CARMAX, INC.
BYLAWS
AS AMENDED AND RESTATED
November 1, 2004
TABLE OF CONTENTS
ARTICLE I MEETINGS OF SHAREHOLDERS..................................1
1.1 Place and Time of Meetings.................................1
1.2 Organization and Order of Business.........................1
1.3 Annual Meeting.............................................1
1.4 Special Meetings...........................................2
1.5 Record Dates...............................................2
1.6 Notice of Meetings.........................................2
1.7 Waiver of Notice; Attendance at Meeting....................3
1.8 Quorum and Voting Requirements.............................3
1.9 Proxies....................................................4
1.10 Voting List................................................4
ARTICLE II DIRECTORS................................................5
2.1 General Powers.............................................5
2.2 Number and Term............................................5
2.3 Nomination of Directors....................................5
2.4 Election...................................................5
2.5 Removal; Vacancies.........................................6
2.6 Annual and Regular Meetings................................6
2.7 Special Meetings...........................................6
2.8 Notice of Meetings.........................................6
2.9 Waiver of Notice; Attendance at Meeting....................6
2.10 Quorum; Voting.............................................7
2.11 Telephonic Meetings........................................7
2.12 Action Without Meeting.....................................7
2.13 Compensation...............................................7
2.14 Chairman and Vice Chairman.................................7
ARTICLE III COMMITTEES OF DIRECTORS.................................8
3.1 Committees.................................................8
3.2 Authority of Committees....................................8
3.3 Executive Committee........................................8
3.4 Audit Committee............................................9
3.5 Nominating and Governance Committee........................9
3.6 Compensation and Personnel Committee......................10
3.7 Committee Meetings; Miscellaneous.........................11
ARTICLE IV OFFICERS................................................11
4.1 Officers..................................................11
4.2 Election; Term............................................11
4.3 Removal of Officers.......................................11
4.4 Duties of the President...................................11
4.5 Duties of the Vice President..............................11
4.6 Duties of the Secretary...................................11
4.7 Duties of the Chief Financial Officer.....................12
4.8 Duties of the Assistant Secretary.........................12
4.9 Duties of Other Officers..................................12
4.10 Voting Securities of Other Corporations...................12
4.11 Compensation..............................................12
4.12 Bonds.....................................................13
ARTICLE V EVIDENCE OF SHARES.......................................13
5.1 Form......................................................13
5.2 Transfer..................................................13
5.3 Restrictions on Transfer..................................13
5.4 Lost or Destroyed Share Certificates......................13
5.5 Registered Shareholders...................................13
ARTICLE VI MISCELLANEOUS PROVISIONS................................14
6.1 Certain Definitions.......................................14
6.2 Corporate Seal............................................14
6.3 Fiscal Year...............................................14
6.4 Amendments................................................14
6.5 General...................................................14
CARMAX, INC.
BYLAWS
ARTICLE I
MEETINGS OF SHAREHOLDERS
1.1 Place and Time of Meetings. Meetings of shareholders shall be held at the
principal office of the Corporation or at such place, either within or without
the Commonwealth of Virginia, and at such time as may be provided in the notice
of the meeting and approved by the Board of Directors.
1.2 Organization and Order of Business. The Chairman or, in the Chairman's
absence, the President shall serve as chairman at all meetings of the
shareholders. In the absence of both of the foregoing persons or if both of them
decline to serve, a majority of the shares entitled to vote at a meeting may
appoint any person entitled to vote at the meeting to act as chairman. The
Secretary or, in the Secretary's absence, an Assistant Secretary shall act as
secretary at all meetings of the shareholders. In the event that neither the
Secretary nor an Assistant Secretary is present, the chairman of the meeting may
appoint any person to act as secretary of the meeting.
The Chairman shall have the authority to make such rules and regulations, to
establish such procedures and to take such steps as he or she may deem necessary
or desirable for the proper conduct of each meeting of the shareholders,
including, without limitation, the authority to make the agenda and to establish
procedures for (i) dismissing of business not properly presented, (ii)
maintaining of order and safety, (iii) placing limitations on the time allotted
to questions or comments on the affairs of the Corporation, (iv) placing
restrictions on attendance at a meeting by persons or classes of persons who are
not shareholders or their proxies, (v) restricting entry to a meeting after the
time prescribed for the commencement thereof and (vi) commencing, conducting and
closing voting on any matter.
Any business which might properly have been conducted on an original meeting
date may come before an adjourned meeting when reconvened.
1.3 Annual Meeting. The annual meeting of shareholders shall be held in the
month of June of each year on such day and convening at such time as shall be
determined by the Board of Directors of the Corporation. If such day is a legal
holiday, then the annual meeting of shareholders shall be held on the next
succeeding business day. Alternatively, the annual meeting may be held on such
other day as may be provided in the notice of the meeting and approved by the
Board of Directors.
At each annual meeting of shareholders, only such business shall be conducted as
is proper to consider and has been brought before the meeting (i) pursuant to
the Corporation's notice of the meeting, (ii) by or at the direction of the
Board of Directors or (iii) by a shareholder who is a shareholder of record of a
class of shares entitled to vote on the business such shareholder is proposing
and who is such a shareholder of record, both at the time of the giving of the
shareholder's notice hereinafter described in this Section 1.3 and on the record
date for such annual meeting, and who complies with the notice procedures set
forth in this Section 1.3.
In order to bring before an annual meeting of shareholders any business which
may properly be considered and which a shareholder has not sought to have
included in the Corporation's proxy statement for the meeting, a shareholder who
meets the requirements set forth in the preceding paragraph must give the
Corporation timely written notice. To be timely, a shareholder's notice must be
given, either by personal delivery to the Secretary or an Assistant Secretary at
the principal office of the Corporation or by first class United States mail,
with postage thereon prepaid, addressed to the Secretary at the principal office
of the Corporation. Any such notice must be received (i) on or after February
1st and before March 1st of the year in which the meeting will be held, if
clause (ii) is not applicable, or (ii) not less than 90 days before the date of
the meeting if the date of such meeting, as prescribed in these bylaws, has been
changed by more than 30 days.
Each such shareholder's notice shall set forth as to each matter the shareholder
proposes to bring before the annual meeting (i) the name and address, as they
appear on the Corporation's stock transfer books, of the shareholder proposing
business, (ii) the class and number of shares of stock of the Corporation
beneficially owned by such shareholder, (iii) a representation that such
shareholder is a shareholder of record at the time of the giving of the notice
and intends to appear in person or by proxy at the meeting to present the
business specified in the notice, (iv) a brief description of the business
desired to be brought before the meeting, including the complete text of any
resolutions to be presented and the reasons for wanting to conduct such business
and (v) any interest which the shareholder may have in such business.
The Secretary or Assistant Secretary shall deliver each shareholder's notice
that has been timely received to the Chairman for review.
Notwithstanding the foregoing provisions of this Section 1.3, a shareholder
seeking to have a proposal included in the Corporation's proxy statement for an
annual meeting of shareholders shall comply with the requirements of Regulation
14A under the Securities Exchange Act of 1934, as amended from time to time, or
with any successor regulation.
1.4 Special Meetings. Special meetings of the shareholders may be called only by
the Chairman, the President or the Board of Directors. Only business within the
purpose or purposes described in the notice for a special meeting of
shareholders may be conducted at the meeting.
1.5 Record Dates. The Board of Directors shall fix, in advance, a record date to
make a determination of shareholders entitled to notice of or to vote at any
meeting of shareholders or to receive any dividend or for any purpose, such date
to be not more than 70 days before the meeting or action requiring a
determination of shareholders.
When a determination of shareholders entitled to notice of or to vote at any
meeting of shareholders has been made, such determination shall be effective for
any adjournment of the meeting unless the Board of Directors fixes a new record
date, which it shall do if the meeting is adjourned to a date more than 120 days
after the date fixed for the original meeting.
1.6 Notice of Meetings. Written notice stating the place, day and hour of each
meeting of shareholders and, in the case of a special meeting, the purpose or
purposes for which the meeting is called, shall be given by mail not less than
10 nor more than 60 days before the date of the meeting (except when a different
time is required in these Bylaws or by law) to each shareholder of record
entitled to vote at such meeting. Such notice shall be deemed to be effective
when deposited in first class United States mail with postage thereon prepaid
and addressed to the shareholder at his or her address as it appears on the
share transfer books of the Corporation.
Notice of a shareholder's meeting to act on (i) an amendment of the Articles of
Incorporation, (ii) a plan of merger or share exchange, (iii) the sale, lease,
exchange or other disposition of all or substantially all the property of the
Corporation otherwise than in the usual and regular course of business or (iv)
the dissolution of the Corporation, shall be given, in the manner provided
above, not less than 25 nor more than 60 days before the date of the meeting.
Any notice given pursuant to this section shall state that the purpose, or one
of the purposes, of the meeting is to consider such action and shall be
accompanied by (x) a copy of the proposed amendment, (y) a copy of the proposed
plan of merger or share exchange or (z) a summary of the agreement pursuant to
which the proposed transaction will be effected. If only a summary of the
agreement is sent to the shareholders, the Corporation shall also send a copy of
the agreement to any shareholder who requests it.
If a meeting is adjourned to a different date, time or place, notice need not be
given if the new date, time or place is announced at the meeting before
adjournment. However, if a new record date for an adjourned meeting is fixed,
notice of the adjourned meeting shall be given to shareholders as of the new
record date unless a court provides otherwise.
Notwithstanding the foregoing, no notice of a meeting of shareholders need be
given to a shareholder if (i) an annual report and proxy statements for two
consecutive annual meetings of shareholders or (ii) all, and at least two,
checks in payment of dividends or interest on securities during a 12-month
period, have been sent by first-class United States mail, with postage thereon
prepaid, addressed to the shareholder at his or her address as it appears on the
share transfer books of the Corporation, and returned undeliverable. The
obligation of the Corporation to give notice of meetings of shareholders to any
such shareholder shall be reinstated once the Corporation has received a new
address for such shareholder for entry on its share transfer books.
1.7 Waiver of Notice; Attendance at Meeting. A shareholder may waive any notice
required by law, the Articles of Incorporation or these Bylaws before or after
the date and time of the meeting that is the subject of such notice. The waiver
shall be in writing, be signed by the shareholder entitled to the notice and be
delivered to the Secretary for inclusion in the minutes or filing with the
corporate records.
A shareholder's attendance at a meeting (i) waives objection to lack of notice
or defective notice of the meeting unless the shareholder, at the beginning of
the meeting, objects to holding the meeting or transacting business at the
meeting and (ii) waives objection to consideration of a particular matter at the
meeting that is not within the purpose or purposes described in the meeting
notice unless the shareholder objects to considering the matter when it is
presented.
1.8 Quorum and Voting Requirements. Unless otherwise required by law, a majority
of the votes entitled to be cast on a matter constitutes a quorum for action on
that matter. Once a share is represented for any purpose at a meeting, it is
deemed present for quorum purposes for the remainder of the meeting and for any
adjournment of that meeting unless a new record date is or shall be set for that
adjourned meeting. If a quorum exists, action on a matter, other than the
election of directors, is approved if the votes cast favoring the action exceed
the votes cast opposing the action unless a greater number of affirmative votes
is required by law. Directors shall be elected by a plurality of the votes cast
by the shares entitled to vote in the election at a meeting at which a quorum is
present. Less than a quorum may adjourn a meeting.
1.9 Proxies. A shareholder may vote his or her shares in person or by proxy. A
shareholder may appoint a proxy to vote or otherwise act for such shareholder by
signing an appointment form, either personally or by his or her
attorney-in-fact. An appointment of a proxy is effective when received by the
Secretary or other officer or agent authorized to tabulate votes and is valid
for eleven (11) months unless a longer period is expressly provided in the
appointment form. An appointment of a proxy is revocable by the shareholder
unless the appointment form conspicuously states that it is irrevocable and the
appointment is coupled with an interest.
The death or incapacity of the shareholder appointing a proxy does not affect
the right of the Corporation to accept the proxy's authority unless notice of
the death or incapacity is received by the Secretary or other officer or agent
authorized to tabulate votes before the proxy exercises his or her authority
under the appointment. An irrevocable appointment is revoked when the interest
with which it is coupled is extinguished. A transferee for value of shares
subject to an irrevocable appointment may revoke the appointment if the
transferee did not know of its existence when the shares were acquired and the
existence of the irrevocable appointment was not noted conspicuously on the
certificate representing the shares or on the information statement for shares
without certificates. Subject to any legal limitations on the right of the
Corporation to accept the vote or other action of a proxy and to any express
limitation on the proxy's authority appearing on the face of the appointment
form, the Corporation is entitled to accept the proxy's vote or other action as
that of the shareholder making the appointment. Any fiduciary who is entitled to
vote any shares may vote such shares by proxy.
1.10 Voting List. The officer or agent having charge of the share transfer books
of the Corporation shall make, at least ten days before each meeting of
shareholders, a complete list of the shareholders entitled to vote at such
meeting or any adjournment thereof, with the address of and the number of shares
held by each. For a period of ten days prior to the meeting, such list shall be
kept on file at the registered office of the Corporation or at its principal
office or at the office of its transfer agent or registrar and shall be subject
to inspection by any shareholder at any time during usual business hours. Such
list shall also be produced and kept open at the time and place of the meeting
and shall be subject to the inspection of any shareholder during the whole time
of the meeting for the purpose thereof. The original share transfer books shall
be prima facie evidence as to which shareholders are entitled to examine such
list or transfer books or to vote at any meeting of the shareholders. The right
of a shareholder to inspect such list prior to the meeting shall be subject to
the conditions and limitations set forth by law. If the requirements of this
section have not been substantially complied with, the meeting shall, on the
demand of any shareholder in person or by proxy, be adjourned until such
requirements are met. Refusal or failure to prepare or make available the
shareholders' list does not affect the validity of action taken at the meeting
prior to the making of any such demand, but any action taken by the shareholders
after the making of any such demand shall be invalid and of no effect.
ARTICLE II
DIRECTORS
2.1 General Powers. The Corporation shall have a Board of Directors. All
corporate powers shall be exercised by or under the authority of, and the
business and affairs of the Corporation managed under the direction of, its
Board of Directors, and such officers and agents as the Board of Directors may
elect to employ, subject to any limitation set forth in the Articles of
Incorporation.
2.2 Number and Term. The number of directors shall be eleven (11). This number
may be increased or decreased from time to time by amendment to these Bylaws to
the extent permitted by law and by the Corporation's Articles of Incorporation.
Except as provided in Section 2.5, directors shall be elected for terms of up to
three (3) years in the manner set forth in the Articles of Incorporation and
shall serve until the election of their successors. No decrease in the number of
directors shall have the effect of changing the term of any incumbent director.
Unless a director resigns or is removed by the majority vote of the
shareholders, every director shall hold office for the term elected or until a
successor to such director shall have been elected.
2.3 Nomination of Directors. Nominations for the election of directors may be
made by the Board of Directors or by any shareholder entitled to vote in the
election of directors generally. However, any such shareholder may nominate one
or more persons for election as directors at a meeting only if written notice of
such shareholder's intent to make such nomination or nominations has been given,
either by personal delivery or by United States mail, postage prepaid, to the
Secretary of the Corporation not later than (i) with respect to an election to
be held at an annual meeting of shareholders 120 days in advance of such meeting
or (ii) with respect to a special meeting of shareholders for the election of
directors, the close of business on the seventh day following the date on which
notice of such meeting is first given to shareholders.
Each such notice shall set forth: (a) the name and address of the shareholder
who intends to make the nomination and of the person or persons to be nominated;
(b) a representation that the shareholder is a holder of record of stock of the
Corporation entitled to vote at such meeting and intends to appear in person or
by proxy at the meeting to nominate the person or persons specified in the
notice; (c) a description of all arrangements or understandings between the
shareholder and each nominee and any other person or persons (naming such person
or persons) pursuant to which the nomination or nominations are to be made by
the shareholder; (d) such other information regarding each nominee proposed by
such shareholder as would be required to be included in a proxy statement filed
pursuant to the proxy rules of the Securities and Exchange Commission, had the
nominee been nominated, or intended to be nominated, by the Board of Directors;
and (e) the consent of each nominee to serve as a director of the Corporation if
so elected. The Chairman may refuse to acknowledge the nomination of any person
not made in compliance with the foregoing procedure.
2.4 Election. Except as provided in Section 2.5, the directors shall be elected
by the holders of the common shares at each annual meeting of shareholders or at
a special meeting called for such purpose. Those persons who receive the
greatest number of votes shall be deemed elected even though they do not receive
a majority of the votes cast. No individual shall be named or elected as a
director without such individual's prior consent.
2.5 Removal; Vacancies. The shareholders may remove one or more directors with
or without cause. If a director is elected by a voting group, only the
shareholders of that voting group may elect to remove the director. Unless the
Articles of Incorporation require a greater vote, a director may be removed if
the number of votes cast to remove the director constitutes a majority of the
votes entitled to be cast at an election of directors of the voting group or
voting groups by which such director was elected. A director may be removed by
the shareholders only at a meeting called for the purpose of removing such
director and the meeting notice must state that the purpose, or one of the
purposes, of the meeting is removal of the director.
A vacancy on the Board of Directors, including a vacancy resulting from the
removal of a director or an increase in the number of directors, may be filled
by (i) the shareholders, (ii) the Board of Directors or (iii) the affirmative
vote of a majority of the remaining directors though less than a quorum of the
Board of Directors and may, in the case of a resignation that will become
effective at a specified later date, be filled before the vacancy occurs but the
new director may not take office until the vacancy occurs. Any director elected
by the Board of Directors shall serve until the next annual meeting of
shareholders or until the election of a successor to such director.
2.6 Annual and Regular Meetings. An annual meeting of the Board of Directors,
which shall be considered a regular meeting, shall be held immediately following
each annual meeting of shareholders for the purpose of electing officers and
carrying on such other business as may properly come before the meeting. The
Board of Directors may also adopt a schedule of additional meetings which shall
be considered regular meetings. Regular meetings shall be held at such times and
at such places, within or without the Commonwealth of Virginia, as the Chairman,
the President or the Board of Directors shall designate from time to time. If no
place is designated, regular meetings shall be held at the principal office of
the Corporation.
2.7 Special Meetings. Special meetings of the Board of Directors may be called
by the President, the Board of Directors or any two Directors of the Corporation
and shall be held at such times and at such places, within or without the
Commonwealth of Virginia, as the person or persons calling the meetings shall
designate. If no such place is designated in the notice of a meeting, it shall
be held at the principal office of the Corporation.
2.8 Notice of Meetings. No notice need be given of regular meetings of the Board
of Directors.
Notices of special meetings of the Board of Directors shall be given to each
director in person or delivered to his or her residence or business address (or
such other place as the director may have directed in writing) not less than
twenty-four (24) hours before the meeting by mail, email, messenger, telecopy,
telegraph or other means of written communication or by telephoning such notice
to the director. Any such notice shall set forth the time and place of the
meeting.
2.9 Waiver of Notice; Attendance at Meeting. A director may waive any notice
required by law, the Articles of Incorporation or these Bylaws before or after
the date and time stated in the notice and such waiver shall be equivalent to
the giving of such notice. Except as provided in the next paragraph of this
section, the waiver shall be in writing, signed by the director entitled to the
notice and filed with the minutes or corporate records.
A director's attendance at or participation in a meeting waives any required
notice to such director of the meeting unless the director, at the beginning of
the meeting or promptly upon arrival, objects to holding the meeting or
transacting business at the meeting and does not thereafter vote for or assent
to action taken at the meeting.
2.10 Quorum; Voting. A majority of the number of directors fixed in these Bylaws
shall constitute a quorum for the transaction of business at a meeting of the
Board of Directors. If a quorum is present when a vote is taken, the affirmative
vote of a majority of the directors present is the act of the Board of
Directors. A director who is present at a meeting of the Board of Directors or a
committee of the Board of Directors when corporate action is taken is deemed to
have assented to the action taken unless (i) the director objects, at the
beginning of the meeting or promptly upon arrival, to holding it or transacting
specified business at the meeting or (ii) the director votes against or abstains
from the action taken.
2.11 Telephonic Meetings. The Board of Directors may permit any or all directors
to participate in a regular or special meeting by, or conduct the meeting
through the use of, any means of communication by which all directors
participating may simultaneously hear each other during the meeting. A director
participating in a meeting by this means is deemed to be present in person at
the meeting.
2.12 Action Without Meeting. Action required or permitted to be taken at a
meeting of the Board of Directors may be taken without a meeting if the action
is taken by all members of the Board. The action shall be evidenced by one or
more written consents stating the action taken, signed by each director either
before or after the action is taken and included in the minutes or filed with
the corporate records. Action taken under this section shall be effective when
the last director signs the consent unless the consent specifies a different
effective date in which event the action taken is effective as of the date
specified therein provided the consent states the date of execution by each
director.
2.13 Compensation. Directors shall not receive a stated salary for their
services, but directors may be paid a fixed sum and expenses for attendance at
any regular or special meeting of the Board of Directors or any meeting of any
Committee and such other compensation as the Board of Directors shall determine.
A director may serve or be employed by the Corporation in any other capacity and
receive compensation thereafter.
2.14 Chairman and Vice Chairman. The Chairman of the Board, if one is designated
by the Board of Directors, shall preside at all meetings of the Board and of
shareholders and perform such other duties as the Board shall assign from time
to time. The Vice Chairman of the Board, if one is designated by the Board of
Directors, shall, at the request of or in the absence of the Chairman of the
Board, preside at meetings of the Board and of shareholders and, when requested
to do so by the Board, shall perform all of the functions of the Chairman of the
Board during the absence or incapacity of the latter.
ARTICLE III
COMMITTEES OF DIRECTORS
3.1 Committees. The Board of Directors may create one or more committees and
appoint members of the Board of Directors to serve on them. Unless otherwise
provided in these Bylaws, each committee shall have two or more members who
serve at the pleasure of the Board of Directors. The creation of a committee and
appointment of members to it shall be approved by a majority of all of the
directors in office when the action is taken.
3.2 Authority of Committees. To the extent specified by the Board of Directors,
each committee may exercise the authority of the Board of Directors, except that
a committee may not (i) approve or recommend to shareholders action that is
required by law to be approved by shareholders, (ii) fill vacancies on the Board
of Directors or on any of its committees, (iii) amend the Articles of
Incorporation, (iv) adopt, amend, or repeal these Bylaws, (v) approve a plan of
merger not requiring shareholder approval, (vi) authorize or approve a
distribution, except according to a general formula or method prescribed by the
Board of Directors or (vii) authorize or approve the issuance or sale or
contract for sale of shares, or determine the designation and relative rights,
preferences, and limitations of a class or series of shares, except that the
Board of Directors may authorize a committee, or a senior executive officer of
the Corporation, to do so within limits specifically prescribed by the Board of
Directors.
3.3 Executive Committee. The Board of Directors may appoint an Executive
Committee consisting of the management members of the Board. Subject to any
limitation provided by law, in the Company's Bylaws, or in any resolution of the
Board of Directors, and with respect to subparts (i) through (vii) herein,
further subject to the limits of the Company's current capital expenditure
budget and/or strategic plan, as applicable, the Committee shall have the
authority of the Board of Directors to approve the following matters: (i) the
purchase, development and sale of real estate, (ii) the formation and
incorporation of domestic operating subsidiaries of the Company having initial
capitalizations not to exceed US$10,000,000 per subsidiary, (iii) the
dissolution, merger, liquidation or unwinding of any domestic operating
subsidiary of the Company, (iv) the acquisition and sale of car dealer
franchises, (v) loan agreements, securitizations and other financing activities,
(vi) the administration, modification and amendment of the Company's employee
benefit plans that are subject to the fiduciary provisions of the Employee
Retirement Income Security Act of 1974 (ERISA), but only to the extent such
administration, modification or amendment does not require shareholder approval
or materially impact the Company's financial results, (vii) the investment
policy for the Company's retirement plans subject to ERISA, (viii) the
appointment and removal of the trustees for the Company's retirement plans
subject to ERISA; (ix) other matters occurring in the ordinary course of the
Company's business, and (x) matters occurring other than in the ordinary course
of business, if, in the judgment of the Chair of the Committee with the
concurrence of either the Chairman of the Board or the chair of any other
standing committee of the Board, exigent circumstances exist which make it
impracticable of impossible to convene a meeting of the Board of Directors. The
Committee may form and delegate authority to a subcommittee consisting of two or
more members. A subcommittee shall report any action to the full Committee at
its next meeting. Subject to the approval of the Board of Directors, the
Executive Committee shall adopt and from time to time assess and revise a
written charter which will specify how the Committee will carry out its
responsibilities and such other matters as the Board determines are necessary
and desirable.
3.4 Audit Committee. The Board of Directors shall appoint each year an Audit
Committee, which shall be composed of at least three members of the Board, all
of whom shall be independent directors (as defined in Section 6.1). In addition,
the members of the Committee shall satisfy the requirements for audit committee
membership imposed by the New York Stock Exchange on audit committees of listed
public companies and any eligibility requirements of the Securities and Exchange
Commission with regard to companies whose securities are registered under the
Securities Exchange Act of 1934, as amended. The Audit Committee shall assist
the Board of Directors in fulfilling its responsibility relating to the
corporate accounting and reporting practices of the Corporation. Subject to the
approval of the Board of Directors, the Audit Committee shall adopt and from
time to time assess and revise a written charter which will specify how the
Committee will carry out its responsibilities and such other matters as the
Board and the Audit Committee determine are necessary or desirable.
3.5 Nominating and Governance Committee. The Board of Directors shall appoint
each year a Nominating and Governance Committee, which shall be composed of at
least three members of the Board, all of whom shall be independent directors (as
defined in Section 6.1). The functions of this Committee shall include the
following:
(a) Review the performance and contributions of existing directors
for the purpose of recommending whether they be nominated for
a successive term.
(b) Recommend policies with regard to the size, composition and
function of the Board.
(c) Suggest persons to fill vacancies on the Board and maintain
files on names submitted.
(d) Assist the Chairman of the Board in carrying out an
orientation program for new directors.
(e) Review and recommend to the Board changes and improvements in
the functioning of the Board.
(f) Review top management organization and assist the CEO in
determining that the Corporation has adequate depth and
breadth of management both to carry out its expansion
programs and to provide for succession in the event of
retirement or the unanticipated departure of a key executive.
As part of this responsibility, the Nominating and Governance
Committee will review periodically, with input from the Chief
Executive Officer, (a) candidates to assume the position of
Chief Executive Officer and other designated senior management
positions, including succession planning for the CEO in the
event of an emergency, death, or resignation, and (b) the
development and/or recruitment plans for internal and external
candidates for such positions. The results of these reviews
shall be reported to the Board of Directors, which shall have
ultimate responsibility for the selection of the Chief
Executive Officer and planning for management succession.
Subject to the approval of the Board of Directors, the Nominating and Governance
Committee shall adopt and from time to time assess and revise a written charter
which will specify how the Committee will carry out its responsibilities and
such other matters as the Board and the Nominating and Governance Committee
determine are necessary or desirable.
3.6 Compensation and Personnel Committee. The Board of Directors shall appoint
each year a Compensation and Personnel Committee, which shall be composed of at
least three members of the Board, all of whom shall be independent directors (as
defined in Section 6.1), and which shall have the following duties:
(a) Review and recommend to the Board current management
compensation programs including salaries, bonuses and fringe
benefits and the creation of new officerships.
(b) Review and report to the Board on the funding and adequacy of
existing executive retirement programs, and recommend new
programs, if appropriate. (This responsibility does not
include investment policy and other responsibilities related
to the Company's ERISA retirement plans.)
(c) Award and administer pursuant to existing authority the
Corporation's equity-based incentive programs for employees,
officers and directors, and review and recommend similar
future programs, if any.
(d) Review and approve corporate goals and objectives relevant to
the CEO's compensation, evaluate the CEO's performance in
light of these goals and objectives (including objectives
relating to the adequacy and effectiveness of the Company's
managerial development efforts and management succession
planning activities as recommended by the Nominating and
Governance Committee and approved by the Board from time to
time), and set the CEO's compensation level based upon this
evaluation. The results of the evaluation shall be discussed
with the non-management directors in executive and with the
CEO.
(e) Review the Corporation's programs for attracting, developing
and compensating management personnel at lower and middle
levels.
(f) Review and recommend compensation levels for non-management
directors.
Subject to the approval of the Board of Directors, the Compensation and
Personnel Committee shall adopt and from time to time assess and revise a
written charter which will specify how the Committee will carry out its
responsibilities and such other matters as the Board and the Compensation and
Personnel Committee determine are necessary or desirable.
3.7 Committee Meetings; Miscellaneous. The provisions of these Bylaws which
govern meetings, action without meetings, notice and waiver of notice, and
quorum and voting requirements of the Board of Directors shall apply to
committees of directors and their members as well.
ARTICLE IV
OFFICERS
4.1 Officers. The officers of the Corporation shall be a President, a Secretary,
a Chief Financial Officer, and, in the discretion of the Board of Directors or
the President, one or more Vice-Presidents and such other officers as may be
deemed necessary or advisable to carry on the business of the Corporation. Any
two or more offices may be held by the same person.
4.2 Election; Term. Officers shall be elected by the Board of Directors. The
President may, from time to time, appoint other officers. Officers elected by
the Board of Directors shall hold office, unless sooner removed, until the next
annual meeting of the Board of Directors or until their successors are elected.
Officers appointed by the President shall hold office, unless sooner removed,
until their successors are appointed. The action of the President in appointing
officers shall be reported to the next regular meeting of the Board of Directors
after it is taken. Any officer may resign at any time upon written notice to the
Board of Directors or the President and such resignation shall be effective when
notice is delivered unless the notice specifies a later effective date.
4.3 Removal of Officers. The Board of Directors may remove any officer at any
time, with or without cause. The President may remove any officer appointed by
the President at any time, with or without cause. Such action shall be reported
to the next regular meeting of the Board of Directors after it is taken.
4.4 Duties of the President. The President shall be the Chief Executive Officer
of the Corporation and a member of the Board of Directors. The President, in the
absence of the Chairman of the Board and the Vice Chairman of the Board, shall
preside at all meetings of the Board of Directors and shareholders, shall have
power to call special meetings of the shareholders and directors for any
purpose; may hire, appoint and discharge employees and agents of the Corporation
and fix their compensation; may make and sign deeds, mortgages, deeds of trust,
notes, leases, powers of attorney, contracts and agreements in the name and on
behalf of the Corporation; shall have power to carry into effect all directions
of the Board of Directors; and shall have general supervision of the business of
the Corporation, except as may be limited by the Board of Directors, the
Articles of Incorporation, or these bylaws.
4.5 Duties of the Vice President. Such Vice Presidents, in the order designated
by the Board of Directors from time to time, shall exercise all of the functions
of the President during the absence or incapacity of the latter and shall
perform such other duties as may be assigned to them by the Board of Directors
or the President.
4.6 Duties of the Secretary. The Secretary shall be the ex-officio clerk of the
Board of Directors and shall give, or cause to be given, notices of all meetings
of shareholders and directors, and all other notices required by law or by these
Bylaws. The Secretary shall record the proceedings of the meetings of the
shareholders, Board of Directors and committees of the Board of Directors in
books kept for that purpose and shall keep the seal of the Corporation and
attach it to all documents requiring such impression unless some other officer
is designated to do so by the Board of Directors. The Secretary shall also
perform such other duties as may be assigned by the Board of Directors or the
President.
4.7 Duties of the Chief Financial Officer. The Chief Financial Officer shall
keep or cause to be kept full and accurate books of account, and may make and
sign deeds, mortgages, deeds of trust, notes, leases, contracts and agreements
in the name and on behalf of the Corporation. Whenever required by the Board of
Directors or the President, the Chief Financial Officer shall render a financial
statement showing all transactions of the Corporation and the financial
condition of the Corporation.
4.8 Duties of the Assistant Secretary. There may be one or more Assistant
Secretaries who shall exercise all of the functions of the Secretary during the
absence or incapacity of the latter and such other duties as may be assigned
from time to time by the Board of Directors or the President.
4.9 Duties of Other Officers. The other officers of the Corporation, which may
include Assistant Vice Presidents, a Treasurer, Assistant Treasurers, a
Controller or Assistant Controllers, shall have such authority and perform such
duties as shall be prescribed by the Board of Directors or by officers
authorized by the Board of Directors to appoint them to their respective
offices. To the extent that such duties are not so stated, such officers shall
have such authority and perform the duties which generally pertain to their
respective offices, subject to the control of the President or the Board of
Directors.
4.10 Voting Securities of Other Corporations. Unless otherwise provided by the
Board of Directors, each of the President and the Chief Financial Officer, in
the name and on behalf of the Corporation, may appoint from time to time himself
or herself or any other person (or persons) proxy, attorney or agent for the
Corporation to cast the votes which the Corporation may be entitled to cast as a
shareholder, member or otherwise in any other corporation, partnership or other
legal entity, domestic or foreign, whose stock, interests or other securities
are held by the Corporation, or to consent in writing to any action by such
other entity, or to exercise any or all other powers of this Corporation as the
holder of the stock, interests or other securities of such other entity. Each of
the President and the Chief Financial Officer may instruct the person or persons
so appointed as to the manner of casting such votes or giving such consent and
may execute or cause to be executed on behalf of the Corporation and under its
corporate seal such written proxies, consents, waivers, or other instruments as
may be deemed necessary or proper. Each of the President and the Chief Financial
Officer may attend any meeting of the holders of stock, interests or other
securities of any such other entity and vote or exercise any or all other powers
of this Corporation as the holder of the stock, interest or other securities of
such other entity.
4.11 Compensation. The compensation of all officers of the Corporation shall be
fixed by the Board of Directors or the Compensation and Personnel Committee.
4.12 Bonds. The Board of Directors may require that any or all officers,
employees and agents of the Corporation give bond to the Corporation, with
sufficient sureties, conditioned upon the faithful performance of the duties of
their respective offices or positions.
ARTICLE V
EVIDENCE OF SHARES
5.1 Form. Shares of the Corporation shall, when fully paid, be evidenced by
certificates containing such information as is required by law and approved by
the Board of Directors. Alternatively, the Board of Directors may authorize the
issuance of some or all shares without certificates. In such event, within a
reasonable time after issuance, the Corporation shall mail to the shareholder a
written confirmation of its records with respect to such shares containing the
information required by law. When issued, certificates shall be signed by the
Chairman of the Board, the President or a Vice President designated by the Board
and the Secretary or an Assistant Secretary and may (but need not) be sealed
with the seal of the Corporation. The seal of the Corporation and any or all of
the signatures on a share certificate may be facsimile. If 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 individual were such officer, transfer agent or
registrar on the date of issue.
5.2 Transfer. The Board of Directors may make rules and regulations concerning
the issue, registration and transfer of shares and/or certificates representing
the shares of the Corporation. Transfers of shares and/or of the certificates
representing such shares shall be made upon the books of the Corporation by
surrender of the certificates representing such shares, if any, accompanied by
written assignments given by the record owners thereof or their
attorneys-in-fact.
5.3 Restrictions on Transfer. A lawful restriction on the transfer or
registration of transfer of shares is valid and enforceable against the holder
or a transferee of the holder if the restriction complies with the requirements
of law and its existence is noted conspicuously on the front or back of any
certificate representing the shares or has been otherwise communicated in
accordance with the requirements of law. Unless so noted or communicated, a
restriction is not enforceable against a person without knowledge of the
restriction.
5.4 Lost or Destroyed Share Certificates. The Corporation may issue a new share
certificate or a written confirmation of its records with respect to shares in
the place of any certificate theretofore issued which is alleged to have been
lost or destroyed and may require the owner of such certificate, or such owner's
legal representative, to give the Corporation a bond, with or without surety, or
such other agreement, undertaking or security as the Board of Directors shall
determine is appropriate, to indemnify the Corporation against any claim that
may be made against it on account of the alleged loss or destruction or the
issuance of any such new certificate.
5.5 Registered Shareholders. The Corporation shall be entitled to treat the
holder of record of any share or shares of stock as the owner thereof and,
accordingly, 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. The
Corporation shall not be liable for registering any transfer of shares which are
registered in the name of a fiduciary unless done with actual knowledge of facts
which would cause the Corporation's action in registering the transfer to amount
to bad faith.
ARTICLE VI
MISCELLANEOUS PROVISIONS
6.1 Certain Definitions. As used in these Bylaws, the term "independent" has the
following meaning: A director is considered to be independent if the individual
meets all independence criteria set forth in Section 303A.02 of the New York
Stock Exchange Listed Company Manual, as amended from time to time, and the
Board of Directors has affirmatively determined that such individual has no
material relationship with the Company (either directly or as a partner,
shareholder or officer of an organization that has a relationship with the
Company).
6.2 Corporate Seal. The corporate seal of the Corporation shall be circular and
shall have inscribed thereon, within and around the circumference, the name of
the Corporation. In the center shall be the word "SEAL".
6.3 Fiscal Year. The fiscal year of the Corporation shall begin on the first day
of March of each year and end on the last day of February in the next succeeding
year.
6.4 Amendments. The power to alter, amend or repeal the Bylaws or adopt new
bylaws shall be vested in the Board of Directors unless otherwise provided in
the Articles of Incorporation. Bylaws adopted by the Board of Directors may be
repealed or changed or new bylaws adopted by the shareholders, and the
shareholders may prescribe that any bylaw adopted by them may not be altered,
amended or repealed by the Board of Directors.
6.5 General. Any matters not specifically covered by these Bylaws shall be
governed by the applicable provisions of the Code of Virginia in force at the
time.