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EXHIBIT 3.5
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DONJOY, L.L.C.
(A DELAWARE LIMITED LIABILITY COMPANY)
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BY-LAWS
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ADOPTED AS OF JUNE 30, 1999
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BY-LAWS
OF
DONJOY, L.L.C.
INTRODUCTION
A. Agreement. These By-laws (the "By-laws") are subject to (i)
and made part of the Amended and Restated Operating Agreement dated as of June
30, 1999, as the same may from time to time be amended and in effect (the
"Operating Agreement"), of DonJoy, L.L.C., a Delaware limited liability company
(the "Company") and (ii) the Members' Agreement, dated as of June 30, 1999
among the Company and the members party thereto (the "Members' Agreement"). In
the event of any inconsistency between the terms hereof and the terms of the
Operating Agreement and the Members' Agreement, the terms of the Operating
Agreement shall control.
B. Definitions. Capitalized terms used and not defined in these
By-laws have the meanings ascribed to such terms in the Operating Agreement.
ARTICLE I
MEETINGS OF MEMBERS
1.1 PLACE OF MEETINGS AND MEETINGS BY TELEPHONE.
Meetings of Members shall be held at any place designated by the Board
of Managers. In the absence of any such designation, meetings of Members shall
be held at the principal place of business of the Company. Any meeting of the
Members may be held by conference telephone or similar communication equipment
so long as all Members participating in the meeting can hear one another, and
all Members participating by telephone or similar communication equipment shall
be deemed to be present in person at the meeting.
1.2 CALL OF MEETINGS.
Meetings of Members may be called at any time by the Board of Managers
or the Chief Executive Officer and President for the purpose of taking action
upon any matter requiring the vote or authority of the Members as provided
herein or in the Operating Agreement or upon any other matter as to which such
vote or authority is deemed by the Board of Managers or the Chief Executive
Officer and President to be necessary or desirable.
1.3 NOTICE OF MEETINGS OF MEMBERS.
All notices of meetings of Members shall be sent or otherwise given in
accordance with Section 1.4 of this Article I not less then ten nor more than
sixty days
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before the date of the meeting. The notice shall specify the place, date and
hour of the meeting.
1.4 MANNER OF GIVING NOTICE.
Notice of any meeting of Members shall be given personally or by
telephone to each Member (in the event any Member is a corporation, partnership
or limited liability company, such notice shall be to any vice president,
general partner, managing member, respectively, or other responsible officer of
such entity) or sent by first class mail, postage prepaid, by telegram or
telecopy (or similar electronic means) or by a nationally recognized overnight
courier, charges prepaid, addressed to the Member at the address of that Member
appearing on the books of the Company or given by the Member to the Company for
the purpose of notice. Notice shall be deemed to have been given at the time
when delivered either personally or by telephone, or at the time when deposited
in the mail or with a nationally recognized overnight courier, or when sent by
telegram or telecopy (or similar electronic means).
1.5 ADJOURNED MEETING; NOTICE.
Any meeting of Members, whether or not a quorum is present, may be
adjourned from time to time by the vote of a Majority in Interest of Members
represented at that meeting, either in person or by proxy. When any meeting of
Members is adjourned to another time or place, notice need not be given of the
adjourned meeting, unless a new record date of the adjourned meeting is fixed
or unless the adjournment is for more than thirty days from the date set for
the original meeting, in which case the Board of Managers shall set a new
record date and shall give notice in accordance with the provisions of Sections
1.3 and 1.4 of this Article I. At any adjourned meeting, the Company may
transact any business that might have been transacted at the original meeting.
1.6 QUORUM; VOTING.
At any meeting of the Members, the presence of a Majority in Interest
of Members, in person or by proxy, shall constitute a quorum for all purposes,
unless or except to the extent that the presence of Members holding such other
percentage of Units is required by the Operating Agreement, these By-laws or
applicable law. Except as otherwise required by the Operating Agreement, these
By-laws or applicable law, all matters shall be determined by an affirmative
vote of a Majority in Interest of Members.
1.7 WAIVER OF NOTICE BY CONSENT OF ABSENT MEMBERS.
The transactions of a meeting of Members, however called and noticed
and wherever held, shall be as valid as though taken at a meeting duly held
after regular call and notice if a quorum is 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 or consent need not specify either the business to be transacted or
the purpose of any meeting of Members. Attendance by a person at a
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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 was not lawfully called or convened.
1.8 MEMBER ACTION BY WRITTEN CONSENT WITHOUT A MEETING.
Any action that may be taken at any meeting of Members may be taken
without a meeting and without prior notice if a consent in writing setting
forth the action so taken is signed by a Majority in Interest of Members (or
Members holding such other percentage of Units as is required to authorize or
take such action under the terms of the Operating Agreement, these By-laws or
applicable law). Any such written consent may be executed and given by telecopy
or similar electronic means. Such consents shall be filed with the Secretary of
the Company and shall be maintained in the Company's records. A copy of any
such consent shall be provided to any Member who does not sign such consent.
1.9 RECORD DATE FOR MEMBER NOTICE, VOTING AND GIVING CONSENTS.
(a) For purposes of determining the Members entitled to vote or act
at any meeting or adjournment thereof, the Board of Managers may fix in advance
a record date which shall not be greater than sixty days nor fewer than ten
days before the date of any such meeting. If the Board of Managers does not so
fix a record date, the record date for determining Members entitled to notice
of or to vote at a meeting of Members shall be at the close of business on the
business day immediately 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 the Members entitled to give
consent to action in writing without a meeting, (i) when no prior action of the
Board of Managers has been taken, shall be the day on which the first written
consent is given, or (ii) when prior action of the Board of Managers has been
taken, shall be such date as determined for that purpose by the Board of
Managers, which record date shall not precede the date upon which the
resolution fixing it is adopted by the Board of Managers and shall not be more
than twenty days after the date of such resolution.
(c) Members of record on the record date as herein determined shall
have any right to vote or to act at any meeting or give consent to any action
relating to such record date, provided that no Member who transfers all or part
of such Member's Unit after a record date (and no transferee of such Unit)
shall have the right to vote or act with respect to the transferred Unit as
regards the matter for which the record date was set.
1.10 PROXIES.
Every Member entitled to vote or act on any matter at a meeting of
Members shall have the right to do so either in person or by proxy, provided
that an instrument authorizing such a proxy to act is executed by the Member in
writing and dated not more than eleven months before the meeting, unless the
instrument specifically provides for a longer period. A proxy shall be deemed
executed by a Member if the Member's name is placed on the proxy (whether by
manual signature, typewriting, telegraphic transmission
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or otherwise) by the Member or the Member's attorney-in-fact. A valid proxy
that does not state that it is irrevocable shall continue in full force and
effect unless (i) revoked by (a) the person executing it before the vote
pursuant to that proxy by a writing delivered to the Company stating that the
proxy is revoked or (b) a subsequent proxy executed by, or by attendance at the
meeting and voting in person by, the person executing that proxy or (ii)
written notice of the death or incapacity of the maker of that proxy is
received by the Company before the vote pursuant to that proxy is counted. A
proxy purporting to be executed by or on behalf of a Member shall be deemed
valid unless challenged at or prior to its exercise and the burden of proving
invalidity shall rest on the challenger. Except to the extent inconsistent with
the provisions hereof, the General Corporation Law of the State of Delaware,
and judicial construction thereof by the Courts of the State of Delaware, shall
be applicable to proxies granted by any Member.
ARTICLE II
MANAGERS AND MEETINGS OF MANAGERS
2.1 POWERS.
The powers of the Managers shall be as provided herein and in the
Operating Agreement.
2.2 NUMBER OF MANAGERS.
The Board of Managers shall consist of at least five Managers. The
number of Managers shall be initially nine and may thereafter be changed from
time to time by action of the Managers.
2.3 VACANCIES.
Newly created vacancies on the Board of Managers resulting from an
increase in the number of Managers and vacancies occurring on the Board of
Managers for any other reason, including the removal of Managers without cause,
may be filled as provided in the Operating Agreement and the Members'
Agreement.
2.4 PLACE OF MEETINGS AND MEETINGS BY TELEPHONE.
All meetings of the Board of Managers may be held at any place that has
been designated from time to time by resolution of the Board of Managers or in
any notice properly given with respect to any such meeting. In the absence of
such a designation, regular meetings shall be held at the principal place of
business of the Company. Any meeting, regular or special, may be held by
conference telephone or similar communication equipment so long as all Managers
participating in the meeting can hear one another, and all Managers
participating by telephone or similar communication equipment shall be deemed
to be present in person at the meeting.
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2.5 REGULAR MEETINGS.
Regular meetings of the Board of Managers shall be held at such times
and at such places as shall be fixed by approval of the Managers. Such regular
meetings may be held without notice.
2.6 SPECIAL MEETINGS.
Special meetings of the Board of Managers for any purpose or purposes
may be called at any time by any Manager. Notice of the time and place of a
special meeting shall be delivered to each Manager (a) personally, (b) by
telephone (and confirmed by one of the methods set out in the immediately
succeeding clause (c)), or (c) by telegram, telecopy (or similar electronic
means), first-class mail or nationally recognized overnight courier, charges
prepaid, addressed to each Manager at that Manager's address as it is shown on
the records of the Company. If the notice is mailed, it shall be deposited in
the United States mail at least ten calendar days before the time of the
holding of the meeting. If the notice is delivered personally or by telephone
or by telegram, telecopy (or similar electronic means) or by a nationally
recognized overnight courier, it shall be given at least twenty-four hours
before the time of the holding of the meeting. Any oral notice given personally
or by telephone may be communicated either to the Manager or to a person at the
office of the Manager who the person giving the notice has reason to believe
will promptly communicate it to the Manager. The notice need not specify the
purpose of the meeting.
2.7 QUORUM; CHAIRMAN.
The Managers holding a majority of the votes entitled to be cast shall
constitute a quorum for the transaction of business, except to adjourn as
provided in Section 1.9 of this Article II. Every act or decision done or made
by the affirmative vote of a majority of Managers entitled to cast votes at a
meeting duly held at which a quorum is present shall be regarded as the act of
the Board of Managers, except to the extent that the vote of a higher number of
Managers is required by the Operating Agreement, these By-laws or applicable
law. The Board of Managers may from time to time appoint any Manager to serve
as Chairman of the Board of Managers, who shall preside at all meetings of the
Board of Managers and of the Members. If at the time of any such meeting, there
shall not be a Chairman of the Board of Managers, or the then incumbent
Chairman does not attend or participate in such meeting, then the Board of
Managers shall appoint a person to preside at such meeting.
2.8 WAIVER OF NOTICE.
Notice of any meeting need not be given to any Manager who either
before or after the meeting signs a written waiver of notice, a consent to
holding the meeting or an approval of the minutes. The waiver of notice or
consent need not specify the purpose of the meeting. All such waivers,
consents, and approvals shall be filed with the records of the Company or made
a part of the minutes of the meeting. Notice of a meeting shall
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also be deemed given to any Manager who attends the meeting without protesting,
at or prior to its commencement, the lack of notice to that Manager.
2.9 ADJOURNMENT.
Managers present at any meeting entitled to cast a majority of all
votes entitled to be cast by such Managers, 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 unless the meeting
is adjourned for more than forty-eight hours, in which case notice of the time
and place shall be given before the time of the adjourned meeting in the manner
specified in Section 2.6 of this Article II.
2.10 ACTION WITHOUT A MEETING.
Any action to be taken by the Board of Managers at a meeting may be
taken without such meeting by the written consent of all the Managers then in
office. Any such written consent may be executed and given by telecopy or
similar electronic means. Such written consents shall be filed with the minutes
of the proceedings of the Board of Managers.
2.11 DELEGATION OF POWER.
Any Manager may, by power of attorney, delegate his power to any other
Manager or Managers; provided, however, that in no case shall fewer than two
Managers personally exercise the powers granted to the Managers, except as
otherwise provided in the Operating Agreement, Members' Agreement or by
resolution of the Board of Managers. A Manager represented by another Manager
pursuant to such power of attorney shall be deemed to be present for purposes
of establishing a quorum and satisfying any voting requirements. The Board of
Managers may, by resolution, delegate any or all of their powers and duties
granted hereunder or under the Operating Agreement or Members' Agreement, to
one or more committees of the Board of Managers, each consisting of one or more
Managers, or to one or more officers, employees or agents (including, without
limitation, Members), and to the extent any such powers or duties are so
delegated, action by the delegate or delegates shall be deemed for all purposes
to be action by the Board of Managers. Except as otherwise provided in the
Operating Agreement or Members' Agreement, all such delegates shall serve at
the pleasure of the Board of Managers. To the extent applicable, notice shall
be given to, and action may be taken by, any delegate of the Board of Managers
as herein provided with respect to notice to, and action by, the Board of
Managers.
2.12 VOTING OF MANAGERS.
Each Manager shall be entitled to one vote on all matters the
Managers are entitled to vote thereon, except for one of the Chase Nominees (as
defined in the Members' Agreement), who shall be entitled to six votes on all
matters the Managers are entitled to vote thereon.
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ARTICLE III
OFFICERS
3.1 OFFICERS.
The officers of the Company shall be a Chief Executive Officer and
President, a Secretary and a Chief Financial Officer. The Company may also
have, at the discretion of the Board of Managers, such other officers as may be
appointed in accordance with the provisions of Section 3.3 of this Article III,
including, without limitation, any number of Vice Presidents. Any number of
offices may be held by the same person. Officers may, but need not, be
Managers.
3.2 ELECTION OF OFFICERS.
The officers of the Company shall be chosen by the Board of Managers,
and each shall serve at the pleasure of the Board of Managers, subject to the
rights, if any, of an officer under any contract of employment.
3.3 ADDITIONAL OFFICERS.
The Board of Managers may appoint and may empower the Chief Executive
Officer and President to appoint such additional officers as the business of
the Company may require, each of whom shall hold office for such period, have
such authority and perform such duties as are provided in these By-laws or as
the Board of Managers (or, to the extent the power to prescribe authorities and
duties of additional officers is delegated to him or her, the Chief Executive
Officer and President) may from time to time determine.
3.4 REMOVAL AND RESIGNATION OF OFFICERS.
Subject to the rights, if any, of an officer under any contract of
employment, any officer may be removed, with or without cause, by the Board of
Managers at any regular or special meeting of the Board of Managers or by such
officer, if any, upon whom such power of removal may be conferred by the Board
of Managers. Any officer may resign at any time by giving written notice to the
Company. 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 Company under any contract to which the officer is a
party.
3.5 VACANCIES IN OFFICES.
A vacancy in any office because of death, resignation, removal,
disqualification or other cause shall be filled by the Board of Managers,
subject in the case of the appointment of additional officers by the Chief
Executive Officer and President in accordance with Section 3.3 of this Article
III. The Chief Executive Officer and
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President may make temporary appointments to a vacant office reporting to the
Chief Executive Officer and President pending action by the Board of Managers.
3.6 CHIEF EXECUTIVE OFFICER AND PRESIDENT.
The Chief Executive Officer and President shall, subject to the control
of the Board of Managers, be responsible for the general supervision, direction
and control of the business and the officers of the Company. He or she shall
have the general powers and duties of management usually vested in the office
of Chief Executive Officer and President of a limited liability company and
shall have such other powers and duties as may be prescribed by the Board of
Managers, the Operating Agreement, the Members' Agreement or these By-laws.
3.7 SECRETARY.
The Secretary shall keep or cause to be kept at the principal place of
business of the Company or such other place as the Board of Managers may direct
a book of minutes of all meetings and actions of the Board of Managers,
committees or other delegates of the Board of Managers (appointed in accordance
with the provisions of Section 2.11 of Article II) and the Members. The
Secretary shall keep or cause to be kept at the principal place of business of
the Company a register or a duplicate register showing the names of all Members
and their addresses, the class and percentage interests in the Company 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 Members
and of the Board of Managers (or committees or other delegates thereof)
required to be given by these By-laws or by applicable law and shall have such
other powers and perform such other duties as may be prescribed by the Board of
Managers or the Chief Executive Officer and President or by these By-laws.
3.8 CHIEF FINANCIAL OFFICER.
The Chief Financial Officer shall keep and maintain or cause to be kept
and maintained adequate and correct books and records of accounts of the
properties and business transactions of the Company. The books of account shall
at all reasonable times be open to inspection by any Manager. The Chief
Financial Officer shall deposit all monies and other valuables in the name and
to the credit of the Company with such depositaries as may be designated by the
Board of Managers. He or she shall disburse the funds of the Company as may be
ordered by the Board of Managers, shall render to the Chief Executive Officer
and President and the Board of Managers, whenever they request it, an account
of all of his or her transactions as Chief Financial Officer and of the
financial condition of the Company and shall have other powers and perform such
other duties as may be prescribed by the Board of Managers or the Chief
Executive Officer and President or these By-laws.
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ARTICLE IV
MAINTENANCE AND INSPECTION OF RECORDS
4.1 MEMBER LIST.
The Company shall maintain at its principal place of business a record
of its Members, giving the names and addresses of all Members and the class and
membership interests in the Company held by each Member. Subject to such
reasonable standards (including standards governing what information and
documents are to be furnished and at whose expense) as may be established by
the Board of Managers from time to time, each Member has the right to obtain
from the Company from time to time upon reasonable demand for any purpose
reasonably related to the Member's interest as a Member of the Company a record
of the Company's Members.
4.2 BY-LAWS.
The Company shall keep at its principal place of business the original
or a copy of these By-laws as amended to date, which shall be open to
inspection by the Members at all reasonable times during office hours.
4.3 OTHER RECORDS.
The accounting books and records, minutes of proceedings of the Members
and the Board of Managers and any committees or delegates of the Board of
Managers and all other information pertaining to the Company that is required
to be made available to the Members under the Delaware Act shall be kept at
such place or places designated by the Board of Managers or in the absence of
such designation, at the principal place of business of the Company. The
minutes shall be kept in written form and the accounting books and records and
other information shall be kept either in written form or in any other form
capable of being converted into written form. The books of account and records
of the Company shall be maintained in accordance with generally accepted
accounting principles consistently applied during the term of the Company,
wherein all transactions, matters and things relating to the business and
properties of the Company shall be currently entered, subject to such
reasonable standards (including standards, governing what information and
documents are to be furnished and at whose expense) as may be established by
the Board of Managers from time to time; and minutes, accounting books and
records and other information shall be open to inspection upon the written
demand of any Member at any reasonable time during usual business hours for
purposes reasonably related to the Member's interests as a Member. Any such
inspection may be made in person or by an agent or attorney and shall include
the right to copy and make extracts. Notwithstanding the foregoing, the Board
of Managers shall have the right to keep confidential from Members for such
period of time as the Board of Managers deems reasonable any information which
the Board of Managers reasonably believes to be in the nature of trade secrets
or other information the disclosure of which the Board of Managers in good
faith believes is not in the best interests of the Company or could
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damage the Company or its business or which the Company is required by law or
by agreement with a third party to keep confidential.
4.4 INSPECTION BY MANAGERS.
Every Manager (and any individuals who are permitted to attend and
observe the meetings of the Board of Managers, subject to the limitations set
forth in the Operating Agreement) shall have the right at any reasonable time
to inspect all books, records and documents of every kind and the physical
properties of the Company for a purpose reasonably related to his position as
Manager. This inspection by a Manager 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.
ARTICLE V
GENERAL MATTERS
5.1 CHECKS, DRAFTS, EVIDENCE OF INDEBTEDNESS.
All checks, drafts or other orders for payment of money, notes or other
evidences of indebtedness issued in the name of or payable by the Company shall
be signed or endorsed in such manner and by such person or persons as shall be
designated from time to time in accordance with the resolution of the Board of
Managers.
5.2 REPRESENTATION OF SHARES OF OTHER ENTITIES HELD BY THE COMPANY.
The Chief Executive Officer and President or any other person
authorized by the Board of Managers is authorized to vote or represent on
behalf of the Company any and all shares (or similar equity interests) of any
corporation, partnership, limited liability company, trusts or other entities,
foreign or domestic, standing in the name of the Company. Such authority may be
exercised in person or by a proxy duly executed by such designated person.
5.3 SEAL.
The Board of Managers may approve and adopt an official seal of the
Company, which may be altered by them at any time. Unless otherwise required by
the Board of Managers, any seal so adopted shall not be necessary to be placed
on, and its absence shall not impair the validity of, any document, instrument
or other paper executed and delivered by or on behalf of the Company.
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ARTICLE VI
AMENDMENTS AND INCORPORATION BY REFERENCE
6.1 AMENDMENT.
These By-laws may be restated, amended, supplemented or repealed only
by the unanimous vote of the Board of Managers or the affirmative vote of a
Majority in Interest of Members (or such other vote of Members holding such
other number of Units as shall be required by the Operating Agreement, these
By-laws or applicable law).
ARTICLE VII
INDEMNIFICATION
7.1 INDEMNIFICATION OF MANAGERS, OFFICERS, EMPLOYEES AND AGENTS.
(a) Each Person who was or is made a party or is threatened to be
made a party to or is otherwise involved in any action, suit or proceeding,
whether civil, criminal, administrative or investigative (hereinafter, a
"proceeding") by reason of the fact that he or she is or was a Manager or an
officer of the Company (or exercised his or her observation rights with respect
to meetings of the Board of Managers), or is or was serving at the request of
the Company as a manager, director, officer, employee or agent of another
limited liability company or of a corporation, partnership, joint venture,
trust or other enterprise, including a service with respect to an employee
benefit plan (hereinafter an "indemnitee"), whether the basis of such a
proceeding is alleged action in an official capacity as a Manager, officer,
employee or agent or in any other capacity while serving as a Manager, officer,
employee or agent, shall be indemnified and held harmless by the Company to the
fullest extent authorized by the Delaware Act (including indemnification for
negligence or gross negligence but excluding indemnification (i) for acts or
omissions involving actual fraud or willful misconduct or (ii) with respect to
any transaction from which the indemnitee derived an improper personal
benefit), against all expense, liability and loss (including attorneys' fees,
judgments, fines, excise taxes or penalties and amounts paid in settlement)
reasonably incurred or suffered by such indemnitee in connection therewith.
(b) The right to indemnification conferred in paragraph (a) shall
include the right to be paid by the Company the expenses (including attorneys'
fees) incurred in defending any proceeding in advance of its final disposition
(hereinafter an "advancement of expenses"). The rights to indemnification and
to the advancement of expenses conferred in paragraph (a) and this paragraph
(b) shall be contract rights and such rights shall continue as to an indemnitee
who has ceased to be a Manager, officer, employee or agent and shall inure to
the benefit of the indemnitee's heirs, executors and administrators.
(c) The rights to indemnification and to the advancement of expenses
conferred in this Section 7.1 shall not be exclusive of any other right that
any Person may
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have or hereafter acquire under any statute, agreement, vote of the Managers or
otherwise.
(d) The Company may maintain insurance, at its expense, to protect
itself and any Manager, officer, employee or agent of the Company or another
limited liability company, consultant, corporation, partnership, joint venture,
trust or other enterprise against any expense, liability or loss, whether or
not the Company would have the power to indemnify such Person against such
expense, liability or loss under the Delaware Act.
(e) The Company may, to the extent authorized from time to time by
the Board of Managers, grant rights to indemnification and to advancement of
expenses to any employee or agent of the Company to the fullest extent of the
provisions of this Section 7.1 with respect to the indemnification and
advancement of expenses of Managers and officers of the Company.
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