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Exhibit 3.14
BY-LAWS
TABLE OF CONTENTS
Article I - Directors; Management
Section Title Page
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1.a. Powers 1
1.b. Standard of Care 2
1.c. Exception for Close Corporation 2
2. Number and Qualification 2
3. Election and Term of Office 2
4. Vacancies 3
5. Removal of Directors 3
6. Notice, Place and Manner of Meetings 3
7. Annual Meeting 4
8. Other Regular Meetings 4
9. Special Meetings - Notices - Waivers 4
10. Sole Director Provided by Articles of Incorporation 5
11. Directors Acting by Unanimous Written Consent 5
12. Quorum 5
13. Adjourned Meetings 5
14. Compensation of Directors 5
15. Committees of Directors 6
16. Committee Procedure 6
17. Advisory Directors 7
18. Resignations 7
Article II - Officers
1. Officers 7
2. Election of Officers 7
3. Subordinate Officers 8
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4. Removal and Resignation of Officers 8
5. Vacancies 8
6. Chairman of the Board 8
7. President 8
8. Vice Presidents 9
9. Secretary 9
10. Chief Financial Officer 9
Article III - Indemnification of Directors,
Officers, Employees, and Other Agents
l. Agents, Proceedings, and Expenses 10
2. Actions Other than by the Corporation 10
3. Actions by the Corporation 11
4. Successful Defense by Agent 11
5. Required Approval 11
6. Advance of Expenses 12
7. Other Contractual Rights 12
8. Limitations 12
9. Insurance 12
10. Fiduciaries of Corporate Employee Benefit Plan 13
Article IV - Shareholders' Meetings
l. Place of Meetings 13
2. Annual Meetings 13
3. Special Meetings 13
4. Notice of Meetings 14
5. Manner of Giving Notice 14
6. Quorum 15
7. Adjourned Meeting; Notice 15
8. Voting Rights; Cumulative Voting 16
9. Record Date 16
10. Proxies 17
11. Organization 17
12. Inspectors of Election 18
13. Shareholders' Agreements 18
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14. Waiver of Notice or Consent by Absent Shareholders 19
15. Shareholder Action by Written Consent Without a Meeting 19
Article V - Certificates and Transfer of Shares
l. Certificates for Shares 20
2. Transfer on the Books 21
3. Lost or Destroyed Certificates 21
4. Transfer Agents and Registrars 21
5. Legend Condition 21
6. Close Corporation Certificates 22
Article VI - Records and Reports
1 Maintenance and Inspection of Share Register 22
2. Maintenance and Inspection of By-Laws 22
3. Maintenance and Inspection of Other Corporate Records 23
4. Inspection by Directors 23
5. Annual Report to Shareholders 23
6. Waiver of Annual Report 24
7. Financial Statements 24
8. Annual Statement of General Information 25
Article VII - Amendments
l. Amendment by Shareholders 25
2. Amendment by Directors 25
3. Record of Amendments 25
Article VIII - Miscellaneous
1. References to Code Sections 26
2. Effect of Shareholders' Agreement 26
3. Representation of Shares in Other Corporations 26
4. Subsidiary Corporations 26
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BY-LAWS
of
SPEED MERCHANTS, INC.
A California Corporation
ARTICLE I
DIRECTORS: MANAGEMENT
Section 1. a. Powers
Subject to the provisions of the General Corporation Law of California,
effective January 1, 1977 (to which the various Section numbers quoted herein
relate) and subject to any limitation in the Articles of Incorporation and the
By-Laws relating to action required to be approved by the Shareholders (Sec.
153) or by the outstanding shares (Sec. 152), the business and affairs of this
corporation shall be managed by and all corporate powers shall be exercised by
or under 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:
(1) Select and remove all officers, agents, and employees of
the corporation; prescribe any powers and duties for them that are consistent
with law, with the Articles of Incorporation, and with these By-Laws; fix their
compensation; and require from them security for faithful service.
(2) 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, including annual
meetings.
(3) Adopt, make, and use a corporate seal; prescribe the forms
of certificates of stock; and alter the form of the seal and certificates.
(4) Authorize the issuance of shares of stock of the
corporation on any lawful terms, in consideration of money paid, labor done,
services actually rendered, debts
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or securities cancelled, or tangible or intangible property actually received.
(5) Borrow money and incur indebtedness on behalf of the
corporation, and cause to be executed and delivered for the corporation's
purposes, in the corporate name, promissory notes, bonds, debentures, deeds of
trust, mortgages, pledges, hypothecations, and other evidences of debt and
securities.
b. Standard of Care
Each Director shall exercise such powers and otherwise perform such
duties in good faith, in the manner such Director believes to be in the best
interests of the corporation, and with such care, including reasonable inquiry,
using ordinary prudence, as a person in a like position would use under similar
circumstances. (Sec. 309)
c. Exception for Close Corporation
Notwithstanding the provisions of Section 1, in the event that this
corporation shall elect to become a close corporation as defined in Sec. 158,
its Shareholders may enter into a Shareholders' Agreement as provided in Sec.
300(b). Said agreement may provide for the exercise of corporate powers by the
Shareholders, provided however such agreement shall, to the extent and so long
as the discretion or the powers of the Board in its management of corporate
affairs is controlled by such agreement, impose upon each Shareholder who is a
party thereof, liability for managerial acts performed or omitted by such person
pursuant thereto otherwise imposed upon Directors as provided in Sec. 300 (d).
Section 2. Number and Qualification
The authorized number of directors shall be two (2) until changed by a
duly adopted amendment to the Articles of Incorporation or by an amendment to
this By-Law adopted by the vote or written consent of holders of a majority of
the outstanding shares entitled to vote; provided, however, that an amendment
reducing the number of directors to a number less than five (5) cannot be
adopted if the votes cast against its adoption at a meeting, or the shares not
consenting in the case of action by written consent, are equal to more than
16-2/3% of the outstanding shares entitled to vote.
Section 3. Election and Term of Office
Directors shall be elected at each annual meeting of the Shareholders
to hold office until the next annual meeting. Each Director, including a
Director elected to fill a vacancy, shall hold office until the expiration of
the term for which elected and until a successor has been elected and qualified.
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Section 4. Vacancies
Vacancies in the Board of Directors 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 his successor is elected at
an annual meeting of Shareholders or at a special meeting called for that
purpose.
The Shareholders may at any time elect a Director to fill any vacancy
not filled by the Directors, and may elect the additional Directors at the
meeting at which an amendment of the By-Laws is voted authorizing an increase in
the number of Directors.
A vacancy or vacancies shall be deemed to exist in case of the death,
resignation or removal of any Director, or if the Shareholders shall increase
the authorized number of Directors but shall fail at the meeting at which such
increase is authorized, or at an adjournment thereof, to elect the additional
Director so provided for, or in case the Shareholders fail at any time to elect
the full number of authorized Directors.
If the Board of Directors accepts the resignation of a Director
tendered to take effect at a future times, the Board, or the Shareholders, shall
have power to elect a successor to take office when the resignation shall become
effective.
No reduction of the number of Directors shall have the effect of
removing any Director prior to the expiration of his term of office.
Section 5. Removal of Directors
The entire Board of Directors or any individual Director may be removed
from office as provided by Secs. 302, 303 and 304 of the Corporations Code of
the State of California. In such case, the remaining Board members may elect a
successor Director to fill such vacancy for the remaining unexpired term of the
Director so removed.
Section 6. Notice, Place and Manner of Meetings
Meetings of the Board of Directors may be called by the Chairman of the
Board, or the President, or any Vice President, or the Secretary, or any two (2)
Directors, and shall be held at the principal executive office of the
corporation in the State of California, unless some other place is designated in
the notice of the meeting. Members of the Board may participate in a meeting
through use of a conference telephone or similar communications equipment so
long as all members participating in such a meeting can hear one another.
Accurate minutes of any meeting of the Board or any committee
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thereof, shall be maintained as required by Sec. 312 of the Code by the
Secretary or other officer designated for that purpose.
Section 7. Annual Meeting
Immediately following each annual meeting of Shareholders, the Board of
Directors shall hold a regular meeting for the purpose of organization, any
desired election of officers, and the transaction of other business. Notice of
this meeting shall not be required.
Section 8. Other Regular Meetings
Other 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 9. Special Meetings - Notices - Waivers
Special meetings of the Board may be called at any time by the Chairman
of the Board, the President or, if he is absent or unable or refuses to act, by
any Vice President or the Secretary or by any two Directors, or by one Director
if only one is provided.
At least forty-eight (48) hours' notice of the time and place of
special meetings shall be delivered personally to the Directors or personally
communicated to them by a corporate officer by telephone or telegraph. If the
notice is sent to a Director by letter, it shall be addressed to him at his
address as it is shown upon the records of the corporation, (or if it is not so
shown on such records or is not readily ascertainable, at the place in which the
meetings of the Directors are regularly held). In case such notice is mailed, it
shall be deposited in the United States mail, postage prepaid, in the place in
which the principal executive office of the corporation is located at least four
(4) days prior to the time of the holding of the meeting. Such mailing,
telegraphing, telephoning or delivery as above provided shall be due, legal and
personal notice to such Director.
When all of the Directors are present at any Directors' meeting,
however called or noticed, and either (i) sign a written consent thereto on the
records of such meeting or, (ii) if a majority of the Directors are present and
if those not present sign a waiver of notice of such meeting or a consent to
holding the meeting or an approval of the minutes thereof, whether prior to or
after the holding of such meeting, which said waiver, consent or approval shall
be filed with the Secretary of the corporation, or (iii) if a Director attends a
meeting without notice but without protesting, prior thereto
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at its commencement, the lack of notice to him, then the transactions thereof
are as valid as if had at a meeting regularly called and noticed.
Section 10. Sole Director Provided by Articles of Incorporation
In the event only one Director is required by the By-Laws or Articles
of Incorporation, then any reference herein to notices, waivers, consents,
meetings or other actions by a majority or quorum of the Directors shall be
deemed to refer to such notice, waiver, etc., by such sole Director, who shall
have all the rights and duties and shall be entitled to exercise all of the
powers and shall assume all the responsibilities otherwise herein described as
given to a Board of Directors.
Section 11. Directors Acting by Unanimous Written Consent
Any action required or permitted to be taken by the Board of Directors
may be taken without a meeting and with the same force and effect as if taken by
a unanimous vote of Directors, if authorized by a writing signed individually or
collectively by all members of the Board. Such consent shall be filed with the
regular minutes of the Board.
Section 12. Quorum
A majority of the authorized number of directors shall constitute a
quorum for the transaction of business, except to adjourn as provided in section
13 of this Article I. 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 of Directors, subject to the provisions of Sec.
310 (as to approval of contacts or transactions in which a director has a direct
or indirect material financial interest), Sec. 311 (as to appointment of
committees), and Sec. 317(e) (as to indemnification of Directors). 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 that meeting.
Section 13. Adjourned Meetings
A majority of the directors present, whether or not constituting a
quorum, may adjourn any 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 and held within
twenty-four (24) hours, but if adjourned more than twenty-four (24) hours,
notice shall be given to all Directors not present at the time of the
adjournment.
Section 14. Compensation of Directors
Directors, as such, shall not receive any stated
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salary for their services, but by resolution of the Board a fixed sum and
expense of attendance, if any, may be allowed for attendance at each regular and
special meeting of the Board; provided that nothing herein contained shall be
construed to preclude any Director from serving the Company in any other
capacity and receiving compensation therefor.
Section 15. Committees of Directors
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 designate one or more Directors as alternate members of any committee,
who may replace any absent member at any meeting of the committee. Any
committee, to the extent provided in the resolution of the Board, shall have all
the authority of the Board, except with respect to:
(a) the approval of any action which, under the General
Corporation Law of California, also requires the Shareholders' approval or
approval of the outstanding shares;
(b) the filling of vacancies on the Board of Directors or in
any committee;
(c) the fixing of compensation of the Directors for serving on
the board or on any committee;
(d) the amendment or repeal of any resolution of the Board of
Directors 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 of Directors; or
(g) the appointment of any other committees of the Board of
Directors or the members of these committees.
Section 16. Committee Procedure
Meetings and action of committees shall be governed by, and held and
taken in accordance with, the provisions of Article I Sections 6 (notice, place
and manner of meetings), 8 (other regular meetings), 9 (special meetings), 10
(sole director), 11 (unanimous written consent), 12 (quorum), and 13 (adjourned
meetings), with such changes in the context of those By-Laws as are necessary to
substitute the committee and its members for the Board of Directors and its
members, except that the time of regular meetings of committees may be
determined either by resolution of the Board of Directors or
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by resolution of the committee; special meetings of committees may also be
called by resolution of the Board of Directors; and notice of special meetings
of committees shall also be given to all alternate members, who shall have the
right to attend all meetings of the committee. The Board of Directors may adopt
rules for the government of any committee not inconsistent with the provisions
of these By-Laws.
Section 17. Advisory Directors
The Board of Directors from time to time may elect one or more persons
to be Advisory Directors who shall not by such appointment be members of the
Board of Directors. Advisory Directors shall be available from time to time to
perform special assignments specified by the President, to attend meetings of
the Board of Directors upon invitation, and to furnish consultation to the
Board. The period during which the title shall be held may be prescribed by the
Board of Directors. If no period is prescribed, the title shall be held at the
pleasure of the Board.
Section 18. Resignations
Any Director may resign effective upon giving written notice to the
Chairman of the Board, the President, the Secretary, or the Board of Directors
of the corporation, 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.
ARTICLE II
OFFICERS
Section 1. Officers
The officers of the corporation shall be a president, a secretary, and
a chief financial officer. The corporation may also have, at the discretion of
the Board of Directors, a chairman of the board, one or more vice presidents,
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. Any number of offices may be held by the same person.
Section 2. Election of Officers
The officers of the corporation, except such officers as may be
appointed in accordance with the provisions of Section 3 or Section 5 of this
Article, shall be chosen by the Board of Directors, and each shall serve at the
pleasure of the Board, subject to the rights, if any, of an officer under any
contract of employment.
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Section 3. Subordinate Officers
The Board of Directors may appoint, 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 the By-Laws or as the Board of Directors may from
time to time determine.
Section 4. Removal and Resignation of Officers
Subject to the rights, it any, of an officer under any contract of
employment, any officer may be removed, either with or without cause, by the
Board of Directors, at any regular or special meeting of the Board, or, except
in case of an officer chosen by the Board of Directors, by any officer upon whom
such power of removal may be conferred by the Board of Directors.
Any officer may resign at any time by giving written notice to the
corporation. Any resignation shall take effect at the date of the receipt of
that notice or at any later time specified in that notice; and, unless otherwise
specified in that notice, the acceptance of the resignation shall not be
necessary to make it effective. Any resignation is without prejudice to the
rights, if any, of the corporation under any contract to which the officer is a
party.
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
the By-Laws for regular appointments 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 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 By-Laws.
Section 7. President
Subject to such supervisory powers, if any, as may be given by the
Board of Directors to the Chairman of the Board, if there be such an officer,
the President shall be the chief executive officer of the corporation and shall,
subject to the control of the Board of Directors, have general supervision,
direction, and control of the business and the officers of the corporation. He
shall preside at all meetings of the shareholders and, in the absence of the
Chairman of the Board, or if there be none, at all meetings of the Board of
Directors. He shall have the general powers and duties of management usually
vested in the office of president of a corporation, and shall have such other
powers and duties as may be prescribed by the Board of Directors or the By-Laws.
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Section 8. Vice Presidents
In the absence or disability of the President, the Vice Presidents, if
any, in order of their rank as fixed by the Board of Directors, or, if not
ranked, a Vice President designated by the Board of Directors, 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 of Directors or the
By-Laws, and the President, or the Chairman of the Board.
Section 9. Secretary
The Secretary shall keep or cause to be kept at the principal executive
office or such other place as the Board of Directors may direct, a book of
minutes of all meetings and actions of Directors, committees of Directors, and
Shareholders, with the time and place of holding, whether regular or special,
and, if special, how authorized, the notice given, the names of those present at
Directors' meetings or committee meetings, the number of shares present or
represented at Shareholders' meetings, and the proceedings.
The Secretary shall keep, or cause to be kept, at the principal
executive office or at the office of the corporation's transfer agent or
registrar, as determined by resolution of the Board of Directors, a share
register, or a duplicate share register, showing the names of all 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 meetings
of the Shareholders and of the Board of Directors required by the By-Laws or by
law to be given, and he shall keep the seal of the corporation if one be
adopted, in safe custody, and shall have such other powers and perform such
other duties as may be prescribed by the Board of Directors or by the By-Laws.
Section 10. Chief Financial Officer
This officer shall keep and maintain, or cause to be kept and
maintained in accordance with generally accepted accounting principles, adequate
and correct accounts of the properties and business transactions of the
corporation, including accounts of its assets, liabilities, receipts,
disbursements, gains, losses, capital, earnings (or surplus) and shares, The
books of account shall at all reasonable times be open to inspection by any
Director.
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This officer shall deposit all moneys and other valuables in the name
and to the credit of the corporation with 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, shall render to the President and
Directors, whenever they request it, an account of all of his transactions and
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 of Directors or
the By-Laws.
ARTICLE III
INDEMNIFICATION OF DIRECTORS, OFFICERS,
EMPLOYEES, AND OTHER AGENTS
Section 1. Agents, Proceedings, and Expenses
For the purposes of this Article, "agent" means any person who is or
was a director, officer, employee, or other agent of this corporation, or is or
was serving at the request of this corporation as a director, officers employee,
or agent of another foreign or domestic corporation, partnership, joint venture,
trust or other enterprise, or was a director, officer, employee, or agent of a
foreign or domestic corporation which was a predecessor corporation of this
corporation or of another enterprise at the request if such predecessor
corporation; "proceeding" means any threatened, pending or completed action or
proceeding, whether civil, criminal, administrative, or investigative; and
"expenses" includes, without limitation, attorneys' fees and any expenses of
establishing a right to indemnification under Section 4 or Section 5(c) of this
Article.
Section 2. Actions Other Than by the Corporation
This corporation shall indemnify any person who was or is a party, or
is threatened to be made a party, to any proceeding (other than an action by or
in the right of this corporation) by reason of the fact that such person is or
was an agent of this corporation, against expenses, judgments, fines,
settlements and other amounts actually and reasonably incurred in connection
with such proceeding if that person acted in good faith and in a manner that
person reasonably believed to be in the best interests of this corporation and,
in the case of a criminal proceeding, had no reasonable cause to believe that
the conduct of that person was unlawful. The termination of any proceeding by
judgment, order, settlement, conviction, or upon a plea of nolo contendere or
its equivalent shall not, of itself, create a presumption that the person did
not act in good faith and in a manner which the person reasonably believed to be
in the best interests of this corporation or that the person had reasonable
cause to believe that the person's conduct was unlawful.
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Section 3. Actions by the Corporation
This corporation shall indemnify any person who was or is a party, or
is threatened to be made a party, to any threatened, pending or completed action
by or in the right of this corporation to procure a judgment in its favor by
reason of the fact that that person is or was an agent of this corporation,
against expenses actually and reasonably incurred by that person in connection
with the defense or settlement of that action if that person acted in good
faith, in a manner that person believed to be in the best interests of this
corporation and with such care, including reasonable inquiry, as an ordinarily
prudent person in a like position would use under similar circumstances. No
indemnification shall be made under this Section 3:
(a) In respect of any claim, issue or matter as to which that
person shall have been adjudged to be liable to this corporation in the
performance of that person's duty to this corporation, unless and only to the
extent that the court in which that action was brought shall determine upon
application that, in view of all the circumstances of the case, that person is
fairly and reasonably entitled to indemnity for the expenses which the court
shall determine;
(b) Of amounts paid in settling or otherwise disposing of a
threatened or pending action, with or without court approval; or
(c) Of expenses incurred in defending a threatened or pending
action which is settled or otherwise disposed of without court approval.
Section 4. Successful Defense by Agent
To the extent that an agent of this corporation has been successful on
the merits in defense of any proceeding referred to in Sections 2 or 3 of this
Article, or in defense of any claim, issue, or matter therein, the agent shall
be indemnified against expenses actually and reasonably incurred by the agent in
connection therewith.
Section 5. Required Approval
Except as provided in Section 4 of this Article, any indemnification
under this Article shall be made by this corporation only if authorized in the
specific case on a determination that indemnification of the agent is proper in
the circumstances because the agent has met the applicable standard of conduct
set forth in Sections 2 or 3 of this Article, by:
(a) A majority vote of a quorum consisting of directors who
are not parties to the proceeding;
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(b) Approval by the affirmative vote of a majority of the
shares of this corporation entitled to vote represented at a duly held meeting
at which a quorum is present or by the written consent of holders of a majority
of the outstanding shares entitled to vote. For this purpose, the shares owned
by the person to be indemnified shall not be considered outstanding or entitled
to vote thereon; or
(c) The court in which the proceeding is or was pending, on
application made by this corporation or the agent or the attorney or other
person rendering services in connection with the defense, whether or not such
application by the agent, attorney or other person is opposed by this
corporation.
Section 6. Advance of Expenses
Expenses incurred in defending any proceeding may be advanced by this
corporation before the final disposition of the proceeding on receipt of an
undertaking by or on behalf of the agent to repay the amount of the advance
unless it shall be determined ultimately that the agent is entitled to be
indemnified as authorized in this Article.
Section 7. Other Contractual Rights
Nothing contained in this Article shall affect any right to
indemnification to which persons other than directors and officers of this
corporation or any subsidiary hereof may be entitled by contract or otherwise.
Section 8. Limitations
No indemnification or advance shall be made under this Article, except
as provided in Section 4 or Section 5(c), in any circumstance where it appears:
(a) That it would be inconsistent with a provision of the
Articles, a resolution of the Shareholders, or an agreement in effect at the
time of the accrual of the alleged cause of action asserted in the proceeding in
which the expenses were incurred or other amounts were paid, which prohibits or
otherwise limits indemnification; or
(b) That it would be inconsistent with any condition expressly
imposed by a court in approving a settlement.
Section 9. Insurance
Upon and in the event of a determination by the Board of Directors of
this corporation to purchase such insurance, this corporation shall purchase and
maintain insurance on behalf of any agent of the corporation against any
liability asserted against or incurred by the agent in such capacity or
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arising out of the agent's status as such whether or not this corporation would
have the power to indemnify the agent against that liability under the
provisions of this section.
Section 10. Fiduciaries of Corporate Employee Benefit Plan
This Article does not apply to any proceeding against any trustee,
investment manager, or other fiduciary of an employee benefit plan in that
person's capacity as such, even though that person may also be an agent of the
corporation as defined in Section 1 of this Article. Nothing contained in this
Article shall limit any right to indemnification to which such a trustee,
investment manager, or other fiduciary may be entitled by contract or otherwise,
which shall be enforceable to the extent permitted by applicable law other than
this Article.
ARTICLE IV
SHAREHOLDERS' MEETINGS
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 meetings of the Shareholders shall be held each year at the
time and on the day following:
Time of Meeting: 1:00 p.m.
Date of Meeting: January 5th
If this day shall be a legal holiday, then the meeting shall be held on
the next succeeding business day, at the same hour. At the annual meeting, the
Shareholders shall elect a Board of Directors, consider reports of the affairs
of the corporation, and transact such other business as may be properly brought
before the meeting.
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 President, a Vice President,
the Secretary, or by one or more of the Shareholders holding not less than one-
tenth (1/10th) of the voting power of the corporation. Except as next provided,
notice shall be given as for the annual meeting.
Upon receipt of a written request addressed to the Chairman, President,
Vice President, or Secretary, mailed or delivered personally to such officer by
any person (other than the Board) entitled to call a special meeting of
Shareholders, such officer 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,
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not less than thirty-five (35) nor more than sixty (60) days after the receipt
of such request. If such notice is not given within twenty (20) days after
receipt of such request, the persons calling the meeting may give notice thereof
in the manner provided by these By-Laws or apply to the Superior Court as
provided in Sec. 305(c).
Section 4. Notice of Meetings
All notices of meetings of Shareholders shall be sent or otherwise
given in accordance with Section 5 of this Article not less than ten (10) nor
more than sixty (60) days before the date of the meeting. The notice shall
specify 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, or (ii) in
the case of the annual meeting, those matters which the Board of Directors, at
the time of giving the notice, intends to present for action by the
Shareholders. The notice of any meeting at which Directors are to be elected
shall include the name of any nominee or nominees whom, at the time of the
notice, management intends to present for election.
If action is proposed to be taken at any meeting for approval of (i) a
contract or transaction in which a Director has a direct or indirect financial
interest, pursuant to Sec. 310, (ii) an amendment of the Articles of
Incorporation, pursuant to Sec. 902, (iii) a reorganization of the corporation,
pursuant to Sec. 1201, (iv) a voluntary dissolution of the corporation, pursuant
to Sec. 1900, or (v) a distribution in dissolution other than in accordance with
the rights of outstanding preferred shares, pursuant to Sec. 2007, the notice
shall also state the general nature of that proposal.
Section 5. Manner of Giving Notice
Notice of any meeting of Shareholders shall be given either personally
or by first-class mail or telegraphic or other written communication, charges
prepaid, addressed to the Shareholder at the address of that Shareholder
appearing on the books of the corporation or given by the Shareholder to the
corporation for the purpose of notice. If no such address appears on the
corporation's books or is given, notice shall be deemed to have been given if
sent to that Shareholder by first-class mail or telegraphic or other written
communication to the corporation's principal executive office, or if published
at least once in a newspaper of general circulation in the county where that
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.
If any notice addressed to a Shareholder at the address of that
Shareholder appearing on the books of the
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corporation is returned to the corporation by the United States Postal Service
marked to indicate that the United States Postal Service is unable to deliver
the notice to the Shareholder at that address, all future notices or reports
shall be deemed to have been duly given without further mailing if these shall
be available to the Shareholder on written demand of the Shareholder at the
principal executive office of the corporation for a period of one year from the
date of the giving of the notice.
An affidavit of the mailing or other means of giving any notice of any
Shareholders' meeting shall be executed by the Secretary, Assistant Secretary,
or any transfer agent of the Corporation giving the notice, and shall be filed
and maintained in the minute book of the corporation.
Section 6. Quorum
The holders of a majority of the shares entitled to vote thereat,
present in person, or represented by proxy, shall constitute a quorum at all
meetings of the Shareholders for the transaction of business except as otherwise
provided by law, by the Articles of Incorporation, or by these By-Laws. If,
however, such majority shall not be present or represented at any meeting of the
Shareholders, the Shareholders entitled to vote thereat, present in person, or
by proxy, shall have the power to adjourn the meeting from time to time, until
the requisite amount of voting shares shall be present. At such adjourned
meeting at which the requisite amount of voting shares shall be represented, any
business may be transacted which might have been transacted at a meeting as
originally notified.
If a quorum be initially present, the Shareholders may continue to
transact business until adjournment, notwithstanding the withdrawal of enough
Shareholders to leave less than a quorum, if any action taken is approved by a
majority of the Shareholders required to initially 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.
When any meeting of Shareholders, either annual or special, is
adjourned to another time or place, notice need not be given of the adjourned
meeting if the time and place are announced at a meeting at which the
adjournment is taken, unless a new record date for the adjourned meeting is
fixed,
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or unless the adjournment is for more than forty-five (45) days from the date
set for the original meeting, in which case the Board of Directors shall set a
new record date. Notice of any such 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. At any adjourned
meeting the corporation may transact any business which might have been
transacted at the original meeting.
Section 8. Voting Rights; Cumulative Voting
Only persons in whose names shares entitled to vote stand on the stock
records of the corporation on the day of any meeting of Shareholders, unless
some other day be fixed by the Board of Directors for the determination of
Shareholders of record, and then on such other day, shall be entitled to vote at
such meeting.
Provided the candidate's name has been placed in nomination prior to
the voting and one or more Shareholders has given notice at the meeting prior to
the voting of the Shareholder's intent to cumulate the Shareholder's votes,
every Shareholder entitled to vote at any election for Directors of any
corporation for profit may cumulate his 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 his shares are entitled, or distribute his votes on the same
principle among as many candidates as he things fit.
The candidates receiving the highest number of votes up to the number
of Directors to be elected are elected.
Section 9. Record Date
The Board of Directors may fix a time in the future not exceeding sixty
(60) days nor less than ten (10) days preceding the date of any meeting of
Shareholders or the date fixed for the payment of any dividend or distribution,
or for the allotment of rights, or when any change or conversion or exchange of
shares shall go into effect, as a record date for the determination of the
Shareholders entitled to notice of and to vote at any such meeting, or entitled
to receive any such dividend or distribution, or any allotment of rights, or to
exercise the rights in respect to any such change, conversion or exchange of
shares. In such case only Shareholders of record on the date so fixed shall be
entitled to notice of and to vote at such meeting, or to receive such dividends,
distribution or allotment of rights, or to exercise such rights, as the case may
be, notwithstanding any transfer of any share on the books of the company after
any record date fixed as aforesaid, The Board of Directors may close the books
of the company against transfers of shares during the whole or any part of such
period.
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In determining the Shareholders entitled to give consent to corporate
action without a meeting, the date set by the Board of Directors shall not be
more than sixty (60) days before any such action without a meeting.
If the Board of Directors does not so fix a record date:
(a) 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.
(b) The record date for determining Shareholders entitled to
give consent to corporate action in writing without a meeting, (i) when no prior
action by the Board has been taken, or (ii) when prior action of the Board has
been taken, shall be at the close of business on the day on which the Board
adopts the resolution relating to that action, or the sixtieth (60th) day before
the date of such other action, whichever is later.
Section 10. Proxies
Every person entitled to vote for Directors or on any other matter
shall have the right to do so either in person or by one or more agents
authorized by a written proxy signed by the person and filed with the Secretary
of the corporation. A proxy shall be deemed signed if the Shareholder's name is
placed on the proxy (whether by manual signature, typewriting, telegraphic
transmission, or otherwise) by the Shareholder or the Shareholder's attorney in
fact. A validly executed proxy which does not state that it is irrevocable shall
continue in full force and effect unless (i) revoked by the person executing it,
before the vote pursuant to that proxy, by a writing delivered to the
corporation stating that the proxy is revoked or by a subsequent proxy executed
by, or attendance at the meeting and voting in person by, the person executing
the proxy; or (ii) written notice of the death or incapacity of the maker of
that proxy is received by the corporation before the vote pursuant to that proxy
is counted; provided, however, that no proxy shall be valid after the expiration
of eleven (11) months from the date of the proxy, unless otherwise provided in
the proxy. The revocability of a proxy that states on its face that it is
irrevocable shall be governed by the provisions of Sec. 705(e) and 705(f) of the
Code.
Section 11. Organization
The President, or in the absence of the President, any Vice President,
shall call the meeting of the Share-
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holders to order, and shall act as Chairman of the meeting. In the absence of
the President and all of the Vice Presidents, Shareholders shall appoint a
Chairman for such meeting. The Secretary of the corporation shall act as
Secretary of all meetings of Shareholders, but in the absence of the Secretary
at any meeting of the Shareholders, the presiding officer may appoint any person
to act as Secretary of the meeting.
Section 12. Inspectors of Election
Before any meeting of Shareholders, the Board of Directors may appoint
any persons other than nominees for office to act as inspectors of election at
the meeting or its adjournment. If no inspectors of election are so appointed,
the Chairman of the meeting may, and on the request of any Shareholder or a
Shareholder's proxy shall, appoint inspectors of election at the meeting. The
number of inspectors shall be either one (1) or three (3). If inspectors are
appointed at a meeting on the request of one or more Shareholders or proxies,
the holders of a majority of shares or their proxies present at the meeting
shall determine whether one or three inspectors are to be appointed. If any
person appointed as inspector fails to appear or fails or refuses to act, the
Chairman of the meeting may, and upon the request of any Shareholder or a
Shareholder's proxy shall, appoint a person to fill that vacancy.
These inspectors shall:
(a) Determine the number of shares outstanding and the voting
power of each, the shares represented at the meeting, the existence of a quorum,
and the authenticity, validity, and effect of proxies;
(b) Receive votes, ballots, or consents;
(c) Hear and determine all challenges and questions in any way
arising in connection with the right to vote;
(d) Count and tabulate all votes or consents;
(e) Determine when the polls shall close;
(f) Determine the result; and
(g) Do any other acts that may be proper to conduct the
election or vote with fairness to all Shareholders.
Section 13. Shareholders' Agreements
Notwithstanding the above provisions in the event this corporation
elects to become a close corporation, an agreement between two or more
Shareholders thereof, if in writing and
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signed by the parties thereof, may provide that in exercising any voting rights
the shares held by them shall be voted as provided therein or in Sec. 706, and
may otherwise modify these provisions as to Shareholders' meetings and actions.
Section 14. Waiver of Notice or Consent by Absent Shareholders
The transactions of any meeting of Shareholders, either annual or
special, however called and noticed, and wherever held, shall be as valid as
though had at a meeting duly held after regular call and notice, if a quorum be
present either in person or by proxy, and if, either before or after the
meeting, each person entitled to vote, who was not present in person or by
proxy, signs a written waiver of notice or a consent to a holding of the
meeting, or an approval of the minutes. The waiver of notice of consent need not
specify either the business to be transacted or the purpose of any annual or
special meeting of Shareholders, except that if action is taken or proposed to
be taken for approval of any of those matters specified in the second paragraph
of Section 4 of this Article, the waiver of notice or consent shall state the
general nature of the proposal. All such waivers, consents or approvals shall be
filed with the corporate records or made a part of the minutes of the meeting.
Attendance by a person at a meeting shall also constitute a waiver of
notice of that meeting, except when the person objects, at the beginning of the
meeting, to the transaction of any business because the meeting is not lawfully
called or convened and except that attendance at a meeting is not a waiver of
any right to object to the consideration of matters not included in the notice
of the meeting if that objection is expressly made at the meeting.
Section 15. Shareholder Action By Written Consent Without a Meeting
Any action which may be taken at any annual or special meeting of
Shareholders may be taken without a meeting and without prior notice, if a
content in writing, setting forth the action so taken, is signed by the holders
of outstanding shares having not less than the minimum number of votes that
would be necessary to authorize or take that action at a meeting at which all
shares entitled to vote on that action were present and voted. In the case of
election of Directors, such a consent shall be effective only if signed by the
holders of all outstanding shares entitled to vote for the election of
Directors; provided, however, that a director may be elected at any time to fill
a vacancy on the Board of Directors that has not been filled by the Directors,
by the written consent of the holders of a majority of the outstanding shares
entitled to vote for the election of Directors. All such consents shall be filed
with the Secretary of the corpo-
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ration and shall be maintained in the corporate records. Any Shareholder giving
a written consent, or the Shareholder's proxy holders, or a transferee of the
shares or a personal representative of the Shareholder or their respective proxy
holders, may revoke the consent by a writing received by the Secretary of the
corporation before written consents of the number of shares required to
authorize the proposed action have been filed with the Secretary.
If the consents of all Shareholders entitled to vote have not been
solicited in writing, and if the unanimous written consent of all such
Shareholders shall not have been received, the Secretary shall give prompt
notice of the corporate action approved by the Shareholders without a meeting.
This notice shall be given in the manner specified in Section 5 of this Article.
In the case of approval of (i) contracts or transactions in which a Director has
a direct or indirect financial interest, pursuant to Sec. 310, (ii)
indemnification of agents of the corporation, pursuant to Sec. 317, (iii) a
reorganization of the corporation, pursuant to Sec. 1201, and (iv) a
distribution in dissolution other than in accordance with the rights of
outstanding preferred shares, pursuant to Sec. 2007, the notice shall be given
at least ten (10) days before the consummation of any action authorized by that
approval.
ARTICLE V
CERTIFICATES AND TRANSFER OF SHARES
Section 1. Certificates for Shares
A certificate or certificates for shares of the capital stock of the
corporation shall be issued to each Shareholder when any of these shares are
fully paid, and the Board of Directors may authorize the issuance of
certificates or shares as partly paid provided that these certificates shall
state the amount of the consideration to be paid for them and the amount paid.
Certificates for shares shall be of such form and device as the Board of
Directors may designate and shall state the name of the record holder of the
shares represented thereby; its number, date of issuance; the number of shares
for which it is issued; a statement of the rights, privileges, preferences and
restrictions, if any; a statement as to the redemption or conversion, if any; a
statement of liens or restrictions upon transfer or voting, if any; if the
shares are assessable or, if assessments are collectible by personal action, a
plain statement of such facts.
All certificates shall be signed in the name of the Corporation by the
Chairman of the Board or Vice Chairman of the Board or the President or Vice
President, and by the
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Chief Financial Officer or an assistant treasurer or the Secretary or any
assistant secretary, certifying the number of shares and the class or series of
shares owned by the Shareholder. Any or all of the signatures on the certificate
may be facsimile. In case any officer, transfer agent, or registrar who has
signed or whose facsimile signature has been placed on a certificate shall have
ceased to be that officer, transfer agent, or registrar before that certificate
is issued, it may be issued by the corporation with the same effect as if that
person were an officer, transfer agent, or registrar at the date of issue.
Section 2. Transfer on the Books
Upon surrender to the Secretary or transfer agent of the corporation of
a certificate for shares duly endorsed or accompanied by proper evidence of
succession, assignment or authority to transfer, it shall be the duty of the
corporation to issue a new certificate to the person entitled thereto, cancel
the old certificate, and record the transaction upon its books.
Section 3. Lost or Destroyed Certificates
Any person claiming a certificate of stock to be lost, stolen, or
destroyed shall make an affidavit or affirmation of that fact and file it with
the Secretary or Chief Financial Officer, or their assistant. The Board of
Directors may then authorize the issuance of a replacement certificate on such
terms and conditions as the Board may require, including provision for
indemnification of the corporation secured by a bond or other adequate security
sufficient to protect the corporation against any claim that may be made against
it, including any expense or liability, on account of the alleged loss, theft,
or destruction of the certificate or the issuance of the replacement
certificate.
Section 4. Transfer Agents and Registrars
The Board of Directors may appoint one or more transfer agents or
transfer clerks, and one or more registrars, which shall be an incorporated bank
or trust company - either domestic or foreign, who shall be appointed at such
times and places as the requirements of the corporation may necessitate and the
Board of Directors may designate.
Section 5. Legend Condition
In the event any shares of this corporation are issued pursuant to a
permit or exemption therefrom requiring the imposition of a legend condition the
person or persons issuing or transferring said shares shall make sure said
legend appears on the certificate and on the stub relating thereto in the stock
record book, and shall not be required to transfer
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any shares free of such legend unless an amendment to such permit or a new
permit be first issued so authorizing such a deletion.
Section 6. Close Corporation Certificates
All certificates representing shares of this corporation, in the event
it shall elect to become a close corporation, shall contain the legend required
by Sec. 418c.
ARTICLE VI
RECORDS AND REPORTS
Section 1. Maintenance and Inspection of Share Register
The corporation shall keep at its principal executive office, or at the
office of its transfer agent or registrar, if either be appointed and as
determined by resolution of the Board of Directors, a record of its
Shareholders, giving the names and addresses of all Shareholders and the number
and class of shares held by each Shareholder.
A Shareholder or Shareholders of the corporation holding at least five
percent (5%) in the aggregate of the outstanding voting shares of the
corporation may (i) inspect and copy the records of Shareholders' names and
addresses and shareholdings during usual business hours on five days' prior
written demand on the corporation, and (ii) obtain from the transfer agent of
the corporation, on written demand and on the tender of such transfer agent's
usual charges for such list, a list of the Shareholders' names and addresses,
who are entitled to vote for the election of directors, and their shareholdings,
as of the most recent record date for which that list has been compiled or as of
a date specified by the Shareholder after the date of demand. This list shall be
made available to any such Shareholder by the transfer agent on or before the
later of five (5) days after the demand is received or the date specified in the
demand as the date of which the list is to be compiled. The record of
Shareholders shall also be open to inspection on the written demand of any
Shareholder or holder of a voting trust certificate, at any time during usual
business hours, for a purpose reasonably related to the holder's interests as a
Shareholder or as the holder of a voting trust certificate. Any inspection and
copying under this Section 1 may be made in person or by an agent or attorney of
the Shareholder or holder of a voting trust certificate making the demand.
Section 2. Maintenance and Inspection of By-Laws
The corporation shall keep at its principal executive office, or if its
principal executive office is not
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in the State of California, at its principal business office in this state, the
original or a copy of the By-laws as amended to date, which shall be open to
inspection by the Shareholders at all reasonable times during office hours. If
the principal executive office of the corporation is outside the State of
California and the corporation has no principal business office in this state,
the Secretary shall, upon the written request of any Shareholder, furnish to
that Shareholder a copy of the By-Laws as amended to date.
Section 3. Maintenance and Inspection of Other Corporate Records
The accounting books and records and minutes of proceedings of the
Shareholders and the Board of Directors and any committee or committees of the
Board of Directors shall be kept at such place or places designated by the Board
of Directors or, in the absence of such designation, at the principal executive
office of the corporation. The minutes shall be kept in written form and the
accounting books and records shall be kept either in written form or in any
other form capable of being converted into written form. The minutes and
accounting books and records shall be open to inspection upon the written demand
of any Shareholder or holder of a voting trust certificate, at any reasonable
time during usual business hours, for a purpose reasonably related to the
holder's interests as a Shareholder or as the holder of a voting trust
certificate. The inspection may be made in person or by an agent or attorney,
and shall include the right to copy and make extracts. These rights of
inspection shall extend to the records of each subsidiary corporation of the
corporation.
Section 4. Inspection by Directors
Every Director shall have the absolute right at any reasonable time to
inspect all books, records and documents of every kind and the physical
properties of the corporation and each of its subsidiary corporations. This
inspection by a Director may be made in person or by an agent or attorney and
the right of inspection includes the right to copy and make extracts of
documents.
Section 5. Annual Report to Shareholders
The Board of Directors shall cause an annual report to be sent to the
Shareholders not later than one hundred twenty (120) days after the close of the
fiscal year adopted by the corporation. This report shall be sent at least
fifteen (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 IV of
these By-Laws for giving notice to Shareholders of the corporation. The annual
report shall contain a balance sheet as of the end of
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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 6. Waiver of Annual Report
The foregoing requirement of an annual report may be waived by the
Board so long as this corporation shall have less than one hundred (100)
shareholders.
Section 7. Financial Statements
A copy of any annual financial statement and any income statement of
the corporation for each quarterly period of each fiscal year, and any
accompanying balance sheet of the corporation as of the end of each such period,
that has been prepared by the corporation shall be kept on file in the principal
executive office of the corporation for twelve (12) months and each such
statement shall be exhibited at all reasonable times to any shareholder
demanding an examination of any such statement or a copy shall be mailed to any
such Shareholder.
If a Shareholder or Shareholders holding at least five percent (5%) of
the outstanding shares of any class of stock of the corporation makes a written
request to the corporation for an income statement of the corporation for the
three-month, six-month, or nine-month period of the then current fiscal year
ended more than thirty (30) days before the date of the request, and a balance
sheet of the corporation as of the end of that period, the Chief Financial
Officer shall cause that statement to be prepared, if not already prepared, and
shall deliver personally or mail that statement or statements to the person
making the request within thirty (30) days after the receipt of the request. If
the corporation has not sent to the Shareholders its annual report for the last
fiscal year, this report shall likewise be delivered or mailed to the
shareholder or Shareholders within thirty (30) days after the request.
The corporation shall also, on the written request of any Shareholder,
mail-to the Shareholder a copy of the last annuals, semi-annual, or quarterly
income statement which it has prepared, and a balance sheet as of the end of
that period.
The quarterly income statements and balance sheets referred to in this
section shall be accompanied by the report, if any, of any independent
accountants engaged by the corporation or the certificate of an authorized
officer
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of the corporation that the financial statements were prepared without audit
from the books and records of the corporation.
Section 8. Annual Statement of General Information
Within ninety (90) days after the filing of the Articles, and annually
thereafter during the applicable filing period in each year, the corporation
shall file with the Secretary of State of the State of California, on the
prescribed form, a statement setting forth the authorized number of directors,
the names and complete business or residence addresses of all incumbent
directors, the names and complete business or residence addresses of the Chief
Executive Officer, Secretary, and Chief Financial Officer, the street address of
its principal executive office or principal business office in this state, and
the general type of business constituting the principal business activity of the
corporation, together with a designation of the agent of the corporation for the
purpose of service of process, all in compliance with Sec. 1502 of the Code.
When changing the agent for service of process or the address of such agent, the
corporation shall file a complete current statement.
ARTICLE VII
AMENDMENTS
Section 1. Amendment by Shareholders
New By-Laws may be adopted or there By-Laws may be amended or repealed
by the vote or written consent of holders of a majority of the outstanding
shares entitled to vote; provided, however, that if the Articles of
Incorporation of the corporation set forth the number of authorize directors of
the corporation, the authorized number of Directors may be changed only by an
amendment of the Articles of Incorporation.
Section 2. Amendment by Directors
Subject to the rights of the Shareholders as provided by Section 1 of
this Article, by-laws, other than a by-law or an amendment of a by-law changing
the authorized number of directors, may be adopted, amended, or repealed by the
Board of Directors.
Section 3. Record of Amendments
Whenever an amendment or new by-law is adopted, it shall be copied in
the book of By-Laws with the original By-Laws, in the appropriate place. If any
by-law is repealed, the fact of repeal with the date of the meeting at which the
repeal was enacted or written assent was filed shall be stated in said book.
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ARTICLE VIII
MISCELLANEOUS
Section 1. References to Code Sections
"Sec." references herein refer to the equivalent Sections of the
General Corporation Law effective January 1, 1977, as amended.
Section 2. Effect of Shareholders' Agreement
Any Shareholders' Agreement authorized by Sec. 300(b) shall only be
effective to modify the terms of these By-Laws if this corporation elects to
become a close corporation with appropriate filing of or amendment to its
Articles as required by Sec. 202, and shall terminate when this corporation
ceases to be a close corporation. Such an agreement cannot waive or alter Secs.
158 (defining close corporations), 202 (requirements of Articles of
Incorporation), 500 and 501 relative to distributions, 111 (merger), 1201(e)
(reorganization), or Chapters 15 (Records and Reports), 16 (Rights of
Inspection), 18 (Involuntary Dissolution), or 22 (Crimes and Penalties). Any
other provisions of the Code or these By-laws may be altered or waived thereby,
but to the extent they are not so altered or waived, these By-Laws shall be
applicable.
Section 3. Representation of Shares in Other Corporations
Shares of other corporations standing in the name of this Corporation
may be voted or represented and all incidents thereto may be exercised on behalf
of the corporation by the Chairman of the Board, the President or any Vice
President and the Secretary or an Assistant Secretary.
Section 4. Subsidiary Corporations
Shares of this corporation owned by a subsidiary shall not be entitled
to vote on any matter. A subsidiary for these purposes is defined as a
corporation, the shares of which possessing more than twenty-five percent (25%)
of the total combined voting power of all classes of shares entitled to vote,
are owned directly or indirectly through one or more subsidiaries.
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CERTIFICATE OF ADOPTION OF BY-LAWS
Adoption by Incorporator or First Director(s)
The undersigned, being all of the persons appointed in the Articles of
Incorporation to act as the Incorporator or First Directors(s) of the above
named corporation hereby adopt the same as the By-Laws of said corporation.
Executed this 18th day of February, 1977.
/s/ MICHAEL T. MORRISSEY
------------------------------------------
MICHAEL T. MORRISSEY, Incorporator
Certificate by Secretary
I DO HEREBY CERTIFY AS FOLLOWS:
That I am the duly elected, qualified and acting Secretary of the above
named corporation; that the foregoing By-Laws were adopted as the By-Laws of
said corporation on the date set forth above by the person(s) appointed in the
Articles of Incorporation to act as the Incorporator or First Directors(s) of
said corporation.
IN WITNESS WHEREOF I have hereunto set my hand and affixed the
corporate seal this 12th day of May, 1977.
/s/ UFA SOARES
------------------------------------------
Secretary
(Seal)
Certificate by Secretary of Adoption by Shareholders' Vote
THIS IS TO CERTIFY:
That I am the duly elected, qualified and acting Secretary of the
above-named corporation and that the above and foregoing Code of By-Laws was
submitted to the Shareholders at their first meeting held on the date set forth
in the By-Laws and recorded in the Minutes thereof, was ratified by the vote of
Shareholders entitled to exercise the majority of the voting power of said
corporation.
IN WITNESS WHEREOF I have hereunto set my hand this 12th day of May,
1977.
/s/ UFA SOARES
------------------------------------------
Secretary
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ARTICLE VIII
(As amended October 28, 1994)
Section 1. Restrictions on Transfer of Shares.
The sale or transfer of shares of the corporation by any of the holders
thereof is restricted as follows:
Before there can be a valid sale or transfer, except as hereinafter
provided, of any of the shares of the corporation by any holder thereof to any
person or entity, the holder of the shares to be sold or transferred shall first
give notice (the "notice") in writing to the secretary of the corporation of his
intention to sell or transfer such shares. The notice shall specify the proposed
purchaser or purchasers, the number of shares to be sold or transferred, the
price per share, and the terms upon which the holder intends to make such sale
or transfer. In the event that the consideration to be received by the
transferor is other than cash, the notice shall fully describe such
consideration and state the fair market value thereof. The corporation, at its
option and at the transferor's expense, may require the transferor to have the
fair market value of such consideration determined by an independent appraiser
selected by the corporation. In the case of a noncash consideration, the price
per share shall be based upon the fair market value of the consideration as
stated in the notice, unless the corporation exercises its option to require the
aforementioned independent appraisal, in which case the price per share shall be
based upon such independently appraised fair market value.
A sale or transfer shall be deemed to have occurred for the purpose of
this Article VIII whenever any interest in any share of stock of the corporation
is transferred voluntarily, involuntarily or by operation of law, irrespective
of whether any change in the record ownership results therefrom and without
regard to whether or not any consideration is received for such transfer. The
following are the only sales or transfers excluded from the provisions of this
Article VIII: transfer by bequest, intestate succession or gift to the spouse,
lineal descendants, brothers or sisters, ancestors, or adopted children, or to
the spouses or adopted children of the lineal descendants, brothers or sisters,
ancestors, or adopted children, or to the spouses or adopted children of the
lineal descendants, brothers or sisters or ancestors, of the holder of the
shares to be transferred, or to any custodian or trustee for the account of such
persons. A sale or transfer which is so excluded from the provisions of this
Article VIII shall not remove those shares so transferred from the restrictions
contained herein and any subsequent sale or transfer shall be subject to, and
comply in all respects with, said restrictions.
The corporation shall have the prior right to purchase the shares
referred to in the notice at the price and upon the terms and conditions stated
in the notice. The corporation may elect to purchase any portion or all of the
shares referred to in the notice at the price and upon the terms and conditions
stated therein. If none or only a portion of the shares referred to in the
notice are, elected to be purchased by the corporation in the foregoing manner,
the shareholders who were holders of record of the corporation on the date the
notice was received by the secretary of the corporation shall have the right to
purchase the shares referred to in the notice which the corporation has not
elected to purchase at the price and upon the terms and conditions stated in the
notice and in accordance with the following provisions. The secretary of the
corporation shall, within ten (10) days after receiving the notice, mail or
deliver a copy thereof, and a statement of the number of shares, if any, which
the corporation has elected to purchase
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thereunder, to each of the other shareholders of the corporation who were
holders of record on the date the notice was received by the secretary. The
notice and statement may be delivered to such shareholders personally or may be
mailed to them at their last known address as the same may appear on the books
of the corporation. Within twenty (20) days after the notice and statement are
mailed or delivered to such shareholders, each shareholder who desires to
acquire any part or all of the shares referred to in the notice, and which the
corporation has not elected to purchase, shall deliver by mail or otherwise to
the secretary of the corporation a written offer to purchase a specific number
of such shares at the price and upon the terms and conditions stated in the
notice.
If the total number of shares specified in all such shareholder offers
exceeds the number of shares referred to in the notice and statement and
available for purchase by the shareholders, each offering shareholder shall be
entitled to purchase such proportion of the shares so referred to as the number
of shares of the corporation which he held of record on the date the notice was
received by the secretary bears to the total number of shares held of record by
all offering shareholders on the date the notice was received by the secretary.
If all of the shares referred to in the notice and statement are not
disposed of under such apportionment, each offering shareholder desiring to
purchase shares in a number in excess of his proportionate share, as provided
above, shall be entitled to purchase such proportion of the shares which remain
thus undisposed of as-the total number of shares which he held of record on the
date the notice was received by the secretary bears to the total number of
shares held of record on the date the notice was received by the secretary by
all shareholders who desire to purchase shares in excess of those to which they
are entitled under such apportionment.
After receipt of the offering shareholder(s)' notice(s), to the extent
that all of the shares referred to in the transferor's notice and statement are
not disposed of under the preceding provisions, the corporation shall have the
right to increase the number of said shares it has elected to purchase.
Within forty (40) days after the notice is mailed or delivery to the
secretary, the corporation shall deliver, by mail or otherwise, to the
shareholder giving such notice a written statement of the number of shares
referred to in the notice which the corporation and/or the shareholders have
elected to purchase.
If (i) none or only a part of the shares referred to in the notice are
contracted for in the foregoing manner within the aforesaid forty (40) day
period, or (ii) prior to the expiration of the aforesaid forty (40) day period,
the holders of two-thirds (2/3) or more of the shares of the corporation on the
date the notice was received by the secretary file with the secretary their
consent in writing that such sale or transfer be made as proposed in the notice
and waive their right to acquire such shares as hereinabove provided, then the
shareholder desiring to sell or transfer shares may, within a period of ninety
(90) days after the date of the notice, sell or transfer to the proposed
purchaser or purchasers all or any part of the shares referred to in the notice;
provided, however, that he shall not sell or transfer any such shares at a lower
price or on terms or conditions more favorable to the purchaser or transferee
than those specified in the notice. If the shareholder desiring to sell or
transfer shares does not sell or transfer all shares referred to in the notice
within the aforesaid ninety (90) day period, the shares which remain thus
undisposed shall become again subject to the restrictions imposed by this
Article VIII.
Any sale or transfer, or purported sale or transfer, of shares of the
corporation shall be null and void unless made in accordance with the terms,
conditions and provisions of this Article VII.
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