KATY INDUSTRIES, INC.
BY-LAWS
___________________________
ARTICLE I
OFFICES
Section 1. The registered office shall be in the city of Wilmington,
County of New Castle, State of Delaware.
Section 2. The corporation may also have offices at such other places both
within and without the State of Delaware as the board of directors may from time
to time determine or the business of the corporation may require.
ARTICLE II
MEETING OF STOCKHOLDERS
Section 1. All meetings of the stockholders for the election of directors
shall be held in Elgin, Illinois, at such place as may be fixed from time to
time by the board of directors, or at such other place either within or without
the State of Delaware as shall be designated from time to time by the board of
directors and stated in the notice of the meeting. Meetings of stockholders for
any other purpose may be held at such time and place, within or without the
State of Delaware, as shall be stated in the notice of the meeting or in duly
executed waiver of notice thereof.
Section 2. Annual Meetings of stockholders shall be held on the third
Wednesday in May in each year if not a legal holiday, and if a legal holiday,
then on the next secular day following, at 10.00 A.M. or at such other date and
time as shall be designated from time to time by the board of directors and
stated in the notice of the meeting, for the purpose of electing directors in
the manner provided in these by-laws and for the transaction of such other
business as may properly come before the meeting.
Section 3. Written notice of the annual meeting stating the place, date
and hour of the meeting shall be given to each stockholder entitled to vote at
such meeting not less than 10 or more than 60 days before the date of the
meeting.
Section 4. The officer who has charge of the stock ledger of the
corporation shall prepare and make, at least ten days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder.
Such list shall be open to the
examination of any stockholder, for any purpose germane to the meeting, during
ordinary business hours, for a period of at least ten days prior to the meeting,
either at a place within the city where the meeting is to he held, which place
shall be specified in the notice of the meeting, or, if not so specified, at the
place where the meeting is to be held. The list shall also be produced and kept
at the time and place of the meeting during the whole time thereof, and may be
inspected by any stockholder who is present.
Section 5. Special meetings of the stockholders for any purpose or
purposes, unless otherwise prescribed by statute or by the certificate of
incorporation, may be called by the chairman and shall be called by the chairman
or secretary at the request in writing of a majority of the board of directors,
or at the request in writing of stockholders owning a majority in amount of the
entire capital stock of the corporation issued and outstanding and entitled to
vote. Such request shall state the purpose or purposes of the proposed meeting.
Section 6. Written notice of a special meeting stating the place, date and
hour of the meeting and the purpose or purposes for which the meeting is called,
shall be given not less than ten nor more than sixty days before the date of the
meeting, to each stockholder entitled to vote at such meeting.
Section 7. Business transacted at any special meeting of stockholders
shall be limited to the purposes stated in the notice.
Section 8. The holders of a majority of the stock issued and outstanding
and entitled to vote thereat, present in person or represented by proxy, shall
constitute a quorum at all meetings of the stockholders for the transaction of
business except as otherwise provided by statute or by the certificate of
incorporation. If, however, such quorum shall not be present or represented at
any meeting of the stockholders, the stockholders entitled to vote thereat,
present in person or represented by proxy, shall have power to adjourn the
meeting from time to time, without notice other than announcement at the
meeting, until a quorum shall be present or represented. At such adjourned
meeting, at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
notified. If the adjournment is for more than 30 days, or if after the
adjournment a new record date is fixed for the adjourned meeting, a notice of
the adjourned meeting shall be given to each stockholder of record entitled to
vote at the meeting.
Section 9. When a quorum is present at any meeting, the vote of the
holders of a majority of the stock having voting power present in person or
represented by proxy shall decide any question brought before such meeting,
unless the question is one upon which by express provision of the statutes or of
the certificate of incorporation, a different vote is required in which case
such express provision shall govern and control the decision of such question.
2
Section 10. Each stockholder shall at every meeting of the stockholders be
entitled to one vote in person or by proxy for each share of the capital stock
having voting power held by such stockholder, but no proxy shall be voted on
after three years from its date, unless the proxy provides for a longer period.
Section 11. Whenever the vote of stockholders at a meeting thereof is
required or permitted to be taken for or in connection with any corporate
action, by any provision of the statute, the meeting and vote of stockholders
may be dispensed with if all the stockholders who would have been entitled to
vote upon the action if such meeting were held shall consent in writing to such
corporate action being taken; or, unless otherwise provided in the certificate
of incorporation, any action required to be taken at any annual or special
meeting of stockholders of a corporation or any action which may be taken at any
annual or special meeting of such stockholders, may be taken without a meeting,
without prior notice and without a vote, if a consent in writing, setting forth
the action so taken, shall be signed by the holders of outstanding stock having
not less than the minimum number of votes that would be necessary to authorize
or take such action at a meeting at which all shares entitled to vote thereon
were present and voted.
Section 12. Only persons who are nominated in accordance with the
procedures set forth in this Section 12 shall be eligible for election as
directors. Nominations of persons for election to the board of directors of the
corporation may be made at a meeting of stockholders by or at the direction of
the board of directors or by any stockholder of the corporation entitled to vote
for the election of directors at the meeting who complies with the notice
procedures set forth in this Section 12. Such nominations, other than those made
by or at the direction of the board of directors, shall be made pursuant to
timely notice in writing to the secretary of the corporation. To be timely, a
stockholder's notice shall be delivered to or mailed and received at the
principal executive offices of the Corporation not less than 50 days nor more
than 90 days prior to the meeting; provided, however, that in the event that
-------- -------
less than 60 days' notice or prior public disclosure of the date of the meeting
is given or made to stockholders, notice by the stockholder to be timely must be
so received not later than the close of business on the 10th day following the
day on which such notice of the date of the meeting was mailed or such public
disclosure was made. Such stockholder's notice shall set forth:
(a) as to each person whom the stockholder proposes to nominate for
election or re-election as a director;
(i) the name, age, business address and residence address of such
persons;
(ii) the principal occupation or employment of such person;
3
(iii) the class and number of shares of the corporation which are
beneficially owned by such person; and
(iv) any other information relating to such person that is required
to be disclosed in solicitations of proxies for election of
directors, or is otherwise required, in each case pursuant to Regulation
14A under the Securities Exchange Act of 1934, as amended (including,
without limitation, such person's written consent to being named in the
proxy statement as a nominee and to serving as a director of elected); and
(b) as to the stockholder giving the notice,
(i) the name and address, as they appear on the corporation's books,
of such stockholder; and
(ii) the class and number of shares of the corporation which are
beneficially owned by such stockholder.
At the request of the board of directors, any person nominated by the
Board of Directors for election as a director shall furnish to the secretary of
the corporation that information required to be set forth in a stockholder's
notice of nomination which pertains to the nominee. No later than the 10th day
following the date of receipt of a stockholder nomination submitted pursuant to
this Section 12, the chairman of the board of directors of the corporation
shall, if the facts warrant, determine and notify in writing the stockholder
making such nomination that such nomination was not made in accordance with the
time limits and/or other procedures prescribed by the by-laws. If no such
notification is mailed to such stockholder within such 10-day period, such
nomination shall be deemed to have been made in accordance with the provisions
of this Section 12. No person shall be eligible for election as directors of
the corporation unless nominated in accordance with the procedures set forth in
this Section 12.
Section 13. At any Annual Meeting or special meeting of the stockholders,
only such business shall be conducted as shall have been properly brought before
the meeting. To be properly brought before an Annual Meeting or special meeting,
business must be:
(a) specified in the notice of meeting (or any supplement thereto) given
by or at the direction of the board of directors;
(b) otherwise properly brought before the meeting by or at the direction
of the board of directors; or
4
(c) otherwise properly brought before the meeting by a stockholder. For
business to be properly brought before an Annual Meeting or special meeting
by a stockholder, the stockholder must have given timely notice thereof in
writing to the secretary of the corporation.
To be timely, a stockholder's notice must be delivered to or mailed and
received at the principal executive offices of the corporation not less than 50
days nor more than 90 days prior to the meeting; provided, however, that in the
-------- -------
event that less than 60 days' notice or prior public disclosure of the date of
the meeting is given or made to stockholders, notice by the stockholder to be
timely must be so received not later than the close of business on the 10th day
following the day on which such notice of the date of the Annual Meeting or
special meeting was mailed or such public disclosure was made. A stockholder's
notice to the secretary shall set forth as to each matter the stockholder
proposes to bring before the Annual Meeting or Special Meeting:
(a) a brief description of the business desired to be brought before the
Annual Meeting or special meeting and the reasons for conducting such business
at the Annual Meeting or special meeting;
(b) the name and address, as they appear on the corporation's books, of
the stockholder proposing such business;
(c) the class and number of shares of the corporation which are
beneficially owned by the stockholder; and
(d) any material interest of the stockholder in such business.
No later than the 10/th/ day following the date of receipt of a shareholder
notice pursuant to this Section 13, the chairman of the board of directors of
the corporation shall, if the facts warrant, determine and notify in writing the
stockholder submitting such notice that such notice was not made in accordance
with the time limits and/or other procedures prescribed by the by-laws. If no
such notification is mailed to such stockholder within such 10-day period, such
shareholder notice containing a matter of business shall be deemed to have been
made in accordance with the provisions of this Section 13. Notwithstanding
anything in these by-laws to the contrary, no business shall be conducted at an
Annual Meeting or special meeting except in accordance with the procedures set
forth in this Section 13.
5
ARTICLE III
DIRECTORS
Section 1. The number of directors constituting the whole board shall be
nine. Each director shall hold office until the next Annual Stockholders Meeting
or until such director's successors shall have been duly elected and qualified
or until such director's earlier resignation or removal. Directors need not be
stockholders of the corporation.
Section 2. Vacancies and newly created directorships resulting from any
increase in the authorized number of directors may be filled by a majority of
the directors then in office, though less than a quorum, or by a sole remaining
director. The directors so chosen shall hold office until the next election of
the class for which such directors shall have been chosen and until their
successors shall be elected and qualified, unless sooner displaced. If there
are no directors in office then an election of directors may be held in the
manner provided by statute. If, at the time of filling any vacancy or any newly
created directorship, the directors then in office shall constitute less than a
majority of the whole board (as constituted immediately prior to any such
increase), the Court of Chancery may, upon application of any stockholder or
stockholders holding at least ten percent of the total number of the shares at
the time outstanding having the right to vote for such directors, summarily
order an election to be held to fill any such vacancies or newly created
directorships, or to replace the directors chosen by the directors then in
office.
Section 3. The business of the corporation shall be managed by its board
of directors which may exercise all such powers of the corporation and do all
such lawful acts and things as are not by statute or by the certificate of
incorporation or by these by-laws directed or required to be exercised or done
by the stockholders.
MEETINGS OF THE BOARD OF DIRECTORS
Section 4. The board of directors of the corporation may hold meetings,
both regular and special, either within or without the State of Delaware.
Section 5. The first meeting of each newly elected board of directors
shall be held at such time and place as shall be fixed by the vote of the
stockholders at the annual meeting and no notice of such meeting shall be
necessary to the newly elected directors in order legally to constitute the
meeting, provided a quorum shall be present. In the event of the failure of the
stockholders to fix the time or place of such first meeting of the newly elected
board of directors, or in the event such meeting is not held at the time and
place so fixed by the stockholders, the meeting may he held at such time and
place as shall be specified in a notice given as hereinafter provided for
special meetings
6
of the board of directors, or as shall be specified in a written waiver signed
by all of the directors.
Section 6. Regular meetings of the board of directors may be held without
notice at such time and at such place as shall from time to time be determined
by the board.
Section 7. Special meetings of the board may be called by the chairman on
two days notice to each director, either in person or by telephone, by mail or
by telegram; special meetings shall be called by the chairman or secretary in
like manner and on like notice on the written request of two directors.
Section 8. At all meetings of the board a majority of the directors shall
constitute a quorum for the transaction of business and the act of a majority of
the directors present at any meeting at which there is a quorum shall be the act
of the board of directors, except as may be otherwise specifically provided by
statute or by the certificate of incorporation. If a quorum shall not be
present at any meeting of the board of directors, the directors present thereat
may adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present.
Section 9. Unless otherwise restricted by the certificate of incorporation
or these by-laws, any action required or permitted to be taken at any meeting of
the board of directors or any committee thereof may be taken without a meeting,
if all members of the board or committee, as the case may be, consent thereto in
writing, and the writing or writings are filed with the minutes of proceedings
of the board or committee.
COMMITTEES OF DIRECTORS
Section 10. The board of directors may, by resolution passed by a majority
of the whole board, designate one or more committees, each committee to consist
of one or more of the directors of the corporation. 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. In the absence or
disqualification of a member of a committee, the member or members thereof
present at any meeting and not disqualified from voting, whether or not he or
they constitute a quorum, may unanimously appoint another member of the board of
directors to act at the meeting in the place of any such absent or disqualified
member. Any such committee, to the extent provided in the resolution of the
board of directors, shall have and may exercise all the powers and authority of
the board of directors in the management of the business and affairs of the
corporation, and may authorize the seal of the corporation to be affixed to all
papers which may require it; but no such committee shall have the power or
authority in reference to amending the Certificate of Incorporation, adopting an
agreement of
7
merger or consolidation, recommending to the stockholders the sale, lease or
exchange of all or substantially all of the corporation's property and assets,
recommending to the stockholders a dissolution of the corporation or a
revocation of a dissolution or amending the by-laws of the corporation; and,
unless the resolution expressly so provides, no such committee shall have the
power or authority to declare a dividend or to authorize the issuance of stock.
Such committee or committees shall have such name or names as may be determined
from time to time by resolution adopted by the board of directors.
Section 11. Each committee shall keep regular minutes of its meetings and
report the same to the board of directors when required.
COMPENSATION OF DIRECTORS
Section 12. The directors may be paid their expenses, if any, of
attendance at each meeting of the board of directors and may be paid a fixed sum
for attendance at each meeting of the board of directors or a stated salary as
director. No such payment shall preclude any director from serving the
corporation in any other capacity and receiving compensation therefor. Members
of special or standing committees may be allowed like compensation for attending
committee meetings.
ARTICLE IV
NOTICES
Section 1. Whenever, under the provisions of the statutes or of the
certificate of incorporation or of these by-laws, notice is required to be given
to any director or stockholder, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
director or stockholder, at his address as it appears on the records of the
corporation, with postage thereon prepaid, and such notice shall be deemed to be
given at the time when the same shall be deposited in the United States mail.
Notice to directors may also be given by telegram.
Section 2. Whenever any notice is required to be given under the
provisions of the statutes or of the certificate of incorporation or of these
by-laws, a waiver thereof in writing, signed by the person or persons entitled
to said notice, whether before or after the time stated therein, shall be deemed
equivalent thereto.
8
ARTICLE V
OFFICERS
Section 1. The officers of the corporation shall be chosen by the board of
directors and shall be a chairman of the board, a vice-chairman of the board, a
president, a vice-president, a secretary and a treasurer. The board of
directors may also choose additional vice-presidents, and one or more assistant
secretaries and assistant treasurers. Any number of offices may be held by the
same person, unless the certificate of incorporation or these by laws otherwise
provide.
Section 2. The board of directors at its first meeting for each annual
meeting of stockholders shall choose a chairman of the board, a vice-chairman, a
president, one or more vice-presidents, a secretary and a treasurer.
Section 3. The board of directors may appoint such other officers and
agents as it shall deem necessary who shall hold their offices for such terms
and shall exercise such powers and perform such duties as shall be determined
from time to time by the board.
Section 4. The salaries of all officers and agents of the corporation
shall be fixed by the board of directors.
Section 5. The officers of the corporation shall hold office until their
successors are chosen and qualify. Any officer elected or appointed by the
board of directors may be removed at any time by the affirmative vote of a
majority of the board of directors. Any vacancy occurring in any office of the
corporation shall be filled by the board of directors.
Section 6. The chairman of the board shall be the chief executive officer
of the corporation and shall preside at all meetings of the board of directors
and of the executive committee and at all meetings of stockholders. He shall
have general and active management of the business of the corporation and shall
see that all orders and resolutions of the board and the executive committee are
carried into effect. He shall execute bonds, mortgages and other contracts
requiring a seal, under the seal of the corporation, except when required or
permitted by law to be otherwise signed and executed and except where the
signing and execution thereof shall be expressly delegated by the board of
directors to some other officer or agent of the corporation.
Section 7. The vice-chairman, in the absence of the chairman of the board
or in the event of his inability or refusal to act, shall perform the duties of
the chairman, and whom so acting, shall have the power of and be subject to all
the
9
restrictions of the chairman. He shall perform such other duties and have such
other powers as the board of directors may from time to time prescribe.
Section 8. The president shall be the chief operating officer of the
corporation and shall perform such duties and have such powers as the board of
directors may from time to time prescribe.
THE VICE-PRESIDENTS
Section 9. In the absence of the president or in the event of his
inability or refusal to act, the vice-president (or in the event there be more
than one vice-president, the vice-presidents in the order designated, or in the
absence of any designation, then in the order of their election) shall perform
the duties of the president, and when so acting, shall have all the powers of
and be subject to all the restrictions upon the president. The vice-presidents
shall perform such other duties and have such other powers as the board of
directors may from time to time prescribe.
THE SECRETARY AND ASSISTANT
SECRETARIES
Section 10. The secretary shall attend all meetings of the board of
directors and all meetings of the stockholders and record the proceedings of the
meetings of the corporation and of the board of directors in a book to be kept
for that purpose and shall perform like duties for the standing committees when
required. He shall give, or cause to be given, notice of all meetings of the
stockholders and special meetings of the board of directors, and shall perform
such other duties as may be prescribed by the board of directors or chairman,
under whose supervision he shall be. He shall have custody of the corporate seal
of the corporation and he, or an assistant secretary, shall have authority to
affix the same to any instrument requiring it and when so affixed, it may be
attested by his signature or by the signature of such assistant secretary. The
board of directors may give general authority to any other officer to affix the
seal of the corporation and to attest the affixing by his signature.
Section 11. The assistant secretary, or if there be more than one, the
assistant secretaries in the order determined by the board of directors (or if
there be no such determination, then in the order of their election), shall, in
the absence of the secretary or in the event of his inability or refusal to act,
perform the duties and exercise the powers of the secretary and shall perform
such other duties and have such other powers as the board of directors may from
time to time prescribe.
10
THE TREASURER AND ASSISTANT
TREASURERS
Section 12. The treasurer shall have the custody of the corporate funds
and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation and shall deposit all moneys
and other valuable effects in the name and to the credit of the corporation in
such depositories as may be designated by the board of directors.
Section 13. He shall disburse the funds of the corporation as may be
ordered by the board of directors, taking proper vouchers for such
disbursements, and shall render to the president and the board of directors, at
its regular meetings, or when the board of directors so require, an account of
all his transactions as treasurer and of the financial condition of the
corporation.
Section 14. If required by the board of directors, he shall give the
corporation a bond (which shall be renewed every six years) in such sum and with
such surety or sureties as shall be satisfactory to the board of directors for
the faithful performance of the duties of his office and for the restoration to
the corporation, in case of his death, resignation, retirement or removal from
office, of all books, papers, vouchers, money and other property of whatever
kind in his possession or under his control belonging to the corporation.
Section 15. The assistant treasurer, or if there shall be more than one,
the assistant treasurers in the order determined by the board of directors (or
if there be no such determination, then in the order of their election), shall,
in the absence of the treasurer or in the event of his inability or refusal to
act, perform such other duties and have such other powers as the board of
directors may from time to time prescribe.
ARTICLE VI
CERTIFICATES OF STOCK
Section 1. Every holder of stock in the corporation shall he entitled to
have a certificate, signed by or in the name of the corporation by, the chairman
or vice-chairman of the board of directors, the president or a vice-president
and the treasurer or an assistant treasurer, or the secretary or an assistant
secretary of the corporation, certifying the number or shares owned by him in
the corporation.
Section 2. Where a certificate is countersigned (1) by a transfer agent
-
other than the corporation or its employee, or, (2) by a registrar other than
-
the corporation or its employee, the signatures of the officers of the
corporation may be facsimiles. In case any officer who has signed or whose
facsimile signature has been placed upon a
11
certificate shall have ceased to be such officer before such certificate is
issued, it may be issued by the corporation with the same effect as if he were
such officer at the date of issue.
LOST CERTIFICATES
Section 3. The board of directors may direct a new certificate or
certificates to be issued in place of any certificate or certificates
theretofore issued by the corporation alleged to have been lost, stolen or
destroyed. When authorizing such issue of a new certificate or certificates, the
board of directors, may, in its discretion as a condition precedent to the
issuance thereof, require the owner of such lost, stolen or destroyed
certificate or certificates, or his legal representative, to advertise the same
in such manner as it shall require and/or to give the corporation a bond in such
sum as it may direct as indemnity against any claim that may be made against the
corporation with respect to the certificate alleged to have been lost, stolen or
destroyed.
TRANSFER OF STOCK
Section 4. Upon surrender to the corporation or the transfer agent of the
corporation of a certificate for shares duly endorsed or accompanied by proper
evidence of succession, assignment or authority to transfer, it shall be the
duty of the corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction upon its books.
FIXING RECORD DATE
Section 5. In order that the corporation may determine the stockholders
entitled to notice of or to vote at any meeting of stockholders or any
adjournment thereof, or to express consent to corporate action in writing
without a meeting, or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled to exercise any rights in
respect of any change, conversion or exchange of stock or for the purpose of any
other lawful action, the board of directors may fix, in advance, a record date,
which shall not be more that sixty nor less than ten days before the date of
such meeting, nor more than sixty days prior to any other action. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting; provided,
however, that the board of directors may fix a new record date for the adjourned
meeting.
REGISTERED STOCKHOLDERS
Section 6. The corporation shall be entitled to recognize the exclusive
right of a person registered on its books as the owner of shares to receive
dividends, and to vote as such owner, and to hold liable for calls and
assessments a person registered on its books as the owner of shares, and shall
not be bound to recognize any equitable or
12
other claim to interest in such share or shares on the part of any other person,
whether or not it shall have express or other notice thereof, except as
otherwise provided by the laws of Delaware.
ARTICLE VII
GENERAL PROVISIONS
DIVIDENDS
Section 1. Dividends upon the capital stock of the corporation, subject to
the provisions of the certificate of incorporation, if any, may be declared by
the board of directors at any regular or special meeting, pursuant to law.
Dividends may be paid in cash, in property, or in shares of the capital stock,
subject to the provisions of the certificate of incorporation.
Section 2. Before payment of any dividend, there may be set aside out of
any funds of the corporation available for dividends such sum or sums as the
directors from time to time, in their absolute discretion, think proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the corporation, or for such other
purpose as the directors shall think conductive to the interest of the
corporation, and the directors may modify or abolish any such reserve in the
manner in which it was created.
ANNUAL STATEMENT
Section 3. The board of directors shall present at each annual meeting,
and at any special meeting of the stockholders when called for by vote of the
stockholders, a full and clear statement of the business and condition of the
corporation.
CHECKS
Section 4. All checks or demands for money and notes of the corporation
shall be signed by such officer of officers or such other person or persons as
the board of directors may from time to time designate.
FISCAL YEAR
Section 5. The fiscal year of the corporation shall be fixed by resolution
of the board of directors.
SEAL
Section 6. The corporate seal shall have inscribed thereon the name of the
corporation, the year of its organization and the words "Corporate Seal,
Delaware".
13
The seal may be used by causing it or a facsimile thereof to be impressed or
affixed or reproduced or otherwise.
ARTICLE VIII
AMENDMENTS
Section 1. These by-laws may be altered or repealed at any regular meeting
of the stockholders or of the board of directors or at any special meeting of
the stockholders or of the board of directors if notice of such alteration or
repeal be contained in the notice of such special meeting.
ARTICLE IX
INDEMNIFICATION
Section 1. Limited Indemnification of Directors and Officers. Subject to
the limitations of subsection (c) of this Section 1, the corporation shall
indemnify each of its directors and officers to the extent set forth in
subsections (a) and (b) hereof;
(a) Action or Suit by or in the Right of the Corporation. Each director
----------------------------------------------------
and officers of the corporation who was or is a party, or is threatened to be
made a party,
-- to any threatened, pending or completed action or suit, by or in
the right of the corporation, to procure a judgment in its favor,
-- by reason of the fact that he is or was a director or officer of
the corporation, or is or was serving at the request of the corporation as a
director, officers, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise.
shall be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection with the defense or settlement of
such action or suit, if he acted in good faith and in a manner he reasonably
believed to be in, and not opposed to, the best interests of the corporation;
provided that no indemnification shall be made in respect of any claim, issue
or matter as to which such person shall have been adjudged to be liable for
negligence or misconduct in the performance of his duty to the corporation
unless, and only to the extent that, the Court of chancery of Delaware, or the
court in which such action or suit was brought, shall determine upon
application that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of chancery or such other court
shall deem proper.
14
(b) Action or Suit Other Than by or in the Right of the Corporation. Each
---------------------------------------------------------------
director or officer of the corporation who was or is a party, or is
threatened to be made a party,
-- to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
or suit by or in the right of the corporation),
-- by reason of the fact that he is or was a director or officer of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise,
shall be indemnified 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, if he acted in good faith
and in a manner he reasonably believed to be in, or not opposed to, the best
interests of the corporation and with respect to any criminal action or
proceeding, had no reasonable cause to believe his settlement, conviction or
upon a plea of nolo contendere or its equivalent, shall not, of itself,
---- ----------
create a presumption that the director or officer
-- did not act in good faith and in a manner which he reasonably
believed to be in, or not opposed to, the best interests of the corporation,
and
-- with respect to any criminal action or proceeding, had reasonable
cause to believe that his conduct was unlawful.
(c) Limitations on Indemnification. No indemnification shall be made by
------------------------------
the corporation under subsections (a) and (b) of this Section 1 unless ordered
by a court or it is determined in the specific case that indemnification of
such director or officer is proper in the circumstances because he has met the
applicable standard of conduct set forth in subsections (a) and (b) hereof.
Such determination shall be made (1) by the board of directors by a majority
-
vote of a quorum consisting of directors who were not parties to the action,
suit or proceeding referred to, or (2) if such quorum is not obtainable, or
-
even if obtainable, when a quorum of disinterested directors so directs, by
independent legal counsel in a written opinion, or (3) by the stockholders.
-
Section 2. General Indemnification of Directors and Officers. Any other
-------------------------------------------------
provision of this Article IX to the contrary notwithstanding, to the extent that
a director or officer of the corporation has been successful on the merits or
otherwise in defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
15
Section 3. Advance Payment in Indemnification Cases. If authorized by the
----------------------------------------
board of directors in any specific case, expenses incurred by any director or
officer of the corporation in defending a civil or criminal action, suit or
proceeding referred to in subsections (a) and (b) of said Section 1 may be paid
by the corporation in advance of final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of such director or
officer to repay such amount unless it shall ultimately be determined that he
is entitled to be indemnified by the corporation as authorized in this Article
IX.
16