Exhibit 3.5
BY-LAWS
OF
ADVANTAGE SYSTEMS, INC.
i
TABLE OF CONTENTS
PAGE
----
ARTICLE I - OFFICES ..................................... 1
1. PRINCIPAL EXECUTIVE OFFICE ............ 1
2. OTHER OFFICES ......................... 1
ARTICLE II - ANNUAL MEETINGS OF SHAREHOLDERS ............ 1
1. PLACE.................................. 2
2. TIME .................................. 2
3. NOTICE................................. 3
ARTICLE III - SPECIAL MEETINGS OF SHAREHOLDERS .......... 3
1. PURPOSE, TIME AND PLACE ............... 3
2. CALL .................................. 3
3. NOTICE ................................ 3
4. BUSINESS TRANSACTED ................... 4
ARTICLE IV - QUORUM AND VOTING OF STOCK ................. 4
1 . QUORUM ................................ 4
2. MAJORITY VOTE ......................... 5
3. VOTING ................................ 5
4. PROXY REPRESENTATIVES ................. 6
5. WRITTEN CONSENT ....................... 6
6. ANNUAL REPORT ......................... 7
ARTICLE V - DIRECTORS ................................... 7
1. NUMBER, QUALIFICATION AND TERM......... 7
2. VACANCIES ............................. 8
3. FUNCTION .............................. 8
4. BOOKS ................................. 9
5. COMPENSATION .......................... 9
ARTICLE VI - MEETINGS OF THE BOARD OF DIRECTORS ......... 9
1. PLACE ................................. 9
2. FIRST MEETING ......................... 9
3. TIME AND PLACE ........................ 9
4. CALL OF SPECIAL MEETINGS............... 9
5. WAIVER OF NOTICE ...................... 10
6. QUORUM AND ACTION ..................... 10
7. CONSENT ............................... 10
ARTICLE VII - COMMITTEES ................................ 11
1. EXECUTIVE COMMITTEE ................... 11
2. OTHER COMMITTEES ...................... 11
ARTICLE VIII - NOTICES .................................. 12
1. MANNER OF GIVING NOTICE ............... 12
2. WAIVER OF NOTICE OR CONSENT ........... 13
ARTICLE IX - OFFICERS ................................... 14
1. TITLES ................................ 14
2. ELECTION .............................. 14
PAGE
----
3. OTHER OFFICERS ................................. 14
4. BOARD OF DIRECTORS DIRECTION ................... 14
5. SALARIES ....................................... 14
6. TERM ....................................... 14
7. THE PRESIDENT .................................. 15
8. THE VICE-PRESIDENTS ............................ 15
9. THE SECRETARY .................................. 15
10. ASSISTANT SECRETARIES ................. 16
11. THE CHIEF FINANCIAL OFFICER ........... 16
12. THE ASSISTANT TREASURERS .............. 17
ARTICLE X - SHARES ...................................... 17
1. CERTIFICATES FOR SHARES ............... 17
2. LOST CERTIFICATES ..................... 18
3. EXCHANGE OF CERTIFICATES .............. 18
4. TRANSFERS OF SHARES ................... 19
5. CLOSING OF TRANSFER OF BOOKS .......... 19
6. REGISTERED SHAREHOLDERS ............... 20
ARTICLE XI - INDEMNIFICATION OF DIRECTORS, OFFICERS,
EMPLOYEES AND OTHER AGENTS ..................... 21
1. AGENTS, PROCEEDINGS, AND EXPENSES .............. 21
2. ACTIONS OTHERS THAN BY THE CORPORATION ......... 21
3. ACTIONS BY OR IN THE RIGHT OF THE CORPORATION .. 22
4. SUCCESSFUL DEFENSE BY AGENT .................... 23
5. REQUIRED APPROVAL .............................. 23
6. ADVANCE OF EXPENSES ............................ 24
7. OTHER CONTRACTUAL RIGHT ........................ 24
8. LIMITATIONS..................................... 24
9. INSURANCE ...................................... 25
10. FIDUCIARIES OF CORPORATE EMPLOYEE BENEFIT PLAN . 25
11. SURVIVAL OF RIGHTS ............................. 25
12. EFFECT OF AMENDMENT ............................ 25
13. SETTLEMENT OF CLAIMS ........................... 25
14. SUBROGATION .................................... 26
15. NO DUPLICATION OF PAYMENTS...................... 26
ARTICLE XII - GENERAL PROVISIONS......................... 26
1. DIVIDENDS ............................. 26
2. RESERVE FUND .......................... 27
3. CHECKS ................................ 27
4. FISCAL YEAR ........................... 27
5. SEAL .................................. 27
6. BOOKS AND RECORDS ..................... 27
7. AMENDMENTS ............................ 28
8. CORPORATE SECRETARY CERTIFICATION ..... 29
2
iii
ADVANTAGE SYSTEMS, INC.
*****
BYLAWS
*****
ARTICLE I
OFFICES
Section 1. Principal Executive Office. The principal executive office
shall be located in San Jose, California.
Section 2. Other Offices. The location may be changed by approval of a
majority of the authorized directors and the corporation may also establish
offices at such other places both within and without the State of California as
the board of directors may from time to time determine or the business of the
corporation may require.
ARTICLE II
ANNUAL MEETINGS OF SHAREHOLDERS
Section 1. Place. All meetings of shareholders for the election of
directors shall be held in the City of San Jose, State of California, at such
place as may be fixed from time to time by the board of directors, or at such
other place either within or without the State of California as shall be
designated from time to time by the board of directors and stated in the notice
of the meeting. Meetings of shareholders for any other purpose may be held at
such time and place, within or without the State of California, as shall be
stated in the notice of the meeting or in a duly executed
1
waiver of notice thereof If no other place is stated or fixed, shareholders'
meetings shall be held at the principal executive office of the corporation.
Section 2. Time. Annual meetings of shareholders, commencing with the
year 1997, shall be held on the second Tuesday of January if not a legal
holiday, and if a legal holiday, then on the next secular day following at 9:00
a.m., or at such other date and time as shall be designated from time to time by
the board of directors and stated in the notice of the meeting, at which they
shall elect by a plurality vote a board of directors and transact such other
business as may properly be brought before the meeting,
Section 3. Notice. Written or printed notice of the annual meeting
stating the place, day and hour of the meeting and those matters which the board
of directors, at the time of mailing the notice, intends to present for action
by the shareholders, shall be given to each shareholder entitled to vote thereat
not less than 10 (or, if sent by third-class mail, 30) nor more than 60 days
before the date of the meeting. Notice may be sent by third-class mail only if
the outstanding shares of the corporation are held of record by 500 or more
persons (determined as provided in Section 605 of the California General
Corporation Law) on the record date for the shareholders' meeting. The notice of
any meeting at which directors are to be elected shall include the names of
nominees intended at the time of notice to be presented by the Board of
Directors for election. At an annual meeting of shareholders, any matter
relating to the affairs of the corporation, whether or not stated in the notice
of the meeting, may be brought up for action except matters which the General
Corporation Law requires to be stated in the notice of the meeting. The notice
of any annual or special meeting shall also include, or be accompanied by, any
additional statements, information, or documents prescribed by the General
Corporation Law. When a meeting is
2
adjourned to another time or place, notice of die adjourned meeting need not be
given if die time and place thereof are announced at the meeting at which the
adjournment is taken; provided that, if the adjournment is for more than
forty-five (45) days, or if after adjournment a new record date is fixed for the
adjourned meeting, a notice of the adjourned meeting shall be given to each
shareholder. At the adjourned meeting, the corporation may transact any business
which might have been transacted at the original meeting.
ARTICLE III
SPECIAL MEETINGS OF SHAREHOLDERS
Section 1. Purpose. Time and Place. Special meetings of shareholders
for any purpose other than the election of directors may be held at such time
and place within or without the State of California as shall be stated in the
notice of the meeting or in a duly executed waiver of notice thereof.
Section 2. Call. Special meetings of the shareholders, for any purpose
or purposes, unless otherwise prescribed by statute or by the articles of
incorporation, may be called by the president, the board of directors, or the
holders of not less than 10 percent of all the shares entitled to vote at the
meeting and if the corporation has a chairman of the board of directors, special
meetings of the shareholders may be called by the chairman.
Section 3. Notice, Written or printed notice of a special meeting of
shareholders, stating the time, place and purpose or purposes thereof, shall be
given to each shareholder entitled to vote thereat not less than 10 (or, if sent
by third-class mail, 30) nor more than 60 days before the date fixed for the
meeting. Notice may be sent by third-class mail only if the outstanding shares
of
3
the corporation are held of record by 500 or more persons (determined as
provided in Section 605 of the California General Corporation Law) on the record
date for the shareholders' meeting. The notice of any special meeting shall also
include, or be accompanied by any additional statements, information or
documents prescribed by the General Corporation Law. When a meeting is adjourned
to another time or place notice of the adjourned meeting need not be if the time
and place thereof are announced at the meeting at which the adjournment is
taken; provided that, if the adjournment is for more than forty-five (45) days,
or if after the adjournment a new record date is fixed for the adjourned
meeting, a notice of the adjourned meeting shall be given to each shareholder.
At the adjourned meeting, the corporation may transact any business which might
have been transacted the original meeting.
Section 4. Business Transacted. The business transacted at any special
meeting of shareholders shall be limited to the purposes stated in the notice.
ARTICLE IV
QUORUM AND VOTING OF STOCK
Section 1. Quorum. The holders of a majority of the shares of stock
issued and outstanding and entitled to vote, represented in person or by proxy,
shall constitute a quorum at all meetings of the shareholders for the
transaction of business except as otherwise provided by statute or by the
articles of incorporation. If, however, such quorum shall not be present or
represented at any meeting of the shareholders, the shareholders present in
person or represented by proxy shall have power to adjourn the meeting from time
to time, without notice other than announcement at the meeting, until a quorum
shall be present or represented. At such adjourned meeting at which a
quorum shall be present or represented, any business may be transacted which
might have been transacted at the original meeting.
Section 2. Majority Vote. If a quorum is present, the affirmative vote
of a majority of the shares of stock 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 law or the articles of
incorporation.
Section 3. Voting. Each outstanding share of stock having voting power,
shall be entitled to one vote on each matter submitted to a vote at a meeting of
shareholders. A shareholder may vote either in person or by proxy executed in
writing by the shareholder or by his duly authorized attorney-in-fact. On any
matter other than the election of directors, any shareholder may vote part of
the shares in favor of the proposal and refrain from voting the remaining shares
or vote them against the proposal, but, if the shareholder fails to specify the
number of shares that the shareholder is voting affirmatively, it will be
conclusively presumed that the shareholder's approving vote is with respect to
all shares that the shareholder is entitled to vote.
In all elections for directors, every shareholder entitled to vote
shall have the right to vote, in person or by proxy, the number of shares of
stock owned by him for as many persons as there are directors to be elected, or,
upon satisfaction of the requirements set forth in Section 708(b) of the
California General Corporation Law, to cumulate the vote of said shares, 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 the shareholder's shares are
normally entitled, or to distribute the votes on the same principle among as
many candidates as he may see fit. Section 708(b) of the California General
Corporation Law provides that no shareholder shall be entitled to cumulate votes
for any candidate for the office
5
of director unless such candidates' names have been placed in nomination prior
to the voting and at least one shareholder has given notice at the meeting prior
to the voting of his intention to cumulate his votes.
Section 4. Proxy Representatives. Every shareholder may authorize
another person or persons to act as his proxy at a meeting or by written action.
No proxy shall be valid after the expiration of eleven months from the date of
its execution unless otherwise provided in the proxy Every proxy shall be
revocable at the pleasure of the person executing it prior to the vote or
written action pursuant thereto, except as otherwise provided by the General
Corporation Law. As used herein, a "proxy" shall be deemed to mean a written
authorization signed by a shareholder or a shareholder's attorney in fact giving
another person or persons power to vote or consent in writing with respect to
the shares of such shareholder, and "signed" as used herein shall be deemed to
mean the placing of such shareholder's name on the proxy, whether by manual
signature, typewriting, telegraphic transmission or otherwise by such
shareholder or such shareholder's attorney in fact. Where applicable, the form
of any proxy shall comply with the provisions of Section 604 of the General
Corporation Law,
Section 5. Written Consent. Unless otherwise provided in the articles,
any action, except election of directors, which may be taken at any annual or
special meeting of shareholders may be taken without a meeting and without prior
notice, if a consent in writing, setting forth the action so taken, shall be
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.
Except to fill a vacancy in the board of directors not filled by the directors,
directors may not be elected by written consent except
6
by unanimous written consent of all shares entitled to vote for the election of
directors. Any election of a director to fill a vacancy (other than a vacancy
created by removal) not filled by the directors requires the written consent of
a majority of the shares entitled to vote. Notice of any shareholder approval
pursuant to Section 310, 317, 1201 or 2007 without a meeting by less than
unanimous written consent shall be given at least ten days before the
consummation of the action authorized by such approval, and 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.
Elections of directors at a meeting need not be by ballot unless a
shareholder demands election by ballot at the election and before the voting
begins. In all other matters voting need not be by ballot.
Section 6. Annual Report. Whenever the corporation shall have fewer
than one hundred shareholders as said number is determined as provided in
Section 605 of the General Corporation Law, the Board of Directors shall not be
required to cause to be sent to the shareholders of the corporation the annual
report prescribed by Section 1501 of the General Corporation Law unless it shall
determine that a useful purpose would be served by causing the same to be sent
or unless the Department of Corporations, pursuant to the provisions of the
Corporate Securities Law of 1968, shall direct the sending of the same.
ARTICLE V
DIRECTORS
Section 1. Number, Qualification and Term. The number of directors
shall be three (3).
7
Directors need not be residents of the State of California nor shareholders of
the corporation. Subject to the foregoing provisions and the provisions of
Section 212 of the General Corporation Law, the number of directors may be
changed from time to time by an amendment of these Bylaws. No decrease in the
authorized number of directors shall have the effect of shortening the term of
any incumbent director. The directors, other than the first board of directors,
shall be elected at the annual meeting of the shareholders, and each director
elected shall serve until the next succeeding annual meeting and until his
successor shall have been elected and qualified. The first board of directors
shall hold office until the first annual meeting of shareholders.
Section 2. Vacancies. Unless otherwise provided in the articles of
incorporation, vacancies, except for a vacancy created by the removal of a
director, and newly created directorships resulting from any increase in the
number of directors may be filled by a majority of the directors then in office,
though less than a quorum, and the directors so chosen shall hold office until
the next annual election and until their successors are duly elected and shall
qualify. Unless otherwise provided in the articles of incorporation any vacancy
created by the removal of a director shall be filled by the shareholders by the
vote of a majority of the shares entitled to vote at a meeting at which a quorum
is present. Any vacancies, which may be filled by directors and are not filled
by the directors, may be filled by the shareholders by a majority of the shares
entitled to vote at a meeting at which a quorum is present.
Section 3. Function. The business affairs of the corporation shall be
managed by its board of directors which may exercise all such powers of the
corporation and do all such lawful acts and things as are not by statute or by
the articles of incorporation or by these Bylaws directed or required to be
exercised or done by the shareholders.
8
Section 4. Books. The directors may keep the books of the corporation,
except such as are required by law to be kept within the state, outside of the
State of California, at such place or places as they may from time to time
determine,
Section 5 Compensation. The board of directors, by the affirmative vote
of a majority of the directors then in office, and irrespective of any personal
interest of any of its members, shall have authority to establish reasonable
compensation of all directors for services to the corporation as directors,
officers or otherwise,
ARTICLE VI
MEETINGS OF THE BOARD OF DIRECTORS
Section 1. Place. Meetings of the board of directors, regular or
special, may be held either within or without the State of California,
Section 2. First Meeting. The first meeting of each newly elected board
of directors shall be held at such time and place as shall be fixed by the vote
of the shareholders at the annual meeting and no notice of such meeting shall be
necessary to the newly elected directors in order legally to constitute the
meeting, provided a quorum shall be present, or it may convene at such place and
time as shall be fixed by the consent in writing of all the directors.
Section 3. Time and Place. Regular meetings of the board of directors
may be held upon such notice, or without notice, and at such time and at such
place as shall from time to time be determined by the board.
Section 4. Call of Special Meetings. Special meetings of the board of
directors may be called by the president on four (4) days' notice by mail or
forty-eight (48) hours notice delivered
9
personally or by telephone or telegraph to each director, either personally or
by mail or by telephone or by telegram; special meetings shall be called by the
president or secretary in like manner and on like notice on the written request
of two directors unless the board consists of only one director; in which case,
special meetings shall be called by the president or secretary in like manner
and on like notice on the written request of the sole director.
Section 5. Waiver of Notice. Attendance of a director at any meeting
shall constitute a waiver of notice of such meeting, except where a director
attends for the express purpose of objecting to the transaction of any business
because the meeting is not lawfully called or convened. Neither the business to
be transacted at, nor the purpose of, any regular or special meeting of the
board of directors need be specified in the notice or waiver of notice of such
meeting,
Section 6. Quorum and Action. A majority of the directors shall
constitute a quorum for the transaction of business unless a greater number is
required by law or by the articles of incorporation. The act of a majority of
the directors present at any meeting at which a quorum is present shall be the
act of the board of directors, unless the act of a greater number is required by
statute or by the articles of incorporation. If a quorum shall not be present at
any meeting of directors, the directors present thereat may adjourn the meeting
from time to time, without notice other than announcement at the meeting, until
a quorum shall be present,
Section 7. Consent. Any action required or permitted to be taken at a
meeting of the directors may be taken without a meeting if a consent in writing,
setting forth the action so taken shall be signed by all of the directors
entitled to vote with respect to the subject matter thereof.
10
ARTICLE VII
COMMITTEES
Section 1. Executive Committees. The board of directors, by resolution
adopted by a majority of the number of directors fixed by the Bylaws or
otherwise, may designate two or more directors to constitute an executive
committee, which committee, to the extent provided in such resolution, shall
have and exercise all of the authority of the board of directors in the
management of the corporation, except as otherwise required by law. Vacancies in
the membership of the committee shall be filled by the board of directors at a
regular or special meeting of the board of directors. The executive committee
shall keep regular minutes of its proceedings and report the same to the board
when required. The board of directors may designate one or more directors as
alternate members of the executive committee. The executive committee shall not
have authority: (1) To approve any action which will also require the
shareholders' approval; (2) To fill vacancies on the board or in any committee;
(3) To fix the compensation of directors for serving on the board or on any
committee; (4) To amend or repeal the Bylaws or adopt new Bylaws; (5) To amend
or repeal any resolution of the board which by its express terms is not so
amendable or repealable; (6) To make a distribution to the shareholders except
at a rate or in a periodic amount or within a price range determined by the
board; or (7) To appoint other committees of the board or the members thereof.
Section 2. Other Committees, The board of directors, by resolution
adopted by a majority of the authorized number of directors, may 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 such committee, who may
11
replace any absent member at any meeting of such committee. Any such committee,
to the extent provided in the resolution of the board of directors, shall have
all the authority of the board of directors except such authority as may not be
delegated by the provisions of the General Corporation Law.
Meetings and action of committees shall be governed by, and held and
taken in accordance with, Bylaw provisions applicable to meetings and actions of
the Board of Directors, with such changes in the context of those Bylaws as are
necessary to substitute the committee and its members for the board of directors
and its members, except that (a) the time of regular meetings of committees may
be determined either by resolution of the Board of Directors or by resolution of
the committee; (b) special meetings of committees may also be called by
resolution of the board of directors; and (c) notice of special meetings of
committees shall also be given to all alternative members who shall have the
right to attend all meetings of the committee. The board of directors may adopt
rules for the governance of any committee not inconsistent with the provisions
of these Bylaws.
ARTICLE VIII
NOTICES
Section 1. Manner of Giving Notice. Whenever, under the provisions of
the statutes or of the articles of incorporation or of these Bylaws, notice is
required to be given to any director or shareholder, it shall not be construed
to mean personal notice, but such notice may be given in writing, by mail,
addressed to such director or shareholder, at his address as it appears on the
records of the corporation, with postage thereon prepaid, and such notice shall
be deemed to be given at the time when the same shall be deposited in the United
States mail. Notice to directors
12
may also be given by telegram. Notice to any shareholder shall be given at the
address furnished by such shareholder for the purpose of receiving notice. If
such address is not given and if no address appears on the records of tile
corporation for such shareholder, notice may be given to such shareholder at the
place where tile principal executive office of the corporation is located or by
publication at least once in a newspaper of general circulation in the county in
which said principal executive office is located. If a notice of a shareholders'
meeting is sent by mail it shall be sent by first-class mail, or, in case the
corporation has outstanding shares held of record by 500 or more persons
(determined as provided in Section 605 of the California General Corporation
Law) on the record date for the shareholders' meeting, notice may be by
third-class mail.
Section 2, Waiver of Notice or Consent.
Whenever any notice whatever is required to be given under the
provisions of the statutes or under the provisions of the articles of
incorporation or these Bylaws, a waiver thereof in writing or a consent to the
holding of the meeting or an approval of the minutes thereof, signed by the
person or persons entitled to such notice, whether before or after the time
stated therein, shall be deemed equivalent to the giving of such notice. 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 constitutes 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 shall not constitute a waiver of any right to
object to the consideration of matters required by the General Corporation Law
to be included in the notice but not so included, if such objection is expressly
made at the meeting
13
ARTICLE IX
OFFICERS
Section 1. Titles. The officers of the corporation, except those
elected in accordance with Section 210 of the California General Corporation
Law, shall be chosen by the board of directors and shall be president, a
vice-president, a secretary and a chief financial officer. The board of
directors may also choose additional vice-presidents, and one or more assistant
secretaries and assistant treasurers.
Section 2. Election, The board of directors, at its first meeting after
each annual meeting of shareholders, shall choose a president, one or more
vice-presidents, a secretary and a chief financial officer, none of whom need be
a member of the board.
Section 3. Other Officers. The board of directors may appoint such
other officers and agents as it shall deem necessary who shall hold their
offices for such terms and shall exercise such powers and perform such duties as
shall be determined from time to time by the board of directors.
Section 4. Board of Directors Direction. All officers shall perform
their duties and exercise their powers subject to the direction of the board of
directors.
Section 5. Salaries. The salaries of all officers and agents of the
corporation shall be fixed by the board of directors.
Section 6. I=. The officers of the corporation shall hold office until
their successors are chosen and qualify. Any officer elected or appointed by the
board of directors may be removed at any time by the affirmative vote of a
majority of the board of directors. Any vacancy occurring in any office of the
corporation shall be filled by the board of directors.
14
Section 7. The President. The president shall be the chief executive
officer of the corporation, shall preside at all meetings of the shareholders
and the board of directors, shall have general and active management of the
business of the corporation and shall see that all orders and resolutions of the
board of directors are carried into effect.
The President shall execute bonds, mortgages and other contracts
requiring a seal, under the seal of the corporation, except where required or
permitted by law to be otherwise signed and executed and except where the
signing and execution thereof shall be expressly delegated by the board of
directors to some other officer or agent of the corporation.
Section 8. The Vice-Presidents. The vice-president, of if there shall
be more than one, the vice-presidents in the order determined by the board of
directors, shall, in the absence or disability of the president, perform the
duties and exercise the powers of the president and shall perform such other
duties and have such other powers as the board of directors may from time to
time prescribe.
Section 9. The Secretary. The secretary shall attend all meetings of
the board of directors and all meetings of the shareholders and record all
proceedings of the meetings of the corporation and of the board of directors in
a book to be kept for that purpose and shall perform like duties for the
standing committees when required. The secretary shall give, or cause to be
given, notice of all meetings of the shareholders and special meetings of the
board of directors, and shall perform such other duties as may be prescribed by
the board of directors or president, under whose supervision the secretary shall
be. The secretary shall have custody of the corporate seal of the corporation
and the secretary shall have authority to affix the same to any instrument
requiring it, and when so affixed, it may be attested by his or her signature.
Unless a transfer agent is appointed
15
by the board of directors to keep a share resister, the secretary shall keep at
the principal executive office of the corporation a share register showing the
names of the shareholders and their addresses, the number and class of shares
held by each, the number and date of certificates issued and the number and date
of cancellation of each certificate surrendered for cancellation. The board of
directors may give general authority to any other officer to affix the seal of
the corporation and to attest the affixing by his or her signature.
Section 10. Assistant Secretaries. The assistant secretary, or if there
be more than one, the assistant secretaries in the order determined by the board
of directors, shall, in the absence or disability of the secretary perform the
duties and exercise the powers of the secretary and shall perform such other
duties and have such other powers as the board of directors may from time to
time prescribe.
Section 11. The Chief Financial Officer. The chief financial officer
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 chief financial officer shall disburse the funds of the corporation
as may be ordered by the board of directors, taking proper vouchers for such
disbursements, and shall render to the president and the board of directors, at
its regular meetings, or when the board of directors so requires, an account of
all his or her transactions as chief financial officer and of the financial
condition of the corporation.
If required by the board of directors, the chief financial officer
shall give the corporation a
16
bond in such sum and with such surety or sureties as shall be satisfactory to
the board of directors for the faithful performance of the duties of his or her
office and for the restoration to the corporation, in case of his or her death,
resignation, retirement or removal from office, of all books, papers, vouchers,
money and other property of whatever kind in his or her possession or under his
or her control belonging to the corporation.
The chief financial officer is, for the purpose of executing any
documents requiring the signature of the "Treasurer," deemed to be the treasurer
of the corporation.
Section 12. The Assistant Treasurers. The assistant treasurer, or, if
there shall be more than one, the assistant treasurers in the order determined
by the board of directors, shall, in the absence or disability of the chief
financial officer, perform the duties and exercise the powers of the chief
financial officer and shall perform such other duties and have such other powers
as the board of directors may from time to time prescribe.
ARTICLE X
SHARES
Section 1. Certificates for Shares. Every holder of shares in the
corporation shall be entitled to have a certificate, signed by, or in the name
of the corporation by, the chairman or vice-chairman of the board of directors,
or the president or vice-president and the chief financial officer or an
assistant treasurer, or the secretary or an assistant secretary of the
corporation, certifying the number of shares and the class or series of shares
owned by the shareholders in the corporation. If the shares of the corporation
are classified or if any class of shares has two or more series, there shall
appear on the certificate either (1) a statement of the rights, preferences,
privileges and
17
restrictions granted to or imposed upon each class or series of shares to be
issued and upon the holders thereof, or (2) a summary of such rights,
preferences, privileges and restrictions with reference to the provisions of the
articles and any certificates of determination establishing the same; or (3) a
statement setting forth the office or agency of the corporation from which
shareholders may obtain, upon request and without charge, a copy of the
statement referred to in item (1) heretofore, Every certificate shall have noted
thereon any information required to be set forth by the California General
Corporation Law and such information shall be set forth in the manner provided
by such law.
Any or all of the signatures on the certificate may be facsimile. In
case any officer, transfer agent or registrar who has signed or whose facsimile
signature has been placed upon a certificate shall have 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.
Section 2. Lost Certificates. The board of directors may direct a new
certificate to be issued in place of any certificate theretofore issued by the
corporation alleged to have been lost or destroyed. When authorizing such issue
of a new certificate, the board of directors, in its discretion and as a
condition precedent to the issuance thereof, may prescribe such terms and
conditions as it deems expedient, and may require such indemnities as it deems
adequate, to protect the corporation from any claim that may be made against it
with respect to any such certificate alleged to have been lost or destroyed.
Section 3. Exchange of Certificates. If the Articles of Incorporation
are amended in any way affecting the statements contained in the certificates
for outstanding shares, or it becomes
18
desirable for any reason, in the discretion of the board of directors, to cancel
any outstanding certificates for shares and issue a new certificate therefor
conforming to the rights of the holder, the board may order any holders of
outstanding certificates to surrender and exchange them for new certificates
within a reasonable time to be fixed by the board.
Section 4. Transfers of Shares. Upon surrender to the corporation or
the transfer agent of the corporation of a certificate representing shares duly
endorsed or accompanied by proper evidence of succession, assignment or
authority to transfer, a new certificate shall be issued to the person entitled
thereto, and the old certificate cancelled and the transaction recorded upon the
books of the corporation.
Upon compliance with any provisions of the General Corporation Law
and/or the Corporate Securities Law of 1968 which may restrict the
transferability of shares, transfers of shares of the corporation shall be made
only on the record of shareholders of the corporation by the registered holder
thereof, or by his attorney thereunto authorized by power of attorney duly
executed and filed with the Secretary of the corporation or with a transfer
agent or a registrar, if any, and on surrender of the certificate or
certificates for such shares properly endorsed and the payment of all taxes, if
any, due thereon.
Section 5. Closing of Transfer of Books. In order that the corporation
may determine the shareholders entitled to notice of any meeting or to vote or
entitled to receive payment of any dividend or other distribution or allotment
of any rights or entitled to exercise any rights in respect of any other lawful
action, the board may fix, in advance, a record date, which shall not be more
than 60 nor less than 10 days prior to the date of such meeting nor more than 60
days prior to any other action. If the board of directors shall not have fixed a
record date as aforesaid, the record
19
date for determining shareholders entitled to notice of or to vote at a meeting
of shareholders shall be at the close of business on the business day next
preceding the day on which notice is given or, if notice is waived, at the close
of business on the business day next preceding the day on which the meeting is
held; the record date for determining shareholders entitled to give consent to
corporate action in writing without a meeting, when no prior action by the board
of directors has been taken, shall be the day on which the first written consent
is given; and 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 day prior to the date of
such other action, whichever is later.
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 fixes a new record date for the adjourned meeting, but the
board shall fix a new record date if the meeting is adjourned for more than 45
days from the date set for the original meeting.
Except as may be otherwise provided by the General Corporation Law,
shareholders at the close of business on the record date shall be entitled to
notice and to vote or to receive any 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.
Section 6. Registered Shareholders. The corporation shall be entitled
to recognize the exclusive right of a person registered on its books as the
owner of shares to receivedividends, and to vote as such owner, and to hold
liable for calls and assessments to a person registered on its books as the
owner of shares, and shall not be bound to recognize any equitable or other
claim to or interest in such share or shares on the part of any other person,
whether or not it
20
shall have express or other notice thereof, except as otherwise provided by the
laws of California.
ARTICLE XI
INDEMNIFICATION OF DIRECTORS. OFFICERS
EMPLOYEES AND OTHER AGENTS
Section 1. Agents, Proceedings, and Expenses. For the purposes of this
Article, "agent" means any person who is or was a director, officer, employee,
or other agent of this corporation, or is or was serving at the request of this
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
which was a predecessor corporation of this corporation or of another enterprise
at the request of such predecessor corporation; "proceeding" means any
threatened, pending, or completed action or proceeding, whether civil, criminal,
administrative, or investigative; and "expenses" includes, without limitation,
attorneys' fees and any expenses of establishing a right to indemnification
under Section 4 or Section 5(c) of this Article XI.
Section 2. Actions Other than by the Corporation. This corporation
shall indemnify any person who was or is a party, or is threatened to be made a
party, to any proceeding (other than an action by or in the right of this
corporation to procure a judgment in its favor) by reason of the fact that such
person is or was an agent of this corporation, against expenses, judgments,
fines, settlements, and other amounts actually and reasonably incurred in
connection with such proceeding if that person acted in good faith and in a
manner that the person reasonably believed to be in the best interests of this
corporation and, in the case of a criminal proceeding, had no reasonable cause
to
21
believe the conduct of that person was unlawful. The termination of any
proceeding by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent shall not, of itself, create a presumption that the
person did not act in good faith and in a manner that the person reasonably
believed to be in the best interests of this corporation or that the person had
reasonable cause to believe that the person's conduct was unlawful,
Section 3. Actions by or in the Right of the Corporation. This
corporation shall indemnify any person who was or is a party, or is threatened
to be made a party, to any threatened, pending, or completed action by or in the
right of this corporation to procure a judgment in its favor by reason of the
fact that such person is or was an agent of this corporation, against expenses
actually and reasonably incurred by such person in connection with the defense
or settlement of that action, if such person acted in good faith, in a manner
such person believed to be in the best interests of this corporation and its
shareholders. No indemnification shall be made under this Section 3 for the
following:
(a) With respect to any claim issue or matter as to which such person
has been adjudged to be liable to this corporation in the performance of such
person's duty to the corporation and its shareholders, unless and only to the
extent that the court in which such proceeding is or was pending shall determine
upon application that, in view of all the circumstances of the case, such person
is fairly and reasonably entitled to indemnity for expenses and then only to the
extent that the court shall determine;
(b) Of amounts paid in settling or otherwise disposing of a pending
action without court approval;
(c) Of expenses incurred in defending a pending action that is settled
or otherwise
22
disposed of without court approval.
Section 4. Successful Defense by Agent. To the extent that an agent of
this corporation has been successful on the merits in defense of any proceeding
referred to in Section 2 or 3 of this Article XI, or in defense of any claim,
issue or matter therein, the agent shall be indemnified against expenses
actually and reasonably incurred by the agent in connection therewith.
Section 5. Required Approval. Except as provided in Section 4 of this
Article XI, any indemnification under this section shall be made by the
corporation only if authorized in the specific case, upon a determination that
indemnification of the agent is proper in the circumstances because the agent
has met the applicable standard of conduct set forth in Section 2 or 3 by one of
the following:
(a) A majority vote of a quorum consisting of directors who are not
parties to such proceeding;
(b) Independent legal counsel in a written opinion if a quorum of
directors who are not parties to such a proceeding is not available.
(c) (i) The affirmative vote of a majority of shares of this
corporation entitled to vote represented at a duly held meeting at which a
quorum is present; or
(ii) The written consent of holders of a majority of the
outstanding shares entitled to vote (for purposes of the subsections 5(c), the
shares owned by the person to be indemnified shall not be considered outstanding
or entitled to vote thereon); or
(d) The court in which tile proceeding is or was pending, on
application made by this corporation or the agent or the attorney or other
person rendering services in connection with the defense, whether or not such
application by the agent, attorney, or other person is opposed by this
23
corporation.
Section 6. Advance of Expenses. Expenses incurred in defending any
proceeding may be advanced by die corporation before the final disposition of
such proceeding upon receipt of an undertaking by or on behalf of the agent to
repay such amounts if it shall be determined ultimately that the agent is not
entitled to be indemnified as authorized in this Article XI.
Section 7. Other Contractual Right. The indemnification provided by
this Article XI shall not be deemed exclusive of any other rights to which those
seeking indemnification may be entitled under any bylaw, agreement, vote of
shareholders, 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 such additional rights to indemnification are authorized
in the articles of the corporation. The rights of indemnity hereunder shall
continue as to a person who has ceased to be a director, officer, employee, or
agent and shall inure to the benefit of the heirs, executors, and administrators
of the person. Nothing contained in this section shall affect any right to
indemnification to which persons other than such directors and officers may be
entitled by contract or otherwise.
Section 8. Limitations, No indemnification or advance shall be made
under this Article XI except as provided in Section 4 or Section 5(c), in any
circumstance if it appears:
(a) That it would be inconsistent with a provision of the articles,
bylaws, a resolution of the shareholders, or an agreement in effect at the time
of the accrual of the alleged cause of action asserted in die proceeding in
which expenses were incurred or other amounts were paid, which prohibits or
otherwise limits indemnification; or
(b) That it would be inconsistent with any condition expressly imposed
by a court
24
approving settlement.
Section 9. Insurance. This corporation may purchase and maintain
insurance on behalf of any agent of the corporation insuring against any
liability asserted against or incurred by the agent in that capacity or arising
out of the agent's status as such, whether or not this corporation would have
the power to indemnify the agent against that liability under the provisions of
this Article XI Notwithstanding the foregoing, if this corporation owns all or a
portion of the shares of the company issuing the policy of insurance, the
insuring company and/or the policy shall meet the conditions set forth in
Section 317(i) of the Corporations Code.
Section 10. Fiduciaries of Corporate Employee Benefit Plan. This
Article XI does not apply to any proceeding against any trustee, investment
manager, or other fiduciary of an employee benefit plan in that person's
capacity as such, even though that person may also be an agent of the
corporation. The corporation shall have the power to indemnity, and to purchase
and maintain insurance on behalf of any such trustee, investment manager, or
other fiduciary of any benefit plan for any or all of the directors, officers,
and employees of the corporation or any of its subsidiary or affiliated
corporations.
Section 11. Survival of Rights. The rights provided by this Article XI
shall continue for 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 12. Effect of Amendment. Any amendment, repeal, or modification
of this Article XI shall not adversely affect an agent's right or protection
existing at the time of such amendment, repeal, or modification.
Section 13. Settlement of Claims. The corporation shall not be liable
to indemnify any
25
agent under this Article XI for
(a) 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) any judicial award, if the corporation was not given a reasonable
and timely opportunity to participate, at its expense, in the defense of such
action.
Section 14. Subrogation. In the event of payment under this Article XI,
the corporation shall be subrogated to the extend 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 as may be necessary to enable to corporation
effectively to bring suit to enforce such rights,
Section 15. No Duplication of Payments. The corporation shall not be
liable under this Article XI to make any payment in connection with any claim
made against the agent to the extent the agent has otherwise actually received
payment, whether under a policy of insurance, agreement vote, or otherwise, of
the amounts otherwise indemnifiable under this Article
ARTICLE XII
GENERAL PROVISIONS
Section 1. Dividends. Subject to the provisions of the articles of
incorporation relating thereto, if any, dividends may be declared by the board
of directors at any regular or special meeting, pursuant to law. Dividends may
be paid in cash, in property or in shares of the capital stock, subject to any
provisions of the articles of incorporation and the California General
Corporation Law,
26
Section 2. Reserve Fund. 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 modify or abolish any such reserve in the
manner in which it was created.
Section 3. Checks. All checks or demands for money and notes of the
corporation shall be signed by such officer or officers of such other person or
persons as the board of directors may from time to time designate.
Section 4. Fiscal Year. The fiscal year of the corporation shall be
fixed by resolution of the board of directors.
Section 5. Seal. The corporate seal shall have inscribed thereon the
name of the corporation, the date of its incorporation and the words "Corporate
Sale, California". The seal may be used by causing it or a facsimile thereof to
be impressed or affixed or in any mariner reproduced.
Section 6. Books and Records. The corporation shall keep at its
principal executive office in the State of California or, if its principal
executive office is not in the State of California, at its principal business
office in the State of California, the original or a copy of the Bylaws as
amended to date, which shall be open to inspection by the shareholders at all
reasonable times during office hours. If the principal executive office of the
corporation is outside the State of California, and, if the corporation has no
principal business office in the State of California, it shall upon request of
any shareholder furnish a copy of the Bylaws as amended to date.
The corporation shall keep adequate and correct books and records of
account and shall keep
27
minutes of the proceedings of its shareholders, Board of Directors and
committees, if any, of the Board of Directors, The corporation shall keep at its
principal executive office, or at the office of its transfer agent or registrar,
a record of its shareholders, giving the names and addresses of all shareholders
and the number and class of shares held by each. Such minutes shall be in
written form. Such other books and records shall be kept either in written form
or in any other form capable of being converted into written form.
Section 7. Amendments. These bylaws may be altered, amended or repealed
or new bylaws may be adopted:
(a) at any regular or special meeting of shareholders at which a quorum
is present or represented, by the affirmative vote of a majority of the stock
entitled to vote, provided notice of the proposed alteration, amendment or
repeal be contained in the notice of such meeting, or
(b) by the affirmative vote of a majority of the board of directors at
any regular or special meeting of the board.
The board of directors shall not make or alter any bylaw specifying a
fixed number of directors or the maximum or minimum number of directors and the
directors shall not change a fixed board to a variable board or vice versa in
the bylaws. The board of directors shall not change a
28
bylaw, if any, which requires a larger proportion of the vote of directors for
approval then is required by the California General Corporation Law.
I HEREBY CERTIFY that the foregoing is a full, true and correct copy of
the Bylaws of ADVANTAGE SYSTEMS, INC., a California corporation, as in effect on
the date hereof.
WITNESS my hand and the seal of the corporation.
Dated: September 9, 1996
/s/ Keith E. Avinger
---------------------------------
Secretary
ADVANTAGE SYSTEMS INC.
29