the
management of the business affairs of the Corporation, except at such time as
the Board of Directors is in session. The Chairman of the Board and the Chief
Executive Officer (if the Chief Executive Officer is a director) shall each be
a member of the Executive Committee. The members of the Executive Committee
shall select a Chairman of such committee by a majority vote. Meetings of the
Executive Committee may be held at any time on the call of its Chairman or any
two (2) members of the Committee. A majority of the members of the Executive
Committee shall constitute a quorum. Action by the Executive Committee shall
be by majority vote of the members of the Executive Committee. The Executive
Committee shall keep minutes of its meetings and shall report its actions to
the next succeeding meeting of the Board of Directors.
The Board of Directors shall have the power to direct, limit and
control the Executive Committee, and to rescind or modify any action of the
Executive Committee, by resolution at any special or regular meeting or by
general rules adopted for its guidance. In addition, neither the Executive
Committee nor any other committee appointed under these By-Laws shall have any
authority to do any act listed in Section 55-8- 25(e) of the Act, as now or
hereafter existing, or in any successor to such statute.
Section 5.2. Other Committees. The Chairman of the Board, subject to
approval by the Board of Directors by the vote required under Section 4.6, or
the Board of Directors, by proper resolution and by the vote required under
Section 4.6, may appoint such other committees as may be deemed by the
Chairman or the Board, as applicable, to be appropriate. Each such committee
shall have at least two (2) members.
Section 5.3. Vacancy. Any vacancy occurring on a Board committee
shall be filled by the vote of the Board of Directors required under Section
4.6.
Section 5.4. Removal. Members of all committees of the Board shall
serve at the pleasure of the Board. Any member of a Board committee may be
removed at any time with or without cause by the vote of the Board of
Directors required under Section 4.6.
Section 5.5. Committee Membership and Procedures. Except as otherwise
expressly provided in this Article V, the provisions of these By-Laws
governing meetings, action without meetings, notice, waiver of notice, quorum,
and voting requirements of the Board shall apply to each committee of the
Board.
Section 5.6. Responsibility of Directors. In discharging his duties
as a director, a director shall be entitled to rely on information, opinions,
reports and statements prepared or presented by a Board committee
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of which he is not a member unless he has actual knowledge of a matter which
makes such reliance unwarranted. Such permissible reliance shall relieve such
director of any responsibility or liability imposed upon him by law when and
to the extent permitted by the Act.
If any action taken by a Board committee is not thereafter formally
considered by the Board, a director may dissent from such action by filing his
written objection with the Secretary with reasonable promptness after learning
of such action.
ARTICLE VI
Officers
Section 6.1. Officers. The officers of the Corporation shall consist
of a Chairman of the Board of Directors, Chief Executive Officer, President
and a Secretary. Other officers, including, without limitation, a Vice
Chairman of the Board of Directors, one or more Vice Presidents (whose
seniority and titles, including Executive Vice Presidents and Senior Vice
Presidents, may be specified by the Board of Directors), a Chief Operating
Officer, a Chief Financial Officer, a Treasurer, a Controller, Assistant
Secretaries, and Assistant Treasurers, may from time to time be elected by the
Board of Directors. Any two or more offices, except President and Secretary,
Chief Executive Officer and Secretary, and Chief Operating Officer (if
applicable) and Secretary, may be held by the same person. No officer may act
in more than one capacity when the action of two or more officers is required.
Section 6.2. Appointment and Term. The officers of the Corporation
shall be appointed by the Board of Directors. Such appointments may be made at
any regular or special meeting of the Board. Each officer shall hold office
until the officer's death, resignation, retirement, removal, disqualification,
or his successor is appointed and qualified.
Section 6.3. Removal and Resignation. Any officer or agent appointed
by the Board of Directors may be removed by the Board with or without cause
whenever in its judgment the best interests of the Corporation will be served
thereby. Any such removal or disqualification shall be by the vote of the
Board of Directors required under Section 4.6.
An officer may resign at any time by communicating such officer's
resignation to the Corporation. A resignation is effective when it is
communicated unless it specifies in writing a later effective date. If a
resignation is made effective at a later date and the Corporation accepts the
future effective date, the Board of Directors may fill the pending vacancy
before the effective date if the Board of Directors provides that the
successor does not take office until the effective date.
Section 6.4. Compensation and Contract Rights. The compensation of
all officers of the Corpora tion shall be fixed by the Board of Directors.
The appointment of an officer does not itself create contract rights.
An officer's removal does not itself affect the officer's contract rights, if
any, with the Corporation, and an officer's resignation does not itself affect
the Corporation's contract rights, if any, with the officer.
Section 6.5. Chairman and Vice-Chairmen of the Board. The Chairman of
the Board and the Vice-Chairmen of the Board shall be deemed to be officers of
the Corporation and, in addition to their power and
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duties expressly set forth in these By-Laws, shall have such power and duties
as may be prescribed by the Board of Directors from time to time by the vote
required under Section 4.6.
Section 6.6. Chief Executive Officer. Subject to the direction of the
Board of Directors, the Chief Executive Officer shall direct and supervise the
management of the Corporation in accordance with these Bylaws and the
Corporation's Articles of Incorporation.
Section 6.7. President. The President shall be the principal
administrative officer of the Corporation and, subject to the direction of the
Chief Executive Officer and the Board of Directors, shall direct and supervise
the administration of the management of the Corporation in accordance with
these Bylaws and the Corporation's Articles of Incorporation. In the absence
of the Chief Executive Officer, or in the event of his death, disability or
inability or refusal to act, the President, unless otherwise determined by the
Board of Directors, shall also perform the duties of the Chief Executive
Officer, and when so acting, shall have all of the powers and be subject to
all the restrictions upon the Chief Executive Officer.
Section 6.8. Secretary. The Secretary shall: (a) keep the minutes of
the meetings of shareholders, the Board of Directors and each committee of the
Board in one or more books provided for that purpose; (b) see that all notices
are duly given in accordance with the provisions of these By-Laws or as
required by law; (c) be custodian of the corporate records and of the seal of
the Corporation and ascertain that the seal of the Corporation is affixed to
all documents the execution of which on behalf of the Corporation under its
seal is duly authorized; (d) keep a register of the post office address of
each shareholder which shall be furnished to the Secretary by such
shareholder; (e) have general charge of the stock transfer books of the
Corporation; (f) keep or cause to be kept in the State of North Carolina at
the Corporation's registered office or principal office a record of the
Corporation's shareholders, giving the names and addresses of all shareholders
and the number and class of shares held by each, and prepare or cause to be
prepared voting lists prior to each meeting of shareholders as required by law
and these By-Laws; and (g) in general perform all duties incident to the
office of Secretary and such other duties as from time to time may be assigned
to him by the Chief Executive Officer, the President or the Board of
Directors. The Secretary may sign with the Chief Executive Officer or the
President certificates for shares of the Corporation, the issuance of which
shall have been authorized by resolution of the Board of Directors. The
Secretary shall maintain at the Corporation's principal office (a) the
Corporation's Articles of Incorporation, and all amendments thereto, (b) these
ByLaws, and all the amendments hereto, (c) minutes of the meetings, and all
resolutions, of the Board of Directors, (d) the minutes of the meetings, and
the reports, of all committees of the Board of Directors, (e) the minutes of
all meetings of shareholders and the records of all actions by shareholders
without meetings for the preceding three (3) years, (f) all written
communications to shareholders, and all financial statements required to be
made available to shareholders, for the preceding three (3) years, (g) a list
of the names and business addresses of the Corporation's current directors and
officers, and (h) the Corporation's most recent annual report delivered to the
North Carolina Secretary of State under Section 55-16-22 of the Act.
Section 6.9. Duties of Other Officers. The duties of all officers and
employees not defined and enumerated in these By-Laws shall be prescribed and
fixed by the Chief Executive Officer and in carrying out the authority to do
all other acts necessary to be done to carry out the prescribed duties unless
otherwise ordered by the Board of Directors, including, but not limited to,
the power to sign, certify or endorse notes, certificates of indebtedness,
deeds, checks, drafts or other contracts for and on behalf of the Corporation
and/or to affix the seal of the Corporation to such documents as may require
it.
Section 6.10. Bonds. The Board of Directors may by resolution require
any or all officers, agents and employees of the Corporation to give bond to
the Corporation, with sufficient sureties, conditioned on
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the faithful performance of the duties of their respective offices or
positions, and to comply with such other conditions as may from time to time
be required by the Board of Directors.
ARTICLE VII
Contracts, Loans, Checks and Deposits
Section 7.1. Contracts. The Chief Executive Officer and the President
are authorized to enter any contract, lease or other agreement, and to execute
and deliver any instrument, on behalf of the Corporation which is to be
entered or executed and delivered in the ordinary course of the Corporation's
business. In addition, the Board of Directors may authorize any officer or
officers, or agent or agents, to enter into any contract, lease, or other
agreement or to execute and deliver any instrument on behalf of the
Corporation, whether or not such action is within the ordinary course of the
Corporation's business, and such authority may be general or confined to
specific instances. Any resolution of the Board of Directors authorizing the
execution of any contract, lease or other agreement or delivery of any
instrument on behalf of the Corporation by the proper officers of the
Corporation or by officers of the Corporation generally and not specifying
particular officers shall be deemed to authorize execution or delivery, as
applicable, by the Chief Executive Officer, President or any other officer if
such execution or delivery is within the scope of the duties of such other
officer. The Board of Directors may authorize the Corporation to enter into
employment contracts with any of its employees for any length of time and on
any terms and conditions it deems wise.
Section 7.2. Loans. No 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, or a committee
thereof, and except as permitted by law. Such authority may be general or
specific in nature and scope.
Section 7.3. Checks and Drafts. All checks, drafts or other orders
for the payment of money issued in the name of the Corporation shall be signed
by such officer or officers, agent or agents of the Corporation and in such
manner as from time to time shall be determined by resolution of the Board of
Directors.
Section 7.4. Deposits. All funds of the Corporation not otherwise
employed from time to time shall be deposited to the credit of the Corporation
in such depositaries as the Board of Directors or a committee thereof, shall
direct.
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ARTICLE VIII
Shares and Their Transfer
Section 8.1. Certificates for Shares. Shares of the Corporation may,
but need not, be represented by certificates. When shares are represented by
certificates, the Corporation shall issue such certificates in such form as
the Board of Directors, or a committee thereof, shall determine in accordance
with the Act to every shareholder for the fully paid shares owned by him.
These certificates shall be signed by, or bear the facsimile signature of the
Chief Executive Officer or the President and the Secretary or an Assistant
Secretary, and sealed with the seal of the Corporation or its facsimile. They
shall be consecutively numbered or otherwise identified; and the name and
address of the persons to whom they are issued, with the number of shares and
the date of issue, shall be entered on the stock transfer books of the
Corporation. Such information may be stored or retained on discs, tapes, cards
or any other approved storage device relating to data processing equipment;
provided that such device is capable of reproducing all information contained
therein in legible and understandable form, for inspection by shareholders or
for any other corporate purpose. Such certificates shall indicate thereon a
reference to any and all restrictive conditions imposed on the shares
represented thereby.
When shares are not represented by certificates, then within a
reasonable time after the issuance or transfer or such shares, the Corporation
shall send the shareholder to whom such shares have been issued or transferred
a written statement of the information required by the Act to be on
certificates.
Section 8.2. Transfer of Shares. The Corporation, or its agent, shall
keep a book or set of books to be known as the stock transfer books of the
Corporation, containing the name of each shareholder of record, together with
such shareholder's address and the number and class or series of shares held
by such shareholder. Transfer of shares of the Corporation represented by
certificates shall be made on the stock transfer books of the Corporation only
upon surrender of the certificates for the shares sought to be transferred by
the holder of record thereof or by such holder's duly authorized agent,
transferee or legal representative, who shall furnish proper evidence of
authority to transfer with the Secretary. All certificates surrendered for
transfer shall be canceled before new certificates for the transferred shares
shall be issued.
If shares of the Corporation (1) are in the custody of a clearing
corporation or a custodian bank, or a nominee of either subject to the
instructions of the clearing corporation; (2) are in bearer form or endorsed
in blank by an appropriate person or registered in the name of the clearing
corporation or a custodian bank, or a nominee of either; and (3) are shown on
the account of a transferor or pledgor on the books of a clearing corporation,
then in addition to other methods, a transfer or pledge of the shares or any
interest therein may be effected by the making of appropriate entries on the
books of the clearing corporation reducing the account of the transferor or
pledgor and increasing the account of the transferee or pledgee by the number
of shares transferred or pledged.
The Board of Directors, or a committee thereof, may make such
additional rules and regulations regarding the transfer of shares and share
certificates as they deem reasonable, necessary and desirable. All such
restrictions upon transfer shall be noted conspicuously upon the
certificate(s) representing ownership of the shares so restricted.
Section 8.3. Closing Transfer Books and Fixing Record Date. For the
purpose of determining the shareholders of any "voting group" entitled to
notice of or vote at any meeting of shareholders, or any adjournment thereof,
or entitled to receive any "distribution", or in order to make a determination
of the
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shareholders of any "voting group" for any other proper purpose, the Board of
Directors may provide that the stock transfer books shall be closed for a
stated period not to exceed, in any case, thirty (30) days. If the stock
transfer books shall be closed for the purpose of determining shareholders of
any "voting group" entitled to notice of or to vote at a meeting of
shareholders, such books shall be closed for at least ten (10) days
immediately preceding such meeting.
In lieu of closing the stock transfer books, the Board of Directors
may fix in advance a date as the record date for any such determination of the
shareholders of a "voting group", such record date in any case to be not more
than seventy (70) days and, in the case of a shareholders meeting, not less
than ten (10) days immediately preceding the date on which the particular
action, requiring such determination of shareholders, is to occur.
If the stock transfer books are not closed and no record date is
fixed for the determination of the shareholders of a "voting group" entitled
to notice of or to vote at a meeting of shareholders, or shareholders entitled
to receive a "distribution", the close of business on the day before the date
on which notice of the meeting is first delivered to shareholders or the date
on which the resolution of the Board of Directors authorizing such
distribution is deemed effective under the Act, as the case may be, shall be
the record date for such determination of shareholders.
When a determination of the shareholders of a "voting group" entitled
to vote at any meeting of shareholders has been made as provided in this
Section 8.3, such determination shall apply to any adjournment thereof except
(a) where the meeting has been adjourned for more than 120 days after the date
fixed for the original meeting or (b) where the determination has been made
through the closing of the stock transfer books and the stated period of
closing has expired.
Section 8.4. Lost Certificates. The Board of Directors or an officer
so authorized by the Board may authorize the issuance of a new share
certificate in place of a certificate claimed to have been lost, destroyed or
mutilated, upon receipt of an affidavit of such fact from the person claiming
the loss, destruction or mutilation satisfactory to the Board or such officer.
When authorizing such issuance of a new certificate, the Board of Directors or
such officer may require the claimant to give the Corporation a bond in such
sum as the Board of Directors or such officer may direct to indemnify the
Corporation against loss from any claim with respect to the certificate
claimed to have been lost or destroyed.
Section 8.5. Holder of Record. The Corporation may treat as absolute
owner of shares the person in whose name the shares stand of record on its
books just as if that person had full competency, capacity and authority to
exercise all rights of ownership irrespective of any knowledge or notice to
the contrary or any description indicating a representative, pledge or other
fiduciary relation or any reference to any other instrument or to the rights
of any other person appearing upon its record or upon the share certificate
except that any person furnishing to the Corporation proof of his appointment
as a fiduciary shall be treated as if he were a holder of record of its
shares.
Section 8.6. Transfer Agent and Registrar. The Corporation may, if
and whenever the Board of Directors so determines, maintain in the State of
North Carolina or any other state of the United States, one or more transfer
offices or agencies and also one or more registry offices which officers and
agencies may establish rules and regulations for the issue, transfer and
registration of certificates. No certificates for shares of stock of the
Corporation in respect of which a Transfer Agent and Registrar shall have been
designated shall be valid unless countersigned by such Transfer Agent and
registered by such Registrar.
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Section 8.7. Control Share Acquisitions Act. Pursuant to Section
55-9A-09 of the Act, the provisions of Control Shares Acquisitions Act, as
stated in Article 9A of the Act, shall not be applicable to the Corporation,
and the Corporation expressly "opts out" of the Control Shares Acquisitions
Act.
ARTICLE IX
Indemnification of Directors, Officers and Others
Section 9.1. Definitions. For purposes of this Article IX, the
following definitions shall apply:
(a) "Corporation" means the Corporation and all "predecessors"
thereof, as such term is defined in Section 55-8-50(b)(1) of the
Act.
(b) "Director" means an individual who is or was a director of the
Corporation or an individual who, while a director of the
Corporation, is or was serving at the Corporation's request as a
director, officer, partner, trustee, employee or agent or another
foreign or domestic corporation, partnership, joint venture, trust,
employee benefit plan, or other enterprise. A director is considered
to be serving an employee benefit plan at the Corporation's request
if such director's duties to the Corporation also impose duties on,
or otherwise involve services by, the director to the plan or to
participants in or beneficiaries of the plan. "Director" includes,
unless the context requires otherwise, the estate or personal
representative of a director.
(c) "Expenses" means expenses of every kind incurred in defending a
Proceeding, including, but not limited to, legal, accounting, expert
and investigatory fees and expenses.
(d) "Indemnified Officer" shall mean each officer of the Corporation
who is also a director of the Corporation and each other officer of
the Corporation who is designated by the Board of Directors from
time to time as an Indemnified Officer. An Indemnified Officer shall
be entitled to indemnification hereunder to the same extent as a
Director, including, without limitation, indemnification with
respect to service by the Indemnified Officer at the Corporation's
request as a director, officer, partner, trustee, employee or agent
of another foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise.
(e) "Liabilities" means any obligation to pay any or all of the
following: a judgment, a settlement, a penalty, a fine (including an
excise tax assessed with respect to an employee benefit plan) and
reasonable expenses, including, but not limited to, attorneys' fees
of opposing parties incurred with respect to a Proceeding.
(f) "Proceeding" means any threatened, pending, or completed action,
suit or proceeding, whether civil, criminal, administrative or
investigative, whether formal or informal, and any appeal therein
(and any inquiry or investigation that could lead to such a
proceeding).
Section 9.2. Indemnification. In addition to, and not in any way in
limitation of, all indemnification rights and obligations otherwise provided
by law, the Corporation shall indemnify and hold harmless its Directors and
Indemnified Officers against all Liabilities and Expenses in any Proceeding
(including, without limitation, a Proceeding brought by or on behalf of the
Corporation itself) arising out of their status as Directors or officers, or
their service at the Corporation's request as a Director, officer, partner,
trustee,
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employee or agent of another foreign or domestic corporation, partnership,
joint venture, trust, employee benefit plan or other enterprise, or their
activities in any such capacity; provided, however, that the Corporation shall
not indemnify a Director or an Indemnified Officer against Liabilities or
Expenses that such person may incur on account of activities of such person
which at the time taken were known or believed by him or her to be clearly in
conflict with the best interests of the Corporation. The Corporation shall
also indemnify each Director and Indemnified Officer for his or her reasonable
costs, expenses and attorneys' fees incurred in connection with the
enforcement of the rights to indemnification granted herein, if it is
determined in accordance with Section 9.3 that the Director or Indemnified
Officer is entitled to indemnification hereunder.
The Board of Directors shall have the authority to adopt such
resolutions pertaining to the implementation of this Section 9.2 as it may
from time to time determine, and such resolutions shall be given full effect,
even though they supplement, amplify or go beyond the provisions of this
Section 9.2, provided and to the extent such resolution does not violate any
provision of the Act or the Corporation's Articles of Incorporation. This
Section 9.2 shall be construed in a manner to fully effect the purpose and
intent of the resolution of the Corporation's Board of Directors approving and
adopting this provision.
Section 9.3. Determination. Any indemnification under Section 9.2
shall be paid by the Corporation in a specific case only after a determination
that the Director or Indemnified Officer has met the standard of conduct set
forth in Section 9.2. Such determination shall be made:
(a) by the Board of Directors by a majority vote of a quorum
consisting of directors not at the time parties to the Proceeding;
(b) if a quorum cannot be obtained under Section 9.3(a), by a
majority vote of a committee duly designated by the Board of
Directors (in which vote directors who are parties to the Proceeding
may participate), consisting solely of two or more directors not at
the time parties to the Proceeding;
(c) by special legal counsel (i) selected by the Board of Directors
or a committee thereof in the manner prescribed in Section 9.3(a) or
(b); or (ii) if a quorum of the Board of Directors cannot be obtained
under Section 9.3(a) and a committee cannot be designated under
Section 9.3(b), selected by a majority vote of the full Board of
Directors (in which selection directors who are parties in the
Proceeding may participate); or
(d) by the shareholders, but shares owned by or voted under the
control of directors who are at the time parties to the Proceeding
may not be voted on the determination.
The Board of Directors shall take all such action as may be necessary
and appropriate to enable the Corporation to pay the indemnification required
by this Article IX.
Section 9.4. Advances for Expenses. The Expenses incurred by a
Director or an Indemnified Officer in defending a Proceeding may be paid by
the Corporation in advance of the final disposition of such Proceeding as
authorized by the Board of Directors in the specific case upon receipt of an
undertaking by or on behalf of the Director or Indemnified Officer to repay
such amount unless it shall ultimately be determined that such person is
entitled to be indemnified by the Corporation against such Expenses. Subject
to receipt of such undertaking, the Corporation shall make reasonable periodic
advances for Expenses pursuant to this Section 9.4, unless the Board of
Directors shall determine, in the manner provided in Section 9.3 and based on
the facts then known, that indemnification under this Article IX is or will be
precluded.
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Section 9.5. Reliance and Consideration. Any Director or Indemnified
Officer who at any time after the adoption of this Article IX serves or has
served in any of the aforesaid capacities for or on behalf of the Corporation
shall be deemed to be doing or to have done so in reliance upon, and as
consideration for, the right of indemnification provided herein. Such right,
however, shall not be exclusive of any other rights to which such person may
be entitled apart from the provisions of this Article IX. No amendment,
modification or repeal of this Article IX shall adversely affect the right of
any Director or Indemnified Officer to indemnification hereunder with respect
to any activities occurring prior to the time of such amendment, modification
or repeal.
Section 9.6. Insurance. The Corporation may purchase and maintain
insurance on behalf of its directors, officers, employees and agents and those
persons who were or are serving at the request of the Corporation in any
capacity with another corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise against any liability asserted against or
incurred by such person in any such capacity, or arising out of his or her
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 IX or otherwise. Any full or partial payment made by an insurance
company under any insurance policy covering any director, officer, employee,
agent or other person identified above made to or on behalf of a person
entitled to indemnification under this Article IX shall relieve the
Corporation of its liability for indemnification provided for in this Article
IX or otherwise to the extent of such payment, and no insurer shall have a
right of subrogation against the Corporation with respect to such payment.
Section 9.7. Continuation of Prior Provisions. The provisions of
Section 6 of Article IX of the Corporation's Third Amended and Restated Bylaws
(in effect prior to the adoption of these By-Laws) regarding indemnification
shall be deemed to be continued and incorporated herein, but shall not in any
way diminish or limit the other provisions of this Article IX. The
indemnification obligations of the Corporation under such prior Section 6 of
Article IX shall remain in force respecting, but solely respecting, claims
made and liabilities asserted prior to the adoption of these By-Laws to the
full extent provided under law.
ARTICLE X
General Provisions
Section 10.1. Distributions. The Board of Directors from time to time
may declare or authorize, and the Corporation may pay or distribute, dividends
or other distributions on its outstanding shares in the manner and upon the
terms and conditions provided by the Act and by the Articles of Incorporation.
Section 10.2. Seal. The corporate seal of the Corporation shall
consist of two concentric circles between which is the name of the Corporation
and in the center of which is inscribed the word "SEAL"; and such seal, in the
form approved and adopted by the Board of Directors and as impressed on the
margin hereof, shall be the corporate seal of the Corporation.
Section 10.3. Waiver of Notice. Except as otherwise expressly
provided herein, whenever any notice is required to be given to any
shareholder or director under the provisions of the Act or under the
provisions of the Restated Articles of Incorporation or these By-Laws, a
waiver thereof in writing signed by the person or persons entitled to such
notice and delivered to the Secretary of the Corporation, whether before or
after the time stated therein, shall be equivalent to the giving of such
notice.
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Section 10.4. Amendments; Emergency By-Laws. To the extent permitted
by the Act and except as otherwise expressly provided herein, these By-Laws
may be amended or repealed and new By-Laws may be adopted by (i) the
affirmative vote of the Board of Directors required under Section 4.6 or (ii)
the affirmative vote of 66.67% of the voting power of the then outstanding
shares of any class or series of capital stock of the Corporation entitled to
vote. In addition, in the circumstances described in Section 55-2-07(d) of the
Act, the Board of Directors may adopt, as provided in Sections 55-2-07 and
55-3-03 of the Act, such emergency by-laws as may be necessary or appropriate.
Such emergency by-laws shall supersede any inconsistent provisions of these
By-Laws during the existence of such emergency and shall be approved by the
shareholders at the next annual meeting, if necessary.
Except as authorized by the action of the shareholders as provided by
the Act, the Board of Directors shall have no power to adopt a by-law:
(1) requiring more than a majority of the voting shares of a "voting
group" for a quorum at a meeting of shareholders or more than a majority of
the votes cast by the shareholders of a "voting group" to constitute action by
the shareholders of that "voting group", except where higher percentages are
required by law, the Articles of Incorporation or these Bylaws;
(2) providing for the management of the Corporation otherwise than by
the Board of Directors or its Executive Committee;
(3) increasing or decreasing the number of directors above or below
the maximum or minimum, respectively, set forth in Section 3.2 hereof and the
Articles of Incorporation; or
(4) rescinding any classification and staggering of terms by the
shareholders.
Section 10.5. Fiscal Year. The fiscal year of the Corporation shall
be as determined by the Board of Directors.
Section 10.6. Succession Order. The succession order to the Chairman
of the Board for purposes of these By-Laws shall be the Vice-Chairmen of the
Board in the order of seniority of service in such office (in the event of a
dispute as to seniority, a majority vote of the directors then present shall
establish seniority), and the Chief Executive Officer and, if there are no
persons holding such offices or if the Board of Directors shall determine to
alter such succession order, the person selected to preside by a majority of
the directors present or participating in a meeting at which such designation
is necessary.
Section 10.7. Voting of Shares. Authority to vote shares of another
corporation or any subsidiary of the Corporation and to execute proxies,
written waivers and consents with regard to the voting of such shares, in each
instance in accordance with the resolution or action of the Board of Directors
delegating such authority, shall be vested exclusively in the Chairman of the
Board, the Chief Executive Officer or such other officers of the Corporation
as shall be expressly named from time to time by the Board of Directors in
resolutions adopted or actions taken for that purpose.
Section 10.8. Definitions. As used herein, the term "Act" shall refer
to the North Carolina Business Corporation Act, as in effect on the date the
Bylaws are adopted and as amended from time to time. As used herein, the terms
"distribution," "voting group" and "public corporation" shall have the
meanings set forth in Sections 55-1-40(6), 55-1-40(26) and 55-1-40(18a),
respectively, of the Act. As used herein, the term
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"Restated Articles of Incorporation" shall mean the Restated Articles of
Incorporation of the Corporation as they may exist from time to time and as
hereafter amended or restated.
Restated and adopted, this _______ day of ___________________, 1998.
-------------------------
Secretary
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