AMENDMENT AND RESTATEMENT OF
BYLAWS
-- of --
ERIE INDEMNITY COMPANY
August 16, 1999
ARTICLE I
Offices
Section 1.01. Principal Office. The principal office of Erie
Indemnity Company, a Pennsylvania business corporation, shall be located
in the City of Erie, Pennsylvania.
ARTICLE II
Meetings of Shareholders
Section 2.01. Annual Meeting. The Annual Meeting of Shareholders shall
be held each year, at a day and time fixed by the Board of Directors. At the
Annual Meeting, the Shareholders then entitled to vote shall elect Directors and
shall transact such other business as may properly be brought before the
meeting. In elections for Directors, voting need not be by ballot, except upon
demand made by a Shareholder entitled to vote at the election and before the
voting begins.
Section 2.02. Special Meetings.
(a) Call of Special Meetings. Special meetings of the
Shareholders may be called at any time by:
(1) the Chairman of the Board,
(2) the Chief Executive Officer,
(3) the Board of Directors,
(4) the Chairman of the Executive Committee, or
(5) Shareholders entitled to cast at least twenty
percent (20%) of the votes that all Shareholders
are entitled to cast at the particular meeting.
(b) Fixing of Time for Meeting. At any time, upon written request of
any person who has called a special meeting, it shall be the duty of the
Secretary to fix the day and time of the meeting, which shall be held not more
than 60 days after the receipt of the request. If the Secretary neglects or
refuses to fix the day and time of the meeting, the person or persons calling
the meeting may do so.
Section 2.03. Place of Meeting. The place of meeting for any Annual or
Special Meeting of Shareholders of the corporation shall be at the principal
office of the corporation, unless another place is designated by the Board of
Directors in the notice of the meeting.
Section 2.04. Notice of Meeting.
(a) General Rule. Written notice of every meeting of the Shareholders
stating the place, day and time of the meeting shall be given by, or at the
direction of, the Secretary to each Shareholder of record entitled to vote at
the meeting at least:
(1) ten days prior to the day named for a meeting called
to consider a fundamental transaction under 15 Pa.
C.S. Chapter 19; or
(2) five days prior to the day named for the meeting in
any other case.
If the Secretary neglects or refuses to give notice of a meeting, the person or
persons calling the meeting may do so. In the case of a Special Meeting of
Shareholders, the notice shall specify the general nature of the business to be
transacted.
(b) Manner of Giving Notice. Whenever written notice is required to be
given to any Shareholder, it may be given either personally or by sending a copy
thereof by first class or express mail, postage prepaid, or by telegram (with
messenger service specified), telex or TWX (with answerback received) or courier
service, charges, prepaid, or by telecopier, to the address (or to the telex,
TWX, telecopier or telephone number) of the Shareholder appearing on the books
of the corporation. If the notice is sent by mail, telegraph or courier service,
it shall be deemed to have been given to the person entitled thereto when
deposited in the United States mail or with a telegraph office or courier
service for delivery to that person or, in the case of telex or TWX, when
dispatched or, in the case of telecopier, when received.
(c) Adjourned Shareholder Meetings. When a meeting of Shareholders is
adjourned, it shall not be necessary to give any notice of the adjourned meeting
or of the business to be transacted at an adjourned meeting, other than by
announcement at the meeting at which the adjournment is taken, unless the Board
fixes a new record date for the adjourned meeting.
(d) Notice of Action by Shareholders on Bylaws. In the case of a
meeting of Shareholders that has as one of its purposes action on the bylaws,
written notice shall be given to each Shareholder that the purpose, or one of
the purposes, of the meeting is to consider the adoption, amendment or repeal of
the bylaws. There shall be included in, or enclosed with, the notice a copy of
the proposed amendment or a summary of the changes to be effected thereby.
Section 2.05. Quorum.
(a) General Rule. A meeting of Shareholders of the corporation duly
called shall not be organized for the transaction of business unless a quorum is
present. The presence, in person or by proxy, of Shareholders entitled to cast
at least a majority of the votes that all Shareholders are entitled to cast on a
particular matter to be acted upon at the meeting shall constitute a quorum for
the purposes of consideration and action on the matter. Shares of the
corporation owned, directly or indirectly, by it and controlled, directly or
indirectly, by the Board of Directors of this corporation, as such, shall not be
counted in determining the total number of outstanding shares for quorum
purposes at any given time.
(b) Withdrawal of a Quorum. The Shareholders present at a duly
organized meeting can continue to do business until adjournment, notwithstanding
the withdrawal of enough Shareholders to leave less than a quorum.
(c) Adjournment for Lack of Quorum. If a meeting cannot be organized
because a quorum has not attended, those present may, except as provided in the
Business Corporation Law, adjourn the meeting to such time and place as they may
determine.
(d) Adjournments Generally. Any meeting at which Directors are to be
elected shall be adjourned only from day to day, or for such longer periods not
exceeding 15 days each as the Shareholders present and entitled to vote shall
direct, until the Directors have been elected. Any other regular or special
meeting may be adjourned for such period as the Shareholders present and
entitled to vote shall direct.
Section 2.06. Informal Action by Shareholders. Any action required or
permitted to be taken at a meeting of the Shareholders or of a class of
Shareholders may be taken without a meeting if, prior or subsequent to the
action, a consent or consents thereto by all of the Shareholders who would be
entitled to vote at a meeting for such purpose shall be filed in writing with
the Secretary of the corporation.
Section 2.07. Shareholder Proposals.
(a) Shareholder Proposals Relating to Candidates for Election as
Directors.
(1) A Shareholder, whether or not entitled to vote in the
election of Directors, may propose to the Nominating Committee of the Board of
Directors one or more persons who the Shareholder believes would be appropriate
candidates for election by Shareholders as a Director at any meeting of
Shareholders at which Directors are to be elected. Such proposal shall be made
by notice in writing, delivered in person or by first class United States mail
postage prepaid or by reputable overnight delivery service, to the Nominating
Committee of the Board of Directors of the corporation to the attention of the
Secretary of the corporation at the principal office of the corporation, within
the time limits specified herein and otherwise in accordance with this Section
2.07(a).
(2) In the case of an annual meeting of Shareholders, any such
written proposal by a Shareholder must be received by the Nominating Committee
not less than 90 calendar days nor more than 120 calendar days before the first
anniversary of the date on which the corporation first mailed its proxy
statement to Shareholders for the annual meeting of Shareholders in the
immediately preceding year; provided, however, that in the case of an annual
meeting of Shareholders that is called for a date which is not within 30
calendar days before or after the first anniversary date of the annual meeting
of Shareholders in the immediately preceding year, any such written proposal by
a Shareholder must be received by the Nominating Committee within five business
days after the earlier of the date the corporation shall have mailed notice to
its Shareholders that an annual meeting of Shareholders will be held, issued a
press release, filed a periodic report with the Securities and Exchange
Commission (the "SEC"), or otherwise publicly disseminated notice that an annual
meeting of Shareholders will be held.
(3) In the case of a special meeting of Shareholders, any such
written proposal by a Shareholder must be received by the Nominating Committee
within five business days after the earlier of the date that the corporation
shall have mailed notice to its Shareholders that a special meeting of
Shareholders will be held, issued a press release, filed a periodic report with
the SEC, or otherwise publicly disseminated notice that a special meeting of
Shareholders will be held.
(4) Such written proposal by a Shareholder shall set forth (A)
the name and address of the Shareholder who has made the proposal, (B) the name,
age, business address and, if known, residence address of each person so
proposed, (C) the principal occupation or employment for the past five years of
each person so proposed, (D) the number of shares of capital stock of the
corporation beneficially owned within the meaning of SEC Rule 13d-1 by each
person so proposed and the earliest date of acquisition of any such capital
stock, (E) a description of any arrangement or understanding between each person
so proposed and the proposing Shareholder with respect to such person's
proposal, election as a Director, and actions to be proposed or taken by such
person if elected as a Director, (F) the written consent of each person so
proposed to serve as a Director if nominated and elected as a Director and (G)
such other information regarding each such person as would be required under the
proxy solicitation rules of the SEC if proxies were to be solicited for the
election as a Director of each person so proposed.
(5) If a written proposal by a Shareholder submitted to the
Nominating Committee fails, in the reasonable judgment of the Nominating
Committee, to contain the information specified in clause (4) hereof or is
otherwise deficient, the Chairperson of the Nominating Committee shall, as
promptly as is practicable under the circumstances, provide written notice to
the Shareholder of such failure or deficiency in the written proposal by a
Shareholder and such Shareholder shall have five business days from receipt of
such notice to submit a revised proposal that corrects such failure or
deficiency in all material respects.
(b) Shareholder Proposals Relating to Matters Other Than
Candidates for Election as Directors.
(1) A Shareholder of the corporation may bring a matter (other
than a proposal to the Nominating Committee of a candidate for election as a
Director which is covered by subsection (a) of this Section 2.07) before a
meeting of Shareholders only if (A) such matter is a proper matter for
Shareholder action and such Shareholder shall have provided notice in writing,
delivered in person or by first class United States mail postage prepaid or by
reputable overnight delivery service, to the Secretary of the corporation at the
principal office of the corporation, within the time limits specified herein or
(B) the Shareholder complies with the provisions of Rule 14a-8 under the
Securities Exchange Act of 1934 (as amended) relating to inclusion of
Shareholder proposals in the corporation's proxy statement.
(2) In the case of an annual meeting of Shareholders, any such
written notice of presentation of a matter by a Shareholder must be received by
the Secretary of the corporation not less than 90 calendar days nor more than
120 days before the first anniversary of the date on which the corporation first
mailed its proxy statement to Shareholders for the annual meeting of
Shareholders in the immediately preceding year; provided, however, that in the
case of an annual meeting of Shareholders that is called for a date which is not
within 30 calendar days before or after the first anniversary date of the annual
meeting of Shareholders in the immediately preceding year, any such written
notice of presentation by a Shareholder of a matter must be received by the
Secretary of the corporation within five business days after the earlier of the
date the corporation shall have mailed notice to its Shareholders that an annual
meeting of Shareholders will be held, issued a press release, filed a periodic
report with the SEC, or otherwise publicly disseminated that an annual meeting
of Shareholders will be held.
(3) In the case of a special meeting of Shareholders, any such
written notice of presentation of a matter by a Shareholder must be received by
the Secretary of the corporation within five business days after the earlier of
the date the corporation shall have mailed notice to its Shareholders that a
special meeting of Shareholders will be held, issued a press release, filed a
periodic report with the SEC, or otherwise publicly disseminated notice that a
special meeting of Shareholders will be held.
(4) Such written notice of presentation of a matter by a
Shareholder shall set forth information regarding such matter equivalent to the
information regarding such matter that would be required under the proxy
solicitation rules of the SEC if proxies were solicited for Shareholder
consideration of such matter at a meeting of Shareholders.
(5) If a written notice of presentation of a matter submitted
by a Shareholder to the Board of Directors fails, in the reasonable judgment of
the Board of Directors, to contain the information specified in clause (iv)
hereof or is otherwise deficient, the Chairperson of the Board of Directors
shall, as promptly as is practicable under the circumstances, provide written
notice to the Shareholder who submitted the written notice of presentation of a
matter of such failure or deficiency in the written notice of presentation of a
matter and such Shareholder shall have five business days from receipt of such
notice to submit a revised written notice of presentation of a matter that
corrects such failure or deficiency in all material respects.
(6) Only matters submitted in accordance with the foregoing
provisions of this Section 2.07(b) shall be eligible for presentation at such
meeting of Shareholders, and any matter not submitted to the Board of Directors
in accordance with such provisions shall not be considered or acted upon at such
meeting of Shareholders.
Section 2.08. Waiver of Notice. Whenever any written notice is required
to be given to any Shareholder, a waiver thereof in writing signed by the
Shareholder entitled to such notice, whether before or after the time stated
therein, shall be deemed equivalent to the giving of the notice. Attendance of a
person at any meeting shall constitute a waiver of notice of the meeting except
where a person attends a meeting for the express purpose of objecting, at the
beginning of the meeting, to the transaction of any business because the meeting
was not lawfully called or convened.
Section 2.09. Voting and Other Action by Proxy.
(a) General Rule.
(1) Every Shareholder entitled to vote at a meeting of
Shareholders or to express consent or dissent to corporate action in writing
without a meeting may authorize another person to act for the Shareholder by
proxy.
(2) The presence of, or vote or other action at a meeting of
Shareholders, or the expression of consent or dissent to corporate action in
writing, by a proxy of a Shareholder shall constitute the presence of, or vote
or action by, or written consent or dissent of the Shareholder.
(3) Where two or more proxies of a Shareholder are present,
the corporation shall, unless otherwise expressly provided in the proxy, accept
as the vote of all shares represented thereby the vote cast by a majority of
them and, if a majority of the proxies cannot agree whether the shares
represented shall be voted or upon the manner of voting the shares, the voting
of the shares shall be divided equally among those persons.
(b) Minimum Requirements. Every proxy shall be executed in writing by
the Shareholder or by the duly authorized attorney-in-fact of the Shareholder
and filed with the Secretary of the corporation. A proxy, unless coupled with an
interest, shall be revocable at will, notwithstanding any other agreement or any
provision in the proxy to the contrary, but the revocation of a proxy shall not
be effective until written notice thereof has been given to the Secretary of the
corporation. An unrevoked proxy shall not be valid after three years from the
date of its execution unless a longer time is expressly provided therein. A
proxy shall not be revoked by the death or incapacity of the maker unless,
before the vote is counted or the authority is exercised written notice of the
death or incapacity is given to the Secretary of the corporation.
(c) Expenses. Unless otherwise restricted in the articles, the
corporation shall pay the reasonable expenses of solicitation of votes, proxies
or consents of Shareholders by or on behalf of the Board of Directors or its
nominees for election to the Board, including solicitation by professional proxy
solicitors and otherwise.
Section 2.10. Voting by Fiduciaries and Pledgees. Shares of the
corporation standing in the name of a trustee or other fiduciary and shares held
by an assignee for the benefit of creditors or by a receiver may be voted by the
trustee, fiduciary, assignee or receiver. A shareholder whose shares are pledged
shall be entitled to vote the shares until the shares have been transferred into
the name of the pledgee, or a nominee of the pledgee, but nothing in this
section shall affect the validity of a proxy given to a pledgee or nominee.
Section 2.11. Voting by Joint Holders of Shares.
(a) General Rule. Where shares of the corporation are held
jointly or as tenants in common by two or more persons, as fiduciaries or
otherwise:
(1) if only one or more of such persons is present in person
or by proxy, all of the shares standing in the names of such persons
shall be deemed to be represented for the purpose of determining a
quorum and the corporation shall accept as the vote of all the shares
the vote cast by a joint owner or a majority of them; and
(2) if the persons are equally divided upon whether the shares
held by them shall be voted or upon the manner of voting the shares,
the voting of the shares shall be divided equally among the persons
without prejudice to the rights of the joint owners or the beneficial
owners thereof among themselves.
(b) Exception. If there has been filed with the Secretary of the
corporation a copy, certified by an attorney-at-law to be correct, of the
relevant portions of the agreement under which the shares are held or the
instrument by which the trust or estate was created or the order of court
appointing them or of an order of court directing the voting of the shares, the
persons specified as having such voting power in the document latest in date of
operative effect so filed, and only those persons, shall be entitled to vote the
shares but only in accordance therewith.
Section 2.12. Voting by Corporations.
(a) Voting by Corporate Shareholders. Any corporation that is a
Shareholder of this corporation may vote by any of its officers or agents, or by
proxy appointed by any officer or agent, unless some other person, by resolution
of the Board of Directors of the other corporation or a provision of its
articles or bylaws, a copy of which resolution or provision certified to be
correct by one of its officers has been filed with the Secretary of this
corporation, is appointed its general or special proxy in which case that person
shall be entitled to vote the shares.
(b) Controlled Shares. Shares of this corporation owned, directly or
indirectly, by it and controlled, directly or indirectly, by the Board of
Directors of this corporation, as such, shall not be voted at any meeting and
shall not be counted in determining the total number of outstanding shares for
voting purposes at any given time.
Section 2.13. Determination of Shareholders of Record.
(a) Fixing Record Date. The Board of Directors may fix a time prior to
the date of any meeting of Shareholders as a record date for the determination
of the Shareholders entitled to notice, or to vote at, the meeting, which time,
except in the case of an adjourned meeting, shall be not more than 90 days prior
to the date of the meeting of Shareholders. Only Shareholders of record on the
date fixed shall be so entitled notwithstanding any transfer of shares on the
books of the corporation after any record date fixed as provided in this
subsection. The Board of Directors may similarly fix a record date for the
determination of Shareholders of record for any other purpose. When a
determination of Shareholders of record has been made as provided in this
section for purposes of a meeting, the determination shall apply to any
adjournment thereof unless the Board fixes a new record date for the adjourned
meeting.
(b) Determination When a Record Date is not Fixed. If a record date is
not fixed:
(1) The record date for determining Shareholders entitled to
notice of or to vote at a meeting of Shareholders shall be at the close
of business on the day next preceding the day on which notice is given
or, if notice is waived, at the close of business on the day
immediately preceding the day on which the meeting is held.
(2) The record date for determining Shareholders entitled to
express consent or dissent to corporate action in writing without a
meeting, when prior action by the Board of Directors is not necessary,
shall be the close of business on the day on which the first written
consent or dissent is filed with the Secretary of the corporation.
(3) The record date for determining Shareholders for any other
purpose shall be at the close of business on the day on which the Board
of Directors adopts the resolution relating thereto.
Section 2.14. Voting Lists.
(a) General Rule. The officer or agent having charge of the transfer
books for shares of the corporation shall make a complete list of the
Shareholders entitled to vote at any meeting of Shareholders, arranged in
alphabetical order, with the address of and the number of shares held by each.
The list shall be produced and kept open at the time and place of the meeting
and shall be subject to the inspection of any Shareholder during the whole time
of the meeting for the purposes thereof.
(b) Effect of List. Failure to comply with the requirements of this
section shall not affect the validity of any action taken at a meeting prior to
a demand at the meeting by any Shareholder entitled to vote thereat to examine
the list. The original share register or transfer book, or a duplicate thereof
kept in this Commonwealth, shall be prima facie evidence as to who are the
Shareholders entitled to examine the list or share register or transfer book or
to vote at any meeting of Shareholders.
Section 2.15. Judges of Election.
(a) Appointment. In advance of any meeting of Shareholders of the
corporation, the Board of Directors may appoint Judges of Election, who need not
be Shareholders, to act at the meeting or any adjournment thereof. If Judges of
Election are not so appointed, the presiding officer of the meeting may, and on
the request of any Shareholder shall, appoint Judges of Election at the meeting.
The number of Judges shall be one or three. A person who is a candidate for
office to be filled at the meeting shall not act as a Judge.
(b) Vacancies. In case any person appointed as a Judge fails to appear
or fails or refuses to act, the vacancy may be filled by appointment made by the
Board of Directors in advance of the convening of the meeting or at the meeting
by the presiding officer thereof.
(c) Duties. The Judges of Election shall determine the number of shares
outstanding and the voting power of each, the shares represented at the meeting,
the existence of a quorum, the authenticity, validity and effect of proxies,
receive votes or ballots, hear and determine all challenges and questions in any
way arising in connection with the right to vote, count and tabulate all votes,
determine the result and do such acts as may be proper to conduct the election
or vote with fairness to all Shareholders. The Judges of Election shall perform
their duties impartially, in good faith, to the best of their ability and as
expeditiously as is practical. If there are three Judges of Election, the
decision, act or certificate of a majority shall be effective in all respects as
the decision, act or certificate of all.
(d) Report. On request of the presiding officer of the meeting, or of
any Shareholder, 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. Any report or certificate made by them shall be prima facie
evidence of the facts stated therein.
ARTICLE III
Directors
Section 3.01. General Powers. All powers vested by law in the
corporation shall be exercised by or under the authority of, and the business
and affairs of the corporation shall be managed under the direction of, the
Board of Directors.
Section 3.02. Number, Tenure and Qualifications. The Board of Directors
shall consist of not less than seven (7), nor more than sixteen (16), Directors
(the exact number to be fixed from time to time by resolution of the Board), the
majority of whom shall be citizens and residents of the United States, each of
whom shall be at least eighteen (18) years of age, elected at the Annual Meeting
of Shareholders, to serve until the ensuing Annual Meeting and until a successor
is elected and qualified or until his or her earlier death, resignation or
removal. Not less than one-third of the Directors shall be persons who are not
officers or employees of the corporation or of any entity controlling,
controlled by, or under common control with the corporation and who are not
beneficial owners of a controlling interest in the voting securities of the
corporation. "Control," "controlling," "controlled by" and "under common control
with" as used herein, shall be given those meanings prescribed by Section 1201
of Pennsylvania Act 178 of 1992 (40 P.S. ss.991.1401). No person who is seventy
(70) years of age or older shall be elected a Director unless already a Director
in office and qualifying under one or more of the following exceptions if such
person is: (a) seventy-five (75) years of age or older on the date of the 1990
Annual Meeting; or (b) under seventy-five (75) years of age on the date of the
1990 Annual Meeting, provided however, that such person cannot continue to serve
beyond the end of the term in which becoming seventy-five (75) years of age; or
(c) seventy (70) years of age or older and serving as a Trustee of the H. O.
Hirt Trust, so long as the Trust holds the majority Class B, or equivalent,
voting shares of the corporation; or (d) seventy (70) years of age or older and
serving, or previously served, in at least one of the two highest full-time
executive positions of the corporation for a period of at least one (1) year.
Section 3.03. Meetings. The Annual Meeting of the Board of Directors
shall be held immediately after the Annual Meeting of Shareholders for the
purpose of organization and the election of officers, and notice thereof shall
be given in the same manner as hereinbefore provided in the case of the Annual
Meeting of Shareholders. The Board of Directors shall provide, by resolution,
for the holding of at least four (4) regular meetings including the annual
meeting on specified days or dates without notice. Special meetings of the Board
of Directors may be called by or at the request of the Chairman of the Board or
by the President, or by at least three (3) Directors. Written notice of every
special meeting of Directors stating the place, day and time of the meeting
shall be given not less than five (5) days before the meeting, either personally
or by first class or express mail or by telegraph, telex or TWX (with answerback
received) or courier services, charges prepaid, or by telecopier. If the notice
is sent by mail, telegraph or courier service, it shall be deemed to have been
given to the person entitled thereto when deposited in the United States mail or
with a telegraph office or courier service for delivery to that person or, in
the case of telex or TWX, when dispatched or, in the case of telecopier, when
received.
Section 3.04. Waiver of Notice. Whenever any written notice is required
to be given to any Director, a waiver thereof in writing signed by the Director
entitled to the notice, whether before or after the time stated therein, shall
be deemed equivalent to the giving of the notice. Attendance of a person at any
meeting shall constitute a waiver of notice of the meeting except where a person
attends a meeting for the express purpose of objecting, at the beginning of the
meeting, to the transaction of any business because the meeting was not lawfully
called or convened.
Section 3.05. Quorum. A majority of the Directors in office of the
corporation shall be necessary to constitute a quorum for the transaction of
business; provided, however, that a quorum shall consist of at least five (5)
Directors if the Board consists of only seven (7) Directors. At least one
Director who is not an officer or employee of the corporation or of any entity
controlling, controlled by or under common control with the corporation and who
is not a beneficial owner of a controlling interest in the voting securities of
the corporation must be present for a quorum of Directors. The acts of a
majority of the directors present and voting at a meeting at which a quorum is
present shall be the acts of the Board of Directors.
Section 3.06. Limiting Liability of Directors.
A. A Director of the corporation shall stand in a fiduciary relation to the
corporation and shall perform his duties as a Director, including his duties as
a member of any committee of the Board of Directors upon which he may serve, in
good faith, in a manner he reasonably believes to be in the best interest of the
corporation, and with such care, including reasonable inquiry, skill and
diligence, as a person of ordinary prudence would use under similar
circumstances. In performing his duties, a Director shall be entitled to rely in
good faith on information, opinions, reports or statements, including financial
statements and other financial data, in each case prepared or presented by any
of the following:
(1) One or more officers or employees of the corporation whom the
Director reasonably believes to be reliable and competent in
the matters present, or
(2) Counsel, public accountants or other persons as to matters
which the Director reasonably believes to be within the
professional or expert competence of such persons, or
(3) A committee of the Board of Directors upon which he does not
serve, duly designated in accordance with law, as to matters
within its designated authority, which committee the Director
reasonably believes to merit confidence.
A Director shall not be considered to be acting in good faith if he has
knowledge concerning the matter in question that would cause his reliance to be
unwarranted.
B. In discharging the duties of their respective positions, the Board of
Directors, committees of the Board of Directors and individual Directors, may,
in considering the best interest of the corporation, consider the effects of any
action upon employees, upon suppliers and customers of the corporation and upon
communities in which offices or other establishments of the corporation are
located, and all other pertinent factors. The consideration of these factors
shall not constitute a violation of subsection A of this section.
C. Absent breach of fiduciary duty, lack of good faith or self-dealing, any
action taken as a Director or any failure to take any action as a Director shall
be presumed to be in the best interests of the corporation.
D. Section 1715 of 15 Pa.C.S. shall not be applicable to the corporation.
(Added 4/27/91.)
E. A Director of the corporation shall not be personally liable for monetary
damages as such for any action taken, or any failure to take any action, unless:
(1) The Director has breached or failed to perform his duties of
his office under subsections A through C of this section, and
(2) The breach or failure to perform constitutes self-dealing,
willful misconduct or recklessness.
F. The provisions of subsection E of this section shall not apply to:
(1) The responsibility or liability of a Director pursuant to any
criminal statute, or
(2) The liability of a Director for the payment of taxes pursuant
to local, state or federal law.
Section 3.07. Executive Committee.
(a) General Rule. There shall be an Executive Committee which, except
as provided in subsection (b), shall have and exercise all power and authority
of the Board of Directors between meetings of the Board. The Executive Committee
shall consist of not fewer than three (3) regular members including the Chief
Executive Officer of the corporation who shall be Chairman of the Executive
Committee, unless another member shall be designated by resolution of the Board.
All of the regular members shall be designated by resolution of the Board. Not
less than one-third of the committee must be Directors who are not officers or
employees of the corporation or of any entity controlling, controlled by, or
under common control with the corporation and who are not beneficial owners of a
controlling interest in the voting securities of the corporation. The Executive
Committee shall meet at any time and place designated and at least six hours
oral or written notice given by or on behalf of the Chairman of the Executive
Committee, and shall report promptly to the entire Board of Directors the
substance of any action taken by the Executive Committee, which action may be
changed by the Board without prejudice to intervening rights.
(b) Limitation on Authority. The Executive Committee shall not have any
power or authority as to the following:
(1) The submission to Shareholders of any action requiring
approval of Shareholders under the Business Corporation
Law.
(2) The creation or filling of vacancies in the Board of
Directors.
(3) The adoption, amendment or repeal of these bylaws.
(4) The amendment or repeal of any resolution of the Board
that by its terms is amendable or repealable only by the
Board.
(5) Action on matters committed by a resolution of the
Board of Directors to another committee of the Board.
Section 3.08. Audit Committee and Audit.
(a) Appointment. The Board of Directors shall appoint annually an Audit
Committee which shall consist of not less than three (3) Directors who are not
officers or employees of the corporation or of any entity controlling,
controlled by, or under common control with the corporation and who are not
beneficial owners of a controlling interest in the voting securities of the
corporation. The Audit Committee shall determine the nature and extent of the
audit of the records and of the verification and certification of the accounts
of the corporation, and not later than at the last meeting of the Board in a
calendar year, shall recommend to the Board the engagement and compensation of
an independent Certified Public Accountant or firm of such accountants to audit
the said records and certify the said accounts for the ensuing calendar year. In
making said audit, verification and certification, said accountant or firm shall
be under the direction of the Audit Committee and shall be responsible to and
shall report to the Board of Directors and not to the officers of the
corporation. The Chief Executive Officer and the President, if not also the
Chief Executive Officer, shall be non-voting, ex-officio members of the Audit
Committee.
(b) Audit. The Audit Committee shall present the audit in full to the
Board of Directors at a meeting of the Board which shall be held at least two
weeks prior to the next Annual Meeting of Shareholders. The audit of the
corporation need not be mailed to Shareholders, but it shall be available for
inspection by any Shareholders at the office of the corporation during usual
business hours and at the Annual Meeting.
Section 3.09. Nominating Committee. The Board of Directors shall
appoint annually a Nominating Committee which shall consist of not less than
three (3) Directors who are not officers or employees of the corporation or of
any entity controlling, controlled by, or under common control with the
corporation and who are not beneficial owners of a controlling interest in the
voting securities of the corporation. The Nominating Committee shall, prior to
the Annual Meeting, determine and nominate candidates for the office of
Directors of the corporation to be elected by the shareholders to serve terms as
established by the bylaws and until their successors are appointed.
Section 3.10. Executive Compensation Committee. The Board of Directors
shall appoint annually an Executive Compensation committee which shall consist
of not less than three (3) Directors who are not officers or employees of the
corporation or of any entity controlling, controlled by, or under common control
with the corporation and who are not beneficial owners of a controlling interest
in the voting securities of the corporation. The Executive Compensation
Committee shall be responsible for evaluating the performance of the principal
officers of the corporation and recommending to the Board of Directors the
selection and compensation of the principal officers. The Executive Compensation
Committee shall also be responsible for the drafting of reports, disclosures,
evaluations and other documents relating to executive compensation for filing
with State and Federal regulatory authorities.
Section 3.11. Alternate Committee Members. The Board of Directors 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 or for
the purpose of any written action by the committee. In the absence or
disqualification of a member and alternate member or members of a committee, the
member or members thereof present at any meeting and not disqualified from
voting, whether or not constituting a quorum, may unanimously appoint another
Director to act at the meeting in the place of the absent or disqualified
member.
Section 3.12. Other Committees. The Board of Directors may designate
from time to time any other committees as the Board may deem necessary and
appropriate. The Board may set the number of members of any such committee and
may appoint such members. Not less than one-third of any committee created
hereunder must be Directors who are not officers or employees of the corporation
or of any entity controlling, controlled by, or under common control with the
corporation and who are not beneficial owners of a controlling interest in the
voting securities of the corporation.
Section 3.13. Informal Action by Directors. Any action required or
permitted to be taken at a meeting of the Directors may be taken without a
meeting if, prior or subsequent to the action, a consent or consents thereto by
all of the Directors in office is filed with the Secretary of the corporation.
Any action without a meeting of the Board shall be limited to those situations
where time is of the essence and not in lieu of a regularly scheduled meeting.
Section 3.14. Vacancies. Vacancies in the Board of Directors, including
vacancies resulting from an increase in the number of Directors, may be filled
by a majority vote of the remaining members of the Board though less than a
quorum, or by a sole remaining Director, and each person so selected shall be a
director to serve for the balance of the unexpired term, and until a successor
has been selected and qualified or until his or her earlier death, resignation
or removal.
Section 3.15. Removal of Directors.
(a) Removal by the Shareholders. The entire Board of Directors, or any
class of the Board, or any individual Director may be removed from office
without assigning any cause by the vote of Shareholders, or of the holders of a
class or series of shares, entitled to elect Directors, or the class of
Directors. In case the Board or a class of the Board or any one or more
Directors are so removed, new Directors may be elected at the same meeting. The
Board of Directors may be removed at any time with or without cause by the
unanimous vote or consent of Shareholders entitled to vote thereon.
(b) Removal by the Board. The Board of Directors may declare vacant the
office of a Director who has been judicially declared of unsound mind or who has
been convicted of an offense punishable by imprisonment for a term of more than
one year or if, within 60 days after notice of his or her selection, the
Director does not accept the office either in writing or by attending a meeting
of the Board of Directors.
Section 3.16. Compensation. The Board of Directors has the
responsibility and authority to determine the compensation of directors and
officers elected by the Board of Directors in connection with their service to
the corporation and a Director may be a salaried officer of the corporation, who
shall not receive any additional compensation as a Director. The acceptance of
gifts of significant value from persons associated with the corporation may
impair the ability of the Board of Directors to establish appropriate levels of
compensation and incentives for directors and officers elected by the Board of
Directors that the Board considers appropriate. For these reasons, a director or
an officer elected by the Board of Directors may not accept, or arrange for any
member of his or her immediate family to receive, gifts or gratuities of other
than nominal or insignificant value from any of the following persons or members
of their immediate families: a director or officer elected by the Board of
Directors, an employee of the corporation, or any person elected by the Board of
Directors who is known to be a beneficial owner of more than 5 percent of the
outstanding capital stock of any class of the corporation. If a gift or gratuity
of more than nominal or insignificant value is received from any such persons,
the gift or gratuity must be returned and the Board of Directors notified. Gifts
or gratuities from any person to any member of the immediate family of such
person are not prohibited by this bylaw.
ARTICLE IV
Officers
Section 4.01. Number. The officers of the corporation shall be a
Chairman of the Board, a President, a Secretary, a Treasurer, and as many
Executive Vice Presidents, and Senior Vice Presidents as from time to time may
be determined by the Board of Directors. The President, Secretary and Treasurer
may not be the same person. The Treasurer must be a natural person. There shall
also be as many Vice Presidents and Assistant Officers as from time to time may
be determined by the Chief Executive Officer. Other officers, including the
office of Vice Chairman of the Board, as from time to time may be determined may
be added by resolution of the Board of Directors.
Section 4.02. Election, Appointment and Term of Office. The Board of
Directors shall elect annually at their first meeting following the Annual
Meeting of Shareholders, the following officers to serve until the next Annual
Meeting of Directors and until their successors are duly elected and qualified
or until their earlier death, resignation or removal:
(1) the three highest paid officers of the corporation,
(2) the Chairman of the Board and the President if they
are not among the three highest paid officers, and
(3) such other officers as the Board of Directors from
time to time may designate by resolution.
All officers not required to be elected by the Board or not designated by the
Board to be elected by the Board shall be appointed by the Chief Executive
Officer to serve at his or her pleasure.
Section 4.03. Standard of Care. An officer of the corporation shall
perform his or her duties as an officer in good faith, in a manner he or she
reasonably believes to be in the best interests of the corporation and with such
care, including reasonable inquiry, skill and diligence, as a person of ordinary
prudence would use under similar circumstances. A person who so performs his or
her duties shall not be liable by reason of having been an officer of this
corporation.
Section 4.04. Duties and Responsibilities. Officers of the corporation
shall have the duties and responsibilities assigned to them in their respective
position descriptions approved by the Chief Executive Officer in addition to the
following duties and responsibilities of the various offices:
(a) Chairman of the Board. The Chairman of the Board shall be the Chief
Executive Officer of the corporation unless otherwise provided by resolution of
the Board of Directors and shall have general supervision of the business,
affairs and property of the corporation and over its several officers. The
Chairman of the Board shall preside at all meetings of the Shareholders and of
the Board of Directors, and shall perform such other duties as from time to time
may be assigned by the Board of Directors. The Chairman of the Board shall be
ex-officio member of all committees, if any, but shall have no vote on the Audit
Committee and the Executive Compensation Committee.
(b) President. The President, in the absence of the Chairman of the
Board, or a Vice Chairman of the Board, if any, shall preside at all meetings of
the Shareholders and the Board of Directors. The President shall have and
exercise all the powers and authority of the Chairman of the Board when the
Chairman and a Vice Chairman, if any, are absent or unable to act during a
vacancy in the office of the Chairman of the Board. The President shall also
have such other duties and responsibilities as from time to time may be assigned
by the Chief Executive Officer or the Board of Directors.
(c) Secretary. The Secretary, or an Assistant Secretary, shall be
present at all meetings of the Board of Directors and of the Shareholders, and
the Secretary shall keep a record of all proceedings of the Board and its
committees and the Shareholders. The Secretary shall notify the Shareholders and
members of the Board of all regular and special meetings, have charge of the
corporate seal and of the books and records of the corporation pertaining to
actions of the Board or the Shareholders, and shall have such other duties and
authority as prescribed by the Pennsylvania Business Corporation Law and any
other applicable law. The Secretary shall also perform such duties as are
customary and incident to the office of the Secretary and shall have such other
duties as from time to time may be assigned by the Chief Executive Officer or
the Board of Directors.
(d) Treasurer. The Treasurer shall have the care and custody of all
funds and securities of the corporation, depositing the same in the name of the
corporation with such bank or banks as the Board of Directors may select. The
Treasurer shall also perform such duties as are customary and incident to the
office of Treasurer and shall have such other duties as from time to time may be
assigned by the Chief Executive Officer or the Board of Directors.
(e) Executive Vice Presidents. An Executive Vice President shall, in
the absence of the President, perform all the duties of the President. If there
is more than one Executive Vice President, the Chief Executive Officer may
designate one of them to be senior. Executive Vice Presidents shall also have
such other duties and responsibilities as from time to time may be assigned by
the Chief Executive Officer or the Board of Directors.
(f) Senior Vice Presidents, Vice Presidents, Assistant Vice Presidents
and Other Officers. Senior Vice Presidents, Vice Presidents and Assistant Vice
Presidents and other officers shall perform such duties as from time to time may
be assigned by the Chief Executive Officer. The duties and responsibilities of
the Vice Chairman of the Board shall be assigned by resolution of the Board of
Directors.
Section 4.05. Compensation. The compensation of officers elected by the
Board of Directors shall be fixed by the Board of Directors subject to change
from time to time as the Board may determine; and the compensation of officers,
assistant officers, and agents appointed by the Chief Executive Officer shall be
fixed by the Chief Executive Officer subject to change from time to time as the
Chief Executive Officer shall determine.
ARTICLE V
Share Certificates and Their Transfer
Section 5.01. Share Certificates.
(a) Form. Certificates for shares of the corporation shall be in such
form as approved by the Board of Directors, and shall state that the corporation
is incorporated under the laws of Pennsylvania, the name of the person to whom
issued, and the number and class of shares and the designation of the series (if
any) that the certificate represents. The share register or transfer books and
blank share certificates shall be kept by the Secretary or by any transfer agent
or registrar designated by the Board of Directors for that purpose.
(b) Issuance. The share certificates of the corporation shall be
numbered, dated, and registered in the share register on transfer books of the
corporation as they are issued. They shall be signed by the Chairman of the
Board or the President and by the Secretary or the Treasurer, and shall bear the
corporate seal, which may be a facsimile, engraved or printed; but where such
certificate is signed by a transfer agent or a registrar the signature of any
corporate officer upon such certificate may be a facsimile, engraved or printed.
In case any officer who has signed, or whose facsimile signature has been placed
upon, any share certificate shall have ceased to be such officer because of
death, resignation or otherwise, before the certificate is issued, it may be
issued with the same effect as if the officer had not ceased to be such at the
date of its issue. The provisions of this Section 5.01 shall be subject to any
inconsistent or contrary agreement at the time between the corporation and any
transfer agent or registrar.
Section 5.02. Transfer of Shares. Transfer of shares of the corporation
shall be made on the books of the corporation by the registered holder thereof
or by his attorney thereunto authorized by a power of attorney, duly executed
and filed with the Secretary of the corporation and upon surrender for
cancellation of the certificate or certificates for such shares. No transfer
shall be made inconsistent with the provisions of the Uniform Commercial Code,
13 Pa.C.S. ss.ss.8101 et. seq., and its amendments and supplements.
Section 5.03. Record Holder of Shares. The corporation shall be
entitled to treat the person in whose name any share or shares of the
corporation stand on the books of the corporation as the absolute owner thereof,
and shall not be bound to recognize any equitable or other claim to, or interest
in, such share or shares on the part of any other person.
Section 5.04. Lost, Destroyed or Mutilated Certificates. The holder of
any shares of the corporation shall immediately notify the corporation of any
loss, destruction or mutilation of the certificate therefore, and the Secretary
may, in his discretion, cause a new certificate or certificates to be issued to
such holder, in case of mutilation of the certificate, upon the surrender of the
mutilated certificate or, in case of loss or destruction of the certificate,
upon satisfactory proof of such loss or destruction and, if the Secretary shall
so determine, the deposit of a bond in such form and in such sum, and with such
surety or sureties, as he may direct.
ARTICLE VI
Corporate Actions
Section 6.01. Voting Securities of Other Corporations. Securities held
by the corporation in any other corporation shall be voted in person or by proxy
by the Chief Executive Officer or any other person duly authorized by the Chief
Executive Officer.
ARTICLE VII
Indemnification of Directors, Officers & Employees
Section 7.01. (The provisions of this Section were adopted by the
Shareholders on April 28, 1987.)
The Company shall indemnify any Director, officer or employee, who was or is a
party to, or is threatened to be made a party to or who is called as a witness
in connection with any threatened, pending, or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative, including
an action by or in the right of the corporation by reason of the fact that he is
or was a Director, officer or employee of the corporation, or is or was serving
at the request of the corporation as a Director, officer or employee of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses, including attorneys' fees, judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding unless the act or failure to act giving rise to the
claim for indemnification is determined by a court to have constituted willful
misconduct or recklessness.
The indemnification and advancement of expenses provided by, or granted pursuant
to, this Article VII shall not be deemed exclusive of any other rights to which
those seeking indemnification or advancement of expenses may be entitled under
any bylaw, agreement, contract, vote of Shareholders, vote of disinterested
Directors or pursuant to the direction, howsoever embodied, of any court of
competent jurisdiction or otherwise, both as to action in his official capacity
and as to action on another capacity while holding such office. It is the policy
of the corporation that indemnification of, and advancement of expenses to,
Directors, officers and employees of the corporation shall be made to the
fullest extent permitted by law. To this end, the provisions of this Article VII
shall be deemed to have been amended for the benefit of Directors, officers and
employees of the corporation effective immediately upon any modification of the
Business Corporation Law of the Commonwealth of Pennsylvania (the "BCL") or the
Directors' Liability Act of the Commonwealth of Pennsylvania (the "DLA") which
expands or enlarges the power or obligation of corporations organized under the
BCL or subject to the DLA to indemnify, or advance expenses to, Directors,
officers and employees of the corporation.
The corporation shall pay expenses incurred by an officer, Director or other
employee, in defending a civil or criminal action, suit or proceeding in advance
of the final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such person to repay such amount if it shall
ultimately be determined that he is not entitled to be indemnified by the
corporation.
The indemnification and advancement of expenses provided by, or granted pursuant
to, this Article VII shall, unless otherwise provided when authorized or
ratified, continue as to a person who has ceased to be a Director, officer or
employee and shall inure to the benefit of the heirs, executors and
administrators of such person.
The corporation shall have the authority to create a fund of any nature, which
may, but need not be, under the control of a trustee, or otherwise secure or
insure in any manner, its indemnification obligations, whether arising under
these Bylaws or otherwise. This authority shall include, without limitation, the
authority to (i) deposit funds in trust or in escrow, (ii) establish any form of
self-insurance, (iii) secure its indemnity obligation by grant of a security
interest, mortgage or other lien on the assets of the corporation, or (iv)
establish a letter of credit, guaranty or surety arrangement for the benefit of
such persons in connection with the anticipated indemnification or advancement
of expenses contemplated by this Article VII. The provision of this Article VII
shall not be deemed to preclude the indemnification of, or advancement of
expenses to, any person who is not specified in Section 7.01 of this Article
VII, but whom the corporation has the power or obligation to indemnify, or to
advance expenses for, under the provisions of the BCL or the DLA or otherwise.
The authority granted by this section shall be exercised by the Board of
Directors of the corporation.
Section 7.02. Proceedings Initiated by Indemnified Persons.
Notwithstanding any other provision of this Article VII, the corporation shall
not indemnify any person under this Article VII for any liability incurred in an
action, suit or proceeding initiated (which shall not be deemed to include
counterclaims or affirmative defenses) or participated in as an intervenor or
amicus curiae by the person seeking indemnification unless such initiation of or
participation in the action, suit or proceeding is authorized, either before or
after its commencement, by the affirmative vote of a majority of the Directors
in office. This section does not apply to successfully prosecuting or defending
the rights of any person to indemnification granted by or pursuant to this
Article VII.
ARTICLE VIII
Amendments
Section 8.01. Amendments. These bylaws may be altered, amended or
repealed and new bylaws adopted, either (i) by vote of the Shareholders at any
duly organized annual or special meeting of Shareholders, or (ii) with respect
to those matters that are not by statute committed expressly to the Shareholders
and regardless of whether the Shareholders have previously adopted or approved
the bylaw being amended or repealed, by vote of a majority of the Board of
Directors of the corporation in office at any regular or special meeting of
Directors. Any change in these bylaws shall take effect when adopted unless
otherwise provided in the resolution affecting the change.
I hereby certify that the foregoing Bylaws were adopted at the 46th Annual
Meeting of Shareholders of the ERIE INDEMNITY COMPANY held on the 27th day of
April 1971, and were amended at the following meetings: the 52nd Annual Meeting
of Shareholders, April 26, 1977; the Special Shareholders Meeting, August 21,
1979; the 233rd Board of Directors Meeting, November 13, 1979; the 242nd Board
of Directors Meeting, March 4, 1981; the 248th Board of Directors Meeting,
August 24, 1982; the 62nd Annual Meeting of Shareholders, April 28, 1987; the
280th Board of Directors Meeting, April 24, 1990; by unanimous consent
resolution adopted by the Board of Directors on April 27, 1991; the 288th Board
of Directors Meeting, December 19, 1991; the 297th Board of Directors Meeting,
September 27, 1993; the 299th Board of Directors Meeting, March 1, 1994; the
313th Board of Directors Meeting, September 17, 1996; the 320th Board of
Directors Meeting, March 11, 1998; the 325th Board of Directors Meeting, March
9, 1999; the 327th Board of Directors Meeting, June 15, 1999; and the Special
Board of Directors Meeting, August 16, 1999.
\s\ J.R. Van Gorder
J. R. Van Gorder, Secretary