Exhibit 2.10
BYLAWS
of
MAGELLAN HEALTH SERVICES, INC.
(A Delaware corporation)
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As in effect on January 5, 2004
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ARTICLE I
Certain Definitions; Principal Office; Notices to the Corporation
SECTION 1. Certain Definitions. Unless the context otherwise
requires, the following terms when used herein shall have the following
meanings:
(a) "CERTIFICATE OF INCORPORATION" shall mean the Amended and
Restated Certificate of Incorporation, as filed with the Secretary of State of
the State of Delaware on January 5, 2004, of the Corporation, as it may from
time to time be amended and in effect in accordance with law, and shall include
any certificate of designations determining the designation, voting rights,
preferences, limitations and special rights of any shares of the Corporation
which have been adopted by the Board as permitted by the certificate of
incorporation and the law, as then in effect.
(b) "BENEFICIAL OWNERSHIP" shall have the same meaning as provided by
Regulation 13D-G under the Exchange Act, as from time to time in effect (and any
successor regulation).
(c) "BOARD" shall mean the Board of Directors of the Corporation as
constituted in accordance with the Certificate of Incorporation and Article III
of the Bylaws.
(d) "BUSINESS DAY" shall mean any day other than a Saturday, a
Sunday, or any day on which banking institutions in Columbia, Maryland are
required or authorized to close by law or executive order.
(e) "BYLAWS" shall mean these Bylaws, dated as of January 5, 2004,
as the same may from time to time be amended and in effect in accordance with
law. References in the Bylaws to "herein," "hereof" or "hereto," or any like
reference, shall refer to the Bylaws (as amended and in effect from time to
time) as a whole and not to any specific article, section, subsection,
paragraph, sentence or clause of the Bylaws unless explicitly provided.
(f) "CLASS 3 DIRECTOR" shall have the meaning ascribed thereto in the
Certificate of Incorporation.
(g) "COMMON STOCK" shall mean all common stock of the Corporation,
including the Ordinary Common Stock and the Multi-Vote Common Stock.
(h) "CORPORATION" shall mean Magellan Health Services, Inc., the
Delaware corporation incorporated by the filing of a certificate of
incorporation with the Secretary of State of the State of Delaware on August 11,
1969.
(i) "EFFECTIVE TIME" shall mean the effective time of these Bylaws as
provided by Article XI hereof.
(j) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended and as the same may be amended from time to time (and any successor
statute).
(k) "INDEPENDENT DIRECTOR" shall mean a director who meets the
criteria of independence established by the standards for the listing of the
Ordinary Common Stock of the Corporation on Nasdaq or, if the Ordinary Common
Stock is listed at the time on the NYSE, on the NYSE (or, if at any time the
Ordinary Common Stock is not listed on either such market, as would be
applicable if the Ordinary Common Stock were then listed on Nasdaq) in order for
such director to be treated as independent under such listing standards;
provided, however, that, for purposes of Article IX hereof, a director shall not
be considered to be independent unless he or she, in addition to satisfying the
foregoing requirements, has, directly or indirectly, no personal or financial
interest, material to such director, in the transaction or category of
transaction he or she is to review and vote on.
(l) "MULTI-VOTE COMMON STOCK" shall mean the Multiple and Variable
Vote Restricted Convertible Common Stock of the Corporation, as designated in
the Certificate of Incorporation.
(m) "NASDAQ" shall mean the Nasdaq Stock Market.
(n) "ORDINARY COMMON STOCK" shall mean the Ordinary Common Stock of
the Corporation, as designated in the Certificate of Incorporation.
(o) "NYSE" shall mean the New York Stock Exchange.
(p) "PLAN" shall be the Corporation's Third Amended Joint Plan of
Reorganization Under Chapter 11 of the Bankruptcy Code.
(q) "SUBSIDIARY" shall mean any company controlled, directly or
indirectly, by the Corporation. Unless otherwise determined by the Board, the
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Corporation shall be considered to control any company of which it, directly or
through one of more Subsidiaries, owns a majority of the securities entitled to
vote in the election of the directors thereof (or persons performing similar
functions) or securities entitled to elect a majority of the directors thereof
(or persons performing similar functions) and any partnership of which it owns,
directly or through one or more Subsidiaries, a general partner interest and any
limited liability company of which it owns, directly or through one or more
Subsidiaries, a managing member interest, and the Corporation shall not be
considered to control a company in which it does not own, directly or through
one or more Subsidiaries, such an interest.
(r) "WHOLE BOARD" shall mean the number of members of the Board at
any time if there were then no vacancies on the Board.
SECTION 2. Principal Office; Notices to the Corporation. The
principal office of the Corporation shall be at such location in Columbia,
Maryland as the Board shall from time to time determine. All notices to the
Corporation required or permitted by the Bylaws may be addressed to the
principal office of the Corporation and shall be marked to the attention of the
Secretary unless otherwise provided herein.
ARTICLE II
Stockholders' Meetings
SECTION 1. Annual Meetings of Stockholders. An annual meeting of
stockholders shall be held in each year on such date and at such time as may be
set by the Board (or by an officer of the Corporation authorized to do so by the
Board) for the purpose of electing directors and the transaction of such other
business as may properly come before the meeting.
SECTION 2. Special Meetings of Stockholders. Special meetings of the
stockholders may be called at any time by the Board (or by an officer of the
Corporation authorized to do so by the Board ). A special meeting of
stockholders may also be called by the holders of at least 40% of the votes that
all stockholders are entitled to cast on the matter to be voted on at the
particular meeting, including (i) a special meeting of the holders of Multi-Vote
Common Stock for the purpose of electing directors who may be elected by such
holders alone or taking any other action that such holders alone may take or,
(ii) a special meeting of the holders of Ordinary Common Stock for the purpose
of electing directors who may be elected by such holders alone or taking any
other action that such holders alone may take.
At any time, upon written request of any person or persons entitled
to call and who have duly called a special meeting, it shall be the duty of the
Secretary to set the date of the meeting, if such date has not been set by the
Board, on a day not more than sixty days after the receipt of the request, and
to give due notice of such meeting to the stockholders. If the Secretary shall
neglect or refuse to set the date of the meeting and give notice thereof, the
person or persons calling the meeting may do so.
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SECTION 3. Place and Notice of Meetings of Stockholders. All meetings
of stockholders shall be held at the principal office of the Corporation unless
the Board (or an officer of the Corporation authorized to do so by the Board)
shall decide otherwise, in which case such meetings may be held at such location
within or without the State of Delaware as the Board may from time to time
direct. Written notice of the place, day, and hour of all meetings of
stockholders and, in the case of a special meeting, of the general nature of the
business to be transacted at the meeting, shall be given to each stockholder of
record entitled to vote at the particular meeting either personally or by
sending a copy of the notice through the mail or by overnight courier to the
address of the stockholder appearing on the books of the Corporation or supplied
by him to the Corporation for the purpose of notice or by other means including
electronic means permitted by law. Except as otherwise provided by the Bylaws or
by law, such notice shall be given at least 10 days before the date of the
meeting by the President, Vice President, or Secretary. A waiver in writing of
any written notice required to be given, signed by the person entitled to such
notice, whether before or after the time stated, shall be deemed equivalent to
the giving of such notice. Attendance of a person, either in person or by proxy,
at any meeting shall constitute a waiver of notice of such meeting, except where
a person attends a meeting for the express purpose of objecting to the
transaction of any business because the meeting was not lawfully called or
convened.
SECTION 4. Nominations by Stockholders of Candidates for Election as
Directors. In addition to the nomination by the Board of candidates for election
to the Board as hereinafter provided, candidates may be nominated by any
stockholder of the Corporation entitled to notice of, and to vote at, any
meeting called for the election of directors. Subject to the last sentence of
this section, nominations, other than those made by or on behalf of the Board,
shall be made in writing and shall be received by the Secretary of the
Corporation not later than (i) with respect to an election of directors to be
held at an annual meeting of stockholders, 90 days prior to the anniversary date
of the immediately preceding annual meeting, provided that, if the date of the
annual meeting is more than 30 days before or after the anniversary date of the
immediately preceding annual meeting, the stockholder nomination shall be
received within 15 days after the public announcement by the Corporation of the
date of the annual meeting, and (ii), with respect to an election of directors
to be held at a special meeting of stockholders, the close of business on the
15th day following the date on which notice of such meeting is first given to
stockholders or public disclosure of the meeting is made, whichever is earlier.
Such nomination shall contain the following information to the extent known to
the notifying stockholder: (a) the name, age, business address, and residence
address of each proposed nominee and of the notifying stockholder; (b) the
principal occupation of each proposed nominee; (c) a representation that the
notifying stockholder intends to appear in person or by proxy at the meeting to
nominate the person or persons specified in the notice; (d) the class and total
number of shares of capital stock and other securities of the Corporation that
are Beneficially Owned by the notifying stockholder and by the proposed nominee
and, if such securities are not owned solely and directly by the notifying
stockholder or the proposed nominee, the manner of Beneficial Ownership; (e) a
description of all arrangements or understandings between the notifying
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stockholder and each nominee and any other person or persons (naming such person
or persons) pursuant to which the nomination or nominations are to be made by
the notifying stockholder; (f) such other information regarding each nominee
proposed by such stockholder as would be required to be included in a proxy
statement filed with the Securities and Exchange Commission pursuant to
Regulation 14A under the Exchange Act had the nominee been nominated, or
intended to be nominated, by the Board; and (g) the consent of each nominee to
serve as a director of the Corporation if so elected. The Corporation may
request any proposed nominee to furnish such other information as may reasonably
be required by the Corporation to determine the qualifications of the proposed
nominee to serve as a director of the Corporation. Within 15 days following the
receipt by the Secretary of a stockholder notice of nomination pursuant hereto,
the nominating and governance committee (as set forth in article III, section
10, subsection (c)) shall instruct the Secretary of the Corporation to advise
the notifying stockholder of any deficiencies in the notice as determined by
such committee. The notifying stockholder shall cure such deficiencies within 15
days of receipt of such notice. No persons shall be eligible for election as a
director of the Corporation unless nominated in accordance with the Bylaws.
Nominations not made in accordance herewith may, in the discretion of the
presiding officer at the meeting and with the advice of the nominating and
governance committee, be disregarded by the presiding officer and, upon his or
her instructions, all votes cast for each such nominee may be disregarded. The
determinations of the presiding officer at the meeting shall be conclusive and
binding upon all stockholders of the Corporation for all purposes. The
provisions of this section shall not apply to the nomination by any holder(s) of
Multi-Vote Common Stock of any candidate for election as director.
SECTION 5. Advance Notice of Other Matters to be Presented by
Stockholders. At any annual meeting or special meeting of stockholders, only
such business as is properly brought before the meeting in accordance with this
paragraph may be transacted. To be properly brought before any meeting, any
proposed business must be either (a) specified in the notice of the meeting (or
any supplement thereto) given by or at the direction of the Board or by any
holder(s) of Multi-Vote Common Stock, (b) otherwise properly brought before the
meeting by or at the direction of the Board or by any holder(s) of Multi-Vote
Common Stock, or (c) if brought before the meeting by a stockholder other than a
holder of Multi-Vote Common Stock, then (1) written notification of such
proposed business (a "Stockholder Notification") must have been received by the
Secretary of the Corporation from a stockholder of record on the record date for
the determination of stockholders entitled to vote at such meeting not later
than (i), with respect to business to be proposed at an annual meeting of
stockholders, 90 days prior to the anniversary date of the immediately preceding
annual meeting (provided, that if the date of the annual meeting is more than 30
days before or after the anniversary date of the immediately preceding annual
meeting, the Stockholder Notification must have been received within 15 days
after the public announcement by the Corporation of the date of the annual
meeting) and (ii) with respect to business to be proposed at a special meeting
of stockholders, the close of business on the 15th day following the date on
which notice of such meeting is first given to stockholders or public disclosure
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of the meeting is made, whichever is earlier. Such Stockholder Notification
shall set forth the nature of and reasons for the proposal in reasonable detail
and, as to the stockholder giving notification, (1) the name and address of such
stockholder and (2) the class and series of all shares of the Corporation that
are beneficially owned by such stockholder. Within 15 days following receipt by
the Secretary of a Stockholder Notification pursuant hereto, the Corporation
shall advise the stockholder of any deficiencies in the Stockholder
Notification. The notifying stockholder may cure such deficiencies within 15
days after receipt of such advice, failing which the Stockholder Notification
shall be deemed invalid.
SECTION 6. Quorum for Stockholder Meetings. At any meeting of the
stockholders, the presence, in person or by proxy, of stockholders entitled to
cast at least a majority of the votes which all stockholders are entitled to
cast upon a matter shall constitute a quorum for the transaction of business
upon such matter, and the stockholders present at a duly organized meeting can
continue to do business until adjournment, notwithstanding the withdrawal of
enough stockholders to leave less than a quorum. If a meeting cannot be
organized because a quorum has not attended, those present may, except as
otherwise provided by law, adjourn the meeting to such time and place as they
may determine, but in the case of any meeting called for the election of
directors, those who attend the second of such adjourned meetings, although less
than a quorum, shall nevertheless constitute a quorum for the purpose of
electing directors.
SECTION 7. Votes Per Share. Except as otherwise provided in the
Certificate of Incorporation (including in respect of the voting rights of
shares of the Multi-Vote Common Stock), every stockholder of record shall have,
at every stockholders' meeting, one vote for every share standing in his or her
name on the books of the Corporation.
SECTION 8. Proxies. Every stockholder entitled to vote at a meeting
of stockholders may authorize another person or persons to act for him by proxy.
A proxy may be submitted to the Secretary by a stockholder in writing, by
telephone, electronically or any other means permitted by law.
SECTION 9. Required Votes for Stockholder Action. Except in respect
of the election of directors (as to which a plurality of the votes of the shares
entitled to vote on the election of a director and voted in favor thereof shall
be required), all questions submitted to the stockholders and all actions by the
stockholders shall be decided by the affirmative vote of the stockholders
present, in person or by proxy, entitled to cast at least a majority of the
votes which all stockholders present are entitled to vote on the matter, unless
otherwise provided by the Certificate of Incorporation, the Bylaws or by law.
For purposes of this section, in the event that a holder of shares of a class or
series which are entitled to vote on a matter is present in person or by proxy
at a meeting but is not permitted by reason of a legal disability or by a
contractual restriction or otherwise to vote the shares such holder holds on
such matter, the shares held by such holder and not so permitted to be voted
shall nevertheless be considered entitled to vote and present for purposes of
determining the number of votes required for stockholder action.
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SECTION 10. Ballots; Judges of Election. Elections for directors need
not be by ballot but the Board of Directors or the presiding officer at a
meeting of stockholders may direct the use of ballots for voting at the meeting.
In advance of any meeting of stockholders, the Board may appoint judges of
election who need not be stockholders to act at such meeting or any adjournment
thereof, and if such appointment is not made, the presiding officer of any such
meeting may, and on request of any stockholder or his proxy shall, make such
appointment at the meeting. The number of judges shall be one or three and, if
appointed at a meeting on request of one or more stockholders or their proxies,
the majority of the shares present and entitled to vote shall determine whether
one or three judges are to be appointed. No person who is a candidate for office
shall act as a judge. In case any person appointed as judge fails to appear or
fails or refuses to act, the vacancy may be filled by appointment made by the
Board in advance of the convening of the meeting or at the meeting by the person
or officer presiding at the meeting. On request of the presiding officer of the
meeting or of any stockholder or his proxy, the judges shall make a report in
writing of any challenge or question or matter determined by them and execute a
certificate of any fact found by them.
SECTION 11. Action Without a Meeting. To the fullest extent and in
the manner permitted by law, any action required or permitted to be taken at a
meeting of the stockholders or of a class or series of stockholders may be taken
without a meeting of the stockholders or of such class or series of stockholders
upon the consent in writing signed by such stockholders who would have been
entitled to vote the minimum number of votes that would be necessary to
authorize the action at a meeting at which all the stockholders entitled to vote
thereon were present and voting. The consents shall be filed with the Secretary.
ARTICLE III
The Board of Directors
SECTION 1. Authority of the Board of Directors. Except as otherwise
provided by law and subject to the provisions of the Certificate of
Incorporation and the Bylaws, all powers vested by law in the Corporation may be
exercised by or under the authority of, and the business and affairs of the
Corporation shall be managed under the direction of, a Board that shall be
constituted as provided by law, the Certificate of Incorporation and the Bylaws.
SECTION 2. Number Of Directors and Selection Thereof. In accordance
with the Certificate of Incorporation, commencing with the Effective Time and
continuing until the first annual meeting of the stockholders held following the
expiration of the three-year period that shall commence on the date on which the
Plan shall become effective (or written consent of the stockholders , as
permitted by law, the Certificate of Incorporation and the Bylaws, in lieu of
such annual meeting), the Board shall consist of nine members and, thereafter,
the Board of Directors shall have not fewer than five and not more than thirteen
members, the exact number of members to be determined from time to time by
resolution adopted by the affirmative vote of a majority of the Whole Board and,
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if applicable, the vote required by Article IX of the Bylaws, plus, in either
case, any members who may be elected exclusively by the holders of one or more
series of Preferred Stock of the Corporation, as provided by the resolution or
resolutions adopted by the Board of Directors and setting the powers,
preferences and rights of a series of Preferred Stock of the Corporation;
provided that no reduction in the number of members shall end the term of office
of any director earlier than such term of office would otherwise end. Directors
shall be selected as provided by law, the Certificate of Incorporation
(including Part A of Article Sixth of the Certificate of Incorporation) and the
Bylaws (including Section 4 of this Article III).
SECTION 3. Independent Directors. The Board shall present to the
stockholders nominees for election to the Board (or recommend the election of
such candidates as nominated by others) and take such other corporate actions as
may be reasonably required to provide that, to the best knowledge of the Board,
if such candidates are elected by the stockholders, (i) the composition of the
Board shall meet any independence requirements under the then applicable listing
standards to which the Corporation is subject, after giving effect to any
exemption for "controlled companies", (ii) the requirements of subsection 10(a)
of this article regarding the composition of the audit committee shall be
satisfied and (iii) the requirements of subsection 10(b) of this article
regarding the composition of the management compensation committee shall be
satisfied. The foregoing provisions of this section shall not cause a director
who, by reason of any change in circumstances, has ceased to qualify as an
independent director or ceased to qualify for service on the audit committee or
management compensation committee from serving the remainder of the term as a
director for which such director has been elected. Notwithstanding the foregoing
provisions of this section, no action of the Board shall be invalid by reason of
the failure at any time of the Board to be constituted in accordance with this
section 3.
SECTION 4. Vacancies. Vacancies on the Board (including any vacancy
created by an increase in the size of the Board) may be filled as provided by
the Certificate of Incorporation (including Section 2 of Part A of Article Sixth
of the Certificate of Incorporation).
SECTION 5. Annual Organizational Meeting of the Board. The Board
shall hold an annual organizational meeting immediately following the annual
meeting of the stockholders at the place thereof, without notice in addition to
the notice of the annual meeting of stockholders, or at such other time as soon
as practicable after such meeting as the Board shall determine and shall at the
annual organizational meeting elect a President, a Secretary and a Treasurer of
the Corporation and such other officers of the Corporation as shall be provided
by the Bylaws or determined by the Board to be appropriate, shall establish the
standing committees of the Board provided by the Bylaws and may take such other
action as the Board determines to be appropriate. Officers of the Corporation
and standing and other committees of the Board may also be elected at any other
time by the Board.
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SECTION 6. Other Meetings of the Board. All meetings of the Board,
other than the annual organizational meeting, shall be held at the principal
office of the Corporation unless the Board (or the person or persons entitled to
call and calling the meeting) shall decide otherwise, in which case such
meetings may be held at such location within or without the State of Delaware as
the Board (or the person or persons entitled to call and calling the meeting)
may from time to time direct. Regular meetings of the Board shall be held at
such time (and place) in accordance with such schedule as the Board shall have
determined in advance and no further notice of regular meetings of the Board
shall be required. The Independent Directors shall meet periodically without any
member of management present and, except as the Independent Directors may
otherwise determine, without any other director present to consider the overall
performance of management and the performance of the role of the Independent
Directors in the governance of the Corporation; such meetings shall be held in
connection with a regularly scheduled meeting of the Board except as the
Independent Directors shall otherwise determine. Special meetings of the Board
may be called by the Chairman of the Board (if any), a Vice Chairman of the
Board (if any), the President or by any two or more directors by giving written
notice at least two Business Days in advance of the day and hour of the meeting
to each director (unless it is determined by the President, the Chairman of the
Board (if any) or the Lead Director (if any) to be necessary to meet earlier, in
which case no less than twenty-four hours written notice shall be given), either
personally or by facsimile, or other means including electronic means permitted
by law. Attendance at any meeting of the Board shall be a waiver of notice
thereof, unless such lack of notice is protested at the outset of the meeting.
If all the members of the Board are present at any meeting, no notice of the
meeting shall be required.
SECTION 7. Quorum. A majority of the whole number of the directors
then in office and entitled to vote on a particular matter shall constitute a
quorum for the transaction of business with respect to such matter, but if at
any meeting a quorum shall not be present, the meeting may adjourn from time to
time until a quorum shall be present.
SECTION 8. Telephonic Participation. Directors may participate in a
meeting of the Board or a committee thereof by conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other.
SECTION 9. Chairman and Vice Chairman of the Board. The Board may, by
resolution adopted by a majority of the Whole Board, at any time designate one
of its members as Chairman of the Board. The Chairman of the Board shall preside
at the meetings of the Board, shall be responsible for the orderly conduct by
the Board of its oversight of the business and affairs of the Corporation and
its other duties as provided by law, the Certificate of Incorporation and the
Bylaws and shall have such other authority and responsibility as the Board may
designate. The Board may, by resolution adopted by a majority of the Whole
Board, at any time also designate one or more of its members as Vice Chairman of
the Board. A Vice Chairman of the Board shall assist the Chairman of the Board
in the conduct of his duties, including by presiding at meetings of the Board in
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the absence of the Chairman of the Board, and shall have such other authority
and responsibility as the Board may designate. A Chairman or Vice Chairman of
the Board shall not be considered an officer of the Corporation unless otherwise
provided by the Board.
SECTION 10. Lead Director. The non-employee directors may, by
resolution adopted by a majority of the non-employee directors, at any time
designate one non-employee director as Lead Director of the Board. The Lead
Director shall chair executive sessions of the non-employee directors. In his or
her absence, the Chairman of the Nominating and Governance Committee shall chair
the executive session. The Lead Director shall, in the absence of a Chairman or
a Vice Chairman of the Board (if any), preside at all meetings of the Board. The
Lead Director shall meet regularly with the Chairman of the Board and Chief
Executive Officer of the Corporation regarding major corporate strategies and
policies.
SECTION 11. Committees of the Board. The Board may, by resolution
adopted by a majority of the Whole Board, at any time designate one or more
committees, each committee to consist of one or more of the directors of the
Corporation, except as otherwise provided by the Bylaws. The Board may designate
one or more directors as alternate members of any committee, who may replace any
absent or disqualified member at any meeting of the committee. Subject to the
following provisions of this section, any such committee to the extent provided
in such resolution shall have and may exercise any or all of the authority and
responsibility of the Board in the management of the business and affairs of the
Corporation, except as otherwise provided by law, the Certificate of
Incorporation or the Bylaws. Except as otherwise provided by the Certificate of
Incorporation, the Bylaws or action of the Board, a quorum for action by a
committee shall be a majority of the members (assuming no vacancy) and action by
vote of a majority of the members at a meeting duly called at which a quorum is
present shall constitute action by the committee. Each committee shall keep a
record of its actions and all material actions taken by a committee on behalf of
the Board shall be reported to the full Board periodically. In all other
respects, the Board may, by resolution adopted by a majority of the Whole Board,
establish rules of procedure for a committee, including designating a member of
a committee as its chair. In the absence of the designation by the Board of the
chairman of a committee or the adoption by the Board of rules of procedure for a
committee, the committee shall adopt its own rules of procedure and elect its
chair. The Board shall establish standing committees of the Board as provided by
the following provisions of this section. In the event any or all of the members
of any committee are required to be independent under any then applicable
listing standards to which the Company is subject or any other legal
requirement, for the performance of some, but not all, of the duties of such
committee, the Board may establish a separate committee for the performance of
only those duties the performance of which requires such independent Directors.
(a) Audit Committee. The audit committee shall be composed of at
least three members of the Board, each of whom shall be an
Independent Director, shall not, in relation to the Corporation, be
an "affiliated person" as defined in Rule 10A-3 under the Exchange
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Act (as from time to time in effect) and shall meet such other
qualifications for membership on the audit committee as are from time
to time required by the listing standards of the Nasdaq or NYSE
applicable to the Corporation. The audit committee shall assist the
Board in overseeing the Corporation's financial reporting and shall
have such authority and responsibility as is provided in the
committee's charter (as hereinafter provided for) and, subject
thereto, as is normally incident to the functioning of the audit
committee of a publicly-traded company and shall perform the other
functions provided to be performed by it by the Bylaws and such other
functions as are from time to time assigned to it by the Board.
(b) Management Compensation Committee. The management compensation
committee shall be composed of at least three members of the Board,
each of whom shall be independent, if required, under any then
applicable listing standards to which the Corporation is subject,
after giving effect to any exemption for "controlled companies," and
shall meet such other qualifications as may be necessary to qualify
as a non-employee director under Rule 16b-3 under the Exchange Act
(as from time to time in effect) and as an outside director under
Section 162(m) of the Internal Revenue Code of 1986, as amended (and
as from time to time in effect). No member of the committee shall be
eligible to participate in any compensation plan or program of the
Corporation or any Subsidiary of the Corporation that is administered
or overseen by the committee. The management compensation committee
shall assist the Board in overseeing the compensation of the
Corporation's officers, the Corporation's employee stock option or
other equity-based compensation plans and programs and the
Corporation's management compensation policies and shall have such
authority and responsibility as is provided in the committee's
charter (as hereinafter provided for) and, subject thereto and
subject to other direction of the Board, as is normally incident to
the functioning of the management compensation committee of a
publicly-traded company and shall perform the other functions
provided to be performed by it by the Bylaws and such other functions
as are from time to time assigned to it by the Board. Unless reviewed
and, if necessary, approved by the committee, the Corporation shall
not cause or permit any Subsidiary of the Corporation to pay or grant
any compensation to any officer or employee of the Corporation which,
if paid or granted by the Corporation, would require review or
approval of the committee.
(c) Nominating and Governance Committee. The nominating and
governance committee shall be composed of at least three members of
the Board, each of whom shall be independent, if required, under any
then applicable listing standards to which the Corporation is
subject, after giving effect to any exemption for "controlled
companies." The nominating and governance committee (i) shall have
authority and responsibility to recommend to the Board for approval
the candidates to be recommended by the Board to the stockholders for
election as directors of the Corporation or to be elected by the
Board to fill a vacancy on the Board, who shall be such as to cause,
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if such candidates are elected, the composition of the Board to
satisfy the requirements of the Certificate of Incorporation
regarding director independence and the requirements of this section
and any other requirements of any then applicable listing standards,
(ii) shall advise the Board on its policies and procedures for
carrying out its responsibilities and on the Corporation's policies
and procedures respecting shareholder participation in corporate
governance and (iii) shall have such authority and responsibility as
is provided in the committee's charter (as hereinafter provided for)
and, subject thereto and subject to other direction of the Board, as
is normally incident to the functioning of the nominating or
governance committee of a publicly-traded company and (iv) shall
perform the other functions provided to be performed by it by the
Bylaws and such other functions as are from time to time assigned to
it by the Board.
(d) Class 3 Directors Committee. Until such time as the Minimum Hold
Condition is no longer satisfied, there shall be a Class 3 Directors
Committee. The Class 3 Directors committee shall be composed of the
Class 3 Directors. The Class 3 Directors committee shall assist the
Board in evaluating any proposed transactions or other matters that
would require action on the part of the Class 3 Directors pursuant to
the Certificate of Incorporation or these Bylaws and shall assist the
Board in interpreting provisions thereof and provisions of the Plan
and the Order entered on October 8, 2003, by the United States
Bankruptcy Court for the Southern District of New York confirming the
Plan that relate to the Class 3 Directors.
(e) Committee Charters. The Board, by majority vote of the Whole
Board, shall approve a charter describing the purposes, functions and
responsibilities of each standing committee of the Board. Each
standing committee of the Board shall prepare and recommend to the
Board for its approval the committee's charter and shall, at least
annually, review and report to the Board on the adequacy thereof. In
addition to and without limiting the provisions of paragraphs (a)
through (c) of this section, each standing committee of the Board
shall have the authority and responsibility provided by its
Board-approved charter, subject to further action by the Board, and
no further authorization of the Board shall be necessary for actions
by a committee within the scope of its charter. Any other committee
of the Board may likewise prepare and recommend to the Board a
charter for the committee and shall have the authority and
responsibility provided by its Board-approved charter.
(f) Committee Advisors and Resources. Each standing committee of the
Board shall have the authority to retain, at the Corporation's
expense, such legal and other counsel and advisors as it determines
to be necessary or appropriate to carry out its responsibilities
within the scope of its charter. Each other committee of the Board
shall have like authority to the extent provided by its charter or
otherwise authorized by the Board. The Corporation shall pay the
compensation of the independent auditor of the Corporation for all
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audit services, as approved by the audit committee, without need for
further authorization.
SECTION 12. Director Compensation. The Board may set the compensation
of directors and members of committees of the Board as permitted by law.
ARTICLE IV
Officers
SECTION 1. Officers Generally. The Board shall designate a President,
one or more Vice Presidents, a Treasurer, a Secretary and a General Counsel and
shall designate an officer as chief financial officer and an officer as chief
accounting officer and may designate such other officers, with such titles,
authority and responsibility (including Assistant Vice Presidents, Assistant
Treasurers and Assistant Secretaries), as the Board considers appropriate for
the conduct of the business and affairs of the Corporation. Any two or more
offices may be held by the same individual. Unless sooner removed by the Board,
all officers shall hold office until the next annual organizational meeting of
the Board and until their successors shall have been elected. Any officer may be
removed from office at any time, with or without cause, by action of the Board.
SECTION 2. Chief Executive Officer. The Chairman of the Board shall
be the Chief Executive Officer of the Company and in that capacity shall have
general management, subject to the control of the Board of Directors, of the
business of the Company, including the appointment of all officers and employees
of the Company for whose election or appointment no other provision is made in
these By-laws; he shall also have the power, at any time, to discharge or remove
any officer or employee of the Company other than those officers and employees
whose election or appointment is otherwise provided for in these By-laws,
subject to the action thereon of the Board of Directors, and shall perform all
other duties appropriate to this office.
SECTION 3. President. The President shall be the chief operating
officer of the Corporation, shall assist the Chief Executive Officer in the
general supervision of the business and affairs and all other officers of the
Corporation and, subject to the direction of the Board, shall have the authority
and responsibility customary to such office. The President shall preside at all
meetings of the stockholders and, in the absence of a Chairman or Vice Chairman
of the Board (if any) and Lead Director (if any), at all meetings of the Board
at which the President is present.
SECTION 4. Vice Presidents;. The Board may elect one or more Vice
Presidents, with such further titles (including designation as President of a
division or operation of the Corporation) and with such authority and
responsibility as the Board may determine. In the absence or disability of the
President, his duties shall be performed by one or more Vice Presidents as
designated by the Board.
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SECTION 5. Chief Financial Officer; Controller. The Board shall
designate an officer as the chief financial officer of the Corporation, who
shall have general supervision of the financial affairs of the Corporation, such
other authority and responsibility as the Board may designate and, subject to
the direction of the Board, the authority and responsibility customary to such
office. In the absence or disability of the chief financial officer, his or her
duties may be performed by any other officer designated by him or her, by the
President or by the Board. The Board shall also designate an officer as the
Controller of the Corporation, who shall be the chief accounting officer of the
Corporation (and may be the same as or different from the chief financial
officer). The Controller shall have general supervision of the books and
accounts of the Corporation, such other authority and responsibility as the
Board may designate and, subject to the direction of the Board, the authority
and responsibility customary to such office. In the absence or disability of the
Controller, his or her duties may be performed by any other officer designated
by him or her, by the President or by the Board.
SECTION 6. Treasurer. The Treasurer (who may be the same as or
different from the chief financial officer and/or the Controller) shall have
supervision and custody of all funds and securities of the Corporation and keep
or cause to be kept accurate accounts of all money received or payments made by
the Corporation, and shall have such other authority and responsibility as
provided by the Bylaws or as the Board may designate and, subject to the
direction of the Board, the authority and responsibility customary to such
office. The Treasurer shall be ex-officio, and have the authority and
responsibility of, an Assistant Secretary.
SECTION 7. General Counsel. The Board shall designate a General
Counsel for the Corporation, who shall be the Corporation's chief legal officer
and shall have general supervision of the legal affairs of the Corporation and
such other authority and responsibility as the Board may designate and, subject
to the direction of the Board, the authority and responsibility customary to
such office.
SECTION 8. Secretary. The Secretary shall have custody of the minutes
of the meetings of the Board, its committees and the stockholders, of the
Certificate of Incorporation and the Bylaws (as amended from time to time) and
such other records of the Corporation as respect its existence and authority to
conduct business, shall have such other authority and responsibility as provided
by the Bylaws or as the Board may designate and, subject thereto, the authority
and responsibility customary to such office. The Secretary shall send out
notices of meetings of the Board and stockholders as required by law or the
Bylaws. The Secretary shall attend and keep the minutes of the Board except as
the Board may otherwise designate. The Secretary shall be ex-officio, and have
the authority and responsibility of, an Assistant Treasurer.
SECTION 9. Assistant Treasurers; Assistant Secretaries. In the
absence or disability of the Secretary, his or her duties may be performed by an
Assistant Secretary. In the absence or disability of the Treasurer, his or her
duties may be performed by an Assistant Treasurer. Such assistant officers shall
also have such authority and responsibility as may be assigned to them by the
Board.
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SECTION 10. Bonded Officers and Employees. Such officers and
employees of the Corporation as the Board shall determine shall give bond for
the faithful discharge of their duties in such form and for such amount and with
such surety or sureties as the Board shall require. The expense of procuring
such bonds shall be borne by the Corporation.
ARTICLE V
Indemnification of Directors, Officers, Employees and Agents
SECTION 1. Indemnification of Directors and Officers
(a) Indemnification of Directors and Officers. The
Corporation shall indemnify to the full extent permitted by law any
person made, or threatened to be made, a party to or otherwise
involved in (as a witness or otherwise) an action, suit or proceeding
(whether civil, criminal, administrative, legislative or
investigative, and whether by or in the right of the Company or
otherwise asserted) by reason of the fact that the person
(1) is or was a director or officer of the
Corporation or
(2) while a director or officer of the Corporation,
either
(i) serves or served as a director, officer,
partner, member, trustee, employee or agent of any
subsidiary of the Corporation or other related enterprise
at the request of the Corporation or in connection with a
related employee benefit plan of the Corporation, any
Subsidiary or any such enterprise,
(ii) serves or served as a director, officer,
partner, member, trustee, employee or agent of any other
unrelated enterprise (including any charitable
organization) in furtherance of the interests of, and at
the specific written request of the Corporation, or in
connection with a related employee benefit plan of such
enterprise,
against any expenses, judgments, fines, and amounts paid in
settlement actually and reasonably incurred in defending or
responding to any such pending or threatened action, suit or
proceeding (including any incurred in connection with any actions
brought by or in the right of the Corporation). A resolution or other
action by the Corporation or subsidiary electing, nominating or
proposing a person to a position referred to in this subsection 2(a)
shall constitute a specific written request of the Corporation
sufficient for the purposes of this section. Upon written request of
a person claiming to be entitled to indemnification hereunder and
specifying the expenses, judgments, fines and amounts paid in
settlement against which indemnity is sought, the Corporation shall,
as soon as practicable and in any event within 90 days of its receipt
of such request, make a determination, in such manner as is required
15
by law, as to the entitlement of such person to indemnification
against such expenses as provided by this subsection 2(a). Such a
determination, however, shall not be conclusive as to such person's
entitlement to indemnification pursuant to this subsection 2(a) and
such person may seek to enforce an entitlement to indemnification
pursuant to this subsection 2(a) by appropriate proceedings in any
court of competent jurisdiction by showing that, notwithstanding such
determination, such person satisfied the standard of conduct required
by law to be satisfied in order for such person to be entitled to
indemnification from the Corporation as permitted by law.
(b) Advancement of Expenses. Expenses reasonably incurred
by a person referred to in subsection 2(a) above in defending or
responding to a civil, criminal, administrative, legislative or
investigative action, suit or proceeding shall be paid by the
Corporation in advance of the final disposition of the action, suit
or proceeding upon receipt of an undertaking by or on behalf of such
person to repay such amount to the extent it shall ultimately be
determined that such person is not entitled to be indemnified by the
Corporation against such expenses or, in the case of a criminal
action in which a judgment has been entered against such person, as
the Board so determines.
16
SECTION 2. Indemnification of Employees and Agents. The Corporation
may, upon authorization by the Board or any officer expressly authorized to do
so by the Board, indemnify, or agree to indemnify, and advance expenses to any
person who is or was an employee or agent of the Corporation or any Subsidiary
to the same extent (or any lesser extent) to which it may indemnify and advance
expenses to a director or officer of the Corporation in accordance with section
1 of this article.
SECTION 3. Non-Exclusivity. The right to indemnification and
advancement of expenses conferred in this article shall not be deemed exclusive
of any other rights to which any person indemnified may be entitled under any
agreement, vote of stockholders or directors or otherwise, the Corporation
having the express authority to enter such agreements or make other provision
for the indemnification of and advancement of expenses to any or all of its
representatives as the Board deems appropriate, including establishing corporate
policies with respect thereto and the creation of one or more funds or
equivalent guarantees for indemnity payments and/or expense advancements to
present or future indemnified persons.
SECTION 4. Continuing Contractual Rights. The right to
indemnification and the advancement of expenses provided by Section 1 of this
article shall be a contract right, shall continue as to a person who has ceased
to serve in the capacities described therein, and shall inure to the benefit of
the heirs, executors and administrators of such person. Expenses reasonably
incurred by a person in successfully enforcing a right to indemnification or
advancement of expenses provided to such person by, or as permitted by, this
article shall be paid by the Corporation.
SECTION 5. No Retroactive Amendment. No amendment, alteration or
repeal of this article, nor the adoption of any provision inconsistent with this
article, shall adversely affect the rights of a person to indemnification and
advancement of expenses hereunder existing at the time of such amendment,
modification or repeal, or the adoption of such an inconsistent provision.
ARTICLE VI
Seal
The Corporation shall have a seal that shall contain the words
"Magellan Health Services, Inc." and may be affixed to documents of the
Corporation as prima facie evidence of the act of the Corporation to the extent
provided by law.
ARTICLE VII
Share Certificates and Transfers
SECTION 1. Form of Share Certificates. Shares of the Corporation may
be represented by certificates or may be uncertificated, but stockholders shall
be entitled to receive share certificates representing their shares as provided
by law. Share certificates shall be in such form as the Board may from time to
17
time determine and shall be signed by the President or one of the Vice
Presidents and countersigned by the Treasurer or an Assistant Treasurer or the
Secretary or an Assistant Secretary and embossed with the seal of the
Corporation or, if not so signed and sealed, shall bear the engraved or printed
facsimile signatures of the officers authorized to sign and the engraved or
printed facsimile of the seal of the Corporation. The death, incapacity,
resignation or removal of an officer who signed or whose facsimile signature
appears on a share certificate shall not affect the validity of the share
certificate.
SECTION 2. Transfers of Record. The shares of the Corporation shall,
upon the surrender and cancellation of the certificate or certificates
representing the same, be transferred upon the books of the Corporation at the
request of the holder thereof, named in the surrendered certificate or
certificates, in person or by his legal representatives or by his attorney duly
authorized by written power of attorney filed with the Corporation or its
transfer agent. In case of loss or destruction of a certificate of stock,
another may be issued in lieu thereof in such manner and upon such terms as the
Board shall authorize.
SECTION 3. Record Dates. The Board may set a time, not more than 60
days nor less than 10 days prior to the date of any meeting of the stockholders,
or not more than 60 days prior to the date set for the payment of any dividend
or distribution or the date for the allotment of rights, or the date when any
change or conversion or exchange of shares stock will be made or go into effect,
as a record date for the determination of the stockholders entitled to notice
of, or to vote at, any such meeting, or entitled to receive payment of any such
dividend or distribution, or to receive any such allotment of rights, or to
exercise the rights in respect to any such change, conversion, or exchange of
shares of the Corporation. In such case, only such Stockholders as shall be
stockholders of record on the date so set shall be entitled to notice of, or to
vote at, such meeting, or to receive payment of such dividend or distribution,
or to receive such allotment of rights, or exercise such rights, as the case may
be, notwithstanding any transfer of shares of the Corporation on the books of
the Corporation after any record date set as aforesaid.
ARTICLE VIII
Fiscal Year
The fiscal year of the Corporation shall end on the 31st day of
December.
ARTICLE IX
Other Special Approval Requirements
The vote required for any action of the Board or the stockholders
shall be only such vote as is required by law, the Certificate of Incorporation
or other provisions of the Bylaws, except that at any time when any shares of
Multi-Vote Common Stock are outstanding (i) any action by the Board of Directors
pursuant to Section 2 of Article III (as in effect at the Effective Time) of the
18
Bylaws to increase the number of members of the Board of Directors above nine,
other than in respect of any directors to be elected exclusively by the holders
of one or more series of Preferred Stock, shall require the affirmative vote of
three-fourths of the Whole Board and (ii) any amendment of the Bylaws that would
repeal or modify, or would adopt any provision inconsistent with, the provisions
of Sections 2 or 3 of Article III hereof (in each case as in effect at the
Effective Time), or of this Article IX (as in effect at the Effective Time),
shall require, in addition to any other vote required by law or the Certificate
of Incorporation or Bylaws, the affirmative vote of the holders of at least
two-thirds of the voting power of all the outstanding shares of Common Stock.
ARTICLE X
Amendments
Except as provided in Article IX hereof (as in effect at the
Effective Time), the Bylaws, as from time to time in effect, may be amended,
modified or repealed, in whole or in part, at any time and from time to time in
any respect by either (i) the stockholders, by the affirmative vote of the
holders of a majority of the voting power of the outstanding shares of Common
Stock, or (ii) by the Board, by the affirmative vote of a majority of the Whole
Board, in either case except as otherwise provided by law or by the Certificate
of Incorporation; ; provided, however, that so long as the Minimum Hold
Condition (as defined in the Certificate of Incorporation) is satisfied, any
amendment to, repeal of, or adoption of any provision inconsistent with Sections
2, 3, 4, 11(d) (and 11(f) to the extent it relates to 11(d)) of Article III,
Article IX or this proviso of this Article X of these Bylaws and any definitions
used in such provisions shall also require the affirmative vote of a majority of
the Class 3 Directors.
ARTICLE XI
Effective Time
The foregoing Bylaws shall be effective upon the filing with the
Secretary of State of the State of Delaware and the effectiveness of such
Amended and Restated Certificate of Incorporation in accordance with the law
(the "Effective Time").
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TABLE OF CONTENTS
PAGE
ARTICLE I Certain Definitions; Principal Office; Notices to the Corporation...............................1
SECTION 1. Certain Definitions...................................................................1
SECTION 2. Principal Office; Notices to the Corporation..........................................3
ARTICLE II Stockholders' Meetings..........................................................................3
SECTION 1. Annual Meetings of Stockholders.......................................................3
SECTION 2. Special Meetings of Stockholders......................................................3
SECTION 3. Place and Notice of Meetings of Stockholders..........................................4
SECTION 4. Nominations by Stockholders of Candidates for Election as Directors...................4
SECTION 5. Advance Notice of Other Matters to be Presented by Stockholders.......................5
SECTION 6. Quorum for Stockholder Meetings.......................................................6
SECTION 7. Votes Per Share.......................................................................6
SECTION 8. Proxies...............................................................................6
SECTION 9. Required Votes for Stockholder Action.................................................6
SECTION 10. Ballots; Judges of Election...........................................................7
SECTION 11. Action Without a Meeting..............................................................7
ARTICLE III The Board of Directors..........................................................................7
SECTION 1. Authority of the Board of Directors...................................................7
SECTION 2. Number Of Directors and Selection Thereof.............................................7
SECTION 3. Independent Directors.................................................................8
SECTION 4. Vacancies.............................................................................8
SECTION 5. Annual Organizational Meeting of the Board............................................8
SECTION 6. Other Meetings of the Board...........................................................9
SECTION 7. Quorum................................................................................9
SECTION 8. Telephonic Participation..............................................................9
SECTION 9. Chairman and Vice Chairman of the Board...............................................9
SECTION 10. Lead Director........................................................................10
SECTION 11. Committees of the Board..............................................................10
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SECTION 12. Director Compensation................................................................13
ARTICLE IV Officers.......................................................................................13
SECTION 1. Officers Generally...................................................................13
SECTION 2. Chief Executive Officer..............................................................13
SECTION 3. President............................................................................13
SECTION 4. Vice Presidents;.....................................................................13
SECTION 5. Chief Financial Officer; Controller..................................................13
SECTION 6. Treasurer............................................................................14
SECTION 7. General Counsel......................................................................14
SECTION 8. Secretary............................................................................14
SECTION 9. Assistant Treasurers; Assistant Secretaries..........................................14
SECTION 10. Bonded Officers and Employees........................................................14
ARTICLE V Indemnification of Directors, Officers, Employees and Agents..................................15
SECTION 1. Indemnification of Directors and Officers............................................15
SECTION 2. Indemnification of Employees and Agents..............................................16
SECTION 3. Non-Exclusivity......................................................................16
SECTION 4. Continuing Contractual Rights........................................................16
SECTION 5. No Retroactive Amendment.............................................................16
ARTICLE VI Seal...........................................................................................17
ARTICLE VII Share Certificates and Transfers...............................................................17
SECTION 1. Form of Share Certificates...........................................................17
SECTION 2. Transfers of Record..................................................................17
SECTION 3. Record Dates.........................................................................17
ARTICLE VIII Fiscal Year....................................................................................18
ARTICLE IX ...............................................................................................18
ARTICLE X Amendments.....................................................................................18
ARTICLE XI Effective Time.................................................................................19
ii