Exhibit 3.1
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By-Laws
of
PIEDMONT NATURAL GAS COMPANY, INC.
----------------
February 27, 2004
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BY-LAWS
of
Piedmont Natural Gas Company, Inc.
----------------
February 27, 2004
ARTICLE I. MEETING OF SHAREHOLDERS.............................................1
Section 1.1. Annual Meetings........................................1
Section 1.2. Special Meetings.......................................1
Section 1.3. Notice of Meetings.....................................1
Section 1.4. Waiver of Notice.......................................1
Section 1.5. Quorum.................................................1
Section 1.6. Proxies................................................2
Section 1.7. Inspectors.............................................2
Section 1.8. Vote of Shareholders...................................2
Section 1.9. Organization...........................................2
ARTICLE II. BOARD OF DIRECTORS................................................3
Section 2.1. Number, Nominations, Election, Term of Office and
Qualifications.........................................3
Section 2.2. Regular Meetings.......................................3
Section 2.3. Special Meetings.......................................4
Section 2.4. Quorum and Manner of Acting............................4
Section 2.5. Resignations...........................................4
Section 2.6. Removal of Directors...................................4
Section 2.7. Filling of Vacancies...................................4
Section 2.8. Directors' Fees........................................5
Section 2.9. Informal Action by Directors...........................5
Section 2.10. Chairman of the Board and Independent Lead Director....5
ARTICLE III. SPECIAL COMMITTEES................................................5
Section 3.1. Committees.............................................5
Section 3.2. Executive Committee....................................5
Section 3.3. Committees' Fees and Expenses..........................6
ARTICLE IV. OFFICERS - POWERS AND DUTIES.......................................6
Section 4.1. Officers...............................................6
Section 4.2. Term of Office.........................................6
Section 4.3. Removal of Elected Officers............................6
Section 4.4. Vacancies..............................................6
Section 4.5. Chief Executive Officer................................7
Section 4.6 President..............................................7
Section 4.7. Vice-Presidents........................................7
Section 4.8. Secretary..............................................7
Section 4.9. Treasurer..............................................8
Section 4.10. Additional Powers and Duties...........................8
Section 4.11. Compensation...........................................8
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ARTICLE V. SHARES AND TRANSFERS OF SHARES......................................8
Section 5.1. Share Certificates.....................................8
Section 5.2. Transfers of shares....................................9
Section 5.3. Lost Certificates......................................9
Section 5.4. Record Date............................................9
ARTICLE VI. INDEMNIFICATION OF OFFICERS AND DIRECTORS.........................10
Section 6.1. Definitions...........................................10
Section 6.2. Indemnification.......................................11
Section 6.3. Determination.........................................11
Section 6.4. Advances for Expenses.................................12
Section 6.5. Reliance and Consideration............................12
Section 6.6. Insurance.............................................12
ARTICLE VII. FISCAL YEAR......................................................13
Section 7.1. Fiscal Year...........................................13
ARTICLE VIII. AMENDMENTS......................................................13
Section 8.1. Amendment of By-Laws..................................13
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BY-LAWS
OF
PIEDMONT NATURAL GAS COMPANY, INC.
ARTICLE I
MEETING OF SHAREHOLDERS
Section 1.1. Annual Meetings. The annual meeting of shareholders shall
be held on the fourth Friday in February of each year, or, if that date is a
legal holiday on the next succeeding day not a legal holiday at 9:30 a.m., or at
such time as may be fixed by the Board of Directors, for the election of
directors and the transaction of such other business as may come before the
meeting. Such meeting shall be held at such place within or without the State of
North Carolina as may be fixed from time to time by the Board of Directors and
stated in the notice of the meeting.
Section 1.2. Special Meetings. A special meeting of shareholders may be
called at any time and for any purpose or purposes by the Board of Directors and
shall be called by the Secretary upon the written request of the holders of at
least eighty per cent of the outstanding shares of stock entitled to vote in the
election of Directors. Each such request shall state the purpose or purposes of
each meeting.
Section 1.3. Notice of Meetings. Notice of the date, time, place and
purpose of any meeting of shareholders shall be signed by the Chief Executive
Officer or the Secretary and a copy thereof shall be served upon each
shareholder of record entitled to vote at such meeting, either personally or by
mailing the same postage prepaid not less than ten nor more than fifty days
before the meeting. If mailed, such notice shall be directed to a shareholder at
his or her address as it appears on the record of shareholders, unless he or she
shall have filed with the Secretary a written request that notices intended for
him or her be mailed to some other address, in which case it shall be mailed to
the address designated in such request.
Section 1.4. Waiver of Notice. Notice of any meeting of shareholders
shall not be required as to any shareholder who shall attend such meeting in
person or by proxy without protesting prior to the conclusion of the meeting the
lack of notice of such meeting. If any shareholder shall, in writing, in person
or by proxy, before or after the meeting, submit a waiver of notice of any
meeting, notice thereof shall not be required.
Section 1.5. Quorum. At all meetings of shareholders (except where
otherwise provided by statute or by the Articles of Incorporation) the presence,
in person or by proxy, of the holders of a majority of the shares entitled to
vote shall constitute a
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quorum for the transaction of business. In the absence of a quorum, a majority
of the shares present may adjourn the meeting from time to time until a quorum
shall be present. At any such adjourned meeting at which a quorum shall be
present, any business may be transacted which might have been transacted at the
meeting as originally called. No notice of an adjourned meeting need be given if
the time and place to which the meeting is adjourned are announced at the
meeting to which the adjournment is taken; provided that the new date is not
more than 120 days after the date of the original meeting. However, if after the
adjournment, the Board of Directors shall fix a new record date for the
adjourned meeting, notice of the adjourned meeting shall be given to each
shareholder of record on the new record date entitled to notice as specified
herein.
Section 1.6. Proxies. No proxy shall be valid after the expiration of
eleven months from the date of its execution unless the shareholder executing it
shall have specified therein a longer period for its duration.
Section 1.7. Inspectors. The Board of Directors, in advance of any
meeting of shareholders, may appoint one or more inspectors to act at the
meeting or any adjournment thereof. If inspectors are not so appointed, the
person presiding at the meeting may, and on the request of any shareholder
entitled to vote at the meeting shall, appoint one or more Inspectors. In case
any person appointed fails to appear or act, the vacancy may be filled by
appointment made by the Board of Directors in advance of the meeting or at the
meeting by the chairman of the meeting. Each inspector, before entering upon the
discharge of his or her duties, shall take an oath faithfully to execute the
duties of inspector at such meeting with strict impartiality and according to
the best of his or her ability.
Section 1.8. Vote of Shareholders. Each shareholder having the right to
vote shall be entitled at every meeting of shareholders to one vote for every
share standing in his or her name on the record of shareholders. Directors shall
be elected as provided in Section 2.1 of Article II, and whenever any other
corporate action is to be taken by vote of the shareholders, it shall, except as
otherwise required by statute or by the Articles of Incorporation, be authorized
by a majority of votes cast by such voters.
Section 1.9. Organization. The Chairman of the Board and CEO shall
preside at all meetings of shareholders. In the absence of the Chairman of the
Board and CEO, the Independent Lead Director shall preside. The Secretary of the
Company shall act as secretary at all meetings of the shareholders and in the
Secretary's absence, the chairman of the meeting may appoint a secretary. The
Board of Directors of the Company shall be entitled to make such rules or
regulations for the conduct of meetings of shareholders as it shall deem
necessary, appropriate or convenient. Subject to such rules and regulations of
the Board of Directors, if any, the chairman of the meeting shall have the right
and the authority to prescribe such
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rules, regulations and procedures and to do all such acts as, in the judgment of
such chairman, are necessary, appropriate or convenient for the proper conduct
of the meeting, including, without limitation, establishing (i) an agenda or
order of business for the meeting, (ii) rules and procedures for maintaining
order at the meeting and the safety of those present, (iii) limitations on
participation in such meetings to shareholders of record of the Company and
their duly authorized and constituted proxies, and such other persons as the
chairman of the meeting shall permit, (iv) restrictions on entries to the
meeting after the time affixed for the commencement thereof, (v) limitations on
the time allotted to the questions or comments by participants and (vi)
regulation of the opening and closing of the polls for balloting and matters
which are to be voted on by ballot. Unless and to the extent determined by the
Board of Directors or the chairman of the meeting, meetings of shareholders
shall not be required to be held in accordance with rules of parliamentary
procedure.
ARTICLE II
BOARD OF DIRECTORS
Section 2.1. Number, Nominations, Election, Term of Office and
Qualifications. The number of Directors to serve from time to time shall be
determined by a resolution adopted by the affirmative vote of a majority of the
entire Board of Directors, but shall not be less than nine (9). Each Director
shall be at least twenty-one years of age. Directors shall be elected in the
manner and for the terms provided in the Articles of Incorporation. At each
meeting of the shareholders for the election of Directors, at which a quorum is
present, the persons receiving a plurality of the votes cast shall be elected.
No Director shall be elected at an annual or special meeting of shareholders
unless he or she shall have been nominated to serve as a Director at least sixty
(60) days prior to the meeting at which he or she is elected; provided, however,
that should any nominee die, indicate his or her refusal to serve or otherwise
become disqualified to serve within said sixty (60) day period, a replacement
may be nominated by a majority of the entire Board of Directors, or, upon the
failure of the Board to nominate a replacement, by any shareholder at the
meeting at which the disqualified nominee was to have been elected. Directors
need not be shareholders of the Corporation.
Section 2.2. Regular Meetings. The Board of Directors may, by
resolution, from time to time, appoint the time and place for holding regular
meetings of the Board, if it be deemed advisable; and such regular meetings may
thereupon be held without the giving of any special notice. In case the day
appointed for a regular meeting shall fall on a legal holiday, such meeting
shall be held on the next following day not a legal holiday at the regular
appointed hour.
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Section 2.3. Special Meetings. Special meetings of the Board of
Directors shall be held whenever called by the Chairman of the Board, the Chief
Executive Officer or by any two of the Directors. Notice of any special meeting
shall be mailed to each Director, postage prepaid, addressed to him or her at
his or her residence or usual place of business, not later than the second day
before the day on which the meeting is to be held, or shall be sent to him or
her at such place by telegram, telefax, telex or similar facsimile means or be
delivered personally, or by telephone, not later than the day before the day on
which the meeting is to be held. Notice of any meeting of the Board of Directors
need not be given, however, to any Director if waived by him or her in writing
or by telegraph, before or after the holding of the meeting, or if he or she
shall be present at the meeting without protesting.
Section 2.4. Quorum and Manner of Acting. Any two Directors in office
at the time of any meeting of the Board, but in any event not less than
one-third of the entire Board, shall be present in person to constitute a quorum
for the transaction of business; and, except as otherwise required by statute or
by the Articles of Incorporation, the vote of a majority of the Directors
present at any meeting at which a quorum is present shall be the act of the
Board of Directors. In the absence of a quorum, a majority of the Directors
present may adjourn the meeting from time to time and no notice of any adjourned
meeting need be given. Any one or more members of the Board may participate in
any meeting of the Board by means of a conference telephone or similar
communications equipment allowing all persons participating in the meeting to
hear each other at the same time. Participation by such means shall constitute
presence in person at a meeting.
Section 2.5. Resignations. Any Director may resign at any time either
by oral tender of resignation at any meeting of the Board or by giving written
notice thereof to the Secretary. Such resignation shall take effect at the time
specified therefor, and unless otherwise specified with respect thereto, the
acceptance of such resignation shall not be necessary to make it effective.
Section 2.6. Removal of Directors. Subject to the rights of the holders
of any series of Preferred Stock then outstanding, any Director, or the entire
Board of Directors, may be removed from office at any time for cause by the
affirmative vote of at least 80% of the outstanding shares entitled to vote in
the election of Directors.
Section 2.7. Filling of Vacancies. Subject to the rights of the holders
of any series of Preferred Stock then outstanding, newly created directorships
resulting from an increase in the authorized number of Directors may be filled
by vote of the Board of Directors. If the number of Directors then in office is
less than a quorum, such newly-created directorships and vacancies may be filled
by a majority of the Directors then in office. Any Director elected to fill a
vacancy shall hold office until the next annual meeting of shareholders. In no
case shall a decrease in the number of Directors shorten the term of any
incumbent Director.
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Section 2.8. Directors' Fees. In consideration of his or her serving in
such capacity, each Director of the Corporation who is not a full-time officer
shall receive an annual fee and such additional fees in such amounts and payable
in such installments as the Board of Directors, by vote of the majority of the
entire Board, may from time to time determine. Members of the Board of Directors
shall be entitled to reimbursement of reasonable expenses incurred for
attendance at regular or special meetings of the Board of Directors.
Section 2.9. Informal Action by Directors. Action taken by all of the
Directors without a meeting is nevertheless Board action if written consent to
the action is signed by all the Directors and filed with the minutes of the
proceedings of the Board, whether done before or after the action so taken.
Section 2.10. Chairman of the Board and Independent Lead Director. The
Board may elect from among its members a Chairman of the Board of Directors and
an Independent Lead Director. If elected, the Chairman of the Board when present
shall preside at all meetings of Directors and shall have such other duties as
provided by the Board. If elected, the Independent Lead Director shall chair the
meetings of the Board during any meetings or portions of meetings (including
executive sessions) where the Chairman is absent. The Independent Lead Director
shall consult with the CEO on business issues and with the Chairman of the Board
and CEO and the Chairman of the Directors and Corporate Governance Committee on
Board management.
ARTICLE III
SPECIAL COMMITTEES
Section 3.1. Committees. The Board of Directors, by resolution adopted
by a majority of the entire Board, may from time to time designate from among
its members committees, each consisting of three or more Directors, for any
purpose or purposes and may delegate to any such committee such powers as the
Board may deem expedient.
Section 3.2. Executive Committee. The Board of Directors may, by
resolution adopted by a majority of the entire Board, designate from among its
members an Executive Committee consisting of three or more Directors which shall
be empowered to perform such functions as may be delegated to it by the Board
subject to applicable statutory requirements. The Executive Committee shall
elect its own chairman and shall appoint its own Secretary, and shall have full
power and authority to make rules for the conduct of its business, including
notices required to be given in connection with regular or special meetings of
the Executive Committee. A majority of the Executive Committee shall constitute
a quorum for the transaction
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of business, and the vote of a majority of those present at a meeting, at which
a quorum is present, shall be the act of the Executive Committee. The members of
the Executive Committee shall act only as a committee, and the individual
members shall have no power as such. The Executive Committee shall keep minutes
of its proceedings and shall submit the same from time to time to the Board of
Directors. Any vacancy in the Executive Committee shall be filled by a vote of a
majority of the entire Board of Directors.
Section 3.3. Committees' Fees and Expenses. In consideration of his or
her serving in such capacity, each member of any committee who is not a salaried
officer of the Corporation may be compensated in such amount as the Board of
Directors, by vote of the majority of the entire Board, may from time to time
determine. Members of the committees shall be entitled to reimbursement of
reasonable expenses incurred for attendance at regular or special meetings of
the committees.
ARTICLE IV
OFFICERS - POWERS AND DUTIES
Section 4.1. Officers. The elected officers of the Corporation shall be
a Chief Executive Officer, a President, a Secretary and a Treasurer. There may
also be elected one or more Vice-Presidents. The Board of Directors may appoint
a General Manager, one or more Assistant Vice-Presidents, one or more Assistant
Secretaries, one or more Assistant Treasurers, and such other officers and
agents as may from time to time appear to be necessary or advisable in the
conduct of the affairs of the Corporation. Any two of the aforesaid officers may
be held by the same person, except that the office of Chief Executive Officer
and the office of Secretary and the office of President and the office of
Secretary may not be held by the same person.
Section 4.2. Term of Office. So far as practicable, all elected
officers shall be elected at the first meeting of the Board held following the
annual meeting of shareholders in each year and shall hold office until the
organization meeting of the Board in the next subsequent year and until their
respective successors are elected and qualify. All other officers shall hold
office during the pleasure of the Board.
Section 4.3. Removal of Elected Officers. Any elected officer may be
removed at any time, either for or without cause, by vote of a majority of the
whole Board of Directors at any meeting.
Section 4.4. Vacancies. If any vacancy occurs in any office, the Board
of Directors may elect or appoint a successor to fill such vacancy for the
remainder of the term.
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Section 4.5. Chief Executive Officer. The Chief Executive Officer of
the Corporation shall be the chief executive officer of the Corporation and,
subject to the control of the Board of Directors, shall have general and active
control of all of the affairs and business of the Corporation. He or she shall
perform such other duties and have such other powers as may be assigned to him
or her from time to time by the Board. The Chief Executive Officer shall see
that all orders and resolutions of the Board of Directors are put into effect.
Unless the Board of Directors shall have designated another person for such
purpose, he or she shall preside at all meetings of shareholders. In the event
that the Board shall not have elected a Chairman of the Board of Directors or a
Vice Chairman of the Board of Directors or shall have elected one or more of
such positions and neither of such positions shall be present, the Chief
Executive Officer shall preside at all meetings of the Board of Directors.
Subject to the control of the Board of Directors, he or she shall have the power
to sign in the name and on behalf of the Corporation, bonds, notes, deeds and
any and all contracts and other instruments of a contractual nature pertaining
to matters which arise in the normal conduct and ordinary course of the business
of the Corporation; and to appoint and fix the compensation of all employees and
agents whose appointment is not otherwise provided for, and to remove or suspend
the same.
Section 4.6. President. The President of the Corporation shall be the
chief operating officer of the Corporation and shall perform such duties and
have such powers as necessary or appropriate to carry out the day-to-day
operations of the Company. He or she shall perform such other duties and have
such other powers as may be assigned to him or her from time to time by the
Board of Directors or the Chief Executive Officer. Subject to the control of the
Board of Directors and the Chief Executive Officer, he or she shall have the
power to sign in the name and on behalf of the Corporation, bonds, notes, deeds
and any and all contracts and other instruments of a contractual nature which
arise in the ordinary conduct and ordinary course of the business of the
Corporation. In the event that the Board shall not have appointed a Chief
Executive Officer, the President shall perform all of the duties and shall have
all of the powers of the Chief Executive Officer.
Section 4.7. Vice-Presidents. The several Vice-Presidents shall perform
such duties and have such powers as shall be assigned to them from time to time
by the Board of Directors, the Chief Executive Officer or the President. In case
of the absence or disability of the President, his or her duties and powers
shall be exercised and performed by the several Vice-Presidents acting in his or
her place in such order of seniority as the Board of Directors may prescribe
from time to time.
Section 4.8. Secretary. The Secretary shall attend to the giving of
notice of meetings of the shareholders and of the Board of Directors,
respectively, and shall keep and attest true records of all proceedings at such
meetings and shall have charge of the corporate seal and, when authorized by the
Board of Directors, shall
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have authority to attest any and all instruments or writings to which the same
may be affixed. He or she shall keep and account for all books, documents,
papers and records of the Corporation, except those which are herein directed to
be in the charge of the Treasurer. He or she shall have authority to sign stock
certificates and shall generally perform all the duties usually appertaining to
the office of secretary of a corporation. In the absence of the Secretary, an
Assistant Secretary or Secretary pro tempore shall perform his or her duties.
Section 4.9. Treasurer. The Treasurer shall have the care and custody
of all moneys and funds of the Corporation, and shall deposit or cause to be
deposited all funds of the Corporation in and with such depositaries as the
Board of Directors shall designate from time to time. He or she shall have power
to sign stock certificates, to endorse for deposit or collection, or otherwise,
all checks, drafts, notes, bills of exchange or other commercial paper payable
to the Corporation, and to give proper receipts or discharges therefor. He or
she shall keep accurate books of account relating to the moneys and financial
affairs of the Corporation and shall render an account of the Corporation's
funds, whenever required so to do by the Board of Directors or the Chief
Executive Officer. In the absence of the Treasurer, an Assistant Treasurer shall
perform his or her duties.
Section 4.10. Additional Powers and Duties. In addition to the
foregoing especially enumerated duties and powers, the several officers of the
Corporation shall perform such other duties and exercise such further powers as
may be provided in these By-Laws or as the Board of Directors may, from time to
time, determine, or as may be assigned to them by any competent superior
officer.
Section 4.11. Compensation. The compensation of all elected officers of
the Corporation shall be fixed, from time to time, by the Board of Directors;
and the compensation of all appointed officers shall be fixed, or the method of
so doing shall be provided, from time to time, by the Board of Directors.
ARTICLE V
SHARES AND TRANSFERS OF SHARES
Section 5.1. Share Certificates. Certificates of shares shall be in
such form as the Board of Directors may from time to time prescribe, and shall
be signed by the Chairman of the Board, the Chief Executive Officer, the
President or a Vice-President, and by the Secretary or an Assistant Secretary or
the Treasurer or an Assistant Treasurer, and sealed with the corporate seal or a
facsimile thereof. The signatures of the officers upon a certificate may be
facsimiles if the certificate is countersigned by a Transfer Agent or registered
by a Registrar other than the Corporation or its employees. In case any officer
who has signed or whose facsimile signature has been placed upon a certificate
shall have ceased to be such
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officer before such certificate is issued, it may be issued by the Corporation
with the same effect as if he or she were such officer at the date of issue.
The Certificates shall be consecutively numbered or otherwise
identified; and the name and address of the persons to whom they are issued,
with the number of shares and the date of issue, shall be entered on the stock
transfer books of the Corporation. Such information may be stored or retained on
discs, tapes, cards or any other approved storage device relating to data
processing equipment; provided that such device is capable of reproducing all
information contained therein in legible and understandable form, for inspection
by shareholders or for any other corporate purpose. Such certificates shall
indicate thereon a reference to any and all restrictive conditions imposed on
the shares represented thereby.
The Board of Directors may authorize the issuance of some or all of the
shares of the Corporation, or some or all of any class of shares, without
certificates. When shares are not represented by certificates, then within a
reasonable time after the issuance or transfer of such shares, the Corporation
shall send the shareholder to whom such shares have been issued or transferred a
written statement of the information required by the Act to be on certificates.
The Board of Directors shall comply with N.C.G.S. ss. 25-4-408 with respect to
all uncertified shares.
Section 5.2. Transfers of shares. Shares may be transferred on the
books of the Corporation by delivery of the certificates therefor, accompanied
either by an assignment in writing on the back of the certificates or by written
power of attorney to assign and transfer the same, signed by the record holders
thereof; but no transfer shall affect the right of the Corporation to pay any
dividend upon the shares to the holder of record thereof, or to treat the holder
of record as the holder in fact thereof for all purposes, and no transfer shall
be valid, except between the parties thereto, until such transfer shall have
been made upon the books of the Corporation.
Section 5.3. Lost Certificates. ln case any certificate representing
shares shall be lost, stolen or destroyed, the Board of Directors, in its
discretion, may authorize the issue of a substitute certificate in place of the
certificate so lost, stolen or destroyed; provided that, in each such case, the
applicant for a substitute certificate shall furnish to the Corporation evidence
satisfactory to it of the loss, theft or destruction of such certificate and of
the ownership thereof, and also security or indemnity satisfactory to it.
Section 5.4. Record Date. The Board of Directors may fix a time, not
exceeding fifty days preceding the date fixed for the payment of any dividend or
for the making of any distribution, or for the delivery of evidences of rights
or evidences of interests arising out of any change, conversion or exchange of
capital stock, as a record time for the determination of the shareholders
entitled to receive any such dividend, distribution, rights or interests, and in
such case only shareholders of record at the
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time so fixed shall be entitled to receive such dividend, distribution, rights
or interests.
ARTICLE VI
INDEMNIFICATION OF OFFICERS AND DIRECTORS
Section 6.1. Definitions. For purposes of this Article, the following
definitions shall apply:
(a) "Corporation" means the Corporation and all "predecessors"
thereof, as such term is defined in Section 55-8-50(b)(1) of the Act.
(b) "Director" means an individual who is or was a director of
the Corporation or an individual who, while a director of the
Corporation, is or was serving at the Corporation's request as a
director, officer, partner, trustee, employee or agent or another
foreign or domestic corporation, partnership, joint venture, trust,
employee benefit plan, or other enterprise. A director is considered to
be serving an employee benefit plan at the Corporation's request if
such director's duties to the Corporation also impose duties on, or
otherwise involve services by, the director to the plan or to
participants in or beneficiaries of the plan. "Director" includes,
unless the context requires otherwise, the estate or personal
representative of a director.
(c) "Expenses" means expenses of every kind incurred in
defending a Proceeding, including, but not limited to, legal,
accounting, expert and investigatory fees and expenses.
(d) "Indemnified Officer" shall mean each officer of the
Corporation who is also a director of the Corporation and each other
officer of the Corporation who is designated by the Board of Directors
from time to time as an Indemnified Officer. An Indemnified Officer
shall be entitled to indemnification hereunder to the same extent as a
Director, including, without limitation, indemnification with respect
to service by the Indemnified Officer at the Corporation's request as a
director, officer, partner, trustee, employee or agent of another
foreign or domestic corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise.
(e) "Liabilities" means any obligation to pay any or all of
the following: a judgment, a settlement, a penalty, a fine (including
an excise tax assessed with respect to an employee benefit plan) and
reasonable expenses, including, but not limited to, attorneys' fees of
opposing parties incurred with respect to a Proceeding.
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(f) "Proceeding" means any threatened, pending, or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, whether formal or informal, and any appeal therein (and
any inquiry or investigations that could lead to such a proceeding).
Section 6.2. Indemnification. In addition to, and not in any way in
limitation of, all indemnification rights and obligations otherwise provided by
law, the Corporation shall indemnify and hold harmless its Directors and
Indemnified Officers against all Liabilities and Expenses in any Proceeding
(including, without limitation, a Proceeding brought by or on behalf of the
Corporation itself) arising out of their status as Directors or officers, or
their service at the Corporation's request as a Director, officer, partner,
trustee, employee or agent of another foreign or domestic corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise, or
their activities in any such capacity; provided, however, that the Corporation
shall not indemnify a Director or an Indemnified Officer against Liabilities or
Expenses that such person may incur on account of activities of such person
which at the time taken were known or believed by him or her, or a reasonable
person would have or should have known, to be clearly in conflict with the best
interests of the Corporation.
The Corporation shall also indemnify each Director and Indemnified
Officer for his or her reasonable costs, expenses and attorneys' fees incurred
in connection with the enforcement of the rights to indemnification granted
herein, if it is determined in accordance with Section 6.3 that the Director or
Indemnified Officer is entitled to indemnification hereunder.
The Board of Directors shall have the authority to adopt such
resolutions pertaining to the implementation of this Section as it may from time
to time determine, and such resolutions shall be given full effect, even though
they supplement, amplify or go beyond the provisions of this Section, provided
and to the extent such resolution does not violate any provision of the Act or
the Corporation's Articles of Incorporation. This Section shall be construed in
a manner to fully effect the purpose and intent of the resolution of the
Corporation's Board of Directors approving and adopting this provision.
Section 6.3. Determination. Any indemnification under Section 6.2 shall
be paid by the Corporation in a specific case only after a determination that
the Director or Indemnified Officer has met the standard of conduct set forth in
Section 6.2. Such determination shall be made:
(a) by the Board of Directors by a majority vote of a quorum
consisting of directors not at the time parties to the Proceeding;
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(b) if a quorum cannot be obtained under paragraph (a), by a
majority vote of a committee duly designated by the Board of Directors
(in which vote directors who are parties to the Proceeding may
participate), consisting solely of two or more directors not at the
time parties to the Proceeding;
(c) by special legal counsel (i) selected by the Board of
Directors or a committee thereof in the manner prescribed in paragraph
(a) or (b); or (ii) if a quorum of the Board of Directors cannot be
obtained under paragraph (a) and a committee cannot be designated under
paragraph (b), selected by a majority vote of the full Board of
Directors (in which selection directors who are parties in the
Proceeding may participate); or
(d) by the shareholders, but shares owned by or voted under
the control of directors who are at the time parties to the Proceeding
may not be voted on the determination. The Board of Directors shall
take all such action as may be necessary and appropriate to enable the
Corporation to pay the indemnification required by this Article.
Section 6.4. Advances for Expenses. The Expenses incurred by a Director
or an Indemnified Officer in defending a Proceeding may be paid by the
Corporation in advance of the final disposition of such Proceeding as authorized
by the Board of Directors in the specific case upon receipt of an undertaking by
or on behalf of the Director or Indemnified Officer to repay such amount unless
it shall ultimately be determined that such person is entitled to be indemnified
by the Corporation against such Expenses. Subject to receipt of such
undertaking, the Corporation shall make reasonable periodic advances for
Expenses pursuant to this Section, unless the Board of Directors shall
determine, in the manner provided in Section 6.3 and based on the facts then
known, that indemnification under this Article is or will be precluded.
Section 6.5. Reliance and Consideration. Any Director or Indemnified
Officer who at any time after the adoption of this Article serves or has served
in any of the aforesaid capacities for or on behalf of the Corporation shall be
deemed to be doing or to have done so in reliance upon, and as consideration
for, the right of indemnification provided herein. Such right, however, shall
not be exclusive of any other rights to which such person may be entitled apart
from the provisions of this Article. No amendment, modification or repeat of
this Article shall adversely affect the right of any Director or Indemnified
Officer to indemnification hereunder with respect to any activities occurring
prior to the time of such amendment, modification or repeal.
Section 6.6. Insurance. The Corporation may purchase and maintain
insurance on behalf of its directors, officers, employees and agents and those
persons who were or are serving at the request of the Corporation in any
capacity with another
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corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise against any liability asserted against or incurred by such person in
any such capacity, or arising out of his or her status as such, whether or not
the Corporation would have the power to indemnify such person against such
liability under the provisions of this Article or otherwise. Any full or partial
payment made by an insurance company under any insurance policy covering any
director, officer, employee, agent or other person indemnified above made to or
on behalf of a person entitled to indemnification under this Article shall
relieve the Corporation of its liability for indemnification provided for in
this Article or otherwise to the extent of such payment, and no insurer shall
have a right of subrogation against the Corporation with respect to such
payment.
ARTICLE VII
FISCAL YEAR
Section 7.1. Fiscal Year. The fiscal year of the Corporation shall be
the twelve months ended October 31.
ARTICLE VIII
AMENDMENTS
Section 8.1. Amendments of By-Laws. The By-Laws of the Corporation
shall be subject to alteration or repeal, and new By-Laws may be adopted by (i)
the affirmative vote of at least 80% of the outstanding shares entitled to vote
in the election of Directors or by (ii) a majority of the entire Board of
Directors at any meeting at which a quorum is present; provided that the Board
of Directors shall not have power to adopt any By-Law, or expand the
authorization conferred by any By-Law, which by statute only the shareholders
have power to so adopt or expand. Any By-Law adopted by the Board of Directors
may be amended or repealed by shareholders entitled to vote thereon as herein
provided; and any By-Law adopted by the shareholders may be amended or repealed
by the Board of Directors except as limited by statute as above provided and
except when the shareholders have expressly provided otherwise with respect to
any particular By-Law. Further provided, in each case, that notice of the
proposed amendment shall have been contained in the notice of the meeting.
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