BY-LAWS
OF
NEW AVALON, INC.
A CALIFORNIA CORPORATION
ARTICLE I
OFFICES
Section 1. PRINCIPAL OFFICE. The principal office for the
transaction of business of the corporation is hereby fixed and located at 17835
Ventura Boulevard, Suite 208, City of Encino, County of Los Angeles, State of
California. The location may be changed by approval of a majority of the
authorized Directors, and additional offices may be established and maintained
at such other place or places, either within or without California, as the Board
of Directors may from time to time designate.
Section 2. OTHER OFFICES. Branch or subordinate offices may at
any time be established by the Board of Directors at any place or places where
the corporation is qualified to do business.
ARTICLE II
DIRECTORS - MANAGEMENT
Section 1. RESPONSIBILITY OF BOARD OF DIRECTORS. Subject to
the provisions of the General Corporation Law and to any limitations in the
Articles of Incorporation of the corporation relating to action required to be
approved by the Shareholders, as that term is defined in Section 153 of the
California Corporations Code, or by the outstanding shares, as that term is
defined in Section 152 of the Code, the business and affairs of the corporation
shall be managed and all corporate powers shall be exercised by or under the
direction of the Board of Directors. The Board may delegate the management of
the day-to-day operation of the business of the corporation to a management
company or other person, provided that the business and affairs of the
corporation shall be managed and all corporate powers shall be exercised under
the ultimate direction of the Board.
Section 2. STANDARD OF CARE. Each Director shall perform the
duties of a Director, including the duties as a member of any committee of the
Board upon which the Director may serve, in good faith, in a manner such
Director believes to be in the best interests of the corporation, and with such
care, including reasonable inquiry, as an ordinary prudent person in a like
position would use under similar circumstances. (Sec. 309)
Section 3. EXCEPTION FOR CLOSE CORPORATION. Notwithstanding
the provisions of Section 1, in the event that this corporation shall elect to
become a close corporation as defined in Sec. 186, its Shareholders may enter
into a Shareholders' Agreement as provided in Sec. 300 (b). Said agreement may
provide for the exercise of corporate powers and the management of the business
and affairs of this corporation by the Shareholders, provided, however, such
agreement shall, to the extent and so long as the discretion or the powers of
the Board in its management of corporate affairs is controlled by such
agreement, impose upon each Shareholder who is a party thereof, liability for
managerial acts performed or omitted by such person pursuant thereto otherwise
imposed upon Directors as provided in Sec. 300 (d).
Section 4. NUMBER AND QUALIFICATION OF DIRECTORS. The
authorized number of Directors shall be four (4 ) until changed by a duly
adopted amendment to the Articles of Incorporation or by an amendment to this
by-law adopted by the vote or written consent of holders of a majority of the
outstanding shares entitled to vote, as provided in Sec.
212.
Section 5. ELECTION AND TERM OF OFFICE OF DIRECTORS. Directors
shall be elected at each annual meeting of the Shareholders to hold office until
the next annual meeting. Each Director, including a Director elected to fill a
vacancy, shall hold office until the expiration of the term for which elected
and until a successor has been elected and qualified.
Section 6. VACANCIES. Vacancies in the Board of Directors may
be filled by a majority of the remaining Directors, though less than a quorum,
or by a sole remaining Director, except that a vacancy created by the removal of
a Director by the vote or written consent of the Shareholders or by court order
may be filled only by the vote of a majority of the shares entitled to vote
represented at a duly held meeting at which a quorum is present, or by the
written consent of holders of a majority of the outstanding shares entitled to
vote. Each Director so elected shall hold office until the next annual meeting
of the Shareholders and until a successor has been elected and qualified.
A vacancy or vacancies in the Board of Directors shall be
deemed to exist in the event of the death, resignation, or removal of any
Director, or if the Board of Directors by re solution declares vacant the office
of a Director who has been declared of unsound mind by an order of court or
convicted of a felony, or if the authorized number of Directors is increased, or
if the shareholders fail, at any meeting of shareholders at which any Director
or Directors are elected, to elect the number of Directors to be voted for at
that meeting.
The Shareholders may elect a Director or Directors at any time
to fill any vacancy or vacancies not filled by the Directors, but any such
election by written consent shall require the consent of a majority of the
outstanding shares entitled to vote.
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Any Director may resign effective on giving written notice to
the Chairman of the Board, the President, the Secretary, or the Board of
Directors, unless the notice specifies a later time for that resignation to
become effective. If the resignation of a Director is effective at a future
time, the Board of Directors may elect a successor to take office when the
resignation becomes effective.
No reduction of the authorized number of Directors shall have
the effect of removing any Director before that Director's term of office
expires.
Section 7. REMOVAL OF DIRECTORS. The entire Board of Directors
or any individual Director may be removed from office as provided by Secs. 302,
303 and 304 of the Corporations Code of the State of California. In such case,
the remaining Board members may elect a successor Director to fill such vacancy
for the remaining unexpired term of the Director so removed.
Section 8. NOTICE, PLACE AND MANNER OF MEETINGS. Meetings of
the Board of Directors may be called by the Chairman of the Board, or the
President, or any Vice President, or the Secretary, or any two (2) Directors and
shall be held at the principal executive office of the corporation, unless some
other place is designated in the notice of the meeting. Members of the Board may
participate in a meeting through use of a conference telephone or similar
communications equipment so long as all members participating in such a meeting
can hear one another. Accurate minutes of any meeting of the Board or any
committee thereof, shall be maintained as required by Sec. 312 of the Code by
the Secretary or other Officer designated for that purpose.
Section 9. ORGANIZATION MEETINGS. The organization meetings of
the Board of Directors shall be held immediately following the adjournment of
the annual meetings of the Shareholders.
Section 10. OTHER REGULAR MEETINGS. Regular meetings of the
Board of Directors shall be held at the corporate offices, or such other place
as may be designated by the Board of Directors, as follows:
Time of Regular Meeting: 10:00 a.m.
Date of Regular Meeting: June lst
If said day shall fall upon a holiday, such meetings shall be
held on the next succeeding business day thereafter. No notice need be given of
such regular meetings.
Section 11. SPECIAL MEETINGS - NOTICES - WAIVERS. Special
meetings of the Board may be called at any time by the President or, if he or
she is absent or unable or refuses to act, by any Vice President or the
Secretary or by any two (2) Directors, or by one (1) Director if only one is
provided.
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At least forty-eight (48) hours notice of the time and place
of special meetings shall be delivered personally to the Directors or personally
communicated to them by a corporate Officer by telephone or telegraph. If the
notice is sent to a Director by letter, it shall be addressed to him or her at
his or her address as it is shown upon the records of the corporation, or if it
is not so shown on such records or is not readily ascertainable, at the place in
which the meetings of the Directors are regularly held. In case such notice is
mailed, it shall be deposited in the United States mail, postage prepaid, in the
place in which the principal executive office of the corporation is located at
least four (4) days prior to the time of the holding of the meeting. Such
mailing, telegraphing, telephoning or delivery as above provided shall be due,
legal and personal notice to such Director.
When all of the Directors are present at any Directors'
meeting, however called or noticed, and either (i) sign a written consent
thereto on the records of such meeting, or, (ii) if a majority of the Directors
are present and if those not present sign a waiver of notice of such meeting or
a consent to holding the meeting or an approval of the minutes thereof, whether
prior to or after the holding of such meeting, which said waiver, consent or
approval shall be filed with the Secretary of the corporation, or, (iii) if a
Director attends a meeting without notice but without protesting, prior thereto
or at its commencement, the lack of notice, then the transactions thereof are as
valid as if had at a meeting regularly called and noticed.
Section 12. SOLE DIRECTOR PROVIDED BY ARTICLES OF
INCORPORATION OR BY-LAWS. In the event only one (1) Director is required by the
By-Laws or Articles of Incorporation, then any reference herein to notices,
waivers, consents, meetings or other actions by a majority or quorum of the
Directors shall be deemed to refer to such notice, waiver, etc., by such sole
Director, who shall have all the rights and duties and shall be entitled to
exercise all of the powers and shall assume all the responsibilities otherwise
herein described as given to a Board of Directors.
Section 13. DIRECTORS ACTION BY UNANIMOUS WRITTEN CONSENT. Any
action required or permitted to be taken by the Board of Directors may be taken
without a meeting and with the same force and effect as if taken by a unanimous
vote of Directors, if authorized by a writing signed individually or
collectively by all members of the Board. Such consent shall be filed with the
regular minutes of the Board.
Section 14. QUORUM. A majority of the number of Directors as
fixed by the Articles of Incorporation or By-Laws shall be necessary to
constitute a quorum for the transaction of business, and the action of a
majority of the Directors present at any meeting at which there is a quorum,
when duly assembled, is valid as a corporate act; provided that a minority of
the Directors, in the absence of a quorum, may adjourn from time to time, but
may not transact any business. A meeting at which a quorum is initially present
may continue to transact business, notwithstanding the withdrawal of Directors,
if any action taken is approved by a majority of the required quorum for such
meeting.
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Section 15. NOTICE OF ADJOURNMENT. Notice of the time and
place of holding an adjourned meeting need not be given to absent Directors if
the time and place be fixed at the meeting adjourned and held within twenty-four
(24) hours, but if adjourned more than twenty-four (24) hours, notice shall be
given to all Directors not present at the time of the adjournment.
Section 16. COMPENSATION OF DIRECTORS. Directors, as such,
shall not receive any stated salary for their services, but by resolution of the
Board a fixed sum and expense of attendance, if any, may be allowed for
attendance at each regular and special meeting of the Board; provided that
nothing herein contained shall be construed to preclude any Director from
serving the corporation in any other capacity and receiving compensation
therefor.
Section 17. COMMITTEES. Committees of the Board may be
appointed by resolution passed by a majority of the whole Board. Committees
shall be composed of two (2) or more members of the Board, and shall have such
powers of the Board as may be expressly delegated to it by resolution of the
Board of Directors, except those powers expressly made non-delegable by Sec.
311.
Section 18. ADVISORY DIRECTORS. The Board of Directors from
time to time may elect one or more persons to be Advisory Directors who shall
not by such appointment be members of the Board of Directors. Advisory Directors
shall be available from time to time to perform special assignments specified by
the President, to attend meetings of the Board of Directors upon invitation and
to furnish consultation to the Board. The period during which the title shall be
held may be prescribed by the Board of Directors. If no period is prescribed,
the title shall be held at the pleasure of the Board.
Section 19. RESIGNATIONS. Any Director may resign effective
upon giving written notice to the Chairman of the Board, the President, the
Secretary or the Board of Directors of the corporation, unless the notice
specifies a later time for the effectiveness of such resignation. If the
resignation is effective at a future time, a successor may be elected to take
office when the resignation becomes effective.
ARTICLE III
OFFICERS
Section 1. OFFICERS. The Officers of the corporation shall be
a President, a Secretary, and a Chief Financial Officer. The corporation may
also have, at the discretion of the Board of Directors, a Chairman of the Board,
one or more Vice Presidents, one or more Assistant Secretaries, one or more
Assistant Treasurers, and such other Officers as may be appointed in accordance
with the provisions of Section 3 of this Article III. Any number of offices may
be held by the same person.
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Section 2. ELECTION. The Officers of the corporation, except
such Officers as may be appointed in accordance with the provisions of Section 3
or Section 5 of this Article, shall be chosen annually by the Board of
Directors, and each shall hold office until he or she shall resign or shall be
removed or otherwise disqualified to serve, or a successor shall be elected and
qualified.
Section 3. SUBORDINATE OFFICERS, ETC. The Board of Directors
may appoint such other Officers as the business of the corporation may require,
each of whom shall hold office for such period, have such authority and perform
such duties as are provided in the By-Laws or as the Board of Directors may from
time to time determine.
Section 4. REMOVAL AND RESIGNATION OF OFFICERS. Subject to the
rights, if any, of an officer under any contract of employment, any Officer may
be removed, either with or without cause, by the Board of Directors, at any
regular or special meeting of the Board, or, except in case of an Officer chosen
by the Board of Directors, by any officer upon whom such power of removal may be
conferred by the Board of Directors.
Any Officer may resign at any time by giving written notice to
the corporation. Any resignation shall take effect at the date of the receipt of
that notice or at any later time specified in that notice; and, unless otherwise
specified in that notice, the acceptance of the resignation shall not be
necessary to make it effective. Any resignation is without prejudice to the
rights, if any, of the corporation under any contract to which the Officer is a
party.
Section 5. VACANCIES. A vacancy in any office because of
death, resignation, removal, disqualification or any other cause shall be filled
in the manner prescribed in the ByLaws for regular appointments to that office.
Section 6. CHAIRMAN OF THE BOARD. The Chairman of the Board,
if such an officer be elected, shall, if present, preside at meetings of the
Board of Directors and exercise and perform such other powers and duties as may
be from time to time assigned by the Board of Directors or prescribed by the
By-Laws. If there is no President, the Chairman of the Board shall in addition
be the Chief Executive officer of the corporation and shall have the powers and
duties prescribed in Section 7 of this Article III.
Section 7. PRESIDENT. Subject to such supervisory powers, if
any, as may be given by the Board of Directors to the Chairman of the Board, if
there be such an Officer, the President shall be the Chief Executive Officer of
the corporation and shall, subject to the control of the Board of Directors,
have general supervision, direction and control of the business and Officers of
the corporation. He or she shall preside at all meetings of the Shareholders and
in the absence of the Chairman of the Board, or if there be none, at all
meetings of the Board of Directors. The President shall be ex officio a member
of all the standing committees, including the Executive Committee, if any, and
shall have the general powers and duties of management
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usually vested in the office of President of a corporation, and shall have such
other powers and duties as may be prescribed by the Board of Directors or the
By-Laws.
Section 8. VICE PRESIDENT. In the absence or disability of the
President, the Vice Presidents, if any, in order of their rank as fixed by the
Board of Directors, or if not ranked, the Vice President designated by the Board
of Directors, shall perform all the duties of the President, and when so acting
shall have all the powers of, and be subject to, all the restric tions upon, the
President. The Vice Presidents shall have such other powers and perform such
other duties as from time to time may be prescribed for them respectively by the
Board of Directors or the By-Laws.
Section 9. SECRETARY. The Secretary shall keep, or cause to be
kept, a book of minutes at the principal office or such other place as the Board
of Directors may order, of all meetings of Directors and Shareholders, with the
time and place of holding, whether regular or special, and if special, how
authorized, the notice thereof given, the names of those present at Directors'
meetings, the number of shares present or represented at Shareholders' meetings
and the proceedings thereof.
The Secretary shall keep, or cause to be kept, at the
principal office or at the office of the corporation's transfer agent, a share
register, or duplicate share register, showing the names of the Shareholders and
their addresses; the number and classes of shares held by each; the number and
date of certificates issued for the same; and the number and date of
cancellation of every certificate surrendered for cancellation.
The Secretary shall give, or cause to be given, notice of all
the meetings of the Shareholders and of the Board of Directors required by the
By-Laws or by law to be given. He or she shall keep the seal of the corporation
in safe custody, and shall have such other powers and perform such other duties
as may be prescribed by the Board of Directors or by the By-Laws.
Section 10. CHIEF FINANCIAL OFFICER. The Chief Financial
Officer shall keep and maintain, or cause to be kept and maintained in
accordance with generally accepted accounting principles, adequate and correct
accounts of the properties and business transactions of the corporation,
including accounts of its assets, liabilities, receipts, disbursements, gains,
losses, capital, earnings (or surplus) and shares. The books of account shall at
all reasonable times be open to inspection by any Director.
This Officer shall deposit all moneys and other valuables in
the name and to the credit of the corporation with such depositaries as may be
designated by the Board of Directors. He or she shall disburse the funds of the
corporation as may be ordered by the Board of Directors, shall render to the
President and Directors, whenever they request it, an account of all of his or
her transactions and of the financial condition of the corporation, and shall
have such other powers and perform such other duties as may be prescribed by the
Board of Directors or the By-Laws.
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ARTICLE IV
SHAREHOLDERS' MEETINGS
Section 1. PLACE OF MEETINGS. All meetings of the Shareholders
shall be held at the principal executive office of the corporation unless some
other appropriate and convenient location be designated for that purpose from
time to time by the Board of Directors.
Section 2. ANNUAL MEETINGS. The annual meetings of the
Shareholders shall be held, each year, at the time and on the day following:
Time of Meeting: 10:00 a.m.
Date of Meeting: June lst
If this day shall be a legal holiday, then the meeting shall
be held on the next succeeding business day, at the same hour. At the annual
meeting, the Shareholders shall elect a Board of Directors, consider reports of
the affairs of the corporation and transact such other business as may be
properly brought before the meeting.
Section 3. SPECIAL MEETINGS. Special meetings of the
Shareholders may be called at any time by the Board of Directors, the Chairman
of the Board, the President, a Vice President, the Secretary, or by one or more
Shareholders holding not less than one-tenth (1/10) of the voting power of the
corporation. Except as next provided, notice shall be given as for the annual
meeting.
Upon receipt of a written request addressed to the Chairman,
President, Vice President, or Secretary, mailed or delivered personally to such
officer by any person (other than the Board) entitled to call a special meeting
of Shareholders, such Officer shall cause notice to be given, to the
Shareholders entitled to vote, that a meeting will be held at a time requested
by the person or persons calling the meeting, not less than thirty-five (35) nor
more than sixty (60) days after the receipt of such request. If such notice is
not given within twenty (20) days after receipt of such request, the persons
calling the meeting may give notice thereof in the manner provided by these
By-Laws or apply to the Superior Court as provided in Sec. 305 (c).
Section 4. NOTICE OF MEETINGS - REPORTS. Notice of meetings,
annual or special, shall be given in writing not less than ten (10) nor more
than sixty (60) days before the date of the meeting to Shareholders entitled to
vote thereat. Such notice shall be given by the Secretary or the Assistant
Secretary, or if there be no such Officer, or in the case of his or her neglect
or refusal, by any Director or Shareholder.
Such notices or any reports shall be given personally or by
mail or other means of written communication as provided in Sec. 601 of the Code
and shall be sent to the Shareholder's address appearing on the books of the
corporation, or supplied by him or her to the corporation for the purpose of
notice, and in the absence thereof, as provided in Sec. 601 of the Code.
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Notice of any meeting of Shareholders shall specify the place, the day and the
hour of meeting, and (1) in case of a special meeting, the general nature of the
business to be transacted and no other business may be transacted, or (2) in the
case of an annual meeting, those matters which the Board at date of mailing,
intends to present for action by the Shareholders. At any meetings where
Directors are to be elected, notice shall include the names of the nominees, if
any, intended at date of notice to be presented by management for election.
If a Shareholder supplies no address, notice shall be deemed
to have been given if mailed to the place where the principal executive office
of the corporation, in California, is situated, or published at least once in
some newspaper of general circulation in the County of said principal office.
Notice shall be deemed given at the time it is delivered
personally or deposited in the mail or sent by other means of written
communication. The officer giving such notice or report shall prepare and file
an affidavit or declaration thereof.
When a meeting is adjourned for forty-five (45) days or more, notice of
the adjourned meeting shall be given as in case of an original meeting. Save, as
aforesaid, it shall not be necessary to give any notice of adjournment or of the
business to be transacted at an adjourned meeting other than by announcement at
the meeting at which such adjournment is taken.
Section 5. WAIVER OF NOTICE OR CONSENT BY ABSENT SHAREHOLDERS.
The transactions of any meeting of Shareholders, however called and noticed,
shall be valid as though had at a meeting duly held after regular call and
notice, if a quorum be present either in person or by proxy, and if, either
before or after the meeting, each of the Shareholders entitled to vote, not
present in person or by proxy, sign a written waiver of notice, or a consent to
the holding of such meeting or an approval of the minutes thereof. All such
waivers, consents or approvals shall be filed with the corporate records or made
a part of the minutes of the meeting. Attendance shall constitute a waiver of
notice, unless objection shall be made as provided in Sec. 601 (e).
Section 6. SHAREHOLDERS ACTING WITHOUT A MEETING DIRECTORS.
Any action which may be taken at a meeting of the Shareholders, may be taken
without a meeting or notice of meeting if authorized by a writing signed by all
of the Shareholders entitled to vote at a meeting for such purpose, and filed
with the Secretary of the corporation, provided, further, that while ordinarily
Directors can only be elected by unanimous written consent under Sec. 603 (d),
if the Directors fail to fill a vacancy, then a Director to fill that vacancy
may be elected by the written consent of persons holding a majority of shares
entitled to vote for the election of Directors.
Section 7. OTHER ACTIONS WITHOUT A MEETING. Unless otherwise
provided in the GCL or the Articles, any action which may be taken at any annual
or special meeting of Shareholders may be taken without a meeting and without
prior notice, if a consent in
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writing, setting forth the action so taken, signed by the holders of outstanding
shares having not less than the minimum number of votes that would be necessary
to authorize or take such action at a meeting at which all shares entitled to
vote thereon were present and voted.
Unless the consents of all Shareholders entitled to vote have
been solicited in writing,
(1) Notice of any Shareholder approval pursuant to
Secs. 310, 317, 1201 or 2007 without a meeting by less than
unanimous written consent shall be given at least ten (10)
days before the consummation of the action authorized by such
approval, and
(2) Prompt notice shall be given of the taking of any
other corporate action approved by Shareholders without a
meeting by less than unanimous written consent, to each of
those Shareholders entitled to vote who have not consented in
writing.
Any Shareholder giving a written consent, or the Shareholder's
proxyholders, or a transferee of the shares of a personal representative of the
Shareholder or their respective proxy holders, may revoke the consent by a
writing received by the corporation prior to the time that written consents of
the number of shares required to authorize the proposed action have been filed
with the Secretary of the corporation, but may not do so thereafter. Such
revocation is effective upon its receipt by the Secretary of the corporation.
Section 8. QUORUM. The holders of a majority of the shares
entitled to vote thereat, present in person, or represented by proxy, shall
constitute a quorum at all meetings of the Shareholders for the transaction of
business except as otherwise provided by law, by the Articles of Incorporation,
or by these By-Laws. If, however, such majority shall not be present or
represented at any meeting of the Shareholders, the Shareholders entitled to
vote thereat, present in person, or by proxy, shall have the power to adjourn
the meeting from time to time, until the requisite amount of voting shares shall
be present. At such adjourned meeting at which the requisite amount of voting
shares shall be represented, any business may be transacted which might have
been transacted at a meeting as originally notified.
If a quorum be initially present, the Shareholders may
continue to transact business until adjournment, notwithstanding the withdrawal
of enough Shareholders to leave less than a quorum, if any action taken is
approved by a majority of the Shareholders required to initially constitute a
quorum.
Section 9. VOTING. Only persons in whose names shares entitled
to vote stand on the stock records of the corporation on the day of any meeting
of Shareholders, unless some other day be fixed by the Board of Directors for
the determination of Shareholders of record, and then on such other day, shall
be entitled to vote at such meeting.
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Provided the candidate's name has been placed in nomination
prior to the voting and one or more Shareholder has given notice at the meeting
prior to the voting of the Shareholder's intent to cumulate the Shareholder's
votes, every Shareholder entitled to vote at any election for Directors of any
corporation for profit may cumulate their votes and give one candidate a number
of votes equal to the number of Directors to be elected multiplied by the number
of votes to which his or her shares are entitled, or distribute his or her votes
on the same principle among as many candidates as he or she thinks fit.
The candidates receiving the highest number of votes up to the
number of Directors to be elected are elected.
The Board of Directors may fix a time in the future not
exceeding thirty (30) days preceding the date of any meeting of Shareholders or
the date fixed for the payment of any dividend or distribution, or for the
allotment of rights, or when any change or conversion or exchange of shares
shall go into effect, as a record date for the determination of the Shareholders
entitled to notice of and to vote at any such meeting, or entitled to receive
any such dividend or distribution, or any allotment of rights, or to exercise
the rights in respect to any such change, conversion or exchange of shares. In
such case only Shareholders of record on the date so fixed shall be entitled to
notice of and to vote at such meeting, or to receive such dividends, dis
tribution or allotment of rights, or to exercise such rights, as the case may be
notwithstanding any transfer of any share on the books of the corporation after
any record date fixed as aforesaid. The Board of Directors may close the books
of the corporation against transfers of shares during the whole or any part of
such period.
Section 10. PROXIES. Every Shareholder entitled to vote, or to
execute consents, may do so, either in person or by written proxy, executed in
accordance with the provisions of Secs. 604 and 705 of the Code and filed with
the Secretary of the corporation.
Section 11. ORGANIZATION. The President, or in the absence of
the President, any Vice President, shall call the meeting of the Shareholders to
order, and shall act as chairman of the meeting. In the absence of the President
and all of the Vice Presidents, Shareholders shall appoint a chairman for such
meeting. The Secretary of the corporation shall act as Secretary of all meetings
of the Shareholders, but in the absence of the Secretary at any meeting of the
Shareholders, the presiding officer may appoint any person to act as Secretary
of the meeting.
Section 12. INSPECTORS OF ELECTION. In advance o-f any meeting
of Shareholders the Board of Directors may, if they so elect, appoint inspectors
of election to act at such meeting or any adjournment thereof. If inspectors of
election be not so appointed, or if any persons so appointed fail to appear or
refuse to act, the chairman of any such meeting may, and on the request of any
Shareholder or his or her proxy shall, make such appointment at the meeting in
which case the number of inspectors shall be either one (1) or three (3) as
determined by a majority of the Shareholders represented at the meeting.
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Section 13. (A) SHAREHOLDERS' AGREEMENTS. Notwithstanding the
above provisions, in the event this corporation elects to become a close
corporation, an agreement between two (2) or more Shareholders thereof, if in
writing and signed by the parties thereof, may provide that in exercising any
voting rights the shares held by them shall be voted as provided therein or in
Sec. 706, and may otherwise modify these provisions as to Share holders'
meetings and actions.
(B) EFFECT OF SHAREHOLDERS' AGREEMENTS. Any
Shareholders' Agreement authorized by Sec. 300 (b), shall only be effective to
modify the terms of these By-Laws if this corporation elects to become a close
corporation with appropriate filing of or amendment to its Articles as required
by Sec. 202 and shall terminate when this corporation ceases to be a close
corporation. Such an agreement cannot waive or alter Secs. 158, (defining close
corporations), 202 (requirements of Articles of Incorporation), 500 and 501
relative to distributions, 111 (merger), 1201 (e) (reorganization) or Chapters
15 (Records and Reports), 16 (Rights of Inspection), 18 (Involuntary
Dissolution) or 22 (Crimes and Penalties). Any other provisions of the Code or
these By-Laws may be altered or waived thereby, but to the extent they are not
so altered or waived, these By-Laws shall be applicable.
ARTICLE V
CERTIFICATES AND TRANSFER OF SHARES
Section 1. CERTIFICATES FOR SHARES. Certificates for shares
shall be of such form and device as the Board of Directors may designate and
shall state the name of the record holder of the shares represented thereby; its
number; date of issuance; the number of shares for which it is issued; a
statement of the rights, privileges, preferences and restrictions, if any; a
statement as to the redemption or conversion, if any; a statement of liens or
restrictions upon transfer or voting, if any; if the shares be assessable or, if
assessments are collectible by personal action, a plain statement of such facts.
All certificates shall be signed in the name of the
corporation by the Chairman of the Board or Vice Chairman of the Board or the
President or vice President and by the Chief Financial Officer or an Assistant
Treasurer or the Secretary or any Assistant Secretary, certifying the number of
shares and the class or series of shares owned by the Shareholder.
Any or all of the signatures on the certificate may be
facsimile. In case any officer, transfer agent, or registrar who has signed or
whose facsimile signature has been placed on a certificate shall have ceased to
be that Officer, transfer agent, or registrar before that certificate is issued,
it may be issued by the corporation with the same effect as if that person were
an officer, transfer agent, or registrar at the date of issue.
Section 2. TRANSFER ON THE BOOKS. Upon surrender to the
Secretary or transfer agent of the corporation of a certificate for shares duly
endorsed or accompanied by
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proper evidence of succession, assignment or authority to transfer, it shall be
the duty of the corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction upon its books.
Section 3. LOST OR DESTROYED CERTIFICATES. Any person claiming
a certificate of stock to be lost or destroyed shall make an affidavit or
affirmation of that fact and shall, if the Directors so require, give the
corporation a bond of indemnity, inform and with one or more sureties
satisfactory to the Board, in at least double the value of the stock represented
by said certificate, whereupon a new certificate may be issued in the same tenor
and for the same number of shares as the one alleged to be lost or destroyed.
Section 4. TRANSFER AGENTS AND REGISTRARS. The Board of
Directors may appoint one or more transfer agents or transfer clerks, and one or
more registrars, which shall be an incorporated bank or trust company, either
domestic or foreign, who shall be appointed at such times and places as the
requirements of the corporation may necessitate and the Board of Directors may
designate.
Section 5. CLOSING STOCK TRANSFER BOOKS - RECORD DATE. In
order that the corporation may determine the Shareholders entitled to notice of
any meeting or to vote or entitled to receive payment of any dividend or other
distribution or allotment of any rights or entitled to exercise any rights in
respect of any other lawful action, the Board may fix, in advance, a record
date, which shall not be more than sixty (60) nor less than ten (10) days prior
to the date of such meeting nor more than sixty (60) days prior to any other
action.
If no record date is fixed; the record date for determining
Shareholders entitled to notice of or to vote at a meeting of Shareholders shall
be at the close of business on the business day next preceding the day on which
notice is given, or, if notice is waived, at the close of business on the
business day next preceding the day on which the meeting is held. The record
date for determining Shareholders entitled to give consent to corporate action
in writing without a meeting, when no prior action by the Board is necessary,
shall be the day on which the first written consent is given.
The record dat e for determining Shareholders for any other
purpose shall be at the close of business on the day on which the Board adopts
the resolution relating thereto, or the sixtieth (60th) day prior to the date of
such other action, whichever is later.
Section 6. LEGEND CONDITION. In the event any shares of this
corporation are issued pursuant to a permit or exemption therefrom requiring the
imposition of a legend condition, the person or persons issuing or transferring
said shares shall make sure said legend appears on the certificate and shall not
ne required to transfer any shares free of such legend unless an amendment to
such permit or a new permit be first issued so authorizing such a deletion.
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Section 7. CLOSE CORPORATION CERTIFICATES. All certificates
representing shares of this corporation, in the event it shall elect to become a
close corporation, shall contain the legend required by Sec. 418 (c).
ARTICLE VI
RECORDS - REPORTS - INSPECTION
Section 1. RECORDS. The corporation shall maintain, in
accordance with generally accepted accounting principles, adequate and correct
accounts, books and records of its business and properties. All of such books,
records and accounts shall be kept at its principal executive office in the
State of California, as fixed by the Board of Directors from time to time.
Section 2. INSPECTION OF BOOKS AND RECORDS. All books and
records provided for in Sec. 1500 shall be open to inspection of the Directors
and Shareholders from time to time and in the manner provided in said Sec. 1600
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Section 3. CERTIFICATION AND INSPECTION OF BY-LAWS. The
original or a copy of these By-Laws, as amended or otherwise altered to date,
certified by the Secretary, shall be kept at the corporation's principal
executive office and shall be open to inspection by the Shareholders of the
corporation at all reasonable times during office hours, as provided in Sec. 213
of the Corporations Code.
Section 4. CHECKS, DRAFTS, ETC. All checks, drafts, or other
orders for payment of money, notes or other evidences of indebtedness, issued in
the name of or payable to the corporation, shall be signed or endorsed by such
person or persons and in such manner as shall be determined from time to time by
resolution of the Board of Directors.
Section 5. CONTRACTS, ETC. -- HOW EXECUTED. The Board of
Directors, except as in the By-Laws otherwise provided, may authorize any
Officer or Officers, agent or agents, to enter into any contract or execute any
instrument in the name of and on behalf of the corporation. Such authority may
be general or confined to specific instances. Unless so authorized by the Board
of Directors, no Officer, agent or employee shall have any power or authority to
bind the corporation by any contract or agreement, or to pledge its credit, or
to render it liable for any purpose or to any amount, except as provided in Sec.
313 of the Corporations Code.
ARTICLE VII
ANNUAL REPORTS
Section 1. REPORT TO SHAREHOLDERS, DUE DATE. The Board of
Directors shall cause an annual report to be sent to the Shareholders not later
than one hundred
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twenty (120) days after the close of the fiscal or calendar year adopted by the
corporation. This report shall be sent at least fifteen (15) days before the
annual meeting of Shareholders to be held during the next fiscal year and in the
manner specified in Section 4 of Article IV of these By-Laws for giving notice
to Shareholders of the corporation. The annual report shall contain a balance
sheet as of the end of the fiscal year and an income statement and statement of
changes in financial position for the fiscal year, accompanied by any report of
independent accountants or, if there is no such report, the certificate of an
authorized Officer of the corporation that the statements were prepared without
audit from the books and records of the corporation.
Section 2. WAIVER. The annual report to Shareholders referred
to in Section 1501 of the California General Corporation Law is expressly
dispensed with so long as this corporation shall have less than one hundred
(100) Shareholders. However, nothing herein shall be interpreted as prohibiting
the Board of Directors from issuing annual or other periodic reports to the
Shareholders of the corporation as they consider appropriate.
ARTICLE VIII
AMENDMENTS TO BY-LAWS
Section 1. AMENDMENT BY SHAREHOLDERS. New By-Laws may be
adopted or these By-Laws may be amended or repealed by the vote or written
consent of holders of a majority of the outstanding shares entitled to vote;
provided, however, that if the Articles of Incorporation of the corporation set
forth the number of authorized Directors of the corporation, the authorized
number of Directors may be changed only by an amendment of the Articles of
Incorporation.
Section 2. POWERS OF DIRECTORS. Subject to the right of the
Shareholders to adopt, amend or repeal By-Laws, as provided in Section 1 of this
Article VIII, and the limitations of Sec. 204 (a) (5) and Sec. 212, the Board of
Directors may adopt, amend or repeal any of these By-Laws other than a By-Law or
amendment thereof changing the authorized number of Directors.
Section 3. RECORD OF AMENDMENTS. Whenever an amendment or new
By-Law is adopted, it shall be copied in the book of By-Laws with the original
By-Laws in the appropriate place. If any By-Law is repealed, the fact of repeal
with the date of the meeting at which the repeal was enacted or written assent
was filed shall be stated in said book.
ARTICLE IX
CORPORATE SEAL
The corporate seal shall be circular in form, and shall have
inscribed thereon the name of the corporation, the date of its incorporation,
and the word "California."
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ARTICLE X
MISCELLANEOUS
Section 1. REFERENCES TO CODE SECTIONS. "Sec." references
herein refer to the equivalent Sections of the General Corporation Law effective
January 1, 1977, as amended.
Section 2. REPRESENTATION OF SHARES IN OTHER CORPORATIONS.
Shares of other corporations standing in the name of this corporation may be
voted or represented and all incidents thereto may be exercised on behalf of the
corporation by the Chairman of the Board, the President or any Vice President
and the Secretary or an Assistant Secretary.
Section 3. SUBSIDIARY CORPORATIONS. Shares of this corporation
owned by a subsidiary shall not be entitled to vote on any matter. A subsidiary
for these purposes is defined as a corporation, the shares of which possessing
more than 25% of the total combined voting power of all classes of shares
entitled to vote, are owned directly or indirectly through one (1) or more
subsidiaries.
Section 4. INDEMNITY. The corporation may indemnify any
Director, Officer, agent or employee as to those liabilities and on those terms
and conditions as are specified in Sec. 317 of the Code. In any event, the
corporation shall have the right to purchase and maintain insurance on behalf of
any such persons whether or not the corporation would have the power to
indemnify such person against the liability insured against.
Section 5. ACCOUNTING YEAR. The accounting year of the
corporation shall be fixed by resolution of the Board of Directors.
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CERTIFICATE OF ADOPTION OF BY-LAWS
ADOPTION BY INCORPORATOR OR FIRST DIRECTOR(S).
The undersigned person appointed in the Articles of
Incorporation to act as the Incorporator or First Director(s) of the above named
corporation hereby adopt the same as the By-Laws of said corporation.
Executed this 21 day of October, 1982
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Name: ROBERT BRETZ
CERTIFICATE BY SECRETARY.
I DO HEREBY CERTIFY AS FOLLOWS:
That I am the duly elected, qualified and acting Secretary of
the above named corporation, that the foregoing By-Laws were adopted as the
By-Laws of said corporation on the date set forth above by the person(s)
appointed in the Articles of Incorporation to act as the Incorporator(s) or
First Director(s) of said corporation.
IN WITNESS WHEREOF, I hereunto set my hand and affixed, the
corporate seal this 21 day of October, 1982.
/s/ Thomas Miserendino
Secretary: THOMAS MISERENDINO
CERTIFICATE BY SECRETARY OF ADOPTION BY SHAREHOLDERS' VOTE.
THIS IS TO CERTIFY:
That I am the duly elected, qualified and acting Secretary of
the above named corporation and that the above and foregoing Code of By-Laws was
submitted to the Shareholders at their first meeting and recorded in the minutes
thereof, was ratified by the vote of Shareholders entitled to exercise the
majority of the voting power of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand this 21 day of
October, 1982.
/s/ Thomas Miserendino
Secretary: THOMAS MISERENDINO
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