Exhibit 3.2
EXELON CORPORATION
B Y L A W S
ARTICLE I.
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Offices and Fiscal Year
Section 1.01 Registered Office.-- The registered office of the
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corporation in the Commonwealth of Pennsylvania shall be at 2301 Market Street,
Philadelphia, Pennsylvania 19103.
Section 1.02 Other Offices.-- The corporation may also have offices at
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such other places within or without the Commonwealth of Pennsylvania as the
board of directors may from time to time appoint or as may be necessary,
advisable or appropriate for the business of the corporation.
Section 1.03 Fiscal Year.-- The fiscal year of the corporation shall
begin on the first day of January in each year.
ARTICLE II.
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Notice - Waivers - Meetings Generally
Section 2.01 Manner of Giving Notice.
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(a) General Rule.--Whenever written notice is required to be given to
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any person under the provisions of the Business Corporation Law or by the
articles or these bylaws, it may be given to the person either personally or by
sending a copy thereof by first class or express mail, postage prepaid, or by
telegram (with messenger services specified), telex or TWX (with answerback
received) or courier service, charges prepaid, or by facsimile transmission, to
the address (or to the telex, TWX or facsimile transmission telephone number) of
the person appearing on the books of the corporation, or as otherwise permitted
by applicable law, or, in the case of directors, supplied by the director to the
corporation for the purpose of notice. If the notice is sent by mail, telegraph
or courier service, it shall be deemed to have been given to the person entitled
thereto when deposited in the United States mail or with a telegraph office or
courier service for delivery to that person or, in the case of telex or TWX,
when dispatched or, in the case of facsimile transmission, when received.
Notwithstanding the foregoing, written notice of any meeting of shareholders may
be sent by any class of mail, postage prepaid, so long as such notice is sent at
least 20 calendar days prior to the date of the meeting. A notice of meeting
shall specify the place, day and hour of the meeting and any other information
required by any other provision of the Business Corporation Law, the articles or
these bylaws.
(b) Adjourned Shareholder Meetings.--When a meeting of shareholders is
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adjourned, it shall not be necessary to give any notice of the adjourned meeting
or of the business to be transacted at an adjourned meeting, other than by
announcement at the meeting at which the adjournment is taken, unless the board
fixes a new record date
for the adjourned meeting or the Business Corporation Law requires notice of the
business to be transacted and such notice has not previously been given.
Section 2.02 Notice of Meetings of the Board of Directors.--Notice of a
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regular meeting of the board of directors need not be given. Notice of every
special meeting of the board of directors shall be given to each director by
telephone or in writing at least 24 hours (in the case of notice by telephone,
telex, TWX, facsimile or other electronic transmission) or 48 hours (in the case
of notice by telegraph, courier service or express mail) or five days (in the
case of notice by first class mail) before the time at which the meeting is to
be held. Every such notice shall state the time and place of the meeting.
Neither the business to be transacted at, nor the purpose of, any regular or
special meeting of the board need be specified in a notice of the meeting.
Section 2.03 Notice of Meetings of Shareholders.
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(a) General Rule.-- Written notice of every meeting of the shareholders
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shall be given by, or at the direction of, the secretary or other authorized
person to each shareholder of record entitled to vote at the meeting not less
than five nor more than 90 calendar days prior to the date of the meeting. If
the secretary neglects or refuses to give notice of a meeting, the person or
persons calling the meeting may do so. In the case of a special meeting of
shareholders, the notice shall specify the general nature of the business to be
transacted.
(b) Notice of Action by Shareholders on Bylaws.--In the case of a
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meeting of shareholders that has as one of its purposes adoption, amendment or
repeal of these bylaws, written notice shall be given to each shareholder that
the purpose, or one of the purposes, of the meeting is to consider the adoption,
amendment or repeal of the bylaws. There shall be included in, or enclosed with,
the notice a copy of the proposed amendment or a summary of the changes to be
effected thereby.
Section 2.04 Waiver of Notice.
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(a) Written Waiver.--Whenever any written notice is required to be given
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under the provisions of the Business Corporation Law, the articles or these
bylaws, a waiver thereof in writing, signed by the person or persons entitled to
the notice, whether before or after the time stated therein, shall be deemed
equivalent to the giving of the notice. Neither the business to be transacted
at, nor the purpose of, a meeting need be specified in the waiver of notice of
the meeting.
(b) Waiver by Attendance.--Attendance of a person at any meeting shall
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constitute a waiver of notice of the meeting except where a person attends a
meeting for the express purpose of objecting, at the beginning of the meeting,
to the transaction of any business because the meeting was not lawfully called
or convened.
Section 2.05 Modification of Proposal Contained in Notice.--Whenever the
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language of a proposed resolution is included in a written notice of a meeting
required to be given under the provisions of the Business Corporation Law or the
articles or these bylaws, the meeting considering the resolution may without
further notice adopt it with such clarifying or other amendments as do not
enlarge its original purpose.
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Section 2.06 Exception to Requirement of Notice.
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(a) General Rule.--Whenever any notice or communication is required to be given
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to any person under the provisions of the Business Corporation Law or by
the articles or these bylaws or by the terms of any agreement or other
instrument or as a condition precedent to taking any corporate action and
communication with that person is then unlawful, the giving of the notice
or communication to that person shall not be required.
(b) Shareholders Without Forwarding Addresses.--Notice or other communications
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need not be sent to any shareholder with whom the corporation has been
unable to communicate for more than 24 consecutive months because
communications to the shareholder are returned unclaimed or the shareholder
has otherwise failed to provide the corporation with a current address.
Whenever the shareholder provides the corporation with a current address,
the corporation shall recommence sending notices and other communications
to the shareholder in the manner provided by these bylaws.
Section 2.07 Use of Conference Telephone and Similar Equipment.--
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Any director may participate in any meeting of the board of directors or a
committee thereof, and the board of directors may provide by resolution with
respect to a specific meeting of shareholders or with respect to a class of
meetings of shareholders that one or more persons may participate in a meeting
of the shareholders of the corporation, by means of conference telephone, video
conference or similar communications equipment by means of which all persons
participating in the meeting can hear each other. Participation in a meeting
pursuant to this Section shall constitute presence in person at the meeting.
ARTICLE III.
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Shareholders
Section 3.01 Place of Meeting.--Meetings of the shareholders of the
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corporation may be held at such place within or without the Commonwealth of
Pennsylvania as may be designated by the Board of Directors, or in the absence
of a designation by the Board of Directors, by the chairman of the board or the
president and stated in the notice of a meeting.
Section 3.02 Annual Meeting.--The annual meeting of the shareholders for
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the election of directors and the transaction of other business, if any, shall
be held on such date and time as may be fixed by the board and stated in the
notice of meetings (or, if the board fails to designate a date and time, at
10:30 a.m. on the fourth Wednesday in April of each year or, if such Wednesday
is a legal holiday in the Commonwealth of Pennsylvania or in such other
jurisdiction where such meeting may be held, the next succeeding business day).
Failure to hold such meeting at the designated time or on the designated date or
to elect some or all of the members of the board at such meeting or any
adjournment thereof shall not affect otherwise valid corporate acts or work a
forfeiture or dissolution of the corporation. If the annual meeting shall not
have been called and held within six months after the designated time, any
shareholder may call the meeting at any time thereafter.
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Section 3.03 Special Meetings.--Special meetings of the shareholders may
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be called at any time by resolution of the board of directors, which may fix the
date, time and place of the meeting, and shall be called as provided in the
terms of the Preferred Stock. If the board does not fix the date, time or place
of the meeting, it shall be the duty of the secretary to do so. A date fixed by
the secretary shall not be more than 60 calendar days after the date of the
action calling the special meeting.
Section 3.04 Quorum and Adjournment.
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(a) General Rule.--A meeting of the shareholders of the corporation duly
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called shall not be organized for the transaction of business unless a quorum is
present. Except as otherwise provided in the terms of the Preferred Stock, the
presence of shareholders entitled to cast at least a majority of the votes that
all shareholders are entitled to cast on a particular matter to be acted upon at
the meeting shall constitute a quorum for the purposes of consideration and
action on the matter. Shares of the corporation owned, directly or indirectly,
by it shall not be counted in determining the total number of outstanding shares
for quorum purposes at any given time.
(b) Withdrawal of a Quorum.--The shareholders present at a duly
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organized meeting can continue to do business until adjournment notwithstanding
the withdrawal of enough shareholders to leave less than a quorum.
(c) Adjournments Generally.--Any regular or special meeting of the
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shareholders, including one at which directors are to be elected and one which
cannot be organized because a quorum has not attended, may be adjourned, except
as otherwise provided by the Business Corporation Law, for such period and to
such place as the shareholders present and entitled to vote shall direct.
(d) Electing Directors at Adjourned Meeting.--Those shareholders
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entitled to vote who attend a meeting called for the election of directors that
has been previously adjourned for lack of a quorum, although less than a quorum
as fixed in this Section of these bylaws, shall nevertheless constitute a quorum
for the purpose of electing directors.
(e) Other Action in Absence of Quorum.--Those shareholders entitled to
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vote who attend a meeting of shareholders that has been previously adjourned for
one or more periods aggregating at least 15 calendar days because of an absence
of a quorum, although less than a quorum as fixed in this Section of these
bylaws, shall nevertheless constitute a quorum for the purpose of acting upon
any matter set forth in the notice of the meeting if the notice states that
those shareholders who attend the adjourned meeting shall nevertheless
constitute a quorum for the purpose of acting upon the matter.
Section 3.05 Action by Shareholders.--
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(a) General Rule. Except as otherwise provided in the Business
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Corporation Law or the articles or these bylaws, whenever any corporate action
is to be taken by vote of the shareholders of the corporation, it shall be
authorized upon receiving the affirmative vote of a majority of the votes cast
by all shareholders entitled to vote thereon and, if any shareholders are
entitled to vote thereon as a class, upon receiving the affirmative
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vote of a majority of the votes cast by the shareholders entitled to vote as a
class, in each case at a duly organized meeting of shareholders. Except as
otherwise provided in the terms of the Preferred Stock or when acting by
unanimous consent to remove a director or directors, the shareholders of the
corporation may act only at a duly organized meeting.
(b) Conduct of Business. Only such business will be conducted at an
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annual or special meeting of shareholders as shall have been properly brought
before the meeting by or at the direction of the board of directors, or with
respect to an annual meeting, by any shareholder who complies with the
procedures set forth in this Section.
(1) For business to be properly brought before an annual meeting by a
shareholder, the shareholder must have given to the secretary of the
corporation timely written notice of the shareholder's intention to make a
proposal, in the manner and form prescribed herein.
(i) To be timely, a shareholder's notice with respect to an
annual meeting of shareholders must be addressed to the secretary
of the corporation at the principal executive offices of the
corporation and received by the secretary not less than 120
calendar days in advance of the first anniversary of the date on
which the corporation first mailed its proxy materials to
shareholders for the prior year's annual meeting of shareholders,
and this notice requirement shall not be affected by any
adjournment of said meeting; provided, however, that in the event
public announcement of the date of the annual meeting is not made
at least 75 calendar days prior to the date of the annual meeting,
notice by the shareholder to be timely must be so received not
later than the close of business on the 10th calendar day following
the day on which public announcement is first made of the date of
the annual meeting.
(ii) A shareholder's notice to the secretary must set forth as
to each matter the shareholder proposes to bring before the annual
meeting (A) a description in reasonable detail of the business
desired to be brought before the annual meeting and the reasons for
conducting such business at the annual meeting, (B) the name and
address, as they appear on the corporation's books, of the
shareholder proposing such business and of the beneficial owner, if
any, on whose behalf the proposal is made, (C) the class and number
of shares of the corporation that are owned beneficially and of
record by the shareholder proposing such business and by the
beneficial owner, if any, on whose behalf the proposal is made, and
(D) any material interest of such shareholder proposing such
business and the beneficial owner, if any, on whose behalf the
proposal is made in such business.
(iii) Notwithstanding the foregoing provisions of these bylaws,
a shareholder must also comply with all applicable requirements of
the Securities Exchange Act of 1934 (the "Exchange Act") and the
rules and regulations thereunder with respect to the matters set
forth in this Section. For purposes of this Section, "public
announcement" means disclosure in a press release reported by the
Dow Jones News Service, Bloomberg
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Business News, or Reuters Economic Services or in a document
publicly filed by the corporation with the Securities and Exchange
Commission pursuant to Section 13, 14, or 15(d) of the Exchange
Act, or publicly filed by the corporation with any national
securities exchange or quotation service through which the
corporation's stock is listed or traded, or furnished by the
corporation to its shareholders. Notwithstanding the foregoing, no
notice of the date of the annual meeting is required for the
advance notice provision of this Section 3.05 (b) to be effective
if the annual meeting is held on such date as specified in Section
3.02 of these bylaws. Nothing in this Section will be deemed to
affect any rights of shareholders to request inclusion of proposals
in the corporation's proxy statement pursuant to Rule 14a-8 under
the Exchange Act.
(2) At a special meeting of shareholders, only such business may be
conducted or considered as is properly brought before the meeting. To be
properly brought before a special meeting, business must be (i) specified
in the notice of the meeting (or any supplement thereto) given in
accordance with Section 2.03 of these bylaws or (ii) otherwise brought
before the meeting by the presiding officer or by or at the direction of a
majority of the total number of directors that the corporation would have
if there were no vacancies on the board of directors (the "Whole Board").
(3) The determination of whether any business sought to be brought
before any annual or special meeting of the shareholders is properly
brought before such meeting in accordance with this Section of these bylaws
will be made by the presiding officer of such meeting. If the presiding
officer determines that any business is not properly brought before such
meeting, he or she will so declare to the meeting and any such business
will not be conducted or considered.
Section 3.06 Organization.
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(a) Presiding Officer and Secretary of Meeting.--At every meeting of the
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shareholders, the chairman of the board, or such other officer of the
corporation designated by a majority of the Whole Board, will call meetings of
shareholders to order or, in the case of vacancy in office and absence by action
of the Whole Board, one of the following officers present in the order stated:
The co-chief executive officers, if there be more than one, the chief executive
officer, if there be one, the president, if there be one, the vice presidents in
their order of rank and seniority shall act as "presiding officer" of the
meeting. The term "presiding officer" means an officer who presides over a
meeting of shareholders. The secretary or, in the absence of the secretary, an
assistant secretary, or, in the absence of both the secretary and assistant
secretaries, a person appointed by the presiding officer of the meeting, shall
act as secretary of the meeting.
(b) Rules of Conduct.-- Unless otherwise determined by the board of
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directors prior to the meeting, the presiding officer of the meeting of
shareholders will determine the order of business and have the authority to make
such rules or regulations for the conduct of meetings of shareholders as such
presiding officer deems necessary, appropriate or convenient for the proper
conduct of the meeting, including, without
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limitation, establishing an agenda or order of business for the meeting, rules
and procedures for maintaining order at the meeting and the safety of those
present, limitations on participation in such meeting to shareholders of record
of the corporation and their duly authorized and constituted proxies, and such
other persons as the board of directors or the presiding officer shall permit,
restrictions on entry to the meeting after the time fixed for the commencement
thereof, limitations on the time allotted to questions or comment by
participants and regulation of the opening and closing of the polls for
balloting on matters which are to be voted on by ballot. Unless, and to the
extent determined by the board of directors or the presiding officer of the
meeting, meetings of shareholders need not be conducted in accordance with rules
of parliamentary procedure.
Section 3.07 Voting Rights of Shareholders.--Unless otherwise provided
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in the articles, every shareholder of the corporation shall be entitled to one
vote for every share standing in the name of the shareholder on the books of the
corporation.
Section 3.08 Voting and other Action by Proxy.
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(a) General Rule.--
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(1) Every shareholder entitled to vote at a meeting of
shareholders may authorize another person to act for the
shareholder by proxy.
(2) The presence of, or vote or other action at a meeting of
shareholders by a proxy of a shareholder shall constitute the
presence of, or vote or action by, the shareholder.
(3) Where two or more proxies of a shareholder are present, the
corporation shall, unless otherwise expressly provided in the
proxy, accept as the vote of all shares represented thereby the
vote cast by a majority of them and, if a majority of the proxies
cannot agree whether the shares represented shall be voted, or upon
the manner of voting the shares, the voting of the shares shall be
divided equally among those persons.
(b) Form of Proxy.--Every proxy shall be in a form approved by the
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secretary of the corporation or as otherwise provided by the Business
Corporation Law.
(c) Revocation.--A proxy, unless coupled with an interest, shall be
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revocable at will, notwithstanding any other agreement or any provision in the
proxy to the contrary, but the revocation of a proxy shall not be effective
until written notice thereof has been given to the secretary of the corporation.
An unrevoked proxy shall not be valid after three years from the date of its
execution unless a longer time is expressly provided therein. A proxy shall not
be revoked by the death or incapacity of the maker unless, before the vote is
counted or the authority is exercised, written notice of the death or incapacity
is given to the secretary of the corporation.
(d) Expenses.--The corporation shall pay the reasonable expenses of
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solicitation of votes or proxies of shareholders by or on behalf of the board of
directors or its nominees for election to the board, including solicitation by
professional proxy solicitors and otherwise.
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Section 3.09 Voting by Fiduciaries and Pledgees.--Shares of the
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corporation standing in the name of a trustee or other fiduciary and shares
held by an assignee for the benefit of creditors or by a receiver may
be voted by the trustee, fiduciary, assignee or receiver. A shareholder whose
shares are pledged shall be entitled to vote the shares until the shares have
been transferred into the name of the pledgee, or a nominee of the pledgee, but
nothing in this Section shall affect the validity of a proxy given to a pledgee
or nominee.
Section 3.10 Voting by Joint Holders of Shares.
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(a) General Rule.--Where shares of the corporation are held jointly or
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as tenants in common by two or more persons, as fiduciaries or otherwise:
(1) if only one or more of such persons is present in person or
by proxy, all of the shares standing in the names of such persons
shall be deemed to be represented for the purpose of determining a
quorum and the corporation shall accept as the vote of all the
shares the vote cast by a joint owner or a majority of them; and
(2) if the persons are equally divided upon whether the shares
held by them shall be voted or upon the manner of voting the
shares, the voting of the shares shall be divided equally among the
persons without prejudice to the rights of the joint owners or the
beneficial owners thereof among themselves.
(b) Exception.--If there has been filed with the secretary of the
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corporation a copy, certified by an attorney-at-law to be correct, of the
relevant portions of the agreement under which the shares are held or the
instrument by which the trust or estate was created or the order of court
appointing them or of an order of court directing the voting of the shares, the
persons specified as having such voting power in the latest document so filed,
and only those persons, shall be entitled to vote the shares but only in
accordance therewith.
Section 3.11 Voting by Corporations.
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(a) Voting by Corporate Shareholders.--Any domestic or foreign
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corporation for profit or not-for-profit that is a shareholder of this
corporation may vote at meetings of shareholders of this corporation by any of
its officers or agents, or by proxy appointed by any officer or agent, unless
some other person, by resolution of the board of directors of the other
corporation or a provision of its articles or bylaws, a copy of which resolution
or provision certified to be correct by one of its officers has been filed with
the secretary of this corporation, is appointed its general or special proxy in
which case that person shall be entitled to vote the shares.
(b) Controlled Shares.--Shares of this corporation owned, directly or
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indirectly, by it and controlled, directly or indirectly, by the board of
directors of this corporation, as such, shall not be voted at any meeting and
shall not be counted in determining the total number of outstanding shares for
voting purposes at any given time.
Section 3.12 Determination of Shareholders of Record.
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(a) Fixing Record Date.--The board of directors may fix a time prior to
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the date of any meeting of shareholders as a record date for the determination
of the shareholders entitled to notice of, or to vote at, the meeting, which
time, except as otherwise provided in the articles or in the case of an
adjourned meeting, shall be not more than 90 calendar days prior to the date of
the meeting of shareholders. Only shareholders of record on the date fixed shall
be so entitled notwithstanding any transfer of shares on the books of the
corporation after any record date fixed as provided in this Subsection. The
board of directors may similarly fix a record date for the determination of
shareholders of record for any other purpose, except that the record date fixed
to determine the holders of Preferred Stock entitled to receive dividends
thereon shall not precede the respective dividend payment date by more than 40
calendar days. When a determination of shareholders of record has been made as
provided in this Section for purposes of a meeting, the determination shall
apply to any adjournment thereof unless the board fixes a new record date for
the adjourned meeting.
(b) Determination When Record Date Is Not Fixed.--If a record date is
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not fixed:
(1) The record date for determining shareholders entitled to
notice of or to vote at a meeting of shareholders shall be at the
close of business on the day next preceding the day on which notice
is given.
(2) The record date for determining shareholders 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.
(c) Certification by Nominee.--The board of directors may adopt a
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procedure whereby a shareholder of the corporation may certify in writing to the
corporation that all or a portion of the shares registered in the name of the
shareholder are held for the account of a specified person or persons. Upon
receipt by the corporation of a certification complying with the procedure, the
persons specified in the certification shall be deemed, for the purposes set
forth in the certification, to be the holders of record of the number of shares
specified in place of the shareholder making the certification.
Section 3.13 Voting Lists.
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(a) General Rule.--The officer or agent having charge of the transfer
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books for shares of the corporation shall make a complete list of the
shareholders entitled to vote at any meeting of shareholders, arranged in
alphabetical order, with the address of and the number of shares held by each.
The list shall be produced and kept open at the time and place of the meeting
and shall be subject to the inspection of any shareholder during the whole time
of the meeting for the purposes thereof except that, if the corporation has
5,000 or more shareholders, in lieu of the making of the list the corporation
may make the information therein available at the meeting by any other means.
(b) Effect of List.--Failure to comply with the requirements of this
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Section shall not affect the validity of any action taken at a meeting prior to
a demand at the meeting by any shareholder entitled to vote thereat to examine
the list. The original share register or transfer book, or a duplicate thereof
kept in the Commonwealth of Pennsylvania, shall be prima facie evidence as to
who are the shareholders entitled to
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examine the list or share register or transfer book or to vote at any meeting of
shareholders.
Section 3.14 Judges of Election.
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(a) Appointment.--In advance of any meeting of shareholders of the
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corporation, the board of directors may appoint judges of election, who need not
be shareholders, to act at the meeting or any adjournment thereof. If judges of
election are not so appointed, the presiding officer of the meeting may appoint
judges of election at the meeting. The number of judges shall be one or three. A
person who is a candidate for an office to be filled at the meeting shall not
act as a judge.
(b) Vacancies.--In case any person appointed as a judge fails to appear
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or fails or refuses to act, the vacancy may be filled by appointment made by the
board of directors in advance of the convening of the meeting or at the meeting
by the presiding officer thereof.
(c) Duties.--The judges of election shall determine the number of shares
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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,
receive votes or ballots, hear and determine all challenges and questions in any
way arising in connection with the right to vote, count and tabulate all votes,
determine the result and do such acts as may be proper to conduct the election
or vote. The judges of election shall perform their duties impartially, in good
faith, to the best of their ability and as expeditiously as is practical. If
there are three judges of election, the decision, act or certificate of a
majority shall be effective in all respects as the decision, act or certificate
of all.
(d) Report.--On request of the presiding officer of the meeting or of
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any shareholder, the judges shall make a report in writing of any challenge or
question or matter determined by them, and execute a certificate of any fact
found by them. Any report or certificate made by them shall be prima facie
evidence of the facts stated therein.
Section 3.15 Minors as Security Holders.--The corporation may treat a
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minor who holds shares or obligations of the corporation as having capacity to
receive and to empower others to receive dividends, interest, principal and
other payments or distributions, to vote or express consent or dissent and to
make elections and exercise rights relating to such shares or obligations
unless, in the case of payments or distributions on shares, the corporate
officer responsible for maintaining the list of shareholders or the transfer
agent of the corporation or, in the case of payments or distributions on
obligations, the treasurer or paying officer or agent has received written
notice that the holder is a minor.
ARTICLE IV.
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Board of Directors
Section 4.01 Powers.
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(a) General Rule.--Unless otherwise provided by statute, all powers
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vested by law in the corporation shall be exercised by or under the authority
of, and the business and affairs of the corporation shall be managed under the
direction of, the board of directors.
(b) Personal Liability of Directors.--
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(1) A director shall not be personally liable, as such, for
monetary damages (including, without limitation, any judgment,
amount paid in settlement, penalty, punitive damages or expenses of
any nature, including, without limitation, attorneys' fees and
disbursements) for any action taken, or any failure to take any
action before, on or after the date of these bylaws, unless:
(i) the director has breached or failed to perform the
duties of his or her office under Subchapter B of Chapter
17 of the Business Corporation Law; and
(ii) the breach or failure to perform constitutes self-
dealing, willful misconduct or recklessness.
(2) The provisions of paragraph (1) shall not apply to the
responsibility or liability of a director pursuant to any criminal
statute, or the liability of a director for the payment of taxes
pursuant to local, State or Federal law.
(3) No amendment or repeal of this Section 4.01 shall have any
effect on the liability or alleged liability of any director of the
corporation for or with respect to any such act on the part of such
director occurring prior to the effective date of such amendment or
repeal.
(c) Directors. A director shall stand in a fiduciary relation to the
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corporation and shall perform his duties as a director, including his duties as
a member of any committee of the board upon which he may serve, in good faith,
in a manner he reasonably believes to be in the best interests of the
corporation and with such care, including reasonable inquiry, skill and
diligence, as a person of ordinary prudence would use under similar
circumstances. In performing his duties, a director shall be entitled to rely in
good faith on information, opinions, reports or statements, including financial
statements and other financial data, in each case prepared or presented by any
of the following:
(1) One or more officers or employees of the corporation whom
the director reasonably believes to be reliable and competent in
the matters presented.
(2) Counsel, public accountants or other persons as to matters
which the director reasonably believes to be within the
professional or expert competence of such person.
(3) A committee of the board upon which he does not serve, duly
designated in accordance with law, as to matters within its
designated authority, which committee the director reasonably
believes to merit confidence.
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Section 4.02 Qualifications and Selection of Directors.
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(a) Qualifications.--Each director of the corporation shall be a natural
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person of full age who need not be a resident of the Commonwealth of
Pennsylvania or a shareholder of the corporation.
(b) Notice of Certain Nominations Required.--Nominations for election of
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directors may be made by any shareholder entitled to vote for the election of
directors if timely written notice in proper form (the "Notice") of the
shareholder's intent to nominate a director at the meeting is given by the
shareholder and received by the secretary of the corporation. To be timely, a
shareholder's notice must be delivered to or mailed and received at the
principal executive offices of the corporation not less than 120 calendar days
before the first anniversary of the date on which the corporation first mailed
its proxy materials for the prior year's annual meeting of shareholders;
provided, however, that in the event that public announcement of the date of the
annual meeting is not made at least 75 calendar days prior to the date of the
annual meeting, notice by the shareholder to be timely must be so received not
later than the close of business on the 10th calendar day following the day on
which public announcement is first made of the date of the annual meeting. The
requirements of this Subsection shall not apply to a nomination for directors
made to the shareholders by the board of directors or a committee thereof.
(c) Contents of Notice.--To be in proper written form, the Notice shall
------------------
be in writing and shall contain or be accompanied by:
(1) the name and residence address of the nominating shareholder
and of the beneficial owner, if any, on whose behalf the nomination
is made;
(2) a representation that the shareholder giving the notice is a
holder of record of voting stock of the corporation entitled to
vote at such annual meeting and intends to appear in person or by
proxy at the meeting to nominate the person or persons specified in
the Notice;
(3) the class and number of shares of voting stock of the
corporation owned beneficially and of record by the shareholder
giving the notice and by the beneficial owner, if any, on whose
behalf the nomination is made;
(4) such information regarding each nominee as would have been
required to be included in a proxy statement filed pursuant to
Regulation 14A of the rules and regulations established by the
Securities and Exchange Commission under the Exchange Act (or
pursuant to any successor act or regulation) had proxies been
solicited with respect to such nominee by the management or board
of directors of the corporation;
(5) a description of all arrangements or understandings between
or among any of (A) the shareholder giving the notice, (B) the
beneficial owner on whose behalf the notice is given, (C) each
nominee, and (D) any other person or persons (naming such person or
persons) pursuant to which the nomination or nominations are to be
made by the shareholder giving the notice;
12
(6) a description of all arrangements or understandings among
the shareholder and each nominee and any other person or persons
(naming such person or persons) pursuant to which the nomination or
nominations are to be made by the shareholder; and
(7) the signed consent of each nominee to serve as a director of
the corporation if so elected.
(d) Determination of Compliance.--The presiding officer of the meeting
---------------------------
may, if the facts warrant, determine and declare to the meeting that any
nomination made at the meeting was not made in accordance with the procedures of
this Section and, in such event, the presiding officer will so declare to the
meeting, and the defective nomination shall be disregarded. Any such decision by
the presiding officer shall be conclusive and binding upon all shareholders of
the corporation for any purpose. Notwithstanding the foregoing provisions of
this Section, a shareholder must also comply with all applicable requirements of
the Exchange Act, and the rules and regulations thereunder, with respect to the
matters set forth in this Section.
(e) Election of Directors.--Except as otherwise provided in these
---------------------
bylaws, directors of the corporation shall be elected by the shareholders only
at an annual meeting of shareholders, unless such election of directors is
required by the terms of any series of Preferred Stock. In elections for
directors, voting need not be by ballot, unless required by vote of the
shareholders before the voting for election of directors begins. The candidates
receiving the highest number of votes from each class or group of classes, if
any, entitled to elect directors separately up to the number of directors to be
elected by the class or group of classes shall be elected. If at any meeting of
shareholders, directors of more than one class are to be elected, each class of
directors shall be elected in a separate election.
Section 4.03 Number and Term of Office.
--------------------------
(a) Number.--The board of directors shall consist of such number of
------
directors as may be determined from time to time by resolution of a majority of
the Whole Board.
(b) Term of Office.--Each director shall hold office until the
--------------
expiration of the term for which he or she was selected and until a successor
has been selected and qualified or until his or her earlier death, resignation
or removal. A decrease in the number of directors shall not have the effect of
shortening the term of any incumbent director.
(c) Resignation.--Any director may resign at any time upon written
-----------
notice to the corporation. The resignation shall be effective upon receipt
thereof by the corporation or at such subsequent time as shall be specified in
the notice of resignation.
(d) Classified Board of Directors.--The directors shall be classified in
-----------------------------
respect to the time for which they shall severally hold office as follows:
(1) The term of office of at least one class shall expire in
each year.
13
(2) Except as otherwise provided in the terms of the Preferred
Stock or in the articles, the members of each class shall be
elected for a period of three years.
(3) The number of directors constituting each class shall be
approximately equal in size.
Section 4.04 Vacancies.
----------
(a) General Rule.--Subject to the requirements of Article X hereof and
------------
except as otherwise provided in the terms of the Preferred Stock, vacancies in
the board of directors, including vacancies resulting from an increase in the
number of directors, may be filled by a majority vote of the remaining members
of the board though less than a quorum, or by a sole remaining director, and
each person so selected shall be a director to serve for the balance of the
unexpired term of the class for which such director has been chosen, and until a
successor has been selected and qualified or until his or her earlier death,
resignation or removal.
(b) Action by Resigned Directors.--When one or more directors resign
----------------------------
from the board effective at a future date, the directors then in office,
including those who have so resigned, shall have power by the applicable vote to
fill the vacancies, the vote thereon to take effect when the resignations become
effective.
Section 4.05 Removal of Directors.
---------------------
(a) Removal by the Shareholders.--The entire board of directors, or any
---------------------------
class of the board, or any individual director may be removed from office by
vote of the shareholders entitled to vote thereon only for cause. In case the
board or a class of the board or any one or more directors are so removed, new
directors may be elected at the same meeting. The repeal of a provision of the
articles or bylaws prohibiting, or the addition of a provision to the articles
or bylaws permitting, the removal by the shareholders of the board, a class of
the board or a director without assigning any cause shall not apply to any
incumbent director during the balance of the term for which the director was
selected.
(b) Removal by the Board.--The board of directors may declare vacant the
--------------------
office of a director who has been judicially declared of unsound mind or who has
been convicted of an offense punishable by imprisonment for a term of more than
one year or if, within 60 days after notice of his or her selection, the
director does not accept the office either in writing or by attending a meeting
of the board of directors.
Section 4.06 Place of Meetings.--Meetings of the board of directors may
--------------------
be held at such place within or without the Commonwealth of Pennsylvania as the
board of directors may from time to time appoint or as may be designated in the
notice of the meeting.
Section 4.07 Organization of Meetings.--At every meeting of the board of
---------------------------
directors, the chairman of the board, if there be one, or, in the case of a
vacancy in the office or absence of the chairman of the board, one of the
following officers present in the order stated: the chief executive officer, the
president, the vice presidents in their
14
order of rank and seniority, or a person chosen by a majority of the directors
present, shall act as chairman of the meeting. The secretary or, in the absence
of the secretary, an assistant secretary, or, in the absence of the secretary
and the assistant secretaries, any person appointed by the chairman of the
meeting, shall act as secretary of the meeting.
Section 4.08 Regular Meetings.--Regular meetings of the board of
-------------------
directors shall be held at such time and place as shall be designated from time
to time by resolution of the board of directors.
Section 4.09 Special Meetings.--Special meetings of the board of
-------------------
directors shall be held whenever called by the chairman of the board, the co-
chief executive officers, if there be more than one, or the chief executive
officer, if there be one or by two or more of the directors.
Section 4.10 Quorum of and Action by Directors.
----------------------------------
(a) General Rule.--A majority of the directors in office of the
------------
corporation shall be necessary to constitute a quorum for the transaction of
business and except as otherwise provided in these bylaws the acts of a majority
of the directors present and voting at a meeting at which a quorum is present
shall be the acts of the board of directors.
(b) Action by Written Consent.--Any action required or permitted to be
-------------------------
taken at a meeting of the directors may be taken without a meeting if, prior or
subsequent to the action, a consent or consents thereto by all of the directors
in office is filed with the secretary of the corporation.
(c) Notation of Dissent.--A director who is present at a meeting of the
-------------------
board of directors, or of a committee of the board, at which action on any
corporate matter is taken shall be presumed to have assented to the action taken
unless his or her dissent is entered in the minutes of the meeting or unless the
director files a written dissent to the action with the secretary of the meeting
before the adjournment thereof or transmits the dissent in writing to the
secretary of the corporation immediately after the adjournment of the meeting.
The right to dissent shall not apply to a director who voted in favor of the
action. Nothing in this Section shall bar a director from asserting that minutes
of the meeting incorrectly omitted his or her dissent if, promptly upon receipt
of a copy of such minutes, the director notifies the secretary, in writing, of
the asserted omission or inaccuracy.
Section 4.11 Committees of the Board.
------------------------
(a) Establishment and Powers.--The board of directors may, by resolution
------------------------
adopted by a majority of the directors in office, establish one or more
committees to consist of one or more directors of the corporation. Any
committee, to the extent provided in the resolution of the board of directors,
shall have and may exercise all of the powers and authority of the board of
directors except that a committee shall not have any power or authority as to
the following:
15
(1) The submission to shareholders of any action requiring
approval of shareholders under the Business Corporation Law.
(2) The creation or filling of vacancies in the board of
directors.
(3) The adoption, amendment or repeal of these bylaws.
(4) The amendment or repeal of any resolution of the board that
by its terms is amendable or repealable only by the board.
(5) Action on matters committed by a resolution of the board of
directors to another committee of the board.
(b) Alternate Committee Members.--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 or for the purposes of any
written action by the committee. In the absence or disqualification of a member
and alternate member or members of a committee, the member or members thereof
present at any meeting and not disqualified from voting, whether or not
constituting a quorum, may unanimously appoint another director to act at the
meeting in the place of the absent or disqualified member .
(c) Term.--Each committee of the board shall serve at the pleasure of
----
the board.
(d) Committee Procedures.--The term "board of directors" or "board,"
--------------------
when used in any provision of these bylaws relating to the organization or
procedures of or the manner of taking action by the board of directors, shall be
construed to include and refer to any executive or other committee of the board.
Section 4.12 Compensation.--The board of directors shall have the
------------
authority to fix the compensation of directors for their services as directors
and a director may be a salaried officer of the corporation.
ARTICLE V.
----------
Officers
Section 5.01 Officers Generally.
-------------------
(a) Number, Qualifications and Designation.--Subject to the requirements
--------------------------------------
of Article X hereof, the officers of the corporation shall be a chairman of the
board, president, one or more vice presidents (which term shall include vice
presidents, executive vice presidents and senior vice presidents), a secretary,
a treasurer, and a chief executive officer or two co-chief executive officers,
as the board of directors may designate by resolution, and such other officers
as may be elected in accordance with the provisions of Section 5.03. Officers
may but need not be directors or shareholders of the corporation. The president,
secretary and treasurer shall be natural persons of full age. The board of
directors may elect from among the members of the board a chairman of the board
and vice chairman of the board who shall be officers of the corporation. Any
number of offices may be held by the same person.
16
(b) Bonding.--The corporation may secure the fidelity of any or all of
-------
its officers by bond or otherwise.
Section 5.02 Election, Term of Office and Resignations.
-----------------------------------------
(a) Election and Term of Office.--The officers of the corporation,
---------------------------
except those elected by delegated authority pursuant to Section 5.03, shall be
elected by the board of directors, and each such officer shall hold office at
the discretion of the board until his or her death, resignation or removal with
or without cause.
(b) Resignations.--Any officer may resign at any time upon written
------------
notice to the corporation. The resignation shall be effective upon receipt
thereof by the corporation or at such subsequent time as may be specified in the
notice of resignation.
Section 5.03 Subordinate Officers, Committees and Agents.--The board of
--------------------------------------------
directors may from time to time elect such other officers and appoint such
committees, employees or other agents as the business of the corporation may
require, including without limitation, one or more vice presidents, one or more
assistant secretaries, and one or more assistant treasurers, each of whom shall
hold office for such period, have such authority, and perform such duties as are
provided in these bylaws, or as the board of directors may from time to time
determine. The board of directors may delegate to any officer or committee the
power to elect subordinate officers and to retain or appoint employees or other
agents, or committees thereof, and to prescribe the authority and duties of such
subordinate officers, committees, employees or other agents.
Section 5.04 Removal of Officers and Agents.--Any officer or agent of
------------------------------
the corporation may be removed by the board of directors with or without cause.
The removal shall be without prejudice to the contract rights, if any, of any
person so removed. Election or appointment of an officer or agent shall not of
itself create contract rights.
Section 5.05 Vacancies.--A vacancy in any office because of death,
---------
resignation, removal, disqualification, or any other cause, may be filled by the
board of directors or by the officer or committee to which the power to fill
such office has been delegated pursuant to Section 5.03, as the case may be, and
if the office is one for which these bylaws prescribe a term, shall be filled
for the unexpired portion of the term.
Section 5.06 Authority.
---------
(a) General Rule.--All officers of the corporation, as between
------------
themselves and the corporation, shall have such authority and perform such
duties in the management of the corporation as may be provided by or pursuant to
resolutions or orders of the board of directors or, in the absence of
controlling provisions in the resolutions or orders of the board of directors,
as may be determined by or pursuant to these bylaws.
(b) Chief Executive Officer--Subject to the requirements of Article X
-----------------------
hereof, the board of directors may designate from time to time by resolution a
chief executive officer or two co-chief executive officers. Such chief executive
officers or co-chief executive officers may be, but need not be, the president
or chairman of the board.
17
Section 5.07 Chairman of the Board; Vice Chairman of the Board.--
----------------------------------------------------
Except as otherwise provided by these bylaws, the chairman of the board shall
preside at all meetings of the shareholders and of the board of directors. The
chairman of the board shall perform such other duties as may from time to time
be requested by the board of directors. In addition, the board of directors may
designate by resolution a vice chairman of the board with such duties as may
from time to time be requested by the board of directors.
Section 5.08 The Chief Executive Officer.--The co-chief executive
---------------------------
officers, if there be more than one or, the chief executive officer, if there be
one, may have general supervision over the business and operations of the
corporation, subject however, to the control of the board of directors or the
chairman of the board. Such chief executive officer may sign, execute, and
acknowledge, in the name of the corporation, deeds, mortgages, bonds, contracts
or other instruments, authorized by the board of directors, except in cases
where the signing and execution thereof shall be expressly delegated by the
board of directors, or by these bylaws, to some other officer or agent of the
corporation; and, in general, may perform all duties incident to the office of
chief executive officer and such other duties as from time to time may be
assigned by the board of directors and the chairman of the board.
Section 5.09 The President.--The president may have general supervision
--------------
over the business and operations of the corporation, subject however, to the
control of the board of directors, the chairman of the board and the chief
executive officer or officers, as applicable. The president may sign, execute,
and acknowledge, in the name of the corporation, deeds, mortgages, bonds,
contracts or other instruments, authorized by the board of directors, except in
cases where the signing and execution thereof shall be expressly delegated by
the board of directors, or by these bylaws, to some other officer or agent of
the corporation; and, in general, may perform all duties incident to the office
of president and such other duties as from time to time may be assigned by the
board of directors, the chairman of the board and the chief executive officer or
officers, as applicable.
Section 5.10 The Vice Presidents.--The vice presidents (which term shall
-------------------
include vice presidents, executive vice presidents and senior vice presidents)
shall perform such duties as may from time to time be assigned to them by the
board of directors or by the chief executive officer or, if there be more than
one, by the co-chief executive officers.
Section 5.11 The Secretary.--The secretary or an assistant secretary
-------------
shall attend all meetings of the shareholders and of the board of directors and
shall record all the votes of the shareholders and of the directors and the
minutes of the meetings of the shareholders and of the board of directors and of
committees of the board in a book or books to be kept for that purpose; shall
see that notices are given and records and reports properly kept and filed by
the corporation as required by law; shall be the custodian of the seal of the
corporation and see that it is affixed to all documents to be executed on behalf
of the corporation under its seal; and, in general, shall perform all duties
incident to the office of secretary, and such other duties as may from time to
time be assigned by the board of directors or by the chief executive officer or,
if there be more than one, by the co-chief executive officers.
18
Section 5.12 The Treasurer.--The treasurer or an assistant treasurer
-------------
shall have or provide for the custody of the funds or other property of the
corporation; shall collect and receive or provide for the collection and receipt
of moneys earned by or in any manner due to or received by the corporation;
shall deposit all funds in his, or its custody as treasurer in such banks or
other places of deposit as the board of directors may from time to time
designate; shall, whenever so required by the board of directors, render an
account showing all transactions as treasurer, and the financial condition of
the corporation; and, in general, shall discharge such other duties as may from
time to time be assigned by the board of directors or by the chief executive
officer or, if there be more than one, by the co-chief executive officers.
Section 5.13 Salaries.--The salaries of the officers elected by the
--------
board of directors shall be fixed from time to time by the board of directors or
by such officer as may be designated by resolution of the board. The salaries or
other compensation of any other officers, employees and other agents shall be
fixed from time to time by the officer or committee to which the power to elect
such officers or to retain or appoint such employees or other agents has been
delegated pursuant to Section 5.03. No officer shall be prevented from receiving
such salary or other compensation by reason of the fact that the officer is also
a director of the corporation
ARTICLE VI.
-----------
Certificates of Stock, Transfer, Etc.
Section 6.01 Share Certificates.
-------------------
(a) Form of Certificates.--Certificates for shares of the corporation
--------------------
shall be in such form as approved by the board of directors, and shall state
that the corporation is incorporated under the laws of the Commonwealth of
Pennsylvania, the name of the person to whom issued, and the number and class of
shares and the designation of the series (if any) that the certificate
represents. Certificates for shares of the corporation shall set forth upon the
face or back of the certificate (or shall state on the face or back of the
certificate that the corporation will furnish to any shareholder upon request
and without charge), a full or summary statement of the designations, voting
rights, preferences, limitations and special rights of the shares of each class
or series authorized to be issued so far as they have been fixed and determined
and the authority of the board of directors to fix and determine the
designations, voting rights, preferences, limitations and special rights of the
classes and series of shares of the corporation.
(b) Share Register.--The share register or transfer books and blank
--------------
share certificates shall be kept by the treasurer or by any transfer agent or
registrar designated by the board of directors for that purpose.
Section 6.02 Issuance.--The share certificates of the corporation shall
--------
be numbered and registered in the share register or transfer books of the
corporation as they are issued. They shall be executed in such manner as the
board of directors shall determine.
Section 6.03 Transfer.--Transfers of shares shall be made on the share
--------
register or transfer books of the corporation upon surrender of the certificate
therefor, endorsed
19
by the person named in the certificate or by an attorney lawfully constituted in
writing. No transfer shall be made inconsistent with the provisions of the
Uniform Commercial Code, 13 Pa.C.S. (S)(S) 8101 et seq., and its amendments and
supplements.
Section 6.04 Record Holder of Shares.--The corporation shall be
-----------------------
entitled to treat the person in whose name any share or shares of the
corporation stand on the books of the corporation as the absolute owner thereof,
and shall not be bound to recognize any equitable or other claim to, or interest
in, such share or shares on the part of any other person.
Section 6.05 Lost, Destroyed or Mutilated Certificates.--The holder of
-----------------------------------------
any shares of the corporation shall immediately notify the corporation of any
loss, destruction or mutilation of the certificate therefor, and the officers of
the corporation may, in their discretion, cause a new certificate or
certificates to be issued to such holder, in case of mutilation of the
certificate, upon the surrender of the mutilated certificate or, in case of loss
or destruction of the certificate, upon satisfactory proof of such loss or
destruction and, if such officers shall so determine, the deposit of a bond in
such form and in such sum, and with such surety or sureties, as any of them may
direct.
ARTICLE VII.
------------
Indemnification of Directors, Officers and
Other Authorized Representatives
Section 7.01 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
claim, 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 or an officer 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
permitted or required by the Business 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 such law permitted the corporation to provide prior to such
amendment), 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; provided, however, that, except as provided in Section 7.03 of this
Article VII 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.
Section 7.02 Right to Advancement of Expenses. The right to
--------------------------------
indemnification conferred in Section 7.01 of this Article VII shall include the
right to be paid by the corporation the expenses (including, without limitation,
attorneys' fees and expenses) incurred in defending any such proceeding in
advance of its final disposition (hereinafter
20
an "advancement of expenses"); provided, however, that, if the Business
Corporation Law so 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
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
Section 7.02 or otherwise. The rights to indemnification and to the advancement
of expenses conferred in Sections 7.01 and 7.02 of this Article VII shall be
contract rights and such rights 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. Any repeal,
amendment or modification hereof shall be prospective only and shall not affect
any rights or obligations then existing. Each person who shall act as an
indemnitee of the corporation shall be deemed to be doing so in reliance upon
the rights provided by this Article.
Section 7.03 Right of Indemnitee to Bring Suit. If a claim under
---------------------------------
Section 7.01 or 7.02 of this Article VII is not paid in full by the corporation
within 60 calendar 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 20 calendar 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 (i) 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, and (ii) any suit brought 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 Business Corporation Law. Neither the failure of the corporation
(including its board of directors, independent legal counsel or shareholders) 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 Business
Corporation Law, nor an actual determination by the corporation (including its
board of directors, independent legal counsel or shareholders) 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 brought 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.
21
Section 7.04 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 articles, these bylaws, agreement, vote of shareholders or
disinterested directors or otherwise.
Section 7.05 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 Business Corporation Law.
Section 7.06 Indemnification of Employees and Agents of the Corporation.
----------------------------------------------------------
The corporation may, to the extent authorized from time to time by the board of
directors, grant rights to indemnification and to the advancement of expenses to
any employee or agent of the corporation to the fullest extent of the provisions
of this Article VII with respect to the indemnification and advancement of
expenses of directors and officers of the corporation.
Section 7.07 Interpretation.--The provisions of this Article are
--------------
intended to constitute bylaws authorized by Section 1746 of the Business
Corporation Law.
ARTICLE VIII.
-------------
Emergency Bylaws
Section 8.01 Scope of Article.--This Article shall be applicable during
----------------
any emergency resulting from a catastrophe as a result of which a quorum of the
board of directors cannot readily be assembled. To the extent not in conflict
with this Article, these bylaws shall remain in effect during the emergency.
Section 8.02 Special Meetings of the Board.--A special meeting of the
-----------------------------
board of directors may be called by any director by means feasible at the time.
Section 8.03 Emergency Committee of the Board.
--------------------------------
(a) Composition.--The emergency committee of the board shall consist of
-----------
nine persons standing highest on the following list who are available and able
to act:
The chief executive officer or, if there be more than one, the co-chief
executive officers.
Members of the board of directors.
President.
The individual who, immediately prior to the emergency, was the senior
officer in charge of nuclear operations.
The individual who, immediately prior to the emergency, was the senior
officer in charge of other operations.
The individual who, immediately prior to the emergency, was the senior
officer in charge of finance operations.
Other officers.
22
Where more than one person holds any of the listed ranks, the order of
precedence shall be determined by length of time in rank. Each member of the
emergency committee thus constituted shall continue to act until replaced by an
individual standing higher on the list. The emergency committee shall continue
to act until a quorum of the board of directors is available and able to act.
If the corporation has no directors, the emergency committee shall cause a
special meeting of shareholders for the election of directors to be called and
held as soon as practicable.
(b) Powers.--The emergency committee shall have and may exercise all of
------
the powers and authority of the board of directors, including the power to fill
a vacancy in any office of the corporation or to designate a temporary
replacement for any officer of the corporation who is unavailable, but shall not
have the power to fill vacancies in the board of directors.
(c) Quorum.--A majority of the members of the emergency committee in
------
office shall constitute a quorum.
(d) Status.--Each member of the emergency committee who is not a
------
director shall during his or her service as such be entitled to the rights and
immunities conferred by law, the articles and these bylaws upon directors of the
corporation and upon persons acting in good faith as a representative of the
corporation during an emergency.
ARTICLE IX.
-----------
Miscellaneous
Section 9.01 Corporate Seal.--The corporation may have a corporate seal
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in the form of a circle containing the name of the corporation, the year of
incorporation and such other details as may be approved by the board of
directors from time to time.
Section 9.02 Checks.--All checks, notes, bills of exchange or other
------
orders in writing shall be signed by such person or persons as the board of
directors or any person authorized by resolution of the board of directors may
from time to time designate.
Section 9.03 Contracts.--Except as otherwise provided in the Business
---------
Corporation Law in the case of transactions that require action by the
shareholders, the board of directors may authorize any officer or agent to enter
into any contract or to execute or deliver any instrument on behalf of the
corporation, and such authority may be general or confined to specific
instances.
Section 9.04 Interested Directors or Officers; Quorum.
----------------------------------------
(a) General Rule.--A contract or transaction between the corporation and
------------
one or more of its directors or officers or between the corporation and another
domestic or foreign corporation for profit or not-for-profit, partnership, joint
venture, trust or other enterprise in which one or more of its directors or
officers are directors or officers or have a financial or other interest, shall
not be void or voidable solely for that reason, or solely because the director
or officer is present at or participates in the meeting of the
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board of directors that authorizes the contract or transaction, or solely
because his, her or their votes are counted for that purpose, if:
(1) the material facts as to the relationship or interest and as
to the contract or transaction are disclosed or are known to the
board of directors and the board authorizes the contract or
transaction by the affirmative votes of a majority of the
disinterested directors even though the disinterested directors are
less than a quorum;
(2) the material facts as to his or her relationship or interest
and as to the contract or transaction are disclosed or are known to
the shareholders entitled to vote thereon and the contract or
transaction is specifically approved in good faith by vote of those
shareholders; or
(3) the contract or transaction is fair as to the corporation as
of the time it is authorized, approved or ratified by the board of
directors or the shareholders.
(b) Quorum.--Common or interested directors may be counted in
------
determining the presence of a quorum at a meeting of the board which authorizes
a contract or transaction specified in Subsection (a).
Section 9.05 Deposits.--All funds of the corporation shall be deposited
--------
from time to time to the credit of the corporation in such banks, trust
companies or other depositories as the board of directors may approve or
designate, and all such funds shall be withdrawn only upon checks signed by such
one or more officers or employees as the board of directors shall from time to
time determine.
Section 9.06 Corporate Records.
-----------------
(a) Required Records.--The corporation shall keep complete and accurate
----------------
books and records of account, minutes of the proceedings of the incorporators,
shareholders and directors and a share register giving the names and addresses
of all shareholders and the number and class of shares held by each. The share
register shall be kept at either the registered office of the corporation in the
Commonwealth of Pennsylvania or at its principal place of business wherever
situated or at the office of its registrar or transfer agent. Any books, minutes
or other records may be in written form or any other form capable of being
converted into written form within a reasonable time.
(b) Right of Inspection.--Every shareholder shall, upon written verified
-------------------
demand stating the purpose thereof, have a right to examine, in person or by
agent or attorney, during the usual hours for business for any proper purpose,
the share register, books and records of account, and records of the proceedings
of the incorporators, shareholders and directors and to make copies or extracts
therefrom. A proper purpose shall mean a purpose reasonably related to the
interest of the person as a shareholder. In every instance where an attorney or
other agent is the person who seeks the right of inspection, the demand shall be
accompanied by a verified power of attorney or other writing that authorizes the
attorney or other agent to so act on behalf of the shareholder. The demand shall
be directed to the corporation at its registered office in the Commonwealth of
Pennsylvania or at its principal place of business wherever situated.
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Section 9.07 Amendment of Bylaws.
-------------------
(a) General Rule.--Except as otherwise provided in the express terms of
------------
any series of the shares of the corporation, any one or more of the foregoing
bylaws and, except as otherwise stated in this Section 9.07(a), any other bylaws
made by the board of directors or shareholders may be altered or repealed by the
board of directors. The shareholders or the board of directors may adopt new
bylaws except that the board of directors may not adopt, alter or repeal bylaws
that the Business Corporation Law specifies may be adopted only by shareholders,
and the board of directors may not alter or repeal any bylaw adopted by the
shareholders that presumes that such bylaw shall not be altered or repealed by
the board of directors.
(b) Effective Date.--Any change in these bylaws shall take effect when
--------------
adopted unless otherwise provided in the resolution effecting the change.
ARTICLE X.
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Governance of the Corporation During the Transition Period
Section 10.01 Definitions. For purposes of this Article:
-------------------------------------------
(1) "PECO CEO" means Corbin A. McNeill, Jr.
(2) "PECO Directors" means (i) those directors of the
corporation designated by PECO Energy pursuant to Section 1.06(b)
of the Merger Agreement and (ii) any Replacement PECO Director (as
defined in Section 10.03(b) of these by-laws).
(3) "PECO Energy" means PECO Energy Company, a Pennsylvania
corporation and a subsidiary of the corporation.
(4) "Independent Director" means a disinterested, independent
person (determined in accordance with customary standards for
independent directors applicable to U.S. public companies).
(5) "Merger Agreement" means the Amended and Restated Agreement
and Plan of Exchange and Merger dated as of September 22, 1999,
amended and restated as of January 7, 2000, among PECO Energy, the
corporation and Unicom.
(6) "Merger Effective Time" shall have the meaning assigned to
such term in the Merger Agreement.
(7) "Transition Period" means the period from the Merger
Effective Time until December 31, 2003.
(8) "Unicom" means Unicom Corporation, an Illinois corporation.
(9) "Unicom CEO" means John W. Rowe.
(10) "Unicom Directors" means (i) those directors of the
corporation designated by Unicom pursuant to Section 1.06(b) of the
Merger Agreement and
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(ii) any Replacement Unicom Director (as defined in Section 10.03(b) of
these by-laws) .
(11) "ComEd" means Commonwealth Edison Company, an Illinois corporation
and a subsidiary of the corporation.
Section 10.02 Corporate Offices. At least for the duration of the
-----------------
Transition Period, the corporation shall maintain (a) in Chicago, Illinois
offices serving as its corporate headquarters, (b) in southeastern Pennsylvania
offices serving as the headquarters of the generation and power marketing
businesses of the corporation and its subsidiaries, and (c) offices in Chicago,
Illinois and southeastern Pennsylvania as the headquarters of ComEd and PECO
Energy, respectively.
Section 10.03 Board of Directors.
------------------
(a) Effective immediately at the Merger Effective Time and during the
Transition Period, the board of directors shall consist of sixteen (16)
directors. At the Merger Effective Time, 8 directors shall be PECO Directors and
8 directors shall be Unicom Directors. The term of a class of the board of
directors comprised of 6 directors shall expire at the first annual meeting of
shareholders following the Merger Effective Time, a second class comprised of 5
directors shall expire at the second annual meeting of shareholders following
the Merger Effective Time and a third class comprised of 5 directors shall
expire at the third annual meeting of shareholders following the Merger
Effective Time, and representation of PECO Directors and Unicom Directors in
each class shall be as nearly equal in numbers as possible.
(b) (i) During the Transition Period the board of directors of the
corporation shall consist of equal numbers of PECO Directors and Unicom
Directors.
(ii) During the Transition Period, the board of directors
(subject to the fiduciary duties of the directors in the case of approval
of any individual) shall take all action necessary to ensure that any
vacancy of a position on the board of directors to be filled by the Board
(A) that was held by an PECO Director is filled promptly by a person
designated to fill such seat by a majority of the PECO Directors remaining
on the board of directors (a "Replacement PECO Director") and (B) that was
held by a Unicom Director is filled promptly by a person designated to fill
such seat by a majority of the Unicom Directors remaining on the board of
directors (a "Replacement Unicom Director").
(iii) With respect to each election of directors by shareholders
during the Transition Period, the board of directors or the applicable
committee thereof shall nominate for election (subject to the fiduciary
duties of the directors in the case of approval of any individual), a PECO
Director to fill any position held prior to such election by a PECO
Director and a Unicom Director to fill any position held prior to such
election by a Unicom Director.
(c) During the Transition Period, the executive committee of the board
of directors shall have 6 members, 2 of which will be the Co-Chief Executive
Officers of the corporation (or if either Co-Chief Executive Officer ceases to
serve as such, another officer of the corporation selected by the PECO Directors
in the case of a replacement
26
for the PECO CEO or by the Unicom Directors in the case of a replacement for the
Unicom CEO), 2 of which shall be Independent Directors who are PECO Directors
and 2 of which shall be Independent Directors who are Unicom Directors. For the
duration of the first half of the Transition Period so long as he is a Co-Chief
Executive Officer, the Unicom CEO shall be the chairman of the executive
committee of the board of directors, and as of the first day of the second half
of the Transition Period, the PECO CEO, if he is a Co-Chief Executive Officer at
such time, shall succeed to such position and hold it for the duration of the
Transition Period. If at any time during the Transition Period either the Unicom
CEO or the PECO CEO, whichever is at such time the chairman of the executive
committee, is unwilling or unable to hold such office, the other shall succeed
to such office for the duration of the Transition Period if he continues at such
time to hold the office of Co-Chief Executive Officer or Chief Executive Officer
of the corporation.
(d) During the Transition Period, each other committee of the Board
shall consist of equal numbers of PECO Directors and Unicom Directors and the
chairmen of the committees of the board of directors (other than the executive
committee) shall be PECO Directors and Unicom Directors in as nearly equal
numbers as possible.
(e) During the Transition Period, the board of directors shall hold
between 6 and 8 regular meetings each fiscal year, with no less than 2 of such
meetings each year to be held in the Philadelphia, Pennsylvania area and no less
than 2 of such meetings each year to be held in the Chicago, Illinois area.
Section 10.04 Chairman of the Board of Directors.
------------------------------------
(a) As of the Merger Effective Time and for the duration of the first
half of the Transition Period so long as he is a Co-Chief Executive Officer or
Chief Executive Officer at such time, the PECO CEO shall hold the position of
Chairman of the board of directors, and so long as he is a Co-Chief Executive
Officer or the Chief Executive Officer at such time, the Unicom CEO shall
succeed to the position of Chairman of the board of directors and hold it for
the duration of the Transition Period. If at any time during the Transition
Period either the PECO CEO or the Unicom CEO, whichever is at such time the
Chairman of the board of directors, is unwilling or unable to hold such office,
the board of directors shall elect the other to such office if he continues to
hold the office of Co-Chief Executive Officer of the Corporation at such time.
(b) The Chairman shall chair all meetings of the board of directors and
stockholders at which he is present.
Section 10.05 Co-Chief Executive Officers; President.
--------------------------------------
(a) (i) As of the Merger Effective Time and for the duration of the
Transition Period, each of the PECO CEO and the Unicom CEO shall hold the
position of Co-Chief Executive Officers of the corporation and (ii) as of the
Merger Effective Date and for the duration of the first half of the Transition
Period, the Unicom CEO shall hold the position of President of the corporation.
If at any time during the Transition Period either of the Co-Chief Executive
Officers is unable or unwilling to hold such office, the other Co-Chief
Executive Officer, if he is either the PECO CEO or the Unicom CEO, shall become
the sole Chief Executive Officer of the corporation. The Unicom CEO shall become
the sole
27
Chief Executive Officer immediately prior to the end of the Transition Period if
immediately prior to such time he holds the position of Co- Chief Executive
Officer.
(b) The corporation's generation and wholesale marketing and trading
businesses shall report to the PECO CEO in his capacity as a Co-Chief Executive
Officer, and the corporation's transmission and distribution and unregulated
ventures businesses shall report to the Unicom CEO in his capacity as a Co-Chief
Executive Officer. The corporation's financial, legal, human resources and other
staff functions shall report to the office of the Co-Chief Executive Officers.
(c) The Co-Chief Executive Officers shall each maintain offices in both
southeastern Pennsylvania and Chicago, Illinois.
Section 10.06 Management Changes.
------------------
(a) Until the expiration of the Transition Period, so long as either the
PECO CEO or the Unicom CEO is a Co-Chief Executive Officer or the Chief
Executive Officer of the corporation, (i) the election of any other person to
the position of Chairman of the board of directors, chairman of the executive
committee of the board of directors, Co-Chief Executive Officer or Chief
Executive Officer or, as to the first half of the Transition Period, President
or (ii) the removal, replacement or demotion of the PECO CEO or the Unicom CEO
from one or more of such positions, in each case, shall require the affirmative
vote of at least two-thirds of the members of the board of directors(except as
expressly provided in this Article X).
(b) Until the expiration of the Transition Period, none of the senior
officers of the corporation specified in Exhibit D of the Merger Agreement shall
be removed, replaced or demoted without either (i) the consent of both Co-Chief
Executive Officers or (ii) the affirmative vote of two-thirds of the members of
the Newco Board.
Section 10.07 Amendment. Until the end of the Transition Period (a)
---------
the provisions of this Article X may not be amended, altered, repealed or waived
in any respect, and the board of directors or the corporation shall not
otherwise take any action or fail to take any action which would have the effect
of eliminating, limiting, restricting, avoiding or otherwise modifying the
effect of, or waiving compliance with the provisions of this Article X (e.g., by
creating a holding company structure if the certificate of incorporation, by-
laws or similar document of such holding company does not contain equivalent
provisions), without the affirmative vote of at least two-thirds of the
directors or (b) in the case of any amendment proposed by shareholders without
such vote of directors, the affirmative vote of holders of shares representing
at least two-thirds of the votes eligible to be cast in a general election of
directors.
Section 10.08 Successors. For the duration of the Transition Period, the
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provisions of this Article shall be applicable to (i) any successor to the
corporation as the result of a merger, consolidation or other business
combination, whether or not the corporation is the surviving company in such
transaction, or otherwise and (ii) any corporation or other entity with respect
to which the corporation or its successor is or becomes a direct or indirect
subsidiary, and, in each case, the board of directors shall not permit the
corporation to be a party to any transaction which would not comply with the
foregoing without the affirmative vote of at least two-thirds of the directors.
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Section 10.09 Effectiveness of this Article X. The provisions of this
-------------------------------
Article X shall become null and void and be of no further effect after the
Transition Period. While this Article X is effective if there is a conflict
between this Article X and any other provision of these bylaws, this Article X
shall control.
As adopted _____________, _____.
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