EXHIBIT 3.2
BYLAWS
OF
UNIFIED WESTERN GROCERS, INC.
ARTICLE I
SHAREHOLDERS
Section 1. Qualifications for Class A Shareholders. It is the intent
and purpose of this Corporation to limit the ownership of its Class A Shares to
qualified and active member-patrons of this Corporation.
Applicants for membership as member-patrons (referred to sometimes as
"members") may be persons, firms, associations, corporations or other legal
entities, but must be of good and approved financial standing engaged in selling
groceries and related merchandise at retail or wholesale, must patronize the
Corporation in such amounts and such manner as may be prescribed by policies
adopted or approved by the Board of Directors, must comply with the conditions
and agreements contained in the application for membership and with the
Corporation's Bylaws and with such rules, regulations and policies for the
servicing of accounts as may from time to time be established by the
Corporation. Any applicant so qualified, wishing to become a member-patron,
shall make written application therefor in such form as the Corporation may from
time to time require. Any such application shall be considered by the Board of
Directors, and no membership shall be accepted or shares of the Corporation be
issued to any such applicant without the approval of the Board of Directors.
Section 2. Member-Patrons. The Class A Shares of this Corporation
shall be issued only to member-patrons of this Corporation. Each member-patron
shall be required to hold 150 Class A Shares in the fiscal year ending in 2003,
200 shares in the fiscal year ending in 2004, 250 shares in the fiscal year
ending in 2005, 300 shares in the fiscal year ending in 2006 and 350 shares in
the fiscal year ending in 2007 and thereafter. No member-patron shall be
entitled to hold more than such number of Class A Shares. Each member-patron
shall also hold such amount of Class B Shares of the Corporation as the Board of
Directors may establish as being required to be held by member-patrons whether
based on a percentage of average weekly purchases or on some other basis. In
order to qualify for and retain membership, patrons must qualify and be accepted
as member-patrons in accordance with Section 1, must patronize the Corporation
in such amounts and manner as may be prescribed from time to time by the Bylaws
or by policies adopted or approved by the Board of Directors, must purchase and
hold the requisite number of the Corporation's Class A Shares set forth above
(provided that the manner of purchase of such shares shall be determined by the
Board of Directors), must hold such amount of Class B Shares as may be specified
by requirements regarding the holding of Class B Shares as may from time to time
be established by the Board of Directors, must comply with the agreements
contained in the
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application for membership and with the Corporation's Bylaws and with such
rules, regulations, and policies for the servicing of accounts as may from time
to time be established by the Corporation including, without limitation, payment
of such service dues, maintenance of such deposits and compliance with all terms
of purchase and payment as may be prescribed. Membership as a member-patron does
not obligate the Corporation to make any sale of merchandise or services or any
extension of credit. Membership as a member-patron is not transferable either
voluntarily or by operation of law.
Section 3. Affiliated Member-Patrons. Notwithstanding the provisions
of Section 2 above, the Board of Directors may, in its discretion, authorize the
acceptance and service of member-patrons without the issuance thereto of the
Corporation's Class A Shares when the Board determines that such action is
justified by reason of the fact that the ownership of such member-patron is the
same, or in the Board's determination sufficiently the same, as that of another
member-patron holding Class A Shares. Such member-patron however shall be
required to hold Class B Shares in the same manner as other member-patrons.
Section 4. Associate-Patrons. The Board of Directors may, in its
discretion, authorize doing business on a patronage basis with patrons who are
not member-patrons and who are referred to herein as "associate-patrons."
Section 5. Rules and Regulations for Servicing Accounts.
The Board of Directors shall establish or shall authorize the
establishment, from time to time, of such rules, regulations and policies for
the servicing of accounts as it shall deem advisable, including, without
limitation, rules prescribing monthly service dues, charges applicable on late
payments of accounts, amounts and manner of purchases, required deposits,
guarantees and other credit requirements and other terms of service, purchases
and payment of accounts.
Section 5.A Patronage Dividend Deposit Accounts. Without limiting the
requirement of any condition, rule, regulation or policy for the servicing of
accounts which may otherwise require patron deposits, member-patrons and
associate-patrons may be required to maintain "Patronage Dividend Deposit
Accounts" which shall consist of that portion of patronage dividends
distributable to such patrons and allocated by the Corporation on its books to
such patrons' Patronage Dividend Deposit Accounts. The indebtedness of the
Corporation respecting such accounts may be evidenced by the issuance of notes,
revolving fund certificates, retain certificates, certificates of indebtedness,
patronage dividend certificates or any other written evidences of indebtedness
of the Corporation (collectively, "Patronage Dividend Certificates"). The
portion of the patronage dividends to be so allocated and evidenced by the
issuance of Patronage Dividend Certificates, together with the rate of interest
payable thereon and the maturity date thereof, will be determined by the Board
of Directors prior to their issuance. Such Patronage Dividend Deposit Accounts
shall be maintained, and the Patronage Dividend Certificates shall be issued and
held, on and be subject to such terms and conditions as may be prescribed by the
Corporation, including without limitation the right of the Corporation to set
off against principal and interest thereon all or any portion of amounts owing
to the Corporation or any of its subsidiaries. The indebtedness evidenced by
such Patronage Dividend Certificates shall be subordinated and subject in right
of payment to the prior payment in full of all "Senior Indebtedness" as that
term may be defined in such Patronage Dividend Certificates or in any indenture
under which they are issued
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and the terms and provisions of such subordination shall be as set forth in such
Patronage Dividend Certificates or in such indenture.
Section 6. Termination of Membership as a Member-Patron. Membership as
a member-patron may be terminated:
(a) By written resignation of the member received by the Treasurer of
the Corporation;
(b) By the Corporation on default of the member in any requirement for
membership as set forth in the application for membership, the Bylaws of the
Corporation, or any rules, regulations or policies established by or pursuant to
the authorization of the Board of Directors;
(c) By the Corporation on the member's failure to timely pay or
otherwise meet any obligation to the Corporation or any of its subsidiaries or
to comply with any rule, regulation, requirement or policy for the servicing of
accounts that may be prescribed by the Corporation;
(d) By the Corporation pursuant to provisions of the application for
membership or other agreement with the member;
(e) By the Corporation on the levy of an attachment or execution
against any account of the member or any of the Corporation's shares held by the
member or on any such account or share being subjected to any other process of
law;
(f) By the Corporation on the member's becoming insolvent, being
adjudged bankrupt, commencing any proceeding under any bankruptcy, insolvency,
arrangement or reorganization statute or making an assignment for the benefit of
creditors;
(g) By the Corporation on the death or incompetency of a member;
(h) By the Corporation on the assignment, transfer or encumbrance, or
attempted or purported assignment, transfer or encumbrance, except to the
Corporation or any of its subsidiaries, of any account of the member or of any
of the Corporation's shares held by the member;
(i) By the Corporation whenever it shall determine that for a period
of six months or more during any fiscal year of the Corporation any member's
account is one which entails an operating loss to the Corporation. Termination
of membership shall not relieve the patron of obligations incurred prior to
termination.
Section 7. Qualifications For Class B Shareholders. Unless and until
the Board of Directors shall expressly authorize Class B Shares to be issued to
or held by any person other than a member-patron, it is the intent and purpose
of this Corporation that the ownership of this Corporation's Class B Shares
shall be limited to qualified and active member-patrons of this
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Corporation or former member-patrons who have tendered such shares to the
Corporation for redemption.
Section 8. Required Class B Shares; Excess Class B Shares. The Board
of Directors may from time to time establish the amount of Class B Shares that
shall be held by member-patrons. This may be based upon the member's average
weekly purchases and/or upon any other basis that the Board may determine. The
requirement regarding the holding of Class B Shares as established by the Board
of Directors is subject to change from time to time by the Board of Directors
which may, in its discretion, add to, increase, decrease, limit, eliminate or
otherwise change such requirement.
Class B Shares held by a member-patron in excess of what is
established by the Board of Directors as the Class B Shares required to be held
by such member-patron will be considered "Excess Class B Shares."
Section 9. Nontransferability of Shares Changes in Ownership of
Members.
(a) Nontransferability of Shares. Neither the Class A Shares nor the
Class B Shares may be transferred without the prior written consent of the
Corporation. Such consent will not normally be given. Without in any way
limiting the generality of the foregoing:
(1) Corporation Election to Permit Transfer of Shares. The
Corporation may, but shall not be required to, permit the transfer of
such shares provided (i) the member's membership has not been
terminated, (ii) the member is not in default in any requirement for
membership or in any obligation to the Corporation or any of its
subsidiaries, (iii) all debts and obligations of the member to the
Corporation and all of its subsidiaries have been paid and satisfied
or otherwise provided for to the satisfaction of the Corporation, (iv)
the transfer is to a new member-patron or to an existing member-patron
and, in each case, is in connection with the transfer of the
transferor's business to such new member-patron or existing
member-patron, as the case may be, for continuation of such business,
(v) such transferee, if a new member-patron, duly executes such forms
then in use for application for membership and qualifies in all
respects for membership and meets all credit requirements and has been
accepted as a new member-patron with the approval of the Board of
Directors, and (vi) the Corporation has elected not to purchase or
redeem such shares.
(2) Proprietorships and Partnership Members. Any change in a
proprietorship or partnership which is a member will require a new
membership; however, where the change is a transfer of the business to
a family member or to a partnership or corporation in which a
proprietor or partner continues as a partner or major shareholder, the
Corporation may elect, but shall not be required, to treat such new
membership as a continuation of the prior membership and permit the
transfer of shares held by the prior member to the new member in
accordance with (1) above. The Corporation may, in the discretion of
its managing officers, require such guarantees of the obligations of
partnership and proprietorship members as said officers deem
advisable.
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(3) Corporate Members. The Corporation may elect, but shall not be
required, to treat as being a change in the ownership of the member
and requiring a new membership, any change in the control of the
voting power of the shareholders of a corporate member (whether by the
transfer, issuance or repurchase of shares or otherwise) (other than
the transfer among or issuance to members of the public of shares
publicly traded and widely held of a publicly owned corporate member).
The transfer of stock in a corporate member by any stockholder thereof
shall not affect such stockholder's liability on any guarantees given
of the obligations of the corporate member. The Corporation may, in
the discretion of its managing officers, require such guarantees of
the obligations of a corporate member, from any or all of its
shareholders or from other persons, as said officers deem advisable.
(b) Notification of Change in Ownership. Each member must inform the
Corporation in writing of any contemplated or actual changes in ownership of a
member--whether a proprietorship, partnership or corporate member (other than
the transfer in public trading of shares of a corporate member whose shares are
publicly traded).
Section 10. Shares Held as Security. All Class A Shares and Class B
Shares shall be pledged to, and the certificates for said shares held by, the
Corporation to secure the prohibition against their transfer, to secure the
Corporation's rights to purchase or redeem said shares and as security for the
payment of any and all obligations of the member to the Corporation or any of
its subsidiaries.
Section 11. Repurchase of Shares. In addition to the rights of
purchase or redemption of shares as contained in the Articles of Incorporation
and without limiting or restricting, or being limited or restricted by, the
provisions for repurchase or redemption as contained in the Articles, the
Corporation shall have the right to repurchase Class A Shares and Class B Shares
held by a member upon or at any time after the termination of membership of such
member, and in the case of Excess Class B Stock, the right to repurchase Excess
Class B Shares, in accordance with the redemption policy set forth in Section
12.
The repurchase price for shares repurchased by the Corporation shall
be determined as follows:
(a) Except as provided in (b) below, the repurchase price for said
shares shall be the greater of:
(i) one cent ($0. 01) per share or
(ii) An amount which is calculated by (x) multiplying the number
of shares to be repurchased by the book value per share as of the
close of the Corporation's fiscal year last ended prior to the date on
which the holder ceases to be a qualified and active member, as
conclusively determined by the Board of Directors, provided that with
respect to termination of memberships occurring during the first full
year following the effective
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date of the Merger between United Grocers, Inc. ("United") and a
wholly-owned subsidiary of the Corporation (the "Merger") the book
value shall be determined as of the year end immediately preceding the
Effective Time of the Merger, and (y) subtracting from the amount
computed in clause (x) the amounts of any and all indebtedness that
may be owing the Corporation or any of its subsidiaries by either the
holder or the member from whom the holder has acquired said shares if
such acquisition was without the written consent of the Corporation.
Notwithstanding the foregoing, with respect to Class A Shares received
in the Merger by former United shareholders that receive less than 100
Class A Shares in the Merger and elect not to become a member and to
have their shares repurchased, the repurchase price shall equal an
amount equal to the book value as of April 2, 1999, of the United
Common Shares for which the Class A Shares were exchanged (which
amount was $57.90 per United Common Share).
(b) On the repurchase of Excess Class B Shares, other than on
termination of membership, and provided the member is in good standing, is not
in default or delinquent in any obligation to the Corporation or any of its
subsidiaries and there exist no grounds for termination of membership and
provided further that prior to the payment for said shares neither the member
nor the Corporation terminate such membership, the repurchase of Excess Class B
Shares will be effected by paying to the member, crediting to the member's
account or delivering a note as provided in (iii) below:
(i) during the period prior to the end of the third full fiscal
year of the Corporation following the effective date of the Merger, at
the option of the member made in writing at the time such shares are
tendered for redemption, either: (1)an amount which is equal to the
book value of said shares as of the close of the fiscal year prior to
the effective date of the Merger, as conclusively determined by the
Board of Directors, the Corporation having the right however to deduct
any amounts owing to the Corporation or any of its subsidiaries; or
(2) an amount which is equal to the book value of said shares as of
the close of the fiscal year last ended prior to the date said shares
are tendered for repurchase, as conclusively determined by the Board
of Directors, the Corporation having the right however to deduct any
amounts owing to the Corporation or any of its subsidiaries, provided
that no redemption pursuant to this subparagraph (2) shall be made
until after the end of the third full fiscal year of the Corporation
following the effective date of the Merger;
(ii) during the period following the end of the third full fiscal
year of the Corporation following the effective date of the Merger, an
amount which is equal to the book value of said shares as of the close
of the fiscal year of the Corporation last ended prior to the date
said shares are tendered for repurchase, as conclusively determined by
the Board of Directors, the Corporation having the right however to
deduct any amounts owing to the Corporation or any of its
subsidiaries; and
(iii) notwithstanding (i) and (ii) above, during the period ending
one year and 120 days after the effective date of the Merger, with
respect to Excess Class B Shares held by former shareholders of United
and received in the Merger, an amount which is equal to the
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book value as of April 2, 1999 (which amount was $57.90 per United
common share)of the United common shares for which the Excess Class B
Shares were exchanged, payable by delivery of a non-negotiable note of
the Corporation payable in twenty quarterly installments and bearing
interest at 6% per annum, the Corporation having the right, however,
to deduct any amounts owing to the Corporation or any of its
subsidiaries.
Section 12. Share Redemption Policy. As used herein, unless the
context otherwise requires, the terms "redeem" and "redemption" include
repurchase. The Corporation will redeem the shares of members on termination of
membership in accordance with and subject to limitations of the share redemption
policy described below.
Provided that the redemption price equals or exceeds $l000 the
Corporation will also upon request redeem the excess Class B Shares of a member
who owns Class B Shares in excess of that which is required to be held by such
member ("Excess Class B Shares"). Any such redemption of Excess Class B Shares
will be governed by the same rules that govern the redemption of shares upon
termination of membership. The redemption price for shares being redeemed shall
be as set forth in Section 11. Such redemption is subject to the following
priorities and restrictions.
1. Restrictions on Redemption.
Redemption is subject to the restrictions imposed by (a) the
Corporations Code of the State of California, (b) any loan agreement,
security agreement, mortgage, indenture or contract approved by the
Board of Directors, to which the Corporation is or will be a party,
and which includes a restriction that prohibits the redemption of
shares during the existence thereunder of a breach or default by the
Corporation, and (c) other applicable legal restrictions. The
determination of the Board of Directors as to whether or not, and to
what extent redemptions are permitted by such restrictions shall be
within the authority of the Board and such determination shall be
conclusive.
2. Redemption Policy.
Subject to the Board of Directors' determining that the Corporation
is able to meet the requirements set forth in Paragraph 1 above,
shares will be redeemed in accordance with the following:
(a) Class A Shares eligible for redemption by reason of
termination of membership will be redeemed in the order in which
memberships terminate, and will be redeemed prior to the redemption
of any Class B Shares which have not yet been redeemed but are
eligible for redemption either by reason of termination of
membership or as Excess Class B Shares tendered for redemption. All
determinations by the Company of the order in which memberships
terminate or shares are tendered shall be conclusive.
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(b) The aggregate amount of Class B Shares which the
Corporation will be obligated to redeem in any fiscal year will be
limited to 5% of the sum of (i) the number of Class B Shares
outstanding as of the close of the preceding fiscal year plus (ii)
the number of Class B Shares issued as a part of the patronage
dividend for such preceding fiscal year ("the five percent limit");
provided that until after the end of the third full fiscal year
following the effective date of the Merger the Corporation shall
not be obligated to redeem any Class B Shares eligible for
redemption by reason of termination of membership of such member;
and provided further that shares repurchased pursuant to Section
11(b)(iii) shall not be subject to the 5% limitation on the
obligation to redeem.
(c) Subject to the limitations contained in (b) above, in any
fiscal year, the Corporation will redeem, up to the five percent
limit, Class B Shares which were eligible for redemption in a prior
year, either by reason of termination of membership in a prior year
or which were Excess Class B Shares tendered for redemption in a
prior year, but which have not yet been redeemed, provided that if
the five percent limit would preclude redemption of all such
shares, then such shares will be redeemed pro rata. In the event
that the five percent limit would permit the redemption of all such
shares and would permit the redemption of other Class B Shares as
well, then, subject to the five percent limit, the Corporation will
redeem other Class B Shares eligible for redemption by reason of
termination of membership or which are Excess Class B Shares
tendered for redemption, in the order in which memberships
terminate or shares are tendered for redemption. All determinations
by the Corporation of the order in which memberships terminate or
shares are tendered shall be conclusive.
(d) Except as provided in Section 11(b)(iii), the redemption
of shares may be accomplished by paying to the member or crediting
to the member's account the redemption price. In making such
payment or credit for the redemption of shares, the Corporation
shall have the right to deduct any amounts owing by the member to
the Corporation or any of its subsidiaries. Such payment or credit
for the redemption of shares will be made within 120 days after
such shares have become eligible for redemption, either by reason
of termination of membership or tender in the case of Excess Class
B Shares, and are otherwise entitled to be redeemed in accordance
with legal limitations and as provided in paragraphs (a), (b) and
(c) above. In no event will interest be payable on the redemption
price for any delay in paying or crediting the redemption price.
(e) Without regard to each year's five-percent limit or any
other provision of paragraphs (a), (b) or (c) above, the
Corporation's Board of Directors will have the absolute discretion
to redeem Excess Class B shares or to redeem Class A or Class B
Shares of any outgoing member regardless of when the membership
terminated or the Class B shares were tendered. The Board of
Directors will also have the right to elect to redeem Excess Class
B Shares even
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though such redemption has not been requested and without regard to
the five percent limit or any other provision of paragraphs (a),
(b), or (c) above.
(f) The Board of Directors will have the absolute discretion,
without regard to the five-percent limit or any other provision of
the redemption policy, to authorize the Corporation to agree with
any shareholder to purchase Class B Shares held by such shareholder
and to make such purchase and payment for such shares in such
manner as may be agreed upon, subject only to corporate law
requirements.
ARTICLE II
Section 1. Place of Meetings. Meetings of shareholders shall be held
at any place within or outside the State of California designated by the Board
of Directors. In the absence of any such designation, shareholders' meetings
shall be held at the principal executive office of the Corporation.
Section 2. Annual Meetings. The annual meeting of shareholders shall
be held each year on a date and at a time designated by the Board of Directors.
At each annual meeting Directors shall be elected, and any other proper,
business may be transacted.
Section 3. Special Meetings. Special meetings of the shareholders may
be called at any time by the Board of Directors, the Chairman of the Board, the
Vice Chairman of the Board, the President, or by the holders of shares entitled
to cast not less than ten (10) percent of the votes at such meeting. Upon
request in writing to the Chairman of the Board, the President, any vice
President or the Secretary by any person (other than the Board of Directors)
entitled to call a special meeting of shareholders, the officer forthwith shall
cause notice to be given to the shareholders entitled to vote that a meeting
will be held at a time requested by the person or persons calling the meeting,
not less than 35 nor more than 60 days after the receipt of the request. If the
notice is not given within 20 days after receipt of the request, the persons
entitled to call the meeting may give the notice.
Section 4. Notice of Shareholders' Meetings. Written notice of each
annual or special meeting of shareholders shall be given not less than 10 nor
more than 60 days before the date of the meeting to each shareholder entitled to
vote thereat. Such notice shall state the place, date, and hour of the meeting
and (i) in the case of a special meeting the general nature of the business to
be transacted, and no other business may be transacted, or (ii) in the case of
the annual meeting, those matters which the Board, at the time of the mailing of
the notice, intends to present for action by the shareholders, but, subject to
the provisions of applicable law, any proper matter may be presented at the
meeting for such action. The notice of any meeting at which Directors are to be
elected shall include the names of nominees intended at the time of the notice
to be presented by management for election.
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Section 5. Manner of Giving Notice. Notice of a shareholders' meeting
shall be given either personally or by mail or telegraphic or other means of
written communication, charges prepaid, addressed to the shareholder at the
address of such shareholder appearing on the books of the Corporation or given
by the shareholder to the Corporation for the purpose of notice; or, if no such
address appears or is given, at the place where the principal executive office
of the Corporation is located or by publication at least once in a newspaper of
general circulation in the county in which the principal executive office is
located. Notice shall be deemed to have been given at the time when delivered
personally or deposited in the mail or sent by telegram or other means of
written communication.
Section 6. Quorum. A majority of the shares entitled to vote,
represented in person or by proxy, shall constitute a quorum at any meeting of
shareholders. The shareholders present at a duly called or held meeting at which
a quorum is present may continue to do business until adjournment,
notwithstanding the withdrawal of enough shareholders to leave less than a
quorum, if any action taken (other-than adjournment) is approved by at least a
majority of the shareholders required to constitute a quorum.
Section 7. Adjourned Meeting: Notice. Any shareholders' meeting,
annual or special, whether or not a quorum is present, may be adjourned from
time to time by the vote of the majority of the shares represented at that
meeting, either in person or by proxy, but in the absence of a quorum, no other
business may be transacted at that meeting, except as provided in Section 6 of
this Article II.
When any meeting of shareholders is adjourned to another time or
place, notice need not be given of the adjourned meeting if the time and place
are announced at the meeting at which the adjournment is taken, unless a new
record date for the adjourned meeting is fixed, or unless the adjournment is for
more than 45 days from the date set for the original meeting, in which case
notice of the adjourned meeting shall be given to each shareholder of record
entitled to vote at the adjourned meeting in accordance with the provisions of
Sections 4 and 5 of this Article II. At any adjourned meeting the Corporation
may transact any business which might have been transacted at the original
meeting.
Section 8. Voting. The shareholders entitled to vote at any meeting of
shareholders shall be determined in accordance with the provisions of Section 9
of this Article II, subject to the provisions of Sections 702 to 704, inclusive,
of the Corporations Code of California. The shareholders' vote may be by voice
vote or by ballot; provided, however, that any election of Directors must be by
ballot if demanded by any shareholder at the meeting and before the voting
begins. If a quorum is present, the affirmative vote of the majority of the
shares represented at the meeting and entitled to vote on any matter (other than
the election of Directors) shall be the act of the shareholders, unless the vote
of a greater number or voting by classes is required by California General
Corporation Law or by the Articles of Incorporation.
Subject to the following sentence and to the provisions of Section 708
of the California General Corporation Law, every shareholder entitled to vote at
any election of Directors may
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cumulate such shareholder's votes and give one candidate a number of votes equal
to the number of Directors to be elected multiplied by the number of votes to
which the shareholder's shares are entitled, or distribute the shareholder's
votes on the same principle among as many candidates as the shareholder thinks
fit. No shareholder shall be entitled to cumulate votes for any candidate or
candidates pursuant to the preceding sentence unless such candidate or
candidates' names have been placed in nomination prior to the voting and the
shareholder has given notice at the meeting prior to the voting of the
shareholder's intention to cumulate the shareholder's votes. If any one
shareholder has given such notice, all shareholders may cumulate their votes for
candidates in nomination.
Section 9. Record Date for Shareholders of Record.
(a) In order that the Corporation may determine the shareholders
entitled to notice of any meeting or to vote or entitled to receive payment of
any distribution or allotment of any rights or entitled to exercise any rights
in respect of any other lawful action, the Board may fix, in advance, a record
date which shall not be more than 60 nor less than 10 days prior to the date of
such meeting nor more than 60 days prior to any other action.
(b) If no record date is 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 business day next preceding the day on which notice
is given or, if notice is waived, at the close of business on the
business day next preceding the day on which the meeting is held.
(2) The record date for determining shareholders entitled to
give consent to corporate action in writing without a meeting, when no
prior action by the Board has been taken, shall be the day on which the
first written consent is given.
(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
adopts the resolution relating thereto, or the 60th day prior to the
date of such other action, whichever is later.
(c) 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 fixes a new record date for the adjourned meeting, but
the Board shall fix a new record date if the meeting is adjourned for more than
45 days from the date set for the original meeting.
(d) Shareholders on the record date are entitled to notice and to
vote or to receive the distribution or allotment of rights or to exercise the
rights, as the case may be, notwithstanding any transfer of any shares on the
books of the Corporation after the record date, except as otherwise provided in
the Articles or by agreement or by the California General Corporation Law.
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Section 10. Action Without Meeting. Subject to Section 603 of the
California General Corporation Law, any action which, under any provision of the
California General Corporation Law, may be taken at any annual or special
meeting of shareholders, may be taken without a meeting and without prior notice
if a consent in writing, setting forth the action so taken, shall be signed by
the holders of outstanding shares 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 11. Proxies. Every person entitled to vote shares has the right
to do so either in person or by one or more persons authorized by a written
proxy executed by such shareholder and filed with the Secretary. Any proxy duly
executed is not revoked and continues in full force and effect until revoked by
the Person executing it prior to the vote pursuant thereto by a writing
delivered to the corporation stating that the proxy is revoked or by a
subsequent proxy executed by, or by attendance at the meeting and voting in
person by, the person executing the proxy; provided, however, that no proxy
shall be valid after the expiration of 11 months from the date of its execution
unless otherwise provided in the proxy.
Section 12. Organization. The Chairman of the Board of Directors, or in
his absence, any Vice Chairman, or in their absence the President, shall call
the meeting of the stockholders to order and shall act as Chairman of such
meeting. In the absence of the Chairman of the Board of Directors, and of the
Vice Chairman of the Board of Directors, and the President, stockholders shall
appoint a Chairman for such meetings. The Secretary of the Company, or in his
absence the Assistant Secretary, shall act as Secretary at any meeting of the
stockholders, but in the absence of the Secretary and the Assistant Secretary at
any meeting of the stockholders, the presiding officer may appoint any person to
act as Secretary of the meeting.
Section 13. Inspectors of Election. In advance of any meeting of
shareholders, the Board may appoint any persons other than nominees for office
as inspectors of election to act at such meeting and any adjournment thereof. If
inspectors of meeting may, and on the request of any shareholder or
shareholder's proxy shall, make such appointment at the meeting. The number of
inspectors shall be either one or three. If appointed at a meeting on the
request of one or more shareholders or proxies, the majority of shares present
shall determine whether one or three inspectors are to be appointed.
The duties of such inspectors shall be as prescribed by Section 707(b)
of the California General Corporation Law and shall include: determining 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; receiving votes, ballots, or consents; hearing
and determining all challenges and questions in any way arising in connection
with the right to vote; counting and tabulating all votes or consents,
determining when the polls shall close; determining the result; and doing such
acts as may be proper to conduct the election or vote with fairness to all
shareholders. If there are three inspectors of election, the decision, act, or
certificate of a majority is effective in all respects as the decision, act, or
certificate of all.
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ARTICLE III
DIRECTORS
Section 1. Powers. Subject to the provisions of the new California
General Corporation Law and any limitations in the Articles of Incorporation and
these Bylaws relating to action required to be approved by the shareholders or
by the outstanding shares, the business and affairs of the Corporation shall be
managed and all corporate powers shall be exercised by or under the direction of
the Board of Directors.
Without prejudice to these general powers, and subject to the same
limitations, the Directors shall have the power to:
(a) To select and remove all the other officers, agents and employees
of the Corporation, prescribe the powers and duties for them as may not be
inconsistent with law, or with the Articles or these Bylaws, fix their
compensation, and require from them security for faithful service.
(b) To conduct, manage, and control the affairs and business of the
Corporation and to make such rules and regulations therefor not inconsistent
with law, or with the Articles of Incorporation or these Bylaws, as they may
deem best.
(c) Change the principal executive office or the principal business
office in the State of California from one location to another; cause the
Corporation to be qualified to do business in any other state, territory,
dependency, or country, and conduct business within or without the State of
California; and designate any place within or without the State of California
for the holding of any shareholders' meeting, or meetings.
(d) To adopt, make, and use a corporate seal, and to prescribe the
forms of certificates of stock, and to alter the form of such seal and of such
certificates from time to time as in their judgment they may deem best.
(e) To authorize the issuance of shares of stock of the Corporation
from time to time, upon such terms and for such consideration as may be lawful.
(f) To borrow money and incur indebtedness for the purposes of the
Corporation, and to cause to be executed and delivered therefor; in the
corporate name, promissory notes, bonds, debentures, deeds of trust, mortgages,
pledges, hypothecations, or other evidences of debt and securities therefor.
Section 2. Number and Qualifications of Directors. The number of
Directors of this Corporation shall be as specified in, and such Directors shall
be elected as provided in, Article Fifth of this Corporation's Articles of
Incorporation. All of the Directors except up to two directors elected by the
Class A Shares shall constitute Shareholder-related Directors (as herein
defined). "Shareholder-related Director" shall mean a director who is a
shareholder, or a partner
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of a partnership which is a shareholder, or a member of a limited liability
company which is a shareholder, or an employee of a corporation, partnership or
limited liability company which is a shareholder. Any Shareholder-related
Director who shall, if an employee of a shareholder, cease to be employed by the
shareholder, or if not an employee, cease to be a partner, member of a
shareholder that is a partnership or limited liability company, respectively,
shall automatically become disqualified to act as a Shareholder-related Director
on the date which is six months from such cessation. If the shareholder to whom
the Shareholder-related Director is related ceases to be engaged in the grocery
business for a period of six months, the Shareholder-related Director shall
likewise automatically become disqualified to act as a Shareholder-related
Director.
Section 3. Election and Term of Office. The Directors shall be elected
at each annual meeting of shareholders but if any such annual meeting is not
held or the Directors are not elected thereat, the Directors may be elected at
any special meeting of shareholders held for that purpose. Each director shall
hold office until the next annual meeting and until a successor has been elected
and qualified.
Section 4. Vacancies. Any director may resign effective upon giving
written notice to the Chairman of the Board, the President, Secretary, or the
Board, unless the notice specifies a later time for the effectiveness of such
resignation. If the resignation is effective at a future time, a successor may
be elected to take office when the resignation becomes effective.
Vacancies in the Board excepting those existing as a result of a
removal of a director by the vote or written consent of the shareholders, may be
filled by a majority of the remaining Directors, though less than a quorum, or
by a sole remaining director, and each director so elected shall hold office
until the next annual meeting and until such director's successor has been
elected and qualified.
A vacancy or vacancies in the Board shall be deemed to exist in case of
the death, resignation, or removal of any director, or if the authorized number
of Directors be increased, or if the shareholders fail, at any annual or special
meeting of shareholders at which any director or Directors are elected, to elect
the full authorized number of Directors to be voted for that meeting.
The Board may declare vacant the office of a director who has been
declared of unsound mind by an order of court or convicted of a felony.
The shareholders may elect a director or Directors at any time to fill
any vacancy or vacancies not filled by the Directors. Any such election by
written consent requires the consent of a majority of the outstanding shares
entitled to vote. If the Board accepts the resignation of a director tendered to
take effect at a future time, the Board or the shareholders shall have power to
elect a successor to take office when the resignation is to become effective.
No reduction of the authorized number of Directors shall have the
effect of removing any director prior to the expiration of the director's term
of office.
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Section 5. Nominating Committee. On or before the last monthly meeting
of the Board of Directors of the Corporation in October of each year, the
Directors shall appoint a Nominating Committee of three or more of its members
to select nominees for election as Directors of the Corporation for the ensuing
year and until their successors are elected and qualified. The President of the
Corporation shall be an exofficio member of the Nominating Committee. The
Nominating Committee shall give due consideration to geographic representation
in selecting a slate of nominees for election to the Board of Directors.
The Nominating Committee shall submit its nominations to the Board of
Directors on or before the last monthly meeting of Directors in January of each
year, and the nominees so selected shall be those submitted by the Board of
Directors to the shareholders to be voted upon at the regular annual meeting of
the shareholders of the Corporation.
Section 6. Place of Meetings and Meetings by Telephone. Regular
meetings of the Board of Directors may be held at any place within or outside
the State of California that has been designated from time to time by resolution
of the Board. In the absence of such a designation, regular meetings shall be
held at the principal executive office of the Corporation. Special meetings of
the Board shall be held at any place within or outside the State of California
that has been designated in the notice of the meeting or, if not stated in the
notice or there is no notice, at the principal executive office of the
Corporation. Any meeting, regular or special, may be held by conference
telephone or similar communication equipment, so long as all Directors
participating in the meeting can hear one another, and all such Directors shall
be deemed to be present in person at the meeting.
Section 7. Regular Meetings. Regular meetings of the Board of Directors
shall be held without call at such time as shall from time to time be fixed by
the Board of Directors. Such regular meetings may be held without notice.
Section 8. Special Meetings. Special meetings of the Board for any
purpose or purposes may be called at any time by the Chairman of the Board, the
President, or the Secretary or by any two Directors.
Special meetings of the Board shall be held upon four days' written
notice or 48 hours' notice given personally or by telephone, telegraph, telex,
or other similar means of communication. Any such notice shall be addressed or
delivered to each director at such director's address as it is shown upon the
records of the Corporation or as may have been given to the Corporation by the
Director for purposes of notice or, if such address is not shown on such records
or is not readily ascertainable, at the place in which the meetings of the
Directors are regularly held.
Notice by mail shall be deemed to have been given at the time a written
notice is deposited in the United States mails, postage prepaid. Any other
written notice shall be deemed to have been given at the time it is personally
delivered to the recipient or is delivered to a common carrier for transmission,
or actually transmitted by the person giving the notice by electronic means, to
the recipient. Oral notice shall be deemed to have been given at the time it is
communicated, in
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person or by telephone or wireless, to the recipient or to a person at the
office of the recipient who the person giving the notice has reason to believe
will promptly communicate it to the recipient.
Section 9. Quorum. A majority of the authorized number of Directors
constitutes a quorum of the Board for the transaction of business, except to
adjourn as hereinafter provided. Every act or decision done or made by a
majority of the Directors present at a meeting duly held at which a quorum is
present shall be regarded as the act of the Board, unless a greater number be
required by law or by the Articles. A meeting at which a quorum is initially
present may continue to transact business notwithstanding the withdrawal of
Directors, if any action taken is approved by at least a majority of the
required quorum for such meeting.
Section 10. Adjournment. A majority of the Directors present, whether
or not a quorum is present, may adjourn any Directors' meeting to another time
and place. Notice of the time and place of holding an adjourned meeting need not
be given to absent Directors if the time and place be fixed at the meeting
adjourned. If the meeting is adjourned for more than 24 hours, notice of any
adjournment to another time or place shall be given prior to the time of the
adjourned meeting to the Directors who were not present at the time of the
adjournment.
Section 11. Action Without Meeting. Any action required or permitted to
be taken by the Board may be taken without a meeting if all members of the Board
shall individually or collectively consent in writing to such action. Such
consent or consents shall have the same effect as a unanimous vote of the Board
and shall be filed with the minutes of the proceedings of the Board.
Section 12. Fees and Compensation. Directors and members of committees
may receive such compensation, if any, for their services, and such
reimbursement for expenses, as may be fixed or determined by the Board.
Section 13. Presiding Officers. At the first meeting of the Board of
Directors each year (at which a quorum shall be present), held next after the
annual meeting of the stockholders, the Board shall elect from its membership a
chairman, a First Vice Chairman and a Second Vice Chairman. The Chairman of the
Board of Directors shall preside at all meetings of the Board of Directors. The
First Vice Chairman of the Board of Directors shall preside at all meetings of
the Board of Directors during the absence or disability of the Chairman. The
Second Vice Chairman of the Board of Directors shall preside at all meetings of
the Board of Directors during the absence or disability of the Chairman and the
First Vice Chairman.
Section 14. Election of Officers. At the first meeting of the Board of
Directors each year (at which a quorum shall be present), held next after the
annual meeting of the stockholders, the Directors shall proceed to the election
of the executive officers of the Corporation.
Section 15. Committees. The Board of Directors may, by resolution
adopted by a majority of the authorized number of Directors, designate one or
more committees, each consisting of two or more Directors, to serve at the
pleasure of the Board. The Board may
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designate one or more Directors as alternate members of any committee. The Board
may delegate to such committee any of the authority of the Board except with
respect to:
(a) The approval of any action for which the General Corporation Law
also requires shareholders' approval or approval of the outstanding shares;
(b) The filling of vacancies on the Board or on any committee;
(c) The fixing of compensation of the Directors for serving on any
committee;
(d) The amendment or repeal of Bylaws or the adoption of new Bylaws;
(e) The amendment or repeal of any resolution of the Board which by its
express terms is not so amendable or repealable;
(f) A distribution to the shareholders of the Corporation except at a
rate or in a periodic amount or within a price range determined by the Board;
(g) The appointment of other committees of the Board or the members
thereof.
The Board shall have the power to prescribe the manner in which
proceedings of any committee shall be conducted. In the absence of any such
prescription, such committee shall have the power to prescribe the manner in
which its proceedings shall be conducted. Unless the Board or such committee
shall otherwise provide, the regular and special meetings and other actions of
any such committee shall be governed by the provisions of this Article
applicable to meetings and actions of the Board. Minutes shall be kept of each
meeting of each committee.
ARTICLE IV
OFFICERS
Section 1. Officers. The officers of the Corporation shall be a
President, one or more vice Presidents, a Secretary, a Treasurer and chief
financial officer. The Corporation may also have, at the discretion of the Board
of Directors, a Chairman and one or more Vice Chairmen of the Board, one or more
Assistant Secretaries, one or more Assistant Treasurers, and such other officers
as may be appointed in accordance with the provisions of Section 3 of this
Article. One person may hold two or more offices.
Section 2. Election. The officers of the Corporation, except such
officers as may be elected or appointed in accordance with the provisions of
Section 3 or Section 5 of this Article, shall be chosen annually by, and shall
serve at the pleasure of, the Board, and shall hold their respective offices
until their resignation, removal or other disqualification from service, or
until their respective successors shall be elected.
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Section 3. Subordinate Officers. The Board may elect, and may empower
the President to appoint, such other officers as the business of the Corporation
may require, each of whom shall hold office for such period, have such
authority, and perform such duties as are provided in these Bylaws or as the
Board may from time to time determine.
Section 4. Removal and Resignation. Any officer may be removed, either
with or without cause, by the Board of Directors at any time, or, except in the
case of an officer chosen by the Board, by any officer upon whom such power of
removal may be conferred by the Board. Any such removal shall be without
prejudice to the rights, if any, of the officer under any contract of employment
of the officer.
Any officer may resign at any time by giving written notice to the
Corporation, but without prejudice to the rights, if any, of the Corporation
under any contract to which the officer is a party. Any such resignation shall
take effect at the date of the receipt of such notice or at any later time
specified therein; and, unless otherwise specified therein, the acceptance of
such resignation shall not be necessary to make it effective.
Section 5. Vacancies. A vacancy in any office because of death,
resignation, removal, disqualification, or any other cause shall be filled in
the manner prescribed in these Bylaws for regular election or appointment to
such office.
Section 6. Chairman of the Board. The Chairman of the Board, if there
shall be such an officer, shall, if present, preside at all meetings of the
Board of Directors, and at all meetings of the shareholders, and exercise and
perform such other powers and duties as may be from time to time assigned to him
by the Board of Directors or prescribed by the Bylaws. In the absence of the
Chairman, the First Vice Chairman, and in his absence, the Second Vice Chairman,
of the Board of Directors shall preside at all meetings of the shareholders. The
Chairman of the Board shall be an ex-officio member of all the standing
committees.
Section 7. President. Subject to such powers, if any, as may be given
by the Board to the Chairman of the Board, if there be such an officer, the
President is the general manager and chief executive officer of the Corporation
and has, subject to the control of the Board, general supervision, direction,
and control of the business and officers of the Corporation. The President has
the general powers and duties of management usually vested in the office of
president and general manager of a corporation and such other powers and duties
as may be prescribed by the Board.
Section 8. Vice Presidents. In the absence or disability of the
President, the Vice Presidents in order of their rank as fixed by the Board, or,
if not ranked, the Vice President designated by the Board, shall perform all 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
have such other powers and perform such other duties as from time to time may be
prescribed for them respectively by the Board.
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Section 9. Secretary. The Secretary shall keep or cause to be kept, at
the principal executive office and such other place as the Board may order, a
book of minutes of all meetings of shareholders, the Board of Directors, and its
committees, with the time and place of holding, whether regular or special, and,
if special, how authorized, the notice thereof given, the names of those present
at Board and committee meetings, the number of shares present or represented at
shareholders' meetings, and the proceedings thereof. The Secretary shall keep,
or cause to be kept, a copy of the Bylaws of the corporation at the principal
executive office or business office in accordance with Section 213 of the
California General Corporation Law.
The Secretary shall keep, or cause to be kept, at the principal office
or at the office of the Corporation's transfer agent or registrar, if one be
appointed, a share register, or a duplicate share register, showing the names of
the shareholders and their addresses, the number and classes of shares held by
each, the number and date of certificates issued for the same, and the number
and date of cancellation of every certificate surrendered for cancellation.
The Secretary shall give, or cause to be given, notice of all the
meetings of the shareholders and of the Board and of any committees thereof
required by these Bylaws or by law to be given, and shall keep the seal of the
corporation in safe custody, and shall have such other powers and perform such
other duties as may be prescribed by the Board.
Section 10. Chief Financial Officer. The chief financial officer of the
Corporation shall keep and maintain, or cause to be kept and maintained,
adequate and correct accounts of the properties and business transactions of the
Corporation, and shall send of cause to be sent to the shareholders of the
Corporation such financial statements and reports as are by law or these Bylaws
required to be sent to them, and shall render to the President and directors,
whenever they request it, an account of the financial condition of the
Corporation, and shall have such other powers and perform such other duties as
may be prescribed by the Board. The books of accounts shall at all times be open
to inspection by any director.
Section 11. Treasurer. The Treasurer shall deposit all moneys and other
valuables in the name and to the credit of the Corporation with such
depositaries as may be designated by the Board. The Treasurer shall disburse the
funds of the Corporation as may be ordered by the Board, shall render to the
President and Directors, whenever they request it, an account of all
transactions as Treasurer, and shall have such other powers and perform such
other duties as may be prescribed by the Board.
ARTICLE V
INDEMNIFICATION
The Corporation shall, to the maximum extent permitted by law, have the
power to indemnify each of its agents against expenses, judgments, fines,
settlements and other amounts actually and reasonably incurred in connection
with any proceeding arising by reason of the fact any such person is or was an
agent of the Corporation. For purposes of this Section, an "agent" of the
Corporation includes any person who is or was a director, officer, employee, or
other agent
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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, or was a director, officer, employee, or
agent of a Corporation which was a predecessor corporation of the Corporation or
of another enterprise at the request of such predecessor corporation.
ARTICLE VI
OTHER PROVISIONS
Section 1. Principal Office. The principal executive office for the
transaction of the business of the corporation is hereby fixed and located at:
5200 Sheila Street
Commerce, California 90040
The Board of Directors is hereby granted full power and authority to change said
principal office from one location to another within or outside the State of
California. Any such change shall be noted on the Bylaws by the Secretary,
opposite this Section, or this Section may be amended to state the new location.
Section 2. Other Offices. Branch or subordinate offices may at any time
be established by the Board of Directors at any place or places where the
Corporation is qualified to do business.
Section 3. Inspection of Bylaws. The Corporation shall keep in its
principal executive office the original or a copy of these Bylaws as amended to
date which shall be open to inspection by shareholders at all reasonable times
during office hours.
Section 4. Annual Report to Shareholders. The Board of Directors shall
cause an annual report to be sent to the shareholders not later than 120 days
after the close of the fiscal year adopted by the Corporation. This report shall
be sent at least 15 days before the annual meeting of shareholders to be held
during the next fiscal year and in the manner specified in Section 5 of Article
II of these Bylaws for giving notice to shareholders of the Corporation. The
annual report shall contain a balance sheet as of the end of the fiscal year and
an income statement and statement of changes in financial position for the
fiscal year, accompanied by any report of independent accountants or, if there
is no such report, the certificate of an authorized officer of the Corporation
that the statements were prepared without audit from the books and records of
the Corporation.
Section 5. Corporate Contracts and Instruments; How Executed. The Board
of Directors, except as otherwise provided in these Bylaws, may authorize any
officer or officers, agent or agents, to enter into any contract or execute any
instrument in the name of and on behalf of the corporation and this authority
may be general or confined to specific instances; and, unless so authorized or
ratified by the Board of Directors no officer, agent, or employee shall have any
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power or authority to bind the corporation by any contract or engagement or to
pledge its credit or to render it liable for any purpose or for any amount.
Section 6. Certificates of Stock.
(a) Form and Execution of Certificates. The certificates of shares of
stock of the company shall be in such form as shall be signed by the President,
or a Vice President, and also by the Secretary, or Assistant Secretary, or be
authenticated by the facsimile of the signature of the President and the written
signature of the Secretary or Assistant Secretary.
(b) Shares and certificates for shares may be issued prior to full
payment under such restrictions and for such purposes as the Board of Directors
or the Bylaws may provide.
(c) Certificates to be Entered. All certificates shall be consecutively
numbered and the names of the owners, all the number of shares and the date of
issue shall be entered in the company's books.
(d) Transfer of Shares. The issued Class A Shares and Class B Shares of
the Corporation shall be transferable only as provided by Article I of these
Bylaws. New Class A Shares and Class B Shares shall be issued only to qualified
applicants in accordance with Article I of these Bylaws.
Section 7. Representation of Shares of Other Corporations. The Chairman
of the Board, the President, or any vice President, or any other person
authorized by resolution of the Board of Directors or by any of the foregoing
designated officers, is authorized to vote on behalf of the Corporation any and
all shares of any other corporation or corporations, foreign or domestic,
standing in the name of the Corporation. The authority granted to these officers
to vote or represent on behalf of the Corporation any and all shares held by the
Corporation in any other corporation or corporations may be exercised by any of
these officers in person or by any person authorized to do so by a proxy duly
executed by these officers.
Section 8. Construction and Definitions. Unless the context otherwise
requires, the general provisions, rules of construction, and definitions
contained in the General California Corporation Law shall govern the
construction of these Bylaws.
Section 9. Seal. The Board of Directors shall provide a suitable seal
containing the name of the Company and the words "Incorporated - March, 1925",
or other appropriate words, which seal shall be in the charge of the Secretary
to be used as required by law and the Bylaws of the Company.
ARTICLE VII
PATRONAGE DIVIDENDS
The net earnings of the Corporation from business transacted by the
Corporation with its member-patrons and associate-patrons, except such amounts
as may be required for reserves for normal business requirements, as dictated by
good accounting practice, shall be distributed on a
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patronage basis to the member-patrons and associate-patrons of the Corporation
based in amount upon the volume of business transacted by Divisions of the
Corporation with each of such patrons. Said distributions may be made in money
or part in money and the balance in written notices of allocation, as defined in
Section 1388 of the United States Internal Revenue Code, as determined by the
Board of Directors
ARTICLE VIII
CONSENT OF MEMBERS
Section 1. Each applicant who hereafter applies for and is accepted to
membership in Certified Grocers of California, Ltd. and each member of Certified
Grocers of California, Ltd. who continues as a member after the adoption of this
Bylaw shall, by such act alone, consent that the amount of any patronage
dividend payments made to such member which are made in written notices of
allocation (as defined in Section 1388 of the United States Internal Revenue
Code) will be taken into account by said member at their stated dollar amounts
in the manner provided in Section 1385(a) of the United States Internal Revenue
Code in the taxable year in which such notices of allocation are received by
said member.
Section 2. Each person who hereafter applies for and is accepted to
membership in Certified Grocers of California, Ltd. (Certified) and each member
of Certified on the date of adoption of this Bylaw who continues as a member
after such date shall, by such act alone, consent that the amount of any
distributions with respect to his patronage occurring after the adoption of this
Bylaw which are made in written notices of allocation (as defined in 26 U.S.
Code 1388) and which are received by him from Certified, will be taken into
account by him at their stated dollar amounts in the manner provided in 26 U.S.
Code 1385 (a) in the taxable year in which such written notices of allocation
are received by him. As used herein, "person" includes persons, partnerships,
associations and corporations; the masculine includes the feminine and neuter;
and the singular includes the plural.
ARTICLE IX
AMENDMENTS
These Bylaws may be repealed or amended or new Bylaws may be adopted at
a meeting by the vote of shareholders entitled to exercise a majority of the
voting power or by the written assent of such shareholders. Subject to the right
of shareholders to adopt, amend or repeal Bylaws, these Bylaws, other than a
Bylaw or amendment thereof changing the authorized number of Directors, or a
Bylaw or any amendment thereof providing for the payment of patronage dividends
to the shareholders of the Corporation, may be adopted, amended or repealed by
the Board of Directors. The power of the shareholders to adopt, repeal or amend
Bylaws fixing the number of Directors, or the Bylaws providing for the payment
of patronage dividends to its shareholders, may not be delegated to the
Directors. Whenever any amendment or any Bylaw is adopted, it must be copied in
the book of Bylaws with the original Bylaws and immediately after them. If any
Bylaw is repealed, the fact of repeal, with the date of the meeting at which the
repeal was enacted, or written assent was filed, must be stated in said book.
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