BYLAWS
OF
NATURAL WAY TECHNOLOGIES, INC.
ARTICLE I
OFFICES
1.01 REGISTERED OFFICE AND AGENT
The registered office of the Corporation shall be maintained at 502 E.
John Street, Room E., Carson City, Nevada 89706 in the State of Nevada. The
registered office or the registered agent, or both, may be changed by
resolution of the Board of Directors, upon filing the statement required by
law.
1.02 PRINCIPAL OFFICE
The principal office of the Corporation shall be at One World Trading
Centre, Ste. 7865, New York, New York 10048 provided that the Board of
Directors shall have power to change the location of the principal office in
its discretion.
1.03 OTHER OFFICES
The Corporation may also maintain other offices at such places within or
without the State of Nevada as the Board of Directors may from time to time
appoint or as the business of the Corporation may require.
ARTICLE II
SHAREHOLDERS
2.01 PLACE OF MEETING
All meetings of shareholders, both regular and special, shall be held
either at the registered office of the Corporation, or at such other place as
shall be designated in the notice of the meeting.
2.02 ANNUAL MEETING
The annual meeting of shareholders for the election of directors and for
the transaction of all other business which may come before the meeting shall
be held on the 30th day of April in each year (if not a legal holiday and, if a
legal holiday, then on the next business day following) at the hour specified
in the notice of meeting.
If the election of directors shall not be held on the day above designated
for the annual meeting, the Board of Directors shall cause the election to be
held as soon thereafter as conveniently may be at a special meeting of the
shareholders called for the purpose of holding such election.
The annual meeting of shareholders may be held for any other purpose in
addition to the election of director which may be specified in a notice of such
meeting. The meeting may be called by resolution of the Board of Directors or
by a writing filed with the secretary signed either by a majority of the
directors or by shareholders owning a majority in amount of the entire capital
stock of the Corporation issued and outstanding and entitled to vote at any
such meeting.
2.03 NOTICE OF SHAREHOLDERS' MEETING
A written or printed notice stating the place, day and hour of the
meeting, and in case of a special meeting, the purpose or purposes for which
the meeting is called, shall be delivered not less than ten (10) nor more than
sixty (60) days before the date of the meeting, either personally or by mail,
by or at the direction of the president, secretary or the officer or person
calling the meeting, to each shareholders of record entitled to vote at such
meeting. If mailed, such notice shall be deemed to be delivered when deposited
deemed to be delivered when deposited in the United States mail addressed to
the shareholder at his address as it appears on the share transfer books of the
Corporation, with postage thereon prepaid.
2.04 VOTING OF SHARES
Each outstanding share, regardless of class, shall be entitled to one vote
on each matter submitted to a vote at a meeting of shareholders, except to the
ed by the Articles of Incorporation or by law.
Treasury shares, shares of its own stock owned by another corporation the
majority of the voting stock of which is owned or controlled by this
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Corporation, and shares of its own stock held by this Corporation in a
fiduciary capacity shall not be voted, directly or indirectly, at any meeting,
and shall not be counted in determining the total number of outstanding shares
at any given time.
A shareholder may vote either in person or by proxy executed in writing by
the shareholder or by his duly authorized attorney-in-fact. No proxy shall be
valid after eleven (11) months from the date of its execution unless otherwise
provided in the proxy. Each proxy shall be revocable unless expressly provided
therein to be irrevocable, and in no event shall it remain irrevocable for a
period of more than eleven (11) months.
At each election for directors and every shareholder entitled to vote at
such election shall have the right to vote, in person or by proxy, the number
of shares owned by him for as many persons as there are directors to be elected
and for whose election he has a right to vote, or unless prohibited by the
Articles of Incorporation, to cumulate his votes by giving one candidate as
many votes as the number of such directors multiplied by the number of his
shares shall equal, or by distributing such votes on the same principal among
any number of such candidates. Any shareholder who intends to cumulate his
votes as herein authorized shall give written notice of such intention to the
secretary of the Corporation on or before the day preceding the election at
which such shareholder intends to cumulate his votes.
2.05 CLOSING TRANSFER BOOKS AND FIXING RECORD DATE
For the purpose of determining shareholders entitled to notice of or to
vote at any meeting of shareholders or any adjournment thereof, or entitled to
receive payment of any dividend, or in order to make a determination of
shareholders for any other proper purpose, the Board of Directors may provide
that the share transfer books shall be closed for a stated period not exceeding
sixty (60) days. If the stock transfer books shall be closed for the purpose
of determining shareholders entitled to notice of or to vote at a meeting of
shareholders, such books shall be closed for at least ten (10) days immediately
preceding such meeting. In lieu of closing the stock transfer books, the
ByLaws or, in the absence of an applicable ByLaw, the Board of Directors may
fix in advance a date as the record date for any such determination of
shareholders, not later than sixty (60) days and, in case of a meeting of
shareholders, not earlier than ten (10) days, prior to the date on which the
particular action requiring such determination of shareholders is to be taken.
If the share transfer books are not closed and no record date is fixed for the
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determination of shareholders entitled to notice of or to vote at a meeting of
shareholders, or shareholders entitled to receive payment of a dividend, the
date on which notice of the meeting is mailed or the date on which the
resolution of the Board of Directors declaring such dividend is adopted, as the
case may be, shall be the record date for such determination of shareholders.
When a determination of shareholders entitled to vote at any meeting of
shareholders has been made as provided in this section, such determination
shall apply to any adjournment thereof, except where the determination has been
made through the closing of share transfer books and the stated period of
closing has expired.
2.06 QUORUM OF SHAREHOLDERS
Unless otherwise provided in the Articles of Incorporation, the holders of
a majority of the shares entitled to vote, represented in person or by proxy,
shall constitute a quorum at a meeting of shareholders, but in no event shall a
quorum consist of the holders of less than one-third (1/3) of the shares
entitled to vote and thus represented at such meeting. The vote of the holders
of a majority of the shares entitled to vote and thus represented at a meeting
at which a quorum is present shall be the act of the shareholders' meeting,
unless the vote of a greater number is required by law, the Articles of
Incorporation or the ByLaws.
2.07 VOTING LISTS
The officer or agent having charge of the share transfer books for the
shares of the Corporation shall make, at least ten (10) days before each
meeting of shareholders, a complete list of the shareholders entitled to vote
at such meeting or any adjournment thereof, arranged in alphabetical order,
with the address of and the number of shares held by each, which list, for a
period of ten (10) days prior to such meeting, shall be kept on file at the
registered office of the Corporation and shall be subject to inspection by any
shareholders at any time during usual business hours. Such list shall also 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. The original share transfer books shall be prima-facie evidence as to
who are the shareholders entitled to examine such list or transfer books or to
vote at any meeting of shareholders.
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2.08 ACTION BY CONSENT OF SHAREHOLDERS
In lieu of a formal meeting, action may be taken by written consent of
such number of the shareholders as is required by either State law or the
Corporation's Bylaws for passage of such corporate action.
ARTICLE III
DIRECTORS
3.01 BOARD OF DIRECTORS
The business and affairs of the Corporation shall be managed by a Board of
Directors. Directors need not be residents of the State of Nevada or
shareholders in the Corporation.
3.02 NUMBER AND ELECTION OF DIRECTORS
The number of directors shall be two (2) provided that the number may be
increased or decreased from time to time by an amendment to these ByLaws, but
no decrease shall have the effect of shortening the term of any incumbent
director. At each annual election the shareholders shall elect directors to
hold office until the next succeeding annual meeting.
3.03 VACANCIES
Any vacancy occurring in the Board of Directors may be filled by the
affirmative vote of the remaining directors, though less than a quorum of the
Board. A director elected to fill a vacancy shall be elected for the unexpired
term of his predecessor in office. Any directorship to be filled by reason of
an increase in the number of directors shall be filled by election at an annual
meeting or at a special meeting of shareholders called for that purpose.
3.04 QUORUM OF DIRECTORS
A majority of the Board of Directors shall constitute a quorum for the
transaction of business. The act of the majority of the directors present at a
meeting at which a quorum is present shall be the act of the Board of
Directors.
3.05 ANNUAL MEETING OF DIRECTORS
Within thirty (30) days after each annual meeting of shareholders, the
Board of Directors elected at such meeting shall hold an annual meeting at
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which they shall elect officers and transact such other business as shall come
before the meeting.
3.06 REGULAR MEETING OF DIRECTORS
A regular meeting of the Board of Directors may be held at such time as
shall be determined from time to time by resolution of the Board of Directors.
3.07 SPECIAL MEETINGS OF DIRECTORS
The secretary shall call a special meeting of the Board of Directors
whenever requested to do so by the President or by two directors. Such special
meeting shall be held at the time specified in the notice of meeting.
3.08 PLACE OF DIRECTORS MEETINGS
All meetings of the Board of Directors (annual, regular or special) shall
be held either at the principal office of the Corporation or at such other
place, either within or without the State of Nevada, as shall be specified in
the notice of meeting.
3.09 NOTICE OF DIRECTORS MEETINGS
All meetings of the Board of Directors (annual, regular or special) shall
be held upon five (5) days written notice stating the date, place and hour of
meeting delivered to each director either personally or by mail or at the
direction of the president or the secretary or the officer or person calling
the meeting.
In any case where all of the directors execute a waiver of notice of the
time and place of meeting, no notice thereof shall be required, and any such
meeting (whether annual, regular or special) shall be held at the time and at
the place (either within or without the State of Nevada) specified in the
waiver of notice. Attendance of a director at any meeting shall constitute a
waiver of notice of such meeting, except where the directors attends a meeting
for the express purpose of objecting to the transaction of any business on the
ground that the meeting is not lawfully called or convened.
Neither the business to be transacted at, nor the purpose of, any annual,
regular or special meeting of the Board of Directors need be specified in the
notice or waiver of notice of such meeting.
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3.10 COMPENSATION
Directors, as such, shall not receive any stated salary for their
services, but by resolution of the Board of Directors a fixed sum and expenses
of attendance, if any, may be allowed for attendance at each annual, regular or
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.
3.11 ACTION BY CONSENT OF DIRECTORS
In lieu of a formal meeting, action may be taken by written consent of
such number of the directors as is required by either State law or the
Corporation's Bylaws for passage of such corporate action.
ARTICLE IV
OFFICERS
4.01 OFFICERS ELECTION
The officers of the Corporation shall consist of a president, one or more
vice presidents, a secretary, and a treasurer. All such officers shall be
elected at the annual meeting of the Board of Directors provided for in Article
III, Section 5. If any office is not filled at such annual meeting, it may be
filled at any subsequent regular or special meeting of the Board. The Board of
Directors at such annual meeting, or at any subsequent regular or special
meeting may also elect or appoint such other officers and assistant officers
and agents as may be deemed necessary. Any two or more offices may be held by
the same person, except the offices of president and secretary.
All officers and assistant officers shall be elected to serve until the
next annual meeting of directors (following the next annual meeting of
shareholders) or until their successors are elected; provided, that any officer
or assistant officer elected or appointed by the Board of Directors may be
removed with or without cause at any regular or special meeting of the Board
whenever in the judgment of the Board of Directors the best interests of the
Corporation will be served thereby, but such removal shall be without prejudice
to the contract rights, if any, of the person so removed. Any agent appointed
shall serve for such term, not longer than the next annual meeting of the Board
of Directors, as shall be specified, subject to like right of removal by the
Board of Directors.
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4.02 VACANCIES
If any office becomes vacant for any reason, the vacancy may be filled by
the Board of Directors.
4.03 POWER OF OFFICERS
Each officer shall have, subject to these ByLaws, in addition to the
duties and powers specifically set forth herein, such powers and duties as are
commonly incident to his office and such duties and powers as the Board of
Directors shall from time to time designate. All officers shall perform their
duties subject to the directions and under the supervision of the Board of
Directors. The president may secure the fidelity of any and all officers by
bond or otherwise.
4.04 PRESIDENT
The president shall be the chief executive officer of the Corporation. He
shall preside at all meetings of the directors and shareholders. He shall see
that all orders and resolutions of the Board are carried out, subject however,
to the right of the directors to delegate specific powers, except such as may
be by statute exclusively conferred on the president, to any other officers of
the Corporation.
He or any vice president shall execute bonds, mortgages and other
instruments requiring a seal, in the name of the Corporation, and, when
authorized by the Board, he or any vice president may affix the seal to any
instrument requiring the same, and the seal when so affixed shall be attested
by the signature of either the secretary or an assistant secretary. He or any
vice president shall sign certificates of stock.
The president shall be ex-officio a member of all standing committees.
He shall submit a report of the operations of the Corporation for the year
to the directors at their meeting next preceding the annual meeting of the
shareholders and to the shareholders at their annual meeting.
4.05 VICE PRESIDENT
The vice president shall, in the absence or disability of the president,
perform the duties and exercise the powers of the president, and they shall
perform such other duties as the Board of Directors shall prescribe.
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4.06. SECRETARY AND ASSISTANT SECRETARIES
The secretary shall attend all meetings of the Board and all meetings of
the shareholders and shall record all votes and the minutes of all proceedings
and shall perform like duties for the standing committees when required. He
shall give or cause to be given notice of all meetings of the shareholders and
all meetings of the Board of Directors and shall perform such other duties as
may be prescribed by the Board. He shall keep in safe custody the seal of the
Corporation, and when authorized by the Board, affix the same to any instrument
requiring it, and when so affixed, it shall be attested by his signature or by
the signature of an assistant secretary.
The assistant secretary shall, in the absence or disability of the
secretary, perform the duties and exercise the powers of the secretary, and
they shall perform such other duties as the Board of Directors shall prescribe.
In the absence of the secretary or an assistant secretary, the minutes of
all meetings of the Board and shareholders shall be recorded by such person as
shall be designated by the president or by the Board of Directors.
4.07 TREASURER AND ASSISTANT TREASURERS
The treasurer shall have the custody of the corporate funds and securities
and shall keep full and accurate accounts of receipts and disbursements in
books belonging to the Corporation and shall deposit all moneys and other
valuable effects in the name and to the credit of the Corporation in such
depositories as may be designated by the Board of Directors.
The treasurer shall disburse the funds of the Corporation as may be
ordered by the Board of Directors, taking proper vouchers for such
disbursements. He shall keep and maintain the Corporation's books of account
and shall render to the president and directors an account of all of his
transactions as treasurer and of the financial condition of the Corporation and
exhibit his books, records and accounts to the president or directors at any
time. He shall disburse funds for capital expenditures as authorized by the
Board of Directors and in accordance with the orders of the president, and
present to the president for his attention any requests for disbursing funds if
in the judgment of the treasurer any such request is not properly authorized.
He shall perform such other duties as may be directed by the Board of Directors
or by the president.
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If required by the Board of Directors, he shall give the Corporation a
bond in such sum and with such surety or sureties as shall be satisfactory to
the Board for the faithful performance of the duties of his office and for the
restoration to the Corporation, in case of his death, resignation, retirement
or removal from office, of all books, papers, vouchers, money and other
property of whatever kind in his possession or under his control belonging to
the Corporation.
The assistant treasurers in the order of their seniority shall, in the
absence or disability of the treasurer, perform the duties and exercise the
powers of the treasurer, and they shall perform such other duties as the Board
of Directors shall prescribe.
ARTICLE V
CERTIFICATES OF STOCK: TRANSFER, ETC.
5.01 CERTIFICATES OF STOCK
The certificates for shares of stock of the Corporation shall be numbered
and shall be entered in the Corporation as they are issued. They shall exhibit
the holder's name and number of shares and shall be signed by the president or
a vice president and the secretary or an assistant secretary or if the Board of
Directors determines, by any one of the afore named officers and shall be
sealed with the seal of the Corporation or a facsimile thereof. If the
Corporation has a transfer agent or a registrar, other than the Corporation
itself or an employee of the Corporation, the signatures of any such officer
may be facsimile. In case any officer or officers who shall have signed or
whose facsimile signature or signatures shall have been used on any such
certificate or certificates shall cease to be such officer or officers of the
Corporation, whether because of death, resignation or otherwise, before said
certificate or certificates shall have been issued, such certificate may
nevertheless be issued by the Corporation with the same effect as though the
person or persons who signed such certificates or whose facsimile signature or
signatures shall have been used thereon had been such officer or officers at
the date of its issuance. Certificates shall be in such form as shall in
conformity to law be prescribed from time to time by the Board of Directors.
The Corporation may appoint from time to time transfer agents and
registrars, who shall perform their duties under the supervision of the
secretary.
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5.02 TRANSFERS OF SHARES
Upon surrender to the Corporation or the transfer agent of the Corporation
of a certificate for shares duly endorsed or accompanied by 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.
5.03 REGISTERED SHAREHOLDERS
The Corporation shall be entitled to treat the holder of record of any
share or shares of stock as the holder in fact thereof and, accordingly shall
not be bound to recognize any equitable or other claim to or interest in such
share on the part of any other person, whether or not it shall have express or
other notice thereof, except as otherwise provided by law.
5.04 LOST CERTIFICATE
The Board of Directors may direct a new certificate or certificates to be
issued in place of any certificate or certificates theretofore issued by the
Corporation alleged to have been lost or destroyed, upon the making of an
affidavit of that fact by the person claiming the certificate to be lost. When
authorizing such issue of a new certificate or certificates, the Board of
Directors in its discretion and as a condition precedent to the issuance
thereof, may require the owner of such lost or destroyed certificate or
certificates or his legal representative to advertise the same in such manner as
it shall require or to give the corporation a bond with surety and in form
satisfactory to the Corporation (which bond shall also name the Corporation's
transfer agents and registrars, if any, as obligees) in such sum as it may
direct as indemnity against any claim that may be made against the Corporation
or other obligees with respect to the certificate alleged to have been lost or
destroyed, or to advertise and also give such bond.
ARTICLE VI
DIVIDEND
6.01 DECLARATION
The Board of Directors may declare at any annual, regular or special
meeting of the Board and the Corporation may pay, dividends on the outstanding
shares in cash, property or in the shares of the Corporation to the extent
permitted by, and subject to the provisions of, the laws of the State of
Nevada.
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6.02 RESERVES
Before payment of any dividend there may be set aside out of any funds of
the Corporation available for dividends such sum or sums as the directors from
time to time in their absolute discretion think proper as a reserve fund to
meet contingencies or for equalizing dividends or for repairing or maintaining
any property of the Corporation or for such other purpose as the directors
shall think conducive to the interest of the Corporation, and the directors may
abolish any such reserve in the manner in which it was created.
ARTICLE VII
MISCELLANEOUS
7.01 INFORMAL ACTION
Any action required to be taken or which may be taken at a meeting of the
shareholders, directors or members of the executive committee, may be taken
without a meeting if a consent in writing setting forth the action so taken
shall be signed by all of the shareholders, directors, or members of the
executive committee, as the case may be, entitled to vote with respect to the
subject matter thereof, and such consent shall have the same force and effect
as a unanimous vote of the shareholders, directors, or members of the executive
committee, as the case may be, at a meeting of said body.
7.02 SEAL
The corporate seal shall be circular in form and shall contain the name of
the Corporation, the year of its incorporation and the words "State of Nevada",
and "CORPORATE SEAL". The seal may be used by causing it or a facsimile to be
impressed or affixed or in any other manner reproduced. The corporate seal may
be altered by order of the Board of Directors at any time.
7.03 CHECKS
All checks or demands for money and notes of the Corporation shall be
signed by such officer or officers or such other person or persons as the Board
of Directors may from time to time designate.
7.04 FISCAL YEAR
The fiscal year of the Corporation shall begin on the 1st day of January
in each and every year.
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7.05 DIRECTORS ANNUAL STATEMENT
The Board of Directors shall present at each annual meeting of
shareholders a full and clear statement of the business and condition of the
Corporation.
7.06 CLOSE CORPORATIONS: MANAGEMENT BY SHAREHOLDERS
If the Articles of Incorporation of the Corporation and each certificate
representing its issued and outstanding shares states that the business and
affairs of the Corporation shall be managed by the shareholders of the
Corporation rather than by the Board of Directors, then, whenever the context
so requires the shareholders of the Corporation shall be deemed the directors
of the Corporation for the purposes of applying any provision of these ByLaws.
7.07 AMENDMENTS
These ByLaws may be altered, amended or repealed in whole or in part by
the affirmative vote of the Board of Directors.
ARTICLE VIII
INDEMNIFICATION OF OFFICERS AND DIRECTORS
The following Articles describes and sets out the parameters of
indemnification as set out in Article 2.02-1 of the Texas Business Corporations
Act.
"Article 2.02-1 of the Texas Business Corporation Act provides the
following with respect to indemnification of officers and directors:
Art. 2.02-1 Power to Indemnify and to Purchase Indemnity Insurance; Duty
to Indemnify.
A. 1. "Corporation" includes any domestic or foreign predecessor entity
of the corporation in a merger, consolidation, or other
transaction which the liabilities of the predecessor are
transferred to the corporation by operation of law and in any
other transaction in which the corporation assumes the liabilities
of the predecessor but does not specifically exclude liabilities
that are the subject matter of this article.
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A. 2. "Director" means any person who is or was a director of the
corporation and any person who, while a director of the
corporation, is or was serving at the request of the corporation
as a director, officer, partner, venturer, proprietor, trustee,
employee, agent, or similar functionary of another foreign or
domestic corporation, partnership, joint venture, sole
proprietorship, trust, employee benefit plan, or other enterprise.
A. 3. "Expenses" include court costs and attorney's fees.
A. 4. "Official capacity" means:
a. When used with respect to a director, the office of director
in the corporation, and
b. When used with respect to a person other than a director, the
elective or appointive office in the corporation held by the
officer or the employment or agency relationship undertaken by
the employee or agent in behalf of the corporation, but
c. In both paragraphs (a) and (b) does not include service for
any other foreign or domestic corporation or any partnership,
joint venture, sole proprietorship, trust, employee benefit
plan, or other enterprise.
5. "Proceeding" means any threatened, pending, or completed action,
suit, or proceedings, whether civil, criminal, administrative,
arbitrative, or investigative, any appeal in such an action, suit,
or proceeding, and any inquiry or investigation that could lead to
such an action, suit, or proceeding.
B. A corporation may indemnify a person who was, is or is threatened to
be made a named defendant or respondent in a proceeding because the
person is or was a director only if it is determined in accordance
with Section F of this article that the person:
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1. Conducted himself in good faith;
2. reasonably believed;
a. In the case of conduct in his official capacity as a director
of the corporation, that his conduct was in the corporation's
best interest, and
b. In all other cases, that his conduct was at least not opposed
to the corporation's best interest; and
3. In the case of any criminal proceeding, had no reasonable cause to
believe his conduct was lawful.
C. A director may not be indemnified under Section B of this article for
obligations resulting from a proceeding:
1. In which the person is found liable on the basis that personal
benefit was improperly received by him, whether or not the benefit
resulted from an action taken in the persons' official capacity;
or
2. In which the person is found liable to the corporation.
D. The termination of a proceeding by judgment, order, settlement, or
conviction, or on a plea of nolo contendere or its equivalent is not
of itself determinative that the person did not meet the requirements
set forth in Section B of this article.
E. A person may be indemnified under Section B of this article against
judgments, penalties (including excise and similar taxes), fines,
settlements, and reasonable expenses actually incurred by the person
in connection with the proceeding; but if the proceeding was brought
by or in behalf of the corporation, the indemnification is limited to
reasonable expenses actually incurred by the person in connection with
the proceeding.
F. A determination of indemnification under Section B of this article
must be made:
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1. By a majority vote of a quorum consisting of directors who at the
time of the vote are not named defendants or respondents in the
proceeding;
2. If such a quorum cannot be obtained, by a majority vote of a
committee of the board of directors, designated to act in the
matter by a majority vote of all directors, consisting solely of
two or more directors who at the time of the vote are not named
defendants or respondents in the proceeding.
3. By special legal counsel selected by the board of directors or a
committee of the board by vote as set for in Subsection (1) or (2)
of this section, or, if such quorum cannot be obtained and such a
committee cannot be established, by a majority vote of all
directors; or
4. By the shareholders in a vote that excludes the shares held by
directors who are named defendants or respondents in the
proceeding.
G. Authorization of indemnification and determination as to
reasonableness of expenses must be made in the same manner as the
determination that indemnification is permissible, except that if the
determination that indemnification is permissible is made by special
legal counsel, authorization of indemnification and determination as
to reasonableness of expenses must be made in the manner specified by
Subsection (3) of section F of this article for the selected of
special legal counsel. A provision contained in the article of
incorporation, bylaws, a resolution of shareholders or directors, or
an agreement that makes mandator the indemnification permitted under
section B of this article shall be deemed to constitute authorization
of indemnification in the manner required by this section even though
such provision may not have been adopted or authorized in the same
manner as the determination that indemnification is permissible.
H. A corporation shall indemnify a director against reasonable expenses
incurred by him in connection with a proceeding in which he is a named
defendant or respondent because he is or was a director if he has been
wholly successful, on the merits or otherwise, in the defense of the
proceeding.
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I. If, in a suit for the indemnification required by section H of this
article, a court of competent jurisdiction determines that the
director is entitled to indemnification under that section, the court
shall order indemnification and shall award to the director the
expenses incurred in securing the indemnification.
J. If, upon application of a director, a court of competent jurisdiction
determines, after giving any notice the court considers necessary,
that the director is fairly and reasonably entitled to indemnification
in view of all the relevant circumstances, whether or not he has met
the requirements set forth in section B of this article or has been
abjudged liable in the circumstances described by section C of this
article, the court may order the indemnification that the court
determines is proper and equitable. The court shall limit
indemnification to reasonable expenses if the proceeding is brought by
or on behalf of the corporation or if the director is found liable on
the basis that personal benefit was improperly received by him,
whether or not the benefit resulted from an action taken in the
person's official capacity.
K. Reasonable expenses incurred by a director who was, is, or is
threatened to be made a named defendant or respondent in a proceeding
may be paid or reimbursed by the corporation in advance of the final
disposition of the proceeding after:
1. The corporation receives a written affirmation by the director of
his good faith belief that he has met the standard of conduct
necessary for indemnification under this article and a written
undertaking by or on behalf of the director to repay the amount
paid or reimbursed if it is ultimately determined that he has not
met those requirements; and
2. A determination that the facts then known to those making the
determination would not preclude indemnification under this
article.
L. The written undertaking required by section K of this article must be
an unlimited general obligation of the director but need not be
secured. It may be accepted without reference to financial ability to
make repayment. Determinations and authorizations of payments under
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section K of this article must be made in the manner specified by
section F of this article for determining that indemnification is
permissible.
M. A provision for a corporation to indemnify or to advance expenses to a
director who was, is, or is threatened to be made a named defendant or
respondent in a proceeding, whether contained in the articles of
incorporation, the bylaws, a resolution of shareholders or directors,
an agreement, or otherwise, except in accordance with section R of
this article, is valid only to the extent it is consistent with this
article as limited by the articles of incorporation, if such a
limitation exists.
N. Notwithstanding any other provision of this article, a corporation may
pay or reimburse expenses incurred by a director in connection with
his appearance as a witness or the participation in a proceeding at a
time when he is not a named defendant or respondent in the proceeding.
O. An officer of the corporation shall be indemnified as, and to the same
extent, provided by section H, I, and J of this article for a director
and is entitled to seek indemnification under those sections to the
same extent as a director. A corporation may indemnify and advance
expenses to an officer, employee, or agent of the corporation to the
same extent that it may indemnify and advance expenses to directors
under this article.
P. A corporation may indemnify and advance expenses to persons who are
not or were not officers, employees, or agents of the corporation but
who are or were serving at the request of the corporation as a
director, officer, partner, venturer, proprietor, trustee, employee,
agent, or similar functionary of another foreign or domestic
corporation, partnership, joint venture, sole proprietorship, trust,
employee benefit plan, or other enterprise to the same extent that it
may indemnify and advance expenses to directors under this article.
Q. A corporation may indemnify and advance expenses to an officer,
employee, agent, or person identified in section P of this article and
who is not a director to such further extent, consistent with law, as
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may be provided by its articles of incorporation, bylaws, general or
specific action of its board of directors, or contract or as permitted
or required by common law.
R. A corporation may purchase and maintain insurance on behalf of any
person who is or was a director, officer, employee, or agent of the
corporation or who is or was serving at the request of the corporation
as a director, officer, partner, venturer, proprietor, trustee,
employee, agent, or similar functionary of another foreign or domestic
corporation, partnership, joint venture, sole proprietorship, trust,
employee benefit plan, or other enterprise, against any liability
asserted against him and incurred by him or in such a capacity or
arising out of his status as such a person, whether or not the
corporation would have the power to indemnify him against that
liability under this article.
S. Any indemnification of or advance of expenses to a director in
accordance with this Article shall be reported in writing to the
shareholders with or before the notice or waiver of notice of the next
shareholders' meeting or with or before the next submission to
shareholders of a consent to action without a meeting pursuant to
section A. Article 9.10 of this Act and, in any case, within the
twelve month period immediately following the date of the
indemnification or advance.
T. For purposes of this article, the corporation is deemed to have
requested a director to serve an employee benefit plan whenever the
performance by him of his duties to the corporation also imposes
duties on or otherwise involves services by him to the plan or
participants or beneficiaries of the plan. Excise taxes assessed on a
director with respect to an employee benefit plan pursuant to
applicable law are deemed fines. Action taken or omitted by him with
respect to an employee benefit plan in the performance of his duties
for a purpose reasonably believed by him to be in the interest of the
participants and beneficiaries of the plan is deemed to be for a
purpose which is not opposed to the best interest of the corporation.
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U. The articles of incorporation of a corporation may restrict the
circumstances under which the corporation is required or permitted to
indemnify a person under sections H, I, J, O, P, or Q of this
article."
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