EXHIBIT 3.2
BYLAWS
OF
kNUTEK HOLDINGS, INC.
a California corporation
TABLE OF CONTENTS
ARTICLE I OFFICES 1
Section 1.1 Principal Executive Office. 1
Section 1.2 Other Offices. 1
ARTICLE II MEETINGS OF SHAREHOLDERS 1
Section 2.1 Place of Meetings. 1
Section 2.2 Annual Meeting. 1
Section 2.3 Notice of Annual Meeting. 2
Section 2.4 Special Meetings. 3
Section 2.5 Notice of Special Meetings. 3
Section 2.6 Quorum. 3
Section 2.7 Adjourned Meeting and Notice. 3
Section 2.8 Record Date. 4
Section 2.9 Voting. 4
Section 2.10 Proxies. 5
Section 2.11 Validation of Defectively Called or Noticed
Meetings. 6
Section 2.12 Action Without Meeting. 6
Section 2.13 Inspectors of Election. 7
ARTICLE III BOARD OF DIRECTORS 7
Section 3.1 Powers; Approval of Loans to Officers. 7
Section 3.2 Number and Qualification of Directors. 8
Section 3.3 Election and Term of Office. 8
Section 3.4 Vacancies. 8
Section 3.5 Time and Place of Meetings. 9
Section 3.6 Notice of Special Meetings. 9
Section 3.7 Action at a Meeting: Quorum and Required Vote. 10
Section 3.8 Action Without a Meeting. 10
Section 3.9 Adjourned Meeting and Notice. 10
Section 3.10 Telephonic Meetings. 10
Section 3.11 Fees and Compensation. 11
Section 3.12 Appointment of Executive and Other Committees. 11
ARTICLE IV OFFICERS 12
Section 4.1 Officers. 12
Section 4.2 The Chairman of the Board. 12
Section 4.3 The President. 13
Section 4.4 Vice-Presidents. 13
Section 4.5 The Secretary. 13
Section 4.6 The Chief Financial Officer. 14
Section 4.7 The Controller. 14
ARTICLE V EXECUTION OF CORPORATE INSTRUMENTS, RATIFICATION,
AND VOTING OF STOCKS OWNED BY THE CORPORATION 14
Section 5.1 Execution of Corporate Instruments. 14
Section 5.2 Ratification by Shareholders. 15
Section 5.3 Voting of Stocks Owned by the Corporation. 15
ARTICLE VI ANNUAL AND OTHER REPORTS 15
Section 6.1 Reports to Shareholders. 15
Section 6.2 Report of Shareholder Vote. 16
Section 6.3 Reports to the Secretary of State. 16
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ARTICLE VII SHARES OF STOCK 17
ARTICLE VIII INSPECTION OF CORPORATE RECORDS 17
Section 8.1 General Records. 17
Section 8.2 Inspection of Bylaws. 18
ARTICLE IX INDEMNIFICATION OF OFFICERS, DIRECTORS, EMPLOYEES
AND AGENTS 18
Section 9.1 Right to Indemnification. 18
Section 9.2 Authority to Advance Expenses. 19
Section 9.3 Right of Claimant to Bring Suit. 19
Section 9.4 Provisions Nonexclusive. 20
Section 9.5 Authority to Insure. 20
Section 9.6 Survival of Rights. 20
Section 9.7 Settlement of Claims. 20
Section 9.8 Effect of Amendment. 20
Section 9.9 Subrogation. 20
Section 9.10 No Duplication of Payments. 20
ARTICLE X AMENDMENTS 21
Section 10.1 Power of Shareholders. 21
Section 10.2 Power of Directors. 21
ARTICLE XI DEFINITIONS 21
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BYLAWS
OF
kNUTEK HOLDINGS, INC.
a California corporation
ARTICLE I Offices
Section 1.1 Principal Executive Office.
The principal executive office of the corporation shall be located at such
place as the Board of Directors may from time to time authorize. If the
principal executive office is located outside this state, and the corporation
has one or more business offices in this state, the Board of Directors shall fix
and designate a principal business office in the State of California.
Section 1.2 Other Offices.
Other business offices may at any time be established at any place or
places specified by the Board of Directors.
ARTICLE II Meetings of Shareholders
Section 2.1 Place of Meetings.
All meetings of shareholders shall be held at the principal executive
office of the corporation, or at any other place, within or without the State of
California, specified by the Board of Directors.
Section 2.2 Annual Meeting.
The annual meeting of the shareholders, after the year 2001, shall be held
at the time and date in each year fixed by the Board of Directors. At the
annual meeting, directors shall be elected, reports of the affairs of the
corporation shall be considered, and any other business may be transacted that
is within the power of the shareholders.
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Section 2.3 Notice of Annual Meeting.
Written notice of each annual meeting shall be given to each shareholder
entitled to vote, either personally or by first-class mail, or, if the
corporation has outstanding shares held of record by 500 or more persons
(determined in accordance with Section 605 of the General Corporation Law) on
the record date for the meeting, by third-class mail, or by other means of
written communication, charges prepaid, addressed to such shareholder at the
shareholder's address appearing on the books of the corporation or given by such
shareholder to the corporation for the purpose of notice. If any notice or
report addressed to the shareholder at the address of such shareholder appearing
on the books of the corporation is returned to the corporation by the United
States Postal Service marked to indicate that the United States Postal Service
is unable to deliver the notice or report to the shareholder at such address,
all future notices or reports shall be deemed to have been duly given without
further mailing if the same shall be available for the shareholder upon written
demand of the shareholder at the principal executive office of the corporation
for a period of one year from the date of the giving of the notice or report to
all other shareholders. If a shareholder gives no address, notice shall be
deemed to have been given to such shareholder if addressed to the shareholder at
the place where the principal executive office of the corporation is situated,
or if published at least once in some newspaper of general circulation in the
county in which said principal executive office is located.
All such notices shall be given to each shareholder entitled thereto not
less than ten (10) days (or, if sent by third-class mail, thirty (30) days) nor
more than sixty (60) days before each annual meeting. Any such notice shall be
deemed to have been given at the time when delivered personally or deposited in
the mail or sent by other means of written communication. An affidavit of
mailing of any such notice in accordance with the foregoing provisions, executed
by the Secretary, Assistant Secretary or any transfer agent of the corporation
shall be prima facie evidence of the giving of the notice.
Such notice shall specify:
(a) the place, the date, and the hour of such meeting;
(b) those matters that the Board of Directors, at the time of
the mailing of the notice, intends to present for action by the shareholders
(but, subject to the provisions of subsection (d) below, any proper matter may
be presented at the meeting for such action);
(c) if directors are to be elected, the names of nominees
intended at the time of the notice to be presented by the Board of Directors for
election;
(d) the general nature of a proposal, if any, to take action
with respect to approval of (i) a contract or other transaction with an
interested director, (ii) amendment of the Articles of Incorporation, (iii) a
reorganization of the corporation as defined in Section 181 of the General
Corporation Law, (iv) voluntary dissolution of the corporation, or (v) a
distribution in dissolution other than in accordance with the rights of
outstanding preferred shares, if any; and
(e) such other matters, if any, as may be expressly required by
statute.
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Section 2.4 Special Meetings.
Special meetings of the shareholders for any purpose or purposes whatsoever
may be called at any time by the Chairman of the Board (if there be such an
officer appointed), by the President, by the Board of Directors, or by one or
more shareholders entitled to cast not less than ten percent (10%) of the votes
at the meeting.
Section 2.5 Notice of Special Meetings.
Upon request in writing that a special meeting of shareholders be called
for any proper purpose, directed to the Chairman of the Board (if there be such
an officer appointed), President, Vice President or Secretary by any person
(other than the Board of Directors) entitled to call a special meeting of
shareholders, the officer forthwith 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 the request. Except in special
cases where other express provision is made by statute, notice of any special
meeting of shareholders shall be given in the same manner as for annual meetings
of shareholders. In addition to the matters required by Section 2.3(a) and, if
applicable, Section 2.3(c) of these Bylaws, notice of any special meeting shall
specify the general nature of the business to be transacted, and no other
business may be transacted at such meeting.
Section 2.6 Quorum.
The presence in person or by proxy of persons entitled to vote a majority
of the voting shares at any meeting shall constitute a quorum for the
transaction of business. If a quorum is present, the affirmative vote of a
majority of the shares represented and voting at the meeting (which shares
voting affirmatively also constitute at least a majority of the required quorum)
shall be the act of the shareholders, unless the vote of a greater number or
voting by classes is required by the General Corporation Law or the Articles of
Incorporation. Any meeting of shareholders, whether or not a quorum is present,
may be adjourned from time to time by the vote of the holders of a majority of
the shares present in person or represented by proxy thereat and entitled to
vote, but in the absence of a quorum no other business may be transacted at such
meeting, except that the shareholders present or represented by proxy at a duly
called or held meeting, at which a quorum is present, may continue to transact
business until adjournment, notwithstanding the withdrawal of enough
shareholders to leave less than a quorum, if any action taken (other than
adjournment) is approved by at least a majority of the shares required to
constitute a quorum.
Section 2.7 Adjourned Meeting and Notice.
When any shareholders' meeting, either annual or special, is adjourned for
more than forty-five (45) days, or if after adjournment a new record date is
fixed for the adjourned meeting, notice of the adjourned meeting shall be given
as in the case of an original meeting. Except as provided above, it shall not
be necessary to give any notice of the time and place of the adjourned meeting
or of the business to be transacted thereat, other than by announcement of the
time and place thereof at the meeting at which such adjournment is taken.
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Section 2.8 Record Date.
(a) The Board of Directors may fix a time in the future as a record date
for the determination of the shareholders entitled to notice of and to vote at
any meeting of shareholders or entitled to give consent to corporate action in
writing without a meeting, to receive any report, to receive any dividend or
other distribution, or allotment of any rights, or to exercise rights in respect
of any other lawful action. The record date so fixed shall be not more than
sixty (60) days nor less than ten (10) days prior to the date of such meeting,
nor more than sixty (60) days prior to any other action. A determination of
shareholders of record entitled to notice of or to vote at a meeting of
shareholders shall apply to any adjournment of the meeting unless the Board of
Directors fixes a new record date for the adjourned meeting, but the Board of
Directors shall fix a new record date if the meeting is adjourned for more than
forty-five (45) days from the date set for the original meeting. When a record
date is so fixed, only shareholders of record at the close of business on that
date are entitled to notice of and to vote at any such meeting, to give consent
without a meeting, to receive any report, to receive the dividend, distribution,
or allotment of rights, or to exercise the rights, as the case may be,
notwithstanding any transfer of any shares on the books of the corporation after
the record date, except as otherwise provided in the Articles of Incorporation
or these Bylaws.
(b) If no record date is fixed:
(1) The record date for determining shareholders entitled to
notice of or to vote at a meeting of shareholders shall be at the close of
business on the 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 preceding the
day on which the meeting is held.
(2) 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 of Directors has been taken, shall be the day on which the
first written consent is given.
(3) The record date for determining shareholders for any other
purpose shall be at the close of business on the day on which the Board of
Directors adopts the resolution relating thereto, or the sixtieth (60th) day
prior to the date of such other action, whichever is later.
Section 2.9 Voting.
(a) Except as provided below with respect to cumulative voting and except
as may be otherwise provided in the Articles of Incorporation, each outstanding
share, regardless of class, shall be entitled to one vote on each matter
submitted to a vote of shareholders. Any holders of shares entitled to vote on
any matter may vote part of the shares in favor of the proposal and refrain from
voting the remaining shares or vote them against the proposal, other than
elections to office, but, if the shareholder fails to specify the number of
shares such shareholder is voting affirmatively, it will be conclusively
presumed that the shareholder's approving vote is with respect to all shares
such shareholder is entitled to vote.
(b) Subject to the provisions of Sections 702 through 704 of the General
Corporation Law (relating to voting of shares held by a fiduciary, receiver,
pledgee, or minor, in the name of a corporation, or in joint ownership), persons
in whose names shares entitled to vote stand on the stock records of the
corporation at the close of business on the record date shall be entitled to
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vote at the meeting of shareholders. Such vote may be viva voce or by ballot;
provided, however, that all elections for directors must be by ballot upon
demand made by a shareholder at any election and before the voting begins.
Shares of this corporation owned by a corporation more than twenty-five percent
(25%) of the voting power of which is owned directly by this corporation, or
indirectly through one or more majority-owned subsidiaries of this corporation,
shall not be entitled to vote on any matter.
(c) Subject to the requirements of the next sentence, every shareholder
entitled to vote at any election for directors shall have the right to cumulate
such shareholder's 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
such shareholder's shares are normally entitled, or to distribute votes on the
same principle among as many candidates as such shareholder thinks fit. No
shareholder shall be entitled to cumulate votes unless such candidate's name or
candidates' names have been placed in nomination prior to the voting and the
shareholder has given notice at the meeting, prior to the voting, of the
shareholder's intention to cumulate such shareholder's votes. If any one
shareholder has given such notice, all shareholders may cumulate their votes for
candidates in nomination. The candidates receiving the highest number of
affirmative votes of shares entitled to be voted for them, up to the number of
directors to be elected by such shares, shall be elected. Votes against a
director and votes withheld shall have no legal effect.
Section 2.10 Proxies.
(a) Every person entitled to vote shares (including voting by written
consent) may authorize another person or other persons to act by proxy with
respect to such shares. "Proxy" means a written authorization signed by a
shareholder or the shareholder's attorney-in-fact giving another person or
persons power to vote with respect to the shares of such shareholder. "Signed"
for the purpose of this Section means the placing of the shareholder's name on
the proxy (whether by manual signature, typewriting, telegraphic transmission or
otherwise) by the shareholder or the shareholder's attorney-in-fact. Any proxy
duly executed is not revoked and continues in full force and effect until (i) a
written instrument revoking it is filed with the Secretary of the corporation
prior to the vote pursuant thereto, (ii) a subsequent proxy executed by the
person executing the prior proxy is presented to the meeting, (iii) the person
executing the proxy attends the meeting and votes in person, or (iv) written
notice of the death or incapacity of the maker of such proxy is received by the
corporation before the vote pursuant thereto is counted; provided that no such
proxy shall be valid after the expiration of eleven (11) months from the date of
its execution, unless otherwise provided in the proxy. Notwithstanding the
foregoing sentence, a proxy that states that it is irrevocable, is irrevocable
for the period specified therein to the extent permitted by Section 705(e)
and (f) of the General Corporation Law. The dates contained on the forms of
proxy presumptively determine the order of execution, regardless of the postmark
dates on the envelopes in which they are mailed.
(b) As long as no outstanding class of securities of the corporation is
registered under Section 12 of the Securities Exchange Act of 1934, or is not
exempted from such registration by Section 12(g)(2) of such Act, any form of
proxy or written consent distributed to ten (10) or more shareholders of the
corporation when outstanding shares of the corporation are held of record by 100
or more persons shall afford an opportunity on the proxy or form of written
consent to specify a choice between approval and disapproval of each matter or
group of related matters intended to be acted upon at the meeting for which the
proxy is solicited or by such written consent, other than elections to office,
and shall provide, subject to reasonable specified conditions, that where the
person solicited specifies a choice with respect to any such matter the shares
will be voted in accordance therewith. In any election of directors, any form
of proxy in which the directors to be voted upon are named therein as candidates
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and which is marked by a shareholder "withhold" or otherwise marked in a manner
indicating that the authority to vote for the election of directors is withheld
shall not be voted for the election of a director.
Section 2.11 Validation of Defectively Called or Noticed Meetings.
The transactions of any meeting of shareholders, however called and
noticed, and wherever held, are as valid as though had at a meeting duly held
after regular call and notice, if a quorum is present either in person or by
proxy, and if, either before or after the meeting, each of the persons entitled
to vote, not present in person or by proxy, signs a written waiver of notice or
a consent to the holding of the meeting or an approval of the minutes thereof.
All such waivers, consents and approvals shall be filed with the corporate
records or made a part of the minutes of the meeting. Attendance of a person at
a meeting shall constitute a waiver of notice of and presence at such meeting,
except when the person objects, at the beginning of the meeting, to the
transaction of any business because the meeting is not lawfully called or
convened and except that attendance at a meeting is not a waiver of any right to
object to the consideration of matters required by these Bylaws or by the
General Corporation Law to be included in the notice if such objection is
expressly made at the meeting. Neither the business to be transacted at nor the
purpose of any regular or special meeting of shareholders need be specified in
any written waiver of notice, consent to the holding of the meeting or approval
of the minutes thereof, unless otherwise provided in the Articles of
Incorporation or these Bylaws, or unless the meeting involves one or more
matters specified in Section 2.3(d) of these Bylaws.
Section 2.12 Action Without Meeting.
(a) Directors may be elected without a meeting by a consent in writing,
setting forth the action so taken, signed by all of the persons who would be
entitled to vote for the election of directors, provided that, without notice
except as hereinafter set forth, a director may be elected at any time to fill a
vacancy not filled by the directors (other than a vacancy created by removal of
a director) by the written consent of persons holding a majority of the
outstanding shares entitled to vote for the election of directors.
Any other action that may be taken at a meeting of the shareholders,
may be taken without a meeting, and without prior notice except as hereinafter
set forth, if a consent in writing, setting forth the action so taken, is 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.
(b) Unless the consents of all shareholders entitled to vote have been
solicited in writing:
(1) notice of any proposed shareholder approval of (i) a contract or
other transaction with an interested director, (ii) indemnification of an agent
of the corporation, (iii) a reorganization of the corporation as defined in
Section 181 of the General Corporation Law, or (iv) a distribution in
dissolution other than in accordance with the rights of outstanding preferred
shares, if any, 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 those shareholders entitled to vote who have not consented in
writing. Such notices shall be given in the manner provided in Section 2.3 of
these Bylaws.
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(c) Any shareholder giving a written consent, or the shareholder's
proxyholders, or a transferee of the shares or a personal representative of the
shareholder or their respective proxyholders, 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 2.13 Inspectors of Election.
(a) In advance of any meeting of shareholders, the Board of Directors may
appoint inspectors of election to act at the meeting and any adjournment
thereof. If inspectors of election are 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 the holder of such shareholder's proxy
shall, appoint inspectors of election (or persons to replace those who so fail
or refuse) at the meeting. The number of inspectors shall be either one or
three. If inspectors are appointed at a meeting on the request of one or more
shareholders or holders of proxies, the majority of shares represented in person
or by proxy shall determine whether one inspector or three inspectors are to be
appointed.
(b) The inspectors of election shall determine the number of shares
outstanding and the voting power of each, the shares represented at the meeting,
the existence of a quorum and the authenticity, validity and effect of proxies;
receive votes, ballots or consents; hear and determine all challenges and
questions in any way arising in connection with the right to vote; count and
tabulate all votes or consents; determine when the polls shall close; determine
the result; and do such acts as may be proper to conduct the election or vote
with fairness to all shareholders.
(c) The inspectors of election shall perform their duties impartially, in
good faith, to the best of their ability and as expeditiously as is practical.
If there are three inspectors of election, the decision, act or certificate of a
majority is effective in all respects as the decision, act or certificate of
all. Any report or certificate made by the inspectors of election is prima
facie evidence of the facts stated therein.
ARTICLE III Board of Directors
Section 3.1 Powers; Approval of Loans to Officers.
(a) Subject to the provisions of the General Corporation Law and any
limitations in the Articles of Incorporation relating to action required to be
approved by the shareholders or by the outstanding shares, 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 of
Directors 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 of
Directors.
(b) The corporation may, upon approval of the Board of Directors alone,
make loans of money or property to, or guarantee the obligations of, any officer
(whether or not a director) of the corporation or of its parent, or adopt an
employee benefit plan authorizing such loans or guaranties provided that:
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(1) the Board of Directors determines that such a loan, guaranty, or
plan may reasonably be expected to benefit the corporation;
(2) the corporation has outstanding shares held of record by 100 or
more persons (determined as provided in Section 605 of the General Corporation
Law) on the date of approval by the Board of Directors;
(3) the approval by the Board of Directors is by a vote sufficient
without counting the vote of any interested director(s); and
(4) the loan is otherwise made in compliance with Section 315 of the
General Corporation Law.
Section 3.2 Number and Qualification of Directors.
The authorized number of directors shall be not less than three (3), nor
more than five (5). The initial number of directors was established in the
Statement of Incorporator. The number of directors shall always be within the
authorized limits specified above, and as determined by resolution adopted by
the Board of Directors. The authorized number of directors may be changed only
by an amendment of the Articles of Incorporation or of these Bylaws, such
amendment being duly adopted by a vote or written consent of holders of a
majority of the outstanding shares, provided that any proposal to reduce the
authorized number of directors to a number less than three (3) cannot be adopted
if the votes cast against its adoption at a meeting, or the shares not
consenting in the case of action by written consent, are equal to more than
sixteen and two-thirds percent (16-2/3%) of the outstanding shares entitled to
vote.
Section 3.3 Election and Term of Office.
The directors shall be elected at each annual meeting of shareholders, but,
if any such annual meeting is not held or the directors are not elected thereat,
the directors may be elected at any special meeting of shareholders held for
that purpose. 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 3.4 Vacancies.
A vacancy in the Board of Directors shall be deemed to exist in case of the
death, resignation or removal of any director, if a director has been declared
of unsound mind by order of court or convicted of a felony, if the authorized
number of directors is increased, if the incorporator or incorporators have
failed to appoint the authorized number of directors in any resolution for
appointment of directors upon the initial organization of the corporation, or if
the shareholders fail, at any annual or special meeting of shareholders at which
any director or directors are elected, to elect the full authorized number of
directors to be voted for at that meeting.
Vacancies in the Board of Directors, except for a vacancy created by the
removal of a director, may be filled by a majority of the directors present at a
meeting at which a quorum is present, or if the number of directors then in
office is less than a quorum, (a) by the unanimous written consent of the
directors then in office, (b) by the vote of a majority of the directors then in
office at a meeting held pursuant to notice or waivers of notice in compliance
with these Bylaws, or (c) by a sole remaining director. Each director so
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elected shall hold office until his or her successor is elected at an annual or
a special meeting of the shareholders. A vacancy in the Board of Directors
created by the removal of a director 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 all of the holders of
the outstanding shares entitled to vote.
The shareholders entitled to vote may elect a director or directors at any
time to fill any vacancy or vacancies not filled by the directors. Any such
election by written consent other than to fill a vacancy created by removal
shall require the consent of holders of a majority of the outstanding shares
entitled to vote. Any such election by written consent to fill a vacancy
created by removal shall require the unanimous written consent of all shares
entitled to vote for the election of such directors.
Any director may resign effective upon giving written notice to the
Chairman of the Board (if there be such an officer appointed), 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.
No reduction of the authorized number of directors shall have the effect of
removing any director prior to the expiration of the director's term of office.
Section 3.5 Time and Place of Meetings.
The Board of Directors shall hold a regular meeting immediately after the
meeting of shareholders at which it is elected and at the place where such
meeting is held, or at such other place as shall be fixed by the Board of
Directors, for the purpose of organization, election of officers of the
corporation and the transaction of other business. Notice of such meeting is
hereby dispensed with. Other regular meetings of the Board of Directors shall
be held without notice at such times and places as are fixed by the Board of
Directors. Special meetings of the Board of Directors may be held at any time
whenever called by the Chairman of the Board (if there be such an officer
appointed), the President, any Vice-President, the Secretary or any two
directors.
Except as hereinabove provided in this Section 3.5, all meetings of the
Board of Directors may be held at any place within or without the State of
California that has been designated by resolution of the Board of Directors as
the place for the holding of regular meetings, or by written consent of all
directors. In the absence of such designation, meetings of the Board of
Directors shall be held at the principal executive office of the corporation.
Special meetings of the Board of Directors may be held either at a place so
designated or at the principal executive office of the corporation.
Section 3.6 Notice of Special Meetings.
Notice of the time and place of special meetings shall be delivered
personally to each director or communicated to each director by telephone,
telegraph or mail, charges prepaid, addressed to the director at the director's
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 at which the
meetings of the directors are regularly held. In case such notice is mailed, it
shall be deposited in the United States mail at least four (4) days prior to the
time of the holding of the meeting. In case such notice is delivered personally
or by telephone or telegraph, as above provided, it shall be so delivered at
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least forty-eight (48) hours prior to the time of the holding of the meeting.
Such mailing, telegraphing or delivery, personally or by telephone, as above
provided, shall be due legal and personal notice to such director.
Notice of a meeting need not be given to any director who signs a waiver of
notice or a consent to holding the meeting or an approval of the minutes
thereof, whether before or after the meeting, or who attends the meeting without
protesting, prior thereto or at its commencement, the lack of notice to such
director. All such waivers, consents and approvals shall be filed with the
corporate records or made a part of the minutes of the meetings.
Section 3.7 Action at a Meeting: Quorum and Required Vote.
Presence of a majority of the authorized number of directors at a meeting
of the Board of Directors constitutes a quorum for the transaction of business,
except as hereinafter provided. Members of the Board of Directors may
participate in a meeting through use of conference telephone or similar
communications equipment, so long as all members participating in such meeting
can hear one another. Participation in a meeting as permitted in the preceding
sentence constitutes presence in person at such meeting. Every act or decision
done or made by a majority of the directors present at a meeting duly held at
which a quorum is present is the act of the Board of Directors, unless a greater
number, or the same number after disqualifying one or more directors from
voting, is required by law, by the Articles of Incorporation, or by these
Bylaws. 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 at least a majority of the required quorum for such
meeting.
Section 3.8 Action Without a Meeting.
Any action required or permitted to be taken by the Board of Directors may
be taken without a meeting, if all members of the Board of Directors shall
individually or collectively consent in writing to such action. Such written
consent or consents shall be filed with the minutes of the proceedings of the
Board of Directors. Such action by written consent shall have the same force
and effect as a unanimous vote of such directors.
Section 3.9 Adjourned Meeting and Notice.
A majority of the directors present, whether or not a quorum is present,
may adjourn any meeting to another time and place. If the meeting is adjourned
for more than twenty-four (24) hours, notice of any adjournment to another time
or place shall be given prior to the time of the adjourned meeting to the
directors who were not present at the time of the adjournment.
Section 3.10 Telephonic Meetings.
Unless specifically prohibited by the Articles of Incorporation of this
corporation or these bylaws, members of the Board of Directors or of any
committee of the Board of Directors may participate in and act at any meeting of
such board or committee through the use of a telephone conference or other
communication equipment by means of which all persons participating in the
meeting can hear one another. Participation in such meetings shall constitute
attendance and presence in person at the meeting of the person or persons so
participating.
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Section 3.11 Fees and Compensation.
Directors and members of committees may receive such compensation, if any,
for their services, and such reimbursement for expenses, as may be fixed or
determined by resolution of the Board of Directors.
Section 3.12 Appointment of Executive and Other Committees.
The Board of Directors may, by resolution adopted by a majority of the
authorized number of directors, designate one or more committees, each
consisting of two or more directors, to serve at the pleasure of the Board of
Directors. The Board of Directors may designate one or more directors as
alternate members of any committee, who may replace any absent member at any
meeting of the committee. The appointment of members or alternate members of a
committee requires the vote of a majority of the authorized number of directors.
Any such committee, to the extent provided in the resolution of the Board of
Directors or in these Bylaws, shall have all the authority of the Board of
Directors, except with respect to:
(a) The approval of any action for which the General Corporation Law
also requires shareholders' approval or approval of the outstanding shares.
(b) The filling of vacancies on the Board of Directors or in any
committee.
(c) The fixing of compensation of the directors for serving on the
Board of Directors or on any committee.
(d) The amendment or repeal of these Bylaws or the adoption of new
Bylaws.
(e) The amendment or repeal of any resolution of the Board of
Directors that by its express terms is not so amendable or repealable.
(f) A distribution to the shareholders of the corporation, except at
a rate, in a periodic amount or within a price range determined by the Board of
Directors.
(g) The appointment of other committees of the Board of Directors or
the members thereof.
The provisions of Sections 3.5 through 3.9 of these Bylaws apply also to
committees of the Board of Directors and action by such committees, mutatis
mutandis (with the necessary changes having been made in the language thereof).
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ARTICLE IV Officers
Section 4.1 Officers.
The officers of the corporation shall consist of the President, the
Secretary and the Chief Financial Officer, and each of them shall be appointed
by the Board of Directors. The corporation may also have a Chairman of the
Board, one or more Vice-Presidents, a Controller, one or more Assistant
Secretaries and Assistant Treasurers, and such other officers as may be
appointed by the Board of Directors, or with authorization from the Board of
Directors by the President. The order of the seniority of the Vice-Presidents
shall be in the order of their nomination, unless otherwise determined by the
Board of Directors. Any two or more of such offices may be held by the same
person. The Board of Directors shall designate one officer as the chief
financial officer of the corporation. In the absence of such designation, the
Treasurer shall be the chief financial officer. The Board of Directors may
appoint, and may empower the President to appoint, such other officers as the
business of the corporation may require, each of whom shall have such authority
and perform such duties as are provided in these Bylaws or as the Board of
Directors may from time to time determine.
All officers of the corporation shall hold office from the date appointed
to the date of the next succeeding regular meeting of the Board of Directors
following the meeting of shareholders at which the Board of Directors is
elected, and until their successors are elected; provided that all officers, as
well as any other employee or agent of the corporation, may be removed at any
time at the pleasure of the Board of Directors, or, except in the 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, and upon the removal,
resignation, death or incapacity of any officer, the Board of Directors or the
President, in cases where he or she has been vested by the Board of Directors
with power to appoint, may declare such office vacant and fill such vacancy.
Nothing in these Bylaws shall be construed as creating any kind of contractual
right to employment with the corporation.
Any officer may resign at any time by giving written notice to the Board of
Directors, the President, or the Secretary of the corporation, without
prejudice, however, to the rights, if any, of the corporation under any contract
to which such officer is a party. Any such resignation shall take effect at the
date of the receipt of such notice or at any later time specified therein; and,
unless otherwise specified therein, the acceptance of such resignation shall not
be necessary to make it effective.
The salary and other compensation of the officers shall be fixed from time
to time by resolution of or in the manner determined by the Board of Directors.
Section 4.2 The Chairman of the Board.
The Chairman of the Board (if there be such an officer appointed) shall,
when present, preside at all meetings of the Board of Directors and shall
perform all the duties commonly incident to that office. The Chairman of the
Board shall have authority to execute in the name of the corporation bonds,
contracts, deeds, leases and other written instruments to be executed by the
corporation (except where by law the signature of the President is required),
and shall perform such other duties as the Board of Directors may from time to
time determine.
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Section 4.3 The President.
Subject to such supervisory powers, if any, as may be given by the Board of
Directors to the Chairman of the Board, the President shall be the chief
executive officer of the corporation and shall perform all the duties commonly
incident to that office. The President shall have authority to execute in the
name of the corporation bonds, contracts, deeds, leases and other written
instruments to be executed by the corporation. The President shall preside at
all meetings of the shareholders and, in the absence of the Chairman of the
Board or if there is none, at all meetings of the Board of Directors, and shall
perform such other duties as the Board of Directors may from time to time
determine.
Section 4.4 Vice-Presidents.
The Vice-Presidents (if there be such officers appointed), in the order of
their seniority (unless otherwise established by the Board of Directors), may
assume and perform the duties of the President in the absence or disability of
the President or whenever the offices of the Chairman of the Board and President
are vacant. The Vice-Presidents shall have such titles, perform such other
duties, and have such other powers as the Board of Directors, the President or
these Bylaws may designate from time to time.
Section 4.5 The Secretary.
The Secretary shall record or cause to be recorded, and shall keep or cause
to be kept, at the principal executive office and such other place as the Board
of Directors may order, a book of minutes of actions taken at all meetings of
directors and committees thereof and of 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 executive
office or at the office of the corporation's transfer agent, a share register or
a duplicate share register in a form capable of being converted into written
form, 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 and committees thereof
required by these Bylaws or by law to be given, and shall have such other powers
and perform such other duties as may be prescribed by the Board of Directors or
by these Bylaws.
The President may direct any Assistant Secretary to assume and perform the
duties of the Secretary in the absence or disability of the Secretary, and each
Assistant Secretary shall perform such other duties and have such other powers
as the Board of Directors or the President may designate from time to time.
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Section 4.6 The Chief Financial Officer.
The Chief Financial Officer shall keep and maintain, or cause to be kept
and maintained, adequate and correct accounts of the properties and business
transactions of the corporation. The books of account shall at all reasonable
times be open to inspection by any director.
The Chief Financial 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. The Chief Financial Officer 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 the Chief Financial Officer's transactions as Chief
Financial Officer 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 these Bylaws.
The President may direct any Assistant Chief Financial Officer to assume
and perform the duties of the Chief Financial Officer in the absence or
disability of the Chief Financial Officer, and each Assistant Chief Financial
Officer shall perform such other duties and have such other powers as the Board
of Directors or the President may designate from time to time.
Section 4.7 The Controller.
The Controller (if there be such an officer appointed) shall be responsible
for the establishment and maintenance of accounting and other systems required
to control and account for the assets of the corporation and provide safeguards
therefor, and to collect information required for management purposes, and shall
perform such other duties and have such other powers as the Board of Directors
or the President may designate from time to time. The President may direct any
Assistant Controller to assume and perform the duties of the Controller, in the
absence or disability of the Controller, and each Assistant Controller shall
perform such other duties and have such other powers as the Board of Directors,
the Chairman of the Board (if there be such an officer appointed) or the
President may designate from time to time.
ARTICLE V Execution of Corporate Instruments, Ratification, and Voting
of Stocks Owned by the Corporation
Section 5.1 Execution of Corporate Instruments.
In its discretion, the Board of Directors may determine the method and
designate the signatory officer or officers or other person or persons, to
execute any corporate instrument or document, or to sign the corporate name
without limitation, except where otherwise provided by law, and such execution
or signature shall be binding upon the corporation.
All checks and drafts drawn on banks or other depositaries on funds to the
credit of the corporation, or in special accounts of the corporation, shall be
signed by such person or persons as the Board of Directors shall authorize to do
so.
The Board of Directors shall designate an officer who personally, or
through his representative, shall vote shares of other corporations standing in
the name of this corporation. The authority to vote shares shall include the
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authority to execute a proxy in the name of the corporation for purposes of
voting the shares.
Section 5.2 Ratification by Shareholders.
In its discretion, the Board of Directors may submit any contract or act
for approval or ratification of the shareholders at any annual meeting of
shareholders, or at any special meeting of shareholders called for that purpose;
and any contract or act that shall be approved or ratified by the holders of a
majority of the voting power of the corporation shall be as valid and binding
upon the corporation and upon the shareholders thereof as though approved or
ratified by each and every shareholder of the corporation, unless a greater vote
is required by law for such purpose.
Section 5.3 Voting of Stocks Owned by the Corporation.
All stock of other corporations owned or held by the corporation for
itself, or for other parties in any capacity, shall be voted, and all proxies
with respect thereto shall be executed, by the person authorized to do so by
resolution of the Board of Directors, or in the absence of such authorization,
by the Chairman of the Board (if there be such an officer appointed), the
President or any Vice-President, or by any other person authorized to do so by
the Chairman of the Board, the President or any Vice President.
ARTICLE VI Annual and Other Reports
Section 6.1 Reports to Shareholders.
The Board of Directors of the corporation shall cause an annual report to
be sent to the shareholders not later than 120 days after the close of the
fiscal year, and at least fifteen (15) days (or, if sent by third-class mail,
thirty-five (35) days) prior to the annual meeting of shareholders to be held
during the next fiscal year. This report shall contain a balance sheet as of
the end of that fiscal year and an income statement and statement of changes in
financial position for that fiscal year, accompanied by any report thereon 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. This report shall also
contain such other matters as required by Section 1501(b) of the General
Corporation Law, unless the corporation is subject to the reporting requirements
of Section 13 of the Securities Exchange Act of 1934, and is not exempted
therefrom under Section 12(g)(2) thereof. As long as the corporation has less
than 100 holders of record of its shares (determined as provided in Section 605
of the General Corporation Law), the foregoing requirement of an annual report
is hereby waived.
If no annual report for the last fiscal year has been sent to shareholders,
the corporation shall, upon the written request of any shareholder made more
than 120 days after the close of such fiscal year, deliver or mail to the person
making the request within thirty (30) days thereafter the financial statements
for such year as required by Section 1501(a) of the General Corporation Law. A
shareholder or shareholders holding at least five percent (5%) of the
outstanding shares of any class of the corporation may make a written request to
the corporation for an income statement of the corporation for the three-month,
six-month or nine-month period of the current fiscal year ended more than
thirty (30) days prior to the date of the request and a balance sheet of the
corporation as of the end of such period and, in addition, if no annual report
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for the last fiscal year has been sent to shareholders, the annual report for
the last fiscal year, unless such report has been waived under these Bylaws.
The statements shall be delivered or mailed to the person making the request
within thirty (30) days thereafter. A copy of any such statements shall be kept
on file in the principal executive office of the corporation for twelve (12)
months, and they shall be exhibited at all reasonable times to any shareholder
demanding an examination of the statements, or a copy shall be mailed to the
shareholder.
The quarterly income statements and balance sheets referred to in this
Section shall be accompanied by the report thereon, if any, of any independent
accountants engaged by the corporation or the certificate of an authorized
officer of the corporation that the financial statements were prepared without
audit from the books and records of the corporation.
Section 6.2 Report of Shareholder Vote.
For a period of sixty (60) days following the conclusion of an annual,
regular, or special meeting of shareholders, the corporation shall, upon written
request from a shareholder, forthwith inform the shareholder of the result of
any particular vote of shareholders taken at the meeting, including the number
of shares voting for, the number of shares voting against, and the number of
shares abstaining or withheld from voting. If the matter voted on was the
election of directors, the corporation shall report the number of shares (or
votes if voted cumulatively) cast for each nominee for director. If more than
one class or series of shares voted, the report shall state the appropriate
numbers by class and series of shares.
Section 6.3 Reports to the Secretary of State.
(a) Every year, during the calendar month in which the original articles
of incorporation were filed with the California Secretary of State, or during
the preceding five calendar months, the corporation shall file a statement with
the Secretary of State on the prescribed form, setting forth the authorized
number of directors; the names and complete business and residence addresses of
all incumbent directors; the names and complete business or resident addresses
of the chief executive officer, the secretary, and the chief financial officer;
the street address of the corporation's principal executive office or principal
business office in this state; a statement of the general type of business
constituting the principal business activity of the corporation; and a
designation of the agent of the corporation for the purpose of service of
process, all in compliance with Section 1502 of the Corporations Code of
California.
(b) Notwithstanding the provisions of paragraph (a) of this section, if
there has been no change in the information contained in the corporation's last
annual statement on file in the Secretary of State's office, the corporation
may, in lieu of filing the annual statement described in paragraph (a) of this
section, advise the Secretary of State, on the appropriate form, that no changes
in the required information have occurred during the applicable period.
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ARTICLE VII Shares of Stock
Every holder of shares in the corporation shall be entitled to have a
certificate signed in the name of the corporation by the Chairman or Vice
Chairman of the Board (if there be such officers appointed) or the President or
a Vice-President and by the Chief Financial Officer or Any Assistant Chief
Financial Officer or the Secretary or any Assistant Secretary, certifying the
number of shares and the class or series of shares owned by the shareholder.
Any of the signatures on the certificate may be a facsimile. In case any
officer, transfer agent or registrar who has signed or whose facsimile signature
has been placed upon a certificate has ceased to be such officer, transfer agent
or registrar before such certificate is issued, it may be issued by the
corporation with the same effect as if such person were an officer, transfer
agent or registrar at the date of issue.
Any such certificate shall also contain such legends or other statements as
may be required by Sections 417 and 418 of the General Corporation Law, the
Corporate Securities Law of 1968, federal or other state securities laws, and
any agreement between the corporation and the issue of the certificate.
Certificates for shares may be issued prior to full payment, under such
restrictions and for such purposes as the Board of Directors or these Bylaws may
provide; provided, however, that the certificate issued to represent any such
partly paid shares shall state on the face thereof the total amount of the
consideration to be paid therefor, the amount remaining unpaid and the terms of
payment.
No new certificate for shares shall be issued in lieu of an old certificate
unless the latter is surrendered and cancelled at the same time; provided,
however, that a new certificate will be issued without the surrender and
cancellation of the old certificate if (1) the old certificate is lost,
apparently destroyed or wrongfully taken; (2) the request for the issuance of
the new certificate is made within a reasonable time after the owner of the old
certificate has notice of its loss, destruction, or theft; (3) the request for
the issuance of a new certificate is made prior to the receipt of notice by the
corporation that the old certificate has been acquired by a bona fide purchaser;
(4) the owner of the old certificate files a sufficient indemnity bond with or
provides other adequate security to the corporation; and (5) the owner satisfies
any other reasonable requirement imposed by the corporation. In the event of
the issuance of a new certificate, the rights and liabilities of the
corporation, and of the holders of the old and new certificates, shall be
governed by the provisions of Sections 8104 and 8405 of the California
Commercial Code.
ARTICLE VIII Inspection of Corporate Records
Section 8.1 General Records.
The accounting books and records and the minutes of proceedings of the
shareholders, the Board of Directors and committees thereof of the corporation
and any subsidiary of the corporation shall be open to inspection upon the
written demand on the corporation of any shareholder or holder of a voting trust
certificate at any reasonable time during usual business hours, for a purpose
reasonably related to such holder's interests as a shareholder or as the holder
of such voting trust certificate. Such inspection by a shareholder or holder of
a voting trust certificate may be made in person or by agent or attorney, and
the right of inspection includes the right to copy and make extracts. Minutes
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of proceedings of the shareholders, Board, and committees thereof shall be kept
in written form. Other books and records shall be kept either in written form
or in any other form capable of being converted into written form.
A shareholder or shareholders holding at least five percent (5%) in the
aggregate of the outstanding voting shares of the corporation or who hold at
least one percent (1%) of such voting shares and have filed a Schedule 14B with
the United States Securities and Exchange Commission relating to the election of
directors of the corporation shall have (in person, or by agent or attorney) the
right to inspect and copy the record of shareholders' names and addresses and
shareholdings during usual business hours upon five (5) business days' prior
written demand upon the corporation or to obtain from the transfer agent for the
corporation, upon written demand and upon the tender of its usual charges for
such list, a list of the shareholders' names and addresses, who are entitled to
vote for the election of directors, and their shareholdings, as of the most
recent record date for which it has been compiled or as of a date specified by
the shareholder subsequent to the date of demand. The list shall be made
available on or before the later of five (5) business days after the demand is
received or the date specified therein as the date as of which the list is to be
compiled.
Every director shall have the absolute right at any reasonable time to
inspect and copy all books, records and documents of every kind and to inspect
the physical properties of the corporation and its subsidiaries. Such
inspection by a director may be made in person or by agent or attorney, and the
right of inspection includes the right to copy and make extracts.
Section 8.2 Inspection of Bylaws.
The corporation shall keep at its principal executive office in California,
or if its principal executive office is not in California, then at its principal
business office in California (or shall otherwise provide upon written request
of any shareholder if it has no such office in California) the original or a
copy of these Bylaws as amended to date, which shall be open to inspection by
the shareholders at all reasonable times during office hours.
ARTICLE IX Indemnification of Officers, Directors, Employees and Agents
Section 9.1 Right to Indemnification.
Each person who was or is a party or is threatened to be made a party to or
is involved (as a party, witness, or otherwise), in any threatened, pending, or
completed action, suit, or proceeding, whether civil, criminal, administrative,
or investigative (hereafter a "Proceeding"), by reason of the fact that he, or a
person of whom he is the legal representative, is or was a director, officer,
employee, or agent of the corporation or is or was serving at the request of the
corporation as a director, officer, employee, or agent of another foreign or
domestic corporation, partnership, joint venture, trust, or other enterprise, or
was a director, officer, employee, or agent of a foreign or domestic corporation
that was a predecessor corporation of the corporation or of another enterprise
at the request of such predecessor corporation, including service with respect
to employee benefit plans, whether the basis of the Proceeding is alleged action
in an official capacity as a director, officer, employee, or agent or in any
other capacity while serving as a director, officer, employee, or agent
(hereafter an "Agent"), shall be indemnified and held harmless by the
corporation to the fullest extent authorized by statutory and decisional law, as
the same exists or may hereafter be interpreted or amended (but, in the case of
any such amendment or interpretation, only to the extent that such amendment or
interpretation permits the corporation to provide broader indemnification rights
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than were permitted prior thereto) against all expenses, liability, and loss
(including attorneys' fees, judgments, fines, ERISA excise taxes and penalties,
amounts paid or to be paid in settlement, any interest, assessments, or other
charges imposed thereon, and any federal, state, local, or foreign taxes imposed
on any Agent as a result of the actual or deemed receipt of any payments under
this Article) [reasonably] incurred or suffered by such person in connection
with investigating, defending, being a witness in, or participating in
(including on appeal), or preparing for any of the foregoing in, any Proceeding
(hereafter "Expenses"); provided, however, that except as to actions to enforce
indemnification rights pursuant to Section 9.3 of these Bylaws, the corporation
shall indemnify any Agent seeking indemnification in connection with a
Proceeding (or part thereof) initiated by such person only if the Proceeding (or
part thereof) was authorized by the Board of Directors of the corporation. The
right to indemnification conferred in this Article shall be a contract right.
It is the corporation's intention that these bylaws provide indemnification in
excess of that expressly permitted by Section 317 of the California General
Corporation Law, as authorized by the corporation's Articles of Incorporation.
Section 9.2 Authority to Advance Expenses.
Expenses incurred by an officer or director (acting in his capacity as
such) in defending a Proceeding shall be paid by the corporation in advance of
the final disposition of such Proceeding, provided, however, that if required by
the California General Corporation Law, as amended, such Expenses shall be
advanced only upon delivery to the corporation of an undertaking by or on behalf
of such director or officer to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the corporation as
authorized in this Article or otherwise. Expenses incurred by other Agents of
the corporation (or by the directors or officers not acting in their capacity as
such, including service with respect to employee benefit plans) may be advanced
upon the receipt of a similar undertaking, if required by law, and upon such
other terms and conditions as the Board of Directors deems appropriate. Any
obligation to reimburse the corporation for Expense advances shall be unsecured
and no interest shall be charged thereon.
Section 9.3 Right of Claimant to Bring Suit.
If a claim under Section 9.1 or 9.2 of these Bylaws is not paid in full by
the corporation within thirty (30) days after a written claim has been received
by the corporation, the claimant may at any time thereafter bring suit against
the corporation to recover the unpaid amount of the claim and, if successful in
whole or in part, the claimant shall be entitled to be paid also the expense
(including attorneys' fees) of prosecuting such claim. It shall be a defense to
any such action (other than an action brought to enforce a claim for expenses
incurred in defending a Proceeding in advance of its final disposition where the
required undertaking has been tendered to the corporation) that the claimant has
not met the standards of conduct that make it permissible under the California
General Corporation Law for the corporation to indemnify the claimant for the
amount claimed. The burden of proving such a defense shall be on the
corporation. Neither the failure of the corporation (including its Board of
Directors, independent legal counsel, or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the claimant is proper under the circumstances because he has met the applicable
standard of conduct set forth in the California General Corporation Law, nor an
actual determination by the corporation (including its Board of Directors,
independent legal counsel, or its stockholders) that the claimant had not met
such applicable standard of conduct, shall be a defense to the action or create
a presumption that claimant has not met the applicable standard of conduct.
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Section 9.4 Provisions Nonexclusive.
The rights conferred on any person by this Article shall not be exclusive
of any other rights that such person may have or hereafter acquire under any
statute, provision of the Articles of Incorporation, agreement, vote of
stockholders or disinterested directors, or otherwise, both as to action in an
official capacity and as to action in another capacity while holding such
office. To the extent that any provision of the Articles, agreement, or vote of
the stockholders or disinterested directors is inconsistent with these bylaws,
the provision, agreement, or vote shall take precedence.
Section 9.5 Authority to Insure.
The corporation may purchase and maintain insurance to protect itself and
any Agent against any Expense asserted against or incurred by such person,
whether or not the corporation would have the power to indemnify the Agent
against such Expense under applicable law or the provisions of this Article,
provided that, in cases where the corporation owns all or a portion of the
shares of the company issuing the insurance policy, the company and/or the
policy must meet one of the two sets of conditions set forth in Section 317 of
the California General Corporation Law, as amended.
Section 9.6 Survival of Rights.
The rights provided by this Article shall continue as to a person who has
ceased to be an Agent and shall inure to the benefit of the heirs, executors,
and administrators of such person.
Section 9.7 Settlement of Claims.
The corporation shall not be liable to indemnify any Agent under this
Article (a) for any amounts paid in settlement of any action or claim effected
without the corporation's written consent, which consent shall not be
unreasonably withheld; or (b) for any judicial award, if the corporation was not
given a reasonable and timely opportunity, at its expense, to participate in the
defense of such action.
Section 9.8 Effect of Amendment.
Any amendment, repeal, or modification of this Article shall not adversely
affect any right or protection of any Agent existing at the time of such
amendment, repeal, or modification.
Section 9.9 Subrogation.
In the event of payment under this Article, the corporation shall be
subrogated to the extent of such payment to all of the rights of recovery of the
Agent, who shall execute all papers required and shall do everything that may be
necessary to secure such rights, including the execution of such documents
necessary to enable the corporation effectively to bring suit to enforce such
rights.
Section 9.10 No Duplication of Payments.
The corporation shall not be liable under this Article to make any payment
in connection with any claim made against the Agent to the extent the Agent has
otherwise actually received payment (under any insurance policy, agreement,
vote, or otherwise) of the amounts otherwise indemnifiable hereunder.
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ARTICLE X Amendments
Section 10.1 Power of Shareholders.
New bylaws may be adopted or these Bylaws may be amended or repealed by the
affirmative vote of a majority of the outstanding shares entitled to vote, or by
the written assent of such shareholders entitled to vote such shares, except as
otherwise provided by law or by the Articles of Incorporation.
Section 10.2 Power of Directors.
Subject to the right of shareholders as provided in Section 1 of this
Article X to adopt, amend or repeal these Bylaws, these Bylaws (other than a
bylaw or amendment thereof changing the authorized number of directors, or
providing for the approval by the Board, acting alone, of a loan or guarantee to
any officer or an employee benefit plan providing for the same) may be adopted,
amended or repealed by the Board of Directors.
ARTICLE XI Definitions
Unless the context otherwise requires, the general provisions, rules of
construction and definitions contained in the General Corporation Law as amended
from time to time shall govern the construction of these Bylaws. Without
limiting the generality of the foregoing, the masculine gender includes the
feminine and neuter, the singular number includes the plural and the plural
number includes the singular, and the term "person" includes a corporation as
well as a natural person.
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CERTIFICATE OF SECRETARY
The undersigned, Secretary of kNUTEK HOLDINGS, INC., a California
corporation, hereby certifies that the foregoing is a full, true and correct
copy of the Bylaws of the corporation with all amendments to date of this
Certificate.
WITNESS the signature of the undersigned this___ day of _______,
2001.
____________________________________
Jim Knut Larsson, Secretary
SF\25971.1
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