1
BY - LAWS
OF
SYSCO CORPORATION
(A DELAWARE CORPORATION)
EXHIBIT 3(b)
ARTICLE I
STOCKHOLDERS
1. CERTIFICATES REPRESENTING STOCK. Every holder of stock in
the corporation shall be entitled to have a certificate signed by, or in the
name of, the corporation by the Chairman or Vice-Chairman of the Board of
Directors or the President or a Vice President and by the Treasurer or an
Assistant Treasurer or the Secretary or an Assistant Secretary of the
corporation certifying the number of shares owed by him in the corporation.
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 upon a certificate shall have ceased to be such
officer, transfer agent or registrar before such certificate is issued, it may
be issued by the corporation with the same effect as if he were such officer,
transfer agent or registrar at the date of issue.
Whenever the corporation shall be authorized to issue more
than one class of stock or more than one series of any class of stock, and
whenever the corporation shall issue any shares of its stock as partly paid
stock, the certificates representing shares of any such class or series or of
any such partly paid stock shall set forth thereon the statements prescribed by
the General Corporation Law. Any restrictions on the transfer or registration
of transfer of any shares of stock of any class or series shall be noted
conspicuously on the certificate representing such shares.
The corporation may issue a new certificate of stock in
place of any certificate theretofore issued by it, alleged to have been lost,
stolen, or destroyed, and the Board of Directors may require the owner of any
lost, stolen, or destroyed certificate, or his legal representative, to give
the corporation a bond sufficient to indemnify the corporation against any
claim that may be made against it on account of the alleged loss, theft, or
destruction of any such certificate or the issuance of any such new
certificate.
- 1 -
2
2. FRACTIONAL SHARE INTERESTS. The corporation shall not issue
fractions of a share. In lieu thereof it shall either pay in cash the fair
value of fractions of a share, as determined by the Board of Directors, to
those entitled thereto or issue scrip or fractional warrants in registered or
bearer form over the manual or facsimile signature of an officer of the
corporation or of its agent, exchangeable as therein provided for full shares,
but such scrip or fractional warrants shall not entitle the holder to any
rights of a stockholder except as therein provided. Such scrip or fractional
warrants may be issued subject to the condition that the same shall become void
if not exchanged for certificates representing full shares of stock before a
specified date, or subject to the condition that the shares of stock for which
such scrip or fractional warrants are exchangeable may be sold by the
corporation and the proceeds thereof distributed to the holders of such scrip
or fractional warrants, or subject to any other conditions which the Board of
Directors may determine.
3. STOCK TRANSFERS. Upon compliance with provisions
restricting the transfer or registration of transfer of shares of stock, if
any, transfers or registration of transfers of shares of stock of the
corporation shall be made only on the stock ledger of the corporation, in
accordance with the terms and procedures as outlined in The Uniform Stock
Transfer Act.
4. RECORD DATE FOR STOCKHOLDERS. For the purpose of
determining the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or to express consent to or dissent
from any corporate action in writing without a meeting, or for the purpose of
determining stockholders entitled to receive payment of any dividend or other
distribution or the allotment of any rights, or entitled to exercise any rights
in respect of any change, conversion or exchange of stock, or for the purpose
of any other lawful action, the directors may fix, in advance, a date as the
record date for any such determination of stockholders. Such date shall not be
more than sixty days nor less than ten days before the date of such meeting,
nor more than sixty days prior to any other action. If no record date is
fixed, the record date for the determination of stockholders entitled to notice
of or to vote at a meeting of stockholders shall be at the close of business on
the day next preceding the day on which notice is given, or, if notice is
waived, at the close of business on the day next preceding the day on which the
meeting is held; the record date for determining stockholders for any other
purpose shall be at the close of business on the day on which the Board of
Directors adopts the resolution relating thereto. When a determination of
stockholders of record entitled to notice of or to vote at any meeting of
stockholders has been made as provided in this paragraph, such determination
shall apply to any adjournment thereof; provided, however, that the Board of
Directors may fix a new record date for the adjourned meeting.
5. MEANING OF CERTAIN TERMS. As used herein in respect of the
right to notice of a meeting of stockholders or a waiver thereof or to
participate or vote thereat or to consent or dissent in writing in lieu of a
meeting, as the case may be, the term "share" or "shares" or "share of stock"
or "shares of stock" or "stockholder" or "stockholders" refers to an
outstanding share or shares of stock and to a holder or holders
- 2 -
3
of record of outstanding shares of stock when the corporation is authorized to
issue only one class of shares of stock, and said reference is also intended to
include any outstanding share or shares of stock and any holder or holders of
record of outstanding shares of stock of any class upon which or upon whom the
certificate of incorporation confers such rights where there are two or more
classes or series of shares of stock or upon which or upon whom the General
Corporation Law confers such rights notwithstanding that the certificate of
incorporation may provide for more than one class or series of shares of stock,
one or more of which are limited or denied such rights thereunder; provided,
however, that no such right shall vest in the event of an increase or a
decrease in the authorized number of shares of stock of any class or series
which is otherwise denied voting rights under the provisions of the certificate
of incorporation.
6. STOCKHOLDER MEETINGS.
- Time. The first annual meeting shall be held on the
second Friday in October, 1970; and each successive annual meeting shall be
held on the date and at the time and place fixed, from time to time, by the
directors, and if no date has been set by the directors, then on the first
Friday in November in each year, unless said date falls on a legal holiday, in
which case the meeting shall be held on the secular day next following. A
special meeting shall be held on the date and at the time fixed by the
directors.
- Place. Annual meetings and special meetings shall be
held at such place, within or without the State of Delaware, as the directors
may, from time to time fix. Whenever the directors shall fail to fix such
place, the meeting shall be held at the registered office of the corporation in
the State of Delaware.
- Call. Annual meetings and special meetings may be called
by the Chairman of the Board or by the directors or by any officer instructed
by the directors to call the meeting.
- Notice Or Waiver Of Notice. Written notice of all
meetings shall be given, stating the place, date, and hour of the meeting and
stating the place within the city or other municipality or community at which
the list of stockholders of the corporation may be examined. The notice of an
annual meeting shall state that the meeting is called for the election of
directors and for the transaction of other business which may properly come
before the meeting, and shall, (if any other action which could be taken at a
special meeting is to be taken at such annual meeting) state the purpose or
purposes. The notice of a special meeting shall in all instances state the
purpose or purposes for which the meeting is called. If any action is proposed
to be taken which would, if taken, entitle stockholders to receive payment for
their shares of stock, the notice shall include a statement of that purpose and
to that effect. Except as otherwise provided by the General Corporation Law, a
copy of the notice of any meeting shall be given, personally or by mail, not
less than ten days nor more than fifty days before the date of the meeting,
unless the lapse of the prescribed period of time shall have been waived, and
directed to each stockholder at his record address or at such other address
- 3 -
4
which he may have furnished by request in writing to the Secretary of the
corporation. Notice by mail shall be deemed to be given when deposited, with
postage thereon prepaid, in the United States mail. If a meeting is adjourned
to another time, not more than thirty days hence, and/or to another place, and
if an announcement of the adjourned time and/or place is made at the meeting,
it shall not be necessary to give notice of the adjourned meeting unless the
directors, after adjournment, fix a new record date for the adjourned meeting.
Notice need not be given to any stockholder who submits a written waiver of
notice by him before or after the time stated therein. Attendance of a person
at a meeting of stockholders shall constitute a waiver of notice of such
meeting, except when the stockholder attends a meeting for the express purpose
of objecting, at the beginning of the meeting, to the transaction of any
business because the meeting is not lawfully called or convened. Neither the
business to be transacted at, nor the purpose of, any regular or special
meeting of the stockholders need be specified in any written waiver of notice.
- Stockholder List. The officer who has charge of the
stock ledger or the corporation shall prepare and make, at least ten days
before every meeting of stockholders, a complete list of the stockholders,
arranged in alphabetical order, and showing the address of each stockholder and
the number of shares registered in the name of each stockholder. Such list
shall be open to the examination of any stockholder, for any purpose germane to
the meeting, during ordinary business hours, for a period of at least ten days
prior to the meeting, either at the place within the city or other municipality
or community where the meeting is to be held, which location shall be specified
in the notice of the meeting, or if not so specified, at the location where the
meeting is to be held. The list shall also be produced and kept at the time
and at the location where the meeting is to be held. The list shall also be
produced and kept at the time and at the location of the meeting during the
whole time thereof, and may be inspected by any stockholder who is present.
The stock ledger shall be the only evidence as to who the stockholders entitled
to examine the stock ledger, the list required by this section, or the books of
the corporation, or to vote at any meeting of stockholders.
- Conduct Of Meeting. Meetings of the stockholders shall
be presided over by one of the following officers in the order of seniority and
if present and acting - the Chairman of the Board, the President, a
Vice-President, or, if none of the foregoing is in office and present and
acting, by a chairman to be chosen by the stockholders. The Secretary of the
corporation, or in his absence, an Assistant Secretary, shall act as secretary
of every meeting, but if neither the Secretary nor an Assistant Secretary is
present the Chairman of the meeting shall appoint a secretary of the meeting.
- Proxy Representation. Every stockholder may authorize
another person or persons to act for him by proxy in all matters in which a
stockholder is entitled to participate, whether by waiving notice of any
meeting, voting or participating at a meeting, or expressing consent or dissent
without a meeting. Every proxy must be signed by the stockholder or by his
attorney-in-fact. No proxy shall be voted or acted upon after three years from
its date unless such proxy provides for longer period. A duly executed proxy
shall be irrevocable if it states that it is irrevocable and, if, and only as
- 4 -
5
long as, it is coupled with an interest sufficient in law to support an
irrevocable power. A proxy may be made irrevocable regardless of whether the
interest with which it is coupled is an interest in the stock itself or an
interest in the corporation generally.
- Inspectors And Judges. The directors, in advance of any
meeting, may, but need not, appoint one or more inspectors of election or
judges of the vote, as the case may be, to act at the meeting or any
adjournment thereof. If an inspector or inspectors or judge or judges are not
appointed, the person presiding at the meeting may, but need not, appoint one
or more inspectors or judges. In case any person who may be appointed as an
inspector or judge fails to appear or act, the vacancy may be filled by
appointment made by the directors in advance of the meeting or at the meeting
by the person presiding thereat. Each inspector or judge, if any, before
entering upon the discharge of his duties, shall take and sign an oath
faithfully to execute the duties of inspector or judge at such meeting with
strict impartiality and according to the best of his ability. The inspectors
or judges, if any, shall determine the number of shares of stock outstanding
and the voting power of each, the shares of stock represented at the meeting,
the existence of a quorum, the validity and effect of proxies, and shall
receive votes, ballots or consents, hear and determine all challenges and
questions arising in connection with the right to vote, count and tabulate all
votes, ballots or consents, determine the result, and do such acts as are
proper to conduct the election or vote with fairness to all stockholders. On
request of the person presiding at the meeting, the inspector or inspectors or
judge or judges, if any, shall make a report in writing of any challenge,
question or matter determined by him or them and execute a certificate of any
fact found by him or them.
- Quorum. The holders of thirty-five percent (35%) of the
shares entitled to vote shall constitute a quorum at a meeting of stockholders
for the transaction of any business. The stockholders present may adjourn the
meeting despite the absence of a quorum.
- Voting. Except as may otherwise be provided in the
certificate of incorporation, or in a resolution of the Board of Directors in
accordance with Section 151 of the General Corporation Law of Delaware, each
share of stock shall entitle the holder thereof to one vote. In the election
of directors, a plurality of the votes cast shall elect. Any other action
shall be authorized by a majority of the votes cast except where the General
Corporation Law prescribes a different percentage of votes and/or a different
exercise of voting power. In the election of directors, voting need not be by
ballot. Voting by ballot shall not be required for any other corporate action
except as otherwise provided by the General Corporation Law.
7. STOCKHOLDER ACTION WITHOUT MEETINGS. Whenever the vote of
stockholders at a meeting thereof is required or permitted to be taken for or
in connection with any corporate action, the meeting and vote of stockholders
may be dispensed with if all of the stockholders who would have been entitled
to vote upon the action if such meeting were held shall consent in writing to
such corporate action being taken; or if less than all of said stockholders,
but not less than those having at least the
- 5 -
6
minimum voting power required to take corporate action under the provisions
of the General Corporation law, shall consent in writing to such corporate
action; provided that prompt notice be given to all stockholders of the taking
of such action without a meeting and by less than unanimous written consent.
ARTICLE II
DIRECTORS
1. FUNCTIONS AND DEFINITION. The business of the corporation
shall be managed by the Board of Directors of the corporation. The use of the
phrase "whole board" herein refers to the total number of directors which the
corporation would have if there were no vacancies.
2. QUALIFICATION AND NUMBER. The property, affairs and
business of the corporation shall be managed by its board of directors,
consisting of not less than three nor more than sixteen persons, with the exact
number of directors determined from time to time by the board of directors. A
director need not be a stockholder, a citizen of the United States or a
resident of the State of Delaware.
The directors shall be divided into three classes. The
first class (Class I) shall consist of five directors and the term of office of
such class shall expire at the next Annual Meeting of Stockholders in 1978.
The second class (Class II) shall consist of five directors and the term of
office of such class shall expire at the Annual Meeting of Stockholders in
1979. The third class (Class III) shall consist of five directors and the term
of office of such third class shall expire at the Annual Meeting of
Stockholders in 1980. At the Annual Meeting of Stockholders in 1977, five
directors shall be elected as Class III directors whose term of office shall
expire at the Annual Meeting of Stockholders in 1980, one director shall be
elected as a Class I director whose term of office shall expire at the Annual
Meeting of Stockholders in 1978, and one director shall be elected as a Class
II director whose term of office shall expire at the Annual Meeting of
Stockholders in 1979. Should the number of directors be increased or decreased
in the future, no class of directors shall have more than one director more
than any other class of directors. At each annual election commencing at the
Annual Meeting of Stockholders in 1978, the successors to the class of
directors whose term expires at that time shall be elected to hold office for
the term of three years to succeed those whose term expires, so that the term
of office of one class of directors shall expire in each year. Each director
shall hold office for the term for which he is elected or appointed or until
his successor shall be elected and qualified, or until his death, removal or
resignation. Newly created directorships resulting from an increase in the
number of directors by action of the Board of Directors, may be filled by the
Board of Directors at the meeting at which the number of directors is
increased, or any subsequent meeting of the directors, by a majority of the
directors then in office, although less than a quorum, or by the stockholders
at a meeting called for the purpose of electing directors.
- 6 -
7
3. ELECTION AND TERM. The first Board of Directors, unless the
members thereof shall have been named in the certificate of incorporation,
shall be elected by the incorporator or incorporators and shall hold office
until the first annual meeting of stockholders and until their successors have
been elected and qualified or until their earlier resignation or removal and
shall serve staggered terms as provided for in ARTICLE II, Paragraph 2 of these
By - Laws. Any director may resign at any time upon written notice to the
corporation. Thereafter, directors who are elected at an annual meeting of
stockholders, and directors who are elected in the interim to fill vacancies
and newly created directorships, shall hold office until the term of office to
which they are elected or until their successors have been elected and
qualified or until their earlier resignation or removal. In the interim
between annual meetings of stockholders or of special meetings of stockholders
called for the election of directors and/or for the removal of one or more
directors and for the filling of any vacancy in that connection, newly created
directorships and any vacancies in the Board of Directors, including vacancies
resulting from the removal of directors for cause or without cause, may be
filled only for the remainder of the term of the director or directors whose
term he or they may fill, by the vote of a majority of the remaining directors
then in office, although less than a quorum, or by the sole remaining director.
4. MEETINGS.
- Time. Meetings shall be held at such time as the Board
shall fix except that the first meeting of a newly elected Board shall be held
as soon after its election as the directors may conveniently assemble.
- Place. Meetings shall be held at such place within or
without the State of Delaware as shall be fixed by the Board.
- Call. No call shall be required for regular meetings for
which the time and place have been fixed. Special meetings may be called by or
at the direction of the Chairman of the Board, or the President, or of a
majority of the directors in office.
- Notice Or Actual Or Constructive Waiver. No notice shall
be required for regular meetings for which the time and place have been fixed.
Written, oral, or any other mode of notice of the time and place shall be given
for special meetings upon three days' notice for the convenient assembly of the
directors thereat. The notice of any meeting need not specify the purpose of
the meeting. Any requirement of furnishing a notice shall be waived by any
director who signs a written waiver of such notice before or after the time
stated therein.
- Quorum And Action. A majority of the whole Board shall
constitute a quorum except when a vacancy or vacancies prevents such majority,
whereupon a majority of the directors in office shall constitute a quorum,
provided, that such majority shall constitute at least one-third of the whole
Board. A majority of the directors present, whether or not a quorum is
present, may adjourn a meeting to another time and place. Except as herein
otherwise provided, and except as otherwise provided by the General
- 7 -
8
Corporation Law, the act of the Board shall be the act by vote of a majority of
the directors present at a meeting, a quorum being present. The quorum and
voting provisions herein stated shall not be construed as conflicting with any
provisions of the General Corporation Law and these By - Laws which govern a
meeting of directors held to fill vacancies and newly created directorships in
the Board.
- Chairman Of The Meeting. The Chairman of the Board, and
if present and acting, shall preside at all meetings. Otherwise, the
President, if present and acting, or any other Director chosen by the Board,
shall preside.
5. REMOVAL OF DIRECTORS. Any or all of the directors may be
removed for cause or without cause by the stockholders. One or more of the
directors may be removed for cause by the Board of Directors.
6. COMMITTEES. The Board of Directors may, by resolution
passed by a majority of the whole Board, designate one or more committees,
including an Executive Committee, each committee to consist of two or more of
the directors of the corporation. The Board may designate one or more
directors as alternate members of any committee, who may replace any absent or
disqualified member at any meeting of the committee. Any such committee, to
the extent provided in the resolution of the Board, shall have and may exercise
the powers of the Board of Directors in the management of the business and
affairs of the corporation, and may authorize the seal of the corporation to be
affixed to all papers which may require it. In the absence or disqualification
of any member of any such committee or committees, the member or members
thereof present at any meeting and not disqualified from voting, whether or not
he or they constitute a quorum, may unanimously appoint another member of the
Board of Directors to act at the meeting in the place of any such absent or
disqualified member.
7. ACTION IN WRITING. Any action required or permitted to be
taken at any meeting of the Board of Directors or any committee thereof may be
taken without a meeting if all members of the Board or committee, as the case
may be, consent thereto in writing, and the writing or writings are filed with
the minutes of proceedings of the Board or committee.
ARTICLE III
OFFICERS
The directors shall elect a Chairman of the Board, a President, a
Secretary, and a Treasurer, and may elect a Vice-Chairman thereof, and one or
more Vice-Presidents, Assistant Secretaries, and Assistant Treasurers, and may
elect or appoint such other officers and agents as are desired. The President
may but need not be a director. Any number of offices may be held by the same
person. In the absence, disqualification, death or removal of the Chairman of
the Board, the Vice Chairman, the President, or any other director chosen by
the Board, shall serve in lieu of the said Chairman. The
- 8 -
9
Chairman of the Board shall be an ex officio member of all standing committees
unless otherwise provided in the resolution appointing such committees. The
Chairman of the Board shall have power to call meetings of the shareholders and
directors of the corporation and shall have the power to act as chairman of
such meetings.
Unless otherwise provided in the resolution of election or
appointment, each officer shall hold office until the meeting of the Board of
Directors following the next annual meeting of stockholders and until his
successor has been elected and qualified. Any officer may resign at any time
upon written notice.
The Chairman, if any, of the Board of Directors shall preside at all
meetings of stockholders and directors. Except where by law the signature of
the President is required, he shall possess the same power as the President to
sign all certificates, contracts and other instruments of the corporation which
may be authorized by the Board of Directors. During the absence or disability
of the President he shall exercise all the powers and discharge all the duties
of the President.
The President, in the absence of the Chairman of the Board, shall
preside at all meetings of stockholders and directors, shall have general
supervision of the affairs of the corporation, shall sign or countersign all
certificates, contracts and other instruments of the corporation as authorized
by the Board of Directors; shall make reports to the Board of Directors and
stockholders and perform all such other duties as are incident to his office or
are properly required of him by the Board of Directors.
The Vice Presidents, during the absence or disability of the President
and the Chairman of the Board of Directors, in the order designated by the
Board of Directors, shall exercise all the functions of the President. Each
Vice President shall have such powers and discharge such duties as may be
assigned to him from time to time by the Board of Directors.
The Secretary shall issue notice of all meetings of stockholders and
directors, shall keep minutes of all meetings, shall have charge of the seal of
the corporation and the corporate books, and shall make such reports and
perform such other duties as are incident to his office, or are properly
required of him by the Board of Directors.
The Treasurer shall have the custody of all monies and securities of
the corporation and shall keep regular books of account. He shall disburse the
funds of the corporation in payment of the just demands against the corporation
or as may be ordered by the Board of Directors, taking proper vouchers for such
disbursements, and shall render to the Board of Directors from time to time as
may be required of him, an account of all his transactions as Treasurer and of
the financial condition of the corporation. He shall perform all duties
incident to his office or that are properly required of him by the Board of
Directors.
- 9 -
10
The Assistant Treasurers, in the order of their seniority, shall, in
the absence or disability of the Treasurer, perform the duties and exercise the
powers of the Treasurer, and shall perform such other duties as the Board of
Directors shall prescribe.
In the case of absence or inability to act of any officer of the
corporation and of any person herein authorized to act in his place, the Board
of Directors may, from time to time, delegate the powers or duties of such
officer to any other officer or any director or other person whom it may
select.
Vacancies in any office arising from any cause may be filled by the
directors at any regular or special meeting.
The Board of Directors may appoint such other officers and agents as
it shall deem necessary or expedient, who shall hold their offices for such
terms and shall exercise such powers and perform such duties as shall be
determined from time to time by the Board of Directors.
The Board of Directors may remove any officer for cause or without
cause.
ARTICLE IV
CORPORATE SEAL
The corporate seal shall be in such form as the Board of Directors
shall prescribe. The corporation seal may be a facsimile seal, if the Board
shall so determine.
ARTICLE V
FISCAL YEAR
The fiscal year of the corporation shall be fixed, and shall be
subject to change, by the Board of Directors.
ARTICLE VI
CONTROL OVER BY - LAWS
The power to amend, alter, and repeal these By - Laws and to adopt new
By - Laws shall be vested in the Board of Directors; provided, that the Board
of Directors may delegate such power, in whole or in part, to the stockholders;
and provided, further, that any By - Law, other than an initial By - Law, which
provides for the election of directors by classes for staggered terms shall be
adopted by the stockholders.
- 10 -
11
ARTICLE VII
INDEMNIFICATION
(a) Right to Indemnification. 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 director, officer, employee or agent of the corporation or is
or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation or of a partnership, joint venture,
trust or other enterprise, including service with respect to an employee
benefit plan (hereinafter an "indemnitee"), whether the basis of such
proceeding is alleged action in an official capacity as a director, officer,
employee, or agent or in any other capacity while serving as a director,
officer, employee or agent, shall be indemnified and held harmless by the
corporation to the fullest extent authorized by the Delaware General
Corporation Law, as the same exists or may hereafter be amended (but, in the
case of any such amendment, only to the extent that such amendment permits the
corporation to provide broader indemnification rights than permitted prior
thereto), against all expense, liability and loss (including attorneys' fees,
judgments, fines, ERISA excise taxes or penalties and amounts paid in
settlement) reasonably incurred or suffered by such indemnitee in connection
therewith and such indemnification shall continue as to an indemnitee who has
ceased to be a director, officer, employee or agent and shall inure to the
benefit of the indemnitee's heirs, executors and administrators; provided,
however, that, except as provided in paragraph (c) of this Article VII hereof
with respect to proceedings to enforce rights to indemnification, the
corporation shall indemnify any such indemnitee in connection with a proceeding
(or part thereof) initiated by such indemnitee only if such proceeding (or part
thereof) was authorized by the Board of Directors of the corporation.
(b) Right to Advancement of Expenses. The right to
indemnification conferred in paragraph (a) of this Article VII shall include
the right to be paid by the corporation the expenses incurred in defending any
proceeding for which such right to indemnification is applicable in advance of
its final disposition (hereinafter an "advancement of expenses"; provided,
however, that, if the Delaware General Corporation Law requires, an advancement
of expenses incurred by an indemnitee in his or her capacity as a director or
officer (and not in any other capacity in which service was or is rendered by
such indemnitee, including, without limitation, service to an employee benefit
plan) shall be made only upon the delivery to the corporation of an undertaking
(hereinafter an "undertaking"), by or on behalf of such indemnitee, to repay
all amounts so advanced if it shall ultimately be determined by final judicial
decision from which there is no further right to appeal (hereinafter a "final
adjudication") that such indemnitee is not entitled to be indemnified for such
expenses under this Article VII or otherwise.
(c) Right of Indemnitee to Bring Suit. The rights to
indemnification and to the advancement of expenses conferred in paragraphs (a)
and (b) of this Article VII shall be contract rights. If a claim under
paragraph (a) or (b) of this Article VII is not paid in
- 11 -
12
full by the corporation within sixty days after a written claim has been
received by the corporation, except in the case of a claim for an advancement
of expenses, in which case the applicable period shall be twenty days, the
indemnitee may at any time thereafter bring suit against the corporation to
recover the unpaid amount of the claim. If successful in whole or in part in
any such suit, or in a suit brought by the corporation to recover an
advancement of expenses pursuant to the terms of an undertaking, the indemnitee
shall be entitled to be paid also the expense of prosecuting or defending such
suit. In any suit brought by the indemnitee to enforce a right to
indemnification hereunder (but not in a suit brought by the indemnitee to
enforce a right to an advancement of expenses), it shall be a defense that the
indemnitee has not met any applicable standard for indemnification set forth in
the Delaware General Corporation Law. In any suit by the corporation to
recover an advancement of expenses pursuant to the terms of an undertaking, the
corporation shall be entitled to recover such expenses upon a final
adjudication that the indemnitee has not met any applicable standard for
indemnification set forth in the Delaware General Corporation Law. Neither the
failure of the corporation (including its Board of Directors, independent legal
counsel or its stockholders) to have made a determination prior to the
commencement of such suit that indemnification of the indemnitee is proper in
the circumstances because the indemnitee has met the applicable standard of
conduct set forth in the Delaware General Corporation Law, nor an actual
determination by the corporation (including its Board of Directors, independent
legal counsel or its stockholders) that the indemnitee has not met such
applicable standard of conduct, shall create a presumption that the indemnitee
has not met the applicable standard of conduct or, in the case of such a suit
brought by the indemnitee, be a defense to such suit. In any suit brought by
the indemnitee to enforce a right to indemnification or to an advancement of
expenses hereunder, or by the corporation to recover an advancement of expenses
pursuant to the terms of an undertaking, the burden of proving that the
indemnitee is not entitled to be indemnified, or to such advancement of
expenses, under this Article VII or otherwise shall be on the corporation.
(d) Non-Exclusivity of Rights. The rights to indemnification
and to the advancement of expenses conferred in this Article VII shall not be
exclusive of any other right which any person may have or hereafter acquire
under any statute, the corporation's certificate of incorporation, by - law,
agreement, vote of stockholders or disinterested directors or otherwise.
(e) Insurance. The corporation may maintain insurance, at its
expense, to protect itself and any director, officer, employee or agent of the
corporation or another corporation, partnership, joint venture, trust or other
enterprise against any expense, liability or loss, whether or not the
corporation would have the power to indemnify such person against such expense,
liability or loss under the Delaware General Corporation Law.
- 12 -