EXHIBIT 3.2
AMENDED AND RESTATED BY-LAWS
OF
INNNOTRAC CORPORATION
ARTICLE I
OFFICES
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Section 1. Registered Office. The registered office shall be in the
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State of Georgia, County of Gwinnett.
Section 2. Other Offices. The corporation may also have offices at
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such other places both inside and outside the State of Georgia as the board of
directors may from time to time determine and the business of the corporation
may require or make desirable.
ARTICLE II
SHAREHOLDERS MEETINGS
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Section 1. Annual Meetings. The annual meeting of the shareholders
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of the corporation shall be held at the principal office of the corporation or
at such other place inside or outside the United States as may be determined by
the board of directors, on such date and at such time as may be determined by
the board of directors, for the purpose of electing directors and transacting
such other business as may properly be brought before the meeting.
Section 2. Special Meetings. Special meetings of the shareholders
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shall be held at the principal office of the corporation or at such other place
inside or outside the United States as may be designated in the notice of said
meetings, upon call of the chairman of the board of directors or the president
and shall be called by the president or the secretary when so directed by the
board of directors or at the request in writing of shareholders owning at least
25% of the issued and outstanding capital stock of the corporation entitled to
vote thereat. Any such request shall state the purposes for which the meeting
is to be called.
Section 3. Notice of Meetings. Written notice of every meeting of
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shareholders, stating the place, date and hour of the meetings, shall be given
in a manner
permitted by applicable law to each shareholder of record entitled to vote at
such meeting not less than 10 nor more than 60 days before the date of the
meeting. Attendance of a shareholder at a meeting of shareholders shall
constitute a waiver of notice of such meeting and of all objections to the place
or time of meeting, or the manner in which it has been called or convened,
except when a shareholder attends a meeting solely for the purpose of stating,
at the beginning of the meeting, any such objection to the transaction of any
business. Notice need not be given to any shareholder who signs a waiver of
notice, in person or by proxy, either before or after the meeting.
Section 4. Quorum. At all meetings of shareholders, any Voting
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Group (as defined below) entitled to vote on a matter may take action on the
matter only if a quorum of that Voting Group exists at the meeting, and if a
quorum exists, the Voting Group may take action on the matter notwithstanding
the absence of a quorum of any other Voting Group that may be entitled to vote
separately on the matter. Unless the articles of incorporation, these by-laws or
the Code provides otherwise, the presence (in person or by proxy) of shares
representing a majority of votes entitled to be cast on a matter by a Voting
Group shall constitute a quorum of the Voting Group with regard to that matter.
Once a share is present at any meeting other than solely to object to holding
the meeting or transacting business at the meeting, the share shall be deemed
present for quorum purposes for the remainder of the meeting and for any
adjournments of that meeting, unless a new record date for the adjourned meeting
is or must be set pursuant to Article V, Section 4 of these by-laws. If a quorum
is not present at any meeting of the shareholders, the holders of a majority of
the shares present (in person or represented by proxy) and entitled to vote
thereat may 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 original
meeting.
Section 5. Voting. Unless otherwise provided by law, the articles of
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incorporation, or board resolutions setting forth the preferences and other
rights, restrictions or limitations of any class or series of preferred stock,
each outstanding share, regardless of class or series, shall be entitled to one
vote on each matter voted on at a shareholders meeting, and each class or series
of the corporation's shares entitled to vote generally on a matter shall for
that purpose be considered a single voting group (a "Voting Group"). Unless the
articles of incorporation, these by-laws, a resolution of the board of directors
or applicable law require a different vote, action on a matter presented for
consideration at a meeting where a quorum is present, shall be approved as
follows: (a) directors shall be elected by a plurality of the votes cast by the
shares entitled to vote in the election at a meeting at which a quorum is
present; and (b) all other matters shall be approved if the votes cast within
the applicable Voting Group favoring the action exceed the votes cast opposing
the action, unless the articles of incorporation, a provision of these by-laws
that has been adopted pursuant to Section 14-2-1021 of the Code (or any
successor provision), or applicable law requires a greater number of affirmative
votes. If either the articles of incorporation or the Code requires separate
voting by
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two or more Voting Groups on a matter, action on that matter is taken only when
voted upon by each such Voting Group separately.
A shareholder may vote his shares in person or by proxy. A shareholder
may appoint a proxy to vote or otherwise act for him by signing an appointment
form. An appointment of a proxy is valid for eleven months unless a shorter or
longer period is expressly provided in the appointment form.
Section 6. Consent of Shareholders. Any action required or
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permitted to be taken at any meeting of the shareholders may be taken without a
meeting if all of the shareholders consent thereto in writing, setting forth the
action so taken. Such consent shall have the same force and effect as a
unanimous vote of shareholders.
Section 7. List of Shareholders; Inspection of Records. (a) The
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corporation shall keep at its registered office or principal place of business,
or at the office of its transfer agent or registrar, a record of its
shareholders, giving their names and addresses and the number, class and series,
if any, of the shares held by each.
(b) Shareholders are entitled to inspect the corporate
records as and to the extent provided by the Code; provided, however, that only
shareholders owning more than two percent (2%) of the outstanding shares of any
class of the corporation's stock shall be entitled to inspect (1) the minutes
from any board, board committee or shareholders meeting (including any records
of action taken thereby without a meeting); (2) the accounting records of the
corporation; or (3) any record of the shareholders.
ARTICLE III
DIRECTORS
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Section 1. Powers. Except as otherwise provided by any legal
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agreement among shareholders, the property, affairs and business of the
corporation shall be managed and directed by its board of directors, which may
exercise all powers of the corporation and do all lawful acts and things which
are not by law, by any legal agreement among shareholders, by the articles of
incorporation or by these by-laws directed or required to be exercised or done
by the shareholders.
Section 2. Number, Election, and Term. The board of directors shall
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consist of the number and shall be elected in the manner and serve the term as
set forth in the Amended and Restated Articles of Incorporation. Except as
provided in this Article with respect to filling vacancies on the board, the
directors shall be elected by the shareholders as provided in Article II, and
each director elected shall hold office until his successor is elected
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and qualified or until his earlier resignation, removal from office, or death.
Directors shall be natural persons who have attained the age of 21 years, but
need not be residents of the State of Georgia or shareholders of the
corporation. The board, from time to time, may designate persons to act as
advisory directors.
Section 3. Nominations. (a) If any shareholder intends to nominate
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or cause to be nominated any candidate for election to the board of directors
(other than any candidate to be sponsored by and proposed at the instance of the
management), such shareholder shall notify the president by first class
registered mail sent not less than 14 nor more than 50 days before the scheduled
meeting of the shareholders at which directors will be elected. However, if
less than 21 days notice of the meeting is given to shareholders, such
nomination shall be delivered or mailed to the president not later than the
close of the seventh day following the date on which the notice of the
shareholders' meeting was mailed. Such notification shall contain the following
information with respect to each nominee, to the extent known to the shareholder
giving such notification:
(1) Name, address and principal present occupation;
(2) To the knowledge of the shareholder who proposed to make such
nomination, the total number of shares that may be voted for such
proposed nominee;
(3) The names and address of the shareholders who propose to make such
nomination, and the number of shares of the corporation owned by
each of such shareholders; and
(4) The following additional information with respect to each nominee:
age, past employment, education, beneficial ownership of shares in
the corporation, past and present financial standing, criminal
history (including any convictions, indictments or settlements
thereof), involvement in any past or pending litigation or
administrative proceedings (including threatened involvement),
relationship to and agreements (whether or not in writing) with
the shareholder(s) (and their relatives, subsidiaries and
affiliates) intending to make such nomination, past and present
relationships or dealings with the corporation or any of its
subsidiaries, affiliates, directors, officers or agents, plans or
ideas for managing the affairs of the corporation (including,
without limitation, any termination of employees, any sales of
corporate assets, any proposed merger, business combination or
recapitalization involving the corporation, and any proposed
dissolution or liquidation of the corporation), and all additional
information relating to such person that would be required to be
disclosed, or otherwise required, pursuant to Sections 13 or 14 of
the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder (the
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"Exchange Act"), in connection with any acquisition of shares by
such nominee or in connection with the solicitation of proxies by
such nominee for his election as a director, regardless of the
applicability of such provisions of the Exchange Act.
(b) Any nominations not in accordance with the provisions of this
Section may be disregarded by the chairman of the meeting, and upon instruction
by the chairman, votes cast for each such nominee shall be disregarded. In the
event, however, that a person should be nominated by more than one shareholder,
and if one such nomination complies with the provisions of this Section, such
nomination shall be honored, and all shares voted for such nominee shall be
counted.
Section 4. Vacancies. (a) Subject to subsections 4(b), vacancies,
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including vacancies resulting from any increase in the number of directors and
vacancies resulting from removal from office by the shareholders, may be filled
only by the board of directors or by a majority of the directors then in office
(if the directors remaining in office constitute less than a quorum), and a
director so chosen shall hold office until the expiration of the term and until
his successor is duly elected and qualified, unless sooner displaced; provided,
however, that if there are no directors in office, then vacancies shall be
filled through election by the shareholders.
(b) If any vacant office described in subsection 4(a) was held by a
director elected by a particular Voting Group, only the remaining directors
elected by that Voting Group shall be entitled to fill the vacancy; provided,
however, that if the vacant office was held by a director elected by a
particular Voting Group and there is no remaining director elected by that
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Voting Group, the other remaining directors or director (elected by another
Voting Group or Groups) may fill the vacancy.
Section 5. Meetings and Notice. The board of directors of the
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corporation may hold meetings, both regular and special, either inside or
outside the State of Georgia. Regular meetings of the board of directors may be
held without notice at such time and place as shall from time to time be
determined by resolution of the board. Special meetings of the board may be
called by the chairman of the board or president or by any two directors upon
one days notice given in a manner permitted by law. Such notice shall state a
reasonable time, date and place of meeting, but the purpose need not be stated
therein. A director may waive any notice required by the Code, the articles of
incorporation, or these by-laws before or after the date and time of the matter
to which the notice related, by a written waiver signed by the director and
delivered to the corporation for inclusion in the minutes or filing with the
corporate records. Attendance of a director at a meeting shall constitute a
waiver of notice of such meeting and waiver of all objections to the place and
time of the meeting, or the manner in which it has been called or convened
except when the director states, at the beginning of the meeting, any such
objection or objections to the transaction of business.
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Section 6. Quorum. At all meetings of the board of directors, a
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majority of 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, except as may be otherwise
specifically provided by law, by the articles of incorporation, or by these by-
laws. If a quorum shall not be present at any meeting of the board, 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 7. Conference Telephone Meeting. Unless the articles of
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incorporation or these by-laws otherwise provide, members of the board of
directors, or any committee designated by the board, may participate in a
meeting of the board or committee by means of conference telephone or similar
communications equipment whereby all persons participating in the meeting can
hear each other. Participation in the meeting shall constitute presence in
person.
Section 8. Consent of Directors. Unless otherwise restricted by the
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articles of incorporation or these by-laws, any action required or permitted to
be taken at any meeting of the board of directors or of 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, setting forth the action so taken, and
the writing or writings are filed with the minutes of the proceedings of the
board or committee. Such consent shall have the same force and effect as a
unanimous vote of the board.
Section 9. Committees. The board of directors may, by resolution
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passed by a majority of the whole board, designate from among its members one or
more committees, each committee to consist of two or more directors. The board
may designate one or more directors as alternate members of any committee, who
may replace any absent member at any meeting of such committee. Any such
committee, to the extent provided in the resolution, shall have and may exercise
all of the authority of the board of directors in the management of the business
and affairs of the corporation except as limited by law. 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. A majority of each committee
may determine its action and may fix the time and places of its meetings, unless
otherwise provided by the board of directors. Each committee shall keep regular
minutes of its meetings and report the same to the board of directors when
required.
Section 10. Removal of Directors. At any shareholders' meeting with
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respect to which notice of such purpose has been given, any director may be
removed from office, only for cause, by the vote of shareholders representing a
majority of the issued and outstanding capital stock entitled to vote for the
election of directors, provided that a director elected by a Voting Group may
only be removed for cause by the vote of shareholders representing a majority of
the issued and outstanding capital stock of the Voting Group that elected the
particular director, and his successor may be elected at the same or any
subsequent meeting of shareholders; provided that to the extent any vacancy
created by such
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removal is not filled by such an election within 60 days after such removal, the
remaining directors shall, by majority vote, fill any such vacancy.
Section 11. Compensation of Directors. Directors shall be entitled
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to such reasonable compensation for their services as directors or members of
any committee of the board as shall be fixed from time to time by resolution
adopted by the board, and shall also be entitled to reimbursement for any
reasonable expenses incurred in attending any meeting of the board or any such
committee.
ARTICLE IV
OFFICERS
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Section 1. Number. The officers of the corporation shall be chosen
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by the board of directors and shall be a president and a treasurer. The board
of directors may also choose a chairman of the board, one or more vice-
presidents, a secretary, assistant secretaries and assistant treasurers. 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 2. Compensation. The salaries of all officers and agents of
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the corporation shall be fixed by the board of directors or a committee or
officer appointed by the board.
Section 3. Term of Office. Unless otherwise provided by resolution
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of the board of directors, the principal officers shall be chosen annually by
the board at the first meeting of the board following the annual meeting of
shareholders of the corporation, or as soon thereafter as is conveniently
possible. Subordinate officers may be elected from time to time. Each officer
shall serve until his successor shall have been chosen and qualified, or until
his death, resignation or removal.
Section 4. Removal. Any officer may be removed from office at any
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time, with or without cause, by the board of directors whenever in its judgment
the best interest of the corporation will be served thereby, or if appointed at
the authorization of the board of directors, by a senior officer at any time,
with or without cause, whenever in the officer's judgment the best interest of
the corporation will be served thereby.
Section 5. Vacancies. Any vacancy in an office resulting from any
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cause may be filled by the board of directors.
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Section 6. Powers and Duties. Except as hereinafter provided, the
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officers of the corporation shall each have such powers and duties as
generally pertain to their respective offices, as well as such powers and
duties as from time to time may be conferred by the board of directors.
(a) Chairman of the Board. The chairman of the board (if
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there be one) shall preside at and serve as chairman of meetings of the
stockholders and of the board of directors. The chairman of the board shall
perform other duties and have other authority as may from time to time be
delegated by the board of directors.
(b) Chief Executive Officer. The chief executive officer
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shall be charged with the general and active management of the corporation,
shall see that all orders and resolutions of the board of directors are
carried into effect, shall have the authority to select and appoint
employees and agents of the corporation, and shall, in the absence or
disability of the chairman of the board, perform the duties and exercise
the powers of the chairman of the board. The chief executive officer shall
also be responsible for the development, establishment, and implementation
of the policy and strategic initiatives for the corporation. The chief
executive officer shall perform any other duties and have any other
authority as may be delegated from time to time by the board of directors,
and shall be subject to the limitations fixed from time to time by the
board of directors.
(c) President. If there shall be no separate chief executive
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officer of the corporation, then the president shall be the chief executive
officer of the corporation, with the duties and authority provided in
Section 6 (b). The president shall otherwise be the chief operating
officer of the corporation and shall, consistent with the authority
otherwise conferred upon the chief executive officer in Section 6 (b), have
responsibility for the conduct and general supervision of the business
operations of the corporation, including without limitation responsibility
for the direction, supervision, and coordination of the activities of all
operating subsidiaries and other business units of the corporation. The
president shall perform such other duties and have such other authority as
may from time to time be delegated by the board of directors. In the
absence or disability of the chief executive officer, the president shall
perform the duties and exercise the powers of the chief executive officer.
(d) Vice President. The vice president (if there be one)
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shall, in the absence or disability of the president, perform the duties
and exercise the powers of the president, whether the duties and powers are
specified in these by-laws or otherwise. If the corporation has more than
one vice president, the one designated by the board of directors shall act
in the event of the absence or disability of the president. Vice presidents
shall perform any other duties and have any other authority as from time to
time may be delegated by the board of directors, the chief executive
officer, or the president.
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(e) Secretary. The secretary shall attend all meetings of
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the board of directors and all meetings of the shareholders and record all
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 shareholders and special
meetings of the board of directors, and shall perform such other duties as
may be prescribed by the board of directors or president, 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.
(f) Assistant Secretary. The assistant secretary or if
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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.
(g) Treasurer. The treasurer shall have the custody of the
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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. 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
requires, an account of all his transactions as treasurer and of the
financial condition of the corporation. 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 this control belonging to the corporation.
(h) Assistant Treasurer. The assistant treasurer, or if
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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 the duties and
exercise the powers of the treasurer and shall perform such
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other duties and have such other powers as the board of directors may from
time to time prescribe.
Section 7. Signatures. The signature of any officer, employee or
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agent upon any document of the corporation may be made by facsimile or machine
signature under such limitations and circumstances as the board of directors or
any appropriate committee of the board of directors may provide from time to
time.
Section 8. Voting Securities of Corporation. Unless otherwise
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ordered by the board of directors, the chairman shall have full power and
authority on behalf of the corporation to attend and to act and vote at any
meetings of security holders of corporations in which the corporation may hold
securities, and at such meetings shall possess and may exercise any and all
rights and powers incident to the ownership of such securities which the
corporation might have possessed and exercised if it had been present. The
board of directors by resolution from time to time may confer like powers upon
any other person or persons.
ARTICLE V
CERTIFICATE
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Section 1. Form of Certificate. Every holder of fully-paid stock in
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the corporation shall be entitled to have a certificate in such form as the
board of directors may from time to time prescribe.
Section 2. Lost Certificates. The board of directors may direct
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that a new certificate be issued in place of any certificate theretofore issued
by the corporation and alleged to have been lost, stolen or destroyed, upon the
making of an affidavit of that fact by the person claiming the certificate of
stock to be lost, stolen or destroyed. When authorizing such issue of a new
certificate, the board of directors may, in its discretion and as a condition
precedent to the issuance thereof, require the owner of such lost, stolen or
destroyed certificate, 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.
Section 3. Transfers. (a) Transfers of shares of the capital stock
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of the corporation shall be made only on the books of the corporation by the
registered holder thereof, or by his duly authorized attorney, or with a
transfer clerk or transfer agent appointed as provided in Section 5 of this
Article, and on surrender of the certificate or certificates for such shares
properly endorsed and the payment of all taxes thereon.
(b) 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
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owner, and for all other purposes, 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, whether or not it shall have express or other notice thereof,
except as otherwise provided by law.
(c) Shares of capital stock may be transferred by delivery of the
certificates therefor, accompanied either by an assignment in writing on the
back of the certificates or by separate written power of attorney to sell,
assign and transfer the same, signed by the record holder thereof, or by his
duly authorized attorney-in-fact, but no transfer shall affect the right of the
corporation to pay any dividend upon the stock to the holder of record as the
holder in fact thereof for all purposes, and no transfer shall be valid, except
between the parties thereto, until such transfer shall have been made upon the
books of the corporation as herein provided.
(d) The board may, from time to time, make such additional rules and
regulations as it may deem expedient, not inconsistent with these by-laws or the
articles of incorporation, concerning the issue, transfer and registration of
certificates for shares of the capital stock of the corporation.
Section 4. Record Date. In order that the corporation may determine
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the shareholders entitled to notice of or to vote at any meeting of shareholders
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 than 70 days and, in case of a meeting of shareholders,
not less than 10 days prior to the date on which the particular action requiring
such determination of stockholders is to be taken. If no record date is fixed
for the determination of shareholders entitled to notice of and to vote at any
meeting of shareholders, the record date shall be at the close of business on
the day next preceding the day on which the notice is given, or, if notice is
waived, at the close of business on the day next preceding the day on which the
meeting is held. If no record date is fixed for other purposes, the record date
shall be at the close of business on the day next preceding the day on which the
board of directors adopts the resolution relating thereto. A determination of
shareholders of record entitled to notice of or to vote at a meeting of
shareholders shall apply to any adjournment of the meeting unless the board of
directors shall fix a new record date for the adjourned meeting.
Section 5. Transfer Agent and Registrar. The board of directors
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may appoint one or more transfer agents or one or more transfer clerks and one
or more registrars, and may require all certificates of stock to bear the
signature or signatures of any of them.
ARTICLE VI
GENERAL PROVISIONS
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Section 1. Distributions. Distributions upon the capital stock of
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the corporation, subject to the provisions of the articles of incorporation, if
any, may be declared by the board of directors at any regular or special
meetings, pursuant to law. Distributions may be paid in cash, in property, or in
shares of the corporation's capital stock, subject to the provisions of the
articles of incorporation. Before payment of any distribution, there may be set
aside out of any funds of the corporation available for distributions 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
distributions, or for repairing or maintaining any property of the corporation,
or for such other purpose as the directors shall think conducive to the interest
of the corporation, and the directors may modify or abolish any such reserve in
the manner in which it was created.
Section 2. Fiscal Year. The fiscal year of the corporation shall be
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fixed by resolution of the board of directors.
Section 3. Seal. The corporate seal shall have inscribed thereon
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the name of the corporation, the year of its organization and the words
"Corporate Seal" and "Georgia". The seal may be used by causing it or a
facsimile thereof to be impressed or affixed or reproduced or otherwise. In the
event it is inconvenient to use such a seal at any time, the signature of the
corporation followed by the word "Seal" enclosed in parentheses shall be deemed
the seal of the corporation.
ARTICLE VII
INDEMNIFICATION OF DIRECTORS AND OFFICERS
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Section 1. Indemnification of Directors and Officers.
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corporation shall indemnify and hold harmless any person (an "Indemnified
Person") who is or was 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, against expenses (including, but not limited to,
attorneys' fees and disbursements, court costs and expert witness fees), and
against any 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 conduct
was unlawful; provided, in any case, that no indemnification shall be made in
respect of expenses, judgments, fines and amounts paid in settlement
attributable to circumstances as to which, under applicable provisions of the
Code as in effect from time to time, such indemnification may not be authorized
by action of the board of directors, the shareholders or otherwise.
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Section 2. Indemnification of Directors and Officers for Derivative
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Actions. The corporation shall indemnify and hold harmless any Indemnified
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Person who is or was 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, 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, against expenses (including, but not limited to, attorneys'
fees and disbursements, court costs and expert witness fees) 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. No indemnification shall be
made pursuant to this Section for any claim, issue or matter as to which an
Indemnified Person shall have been adjudged by a court of competent
jurisdiction, after exhaustion of all appeals therefrom, to be liable to the
corporation, or for amounts paid in settlement to the corporation, unless and
only to the extent that the court in which such action or suit was brought or
other court of competent jurisdiction shall determine upon application that such
person is fairly and reasonably entitled to indemnity for such expenses which
the court shall deem proper.
Section 3. Indemnification of Employees and Agents. The board of
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directors shall have the power to cause the corporation to provide to any person
who is or was an employee or agent of the corporation all or any part of the
right to indemnification and other rights of the type provided under Sections 1,
2, 6 and 12 of this Article (subject to the conditions, limitations, obligations
and other provisions specified herein), upon a resolution to that effect
identifying such employee or agent (by position or name) and specifying the
particular rights provided, which may be different for each employee or agent
identified. Each employee or agent of the corporation so identified shall be an
"Indemnified Person" for purposes of the provisions of this Article.
Section 4. Subsidiaries and Other Organizations. The board of
------------------------------------
directors shall have the power to cause the corporation to provide to any person
who is or was a director, officer, employee or agent of the corporation or who
also is or was a director, officer, trustee, partner, employee or agent of a
Subsidiary (as defined below), or is or was serving at the corporation's request
in such a position with any other organization, all or any part of the right to
indemnification and other rights of the type provided under Sections 1, 2, 6 and
12 of this Article (subject to the conditions, limitations, obligations and
other provisions specified herein), with respect to service by such person in
such position with a Subsidiary or other organization, upon a resolution
identifying such person, the Subsidiary or other organization involved (by name
or other classification), and the particular rights provided, which may be
different for each person so identified. Each person so identified shall be an
"Indemnified Person" for purposes of the provisions of this Article. As used in
this Article, "Subsidiary" shall mean (i) another corporation, joint venture,
trust, partnership or unincorporated business association more than 20% of the
voting capital stock or other voting equity interest of which was, at or after
the time of the circumstances giving rise to such action, suit or proceeding,
owned, directly or indirectly, by the corporation; or (ii) a nonprofit
corporation that receives its principal financial support from the corporation
or its Subsidiaries.
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Section 5. Determination. Notwithstanding any judgment, order,
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settlement, conviction or plea in any action, suit or proceeding of the kind
referred to in Sections 1 and 2 of this Article, an Indemnified Person shall be
entitled to indemnification as provided in such Sections 1 and 2 if a
determination that such Indemnified Person is entitled to such indemnification
shall be made (i) by the board of directors by a majority vote of a quorum
consisting of directors who are not at the time parties to the proceeding; or
(ii) if a quorum cannot be obtained under (i) above, by majority vote of a
committee duly designated by the board of directors (in which designation
interested directors may participate), consisting solely of two or more
directors who are not at the time parties to the proceeding; or (iii) in a
written opinion by special legal counsel selected as required by Section 14-2-
855(b)(3) of the Code or any successor provision. To the extent that an
Indemnified Person has been successful on the merits or otherwise in defense of
any action, suit or proceeding of the kind referred to in Sections 1 and 2 of
this Article, or 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.
Section 6. Advances. Expenses (including, but not limited to,
--------
attorneys' fees and disbursements, court costs, and expert witness fees)
incurred by an Indemnified Person in defending any action, suit or proceeding of
the kind described in Sections 1 and 2 hereof (or in Section 4 hereof if
applicable to such Indemnified Person) shall be paid by the corporation in
advance of the final disposition of such action, suit or proceeding as set forth
herein. The corporation shall promptly pay the amount of such expenses to the
Indemnified Person, but in no event later than ten days following the
Indemnified Person's delivery to the corporation of a written request for an
advance pursuant to this Section, together with a reasonable accounting of such
expenses; provided, however, that the Indemnified Person shall furnish the
corporation a written affirmation of his good faith belief that he has met the
standard of conduct set forth in the Code and a written undertaking and
agreement, executed personally or on his behalf, to repay to the corporation any
advances made pursuant to this Section if it shall be ultimately determined that
the Indemnified Person is not entitled to be indemnified by the corporation for
such amounts. The corporation shall make the advances contemplated by this
Section regardless of the Indemnified Person's financial ability to make
repayment. Any advances and undertakings to repay pursuant to this Section
shall be unsecured and interest-free.
Section 7. Non-Exclusivity. Subject to any applicable limitation
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imposed by the Code or the Articles of Incorporation, the indemnification and
advancement of expenses provided by or granted pursuant to this Article shall
not be exclusive of any other rights to which a person seeking indemnification
or advancement of expenses may be entitled under any by-law, resolution or
agreement specifically or in general terms approved or ratified by the
affirmative vote of holders of a majority of the shares entitled to be cast
thereon.
Section 8. Insurance. The corporation shall have the power to
---------
purchase and maintain insurance on behalf of any person who is or was a
director, officer, employee or agent of the corporation, or who, while a
director, officer, employee, or agent of the corporation, is or was serving as a
director, officer, trustee, general partner, employee or agent of a Subsidiary
or, at the request of the corporation, of any other organization, against any
liability asserted against
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him and incurred by him in any such capacity, or arising out of his status as
such, whether or not the corporation would have the power to indemnify him
against such liability under the provisions of this Article.
Section 9. Notice. If any expenses or other amounts are paid by
------
way of indemnification, otherwise than by court order or action by the
shareholders or by an insurance carrier pursuant to insurance maintained by the
corporation, the corporation shall, not later than the next annual meeting of
shareholders, unless such meeting is held within three months from the date of
such payment, and in any event within 15 months from the date of such payment,
send by first class mail to its shareholders of record at the time entitled to
vote for the election of directors a statement specifying the persons paid, the
amount paid and the nature and status at the time of such payment of the
litigation or threatened litigation.
Section 10. Security. The corporation may designate certain of its
--------
assets as collateral, provide self-insurance or otherwise secure its obligations
under this Article, or under any indemnification agreement or plan of
indemnification adopted and entered into in accordance with the provisions of
this Article, as the board of directors deems appropriate.
Section 11. Amendment. Any amendment to this Article that limits or
---------
otherwise adversely affects the right of indemnification, advancement of
expenses, or other rights of any Indemnified Person hereunder shall, as to such
Indemnified Person, apply only to claims, actions, suits or proceedings based on
actions, events or omissions (collectively, "Post Amendment Events") occurring
after such amendment and after delivery of notice of such amendment to the
Indemnified Person so affected. Any Indemnified Person shall, as to any claim,
action, suit or proceeding based on actions, events or omissions occurring prior
to the date of receipt of such notice, be entitled to the right of
indemnification, advancement of expenses and other rights under this Article to
the same extent as if such provisions had continued as part of the by-laws of
the corporation without such amendment. This Section cannot be altered, amended
or repealed in a manner effective as to any Indemnified Person (except as to
Post Amendment Events) without the prior written consent of such Indemnified
Person.
Section 12. Agreements. In addition to the rights provided in this
----------
Article, the corporation shall have the power, upon authorization by the board
of directors, to enter into an agreement or agreements providing to any person
who is or was a director, officer, employee or agent of the corporation
indemnification rights substantially similar to, or greater than, those provided
in this Article.
Section 13. Continuing Benefits. The indemnification and
-------------------
advancement of expenses provided by or granted pursuant to this Article shall,
unless otherwise provided when authorized or ratified, continue as to a person
who has ceased to be a director, officer, employee or agent and shall inure to
the benefit of the heirs, executors and administrators of such a person.
Section 14. Successors. For purposes of this Article, the terms
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"the corporation" or "this corporation" shall include any corporation, joint
venture, trust, partnership or unincorporated business association that is the
successor to all or substantially all of the
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business or assets of this corporation, as a result of merger, consolidation,
sale, liquidation or otherwise, and any such successor shall be liable to the
persons indemnified under this Article on the same terms and conditions and to
the same extent as this corporation.
Section 15. Severability. Each of the sections of this Article,
------------
and each of the clauses set forth herein, shall be deemed separate and
independent, and should any part of any such section or clause be declared
invalid or unenforceable by any court of competent jurisdiction, such invalidity
or unenforceability shall in no way render invalid or unenforceable any other
part thereof or any other separate section or clause of this Article that is not
declared invalid or unenforceable.
Section 16. Additional Indemnification. In addition to the specific
--------------------------
indemnification rights set forth herein, the corporation shall indemnify each of
its directors and officers to the full extent permitted by action of the board
of directors without shareholder approval under the Code or other laws of the
State of Georgia as in effect from time to time.
ARTICLE VIII
AMENDMENTS
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The board of directors shall have power to alter, amend or repeal the
by-laws or adopt new by-laws by majority vote of all of the directors, but any
by-laws adopted by the board of directors may be altered, amended or repealed
and new by-laws adopted, by the shareholders by majority vote of all of the
shares having voting power.
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