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Exhibit 10.58
TRUST AGREEMENT
FOR THE
SAKS INCORPORATED SUPPLEMENTAL SAVINGS PLAN
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TABLE OF CONTENTS
Section 1: Establishment of Trust........................................... 1
Section 2. Payments to Plan Participants and Their Beneficiaries............ 2
Section 3. Trustee Responsibility Regarding Payments to Trust Beneficiary
When Company is Insolvent........................................ 2
Section 4. Payments to Company.............................................. 3
Section 5. Investment Authority............................................. 4
Section 6. Disposition of Income............................................ 5
Section 7. Accounting by Trustee............................................ 5
Section 8. Responsibility of Trustee........................................ 6
Section 9. Compensation and Expenses........................................ 6
Section 10. Resignation and Removal of Trustee............................... 6
Section 11. Appointment of Successor......................................... 7
Section 12. Amendment or Termination......................................... 7
Section 13. Miscellaneous.................................................... 8
Section 14. Effective Date................................................... 8
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TRUST AGREEMENT FOR THE
SAKS INCORPORATED SUPPLEMENTAL SAVINGS PLAN
This agreement is made by and between Saks Incorporated, a corporation
organized and existing under the laws of the State of Alabama (the "Company"),
and Trustmark National Bank (the "Trustee");
(a) WHEREAS, Company has adopted the Saks Incorporated Supplemental Savings
Plan;
(b) WHEREAS, Company has incurred or expects to incur liability under the terms
of such Plan with respect to the individuals participating in such Plan;
(c) WHEREAS, Company has established a trust (hereinafter called "Trust") for
the purpose of contributing to the Trust assets that shall be held therein,
subject to the claims of Company's creditors in the event of Company's
Insolvency, as herein defined, until paid to Plan participants and their
beneficiaries in such manner and at such times as specified in the Plan;
(d) WHEREAS, the Company and the Trustee desire to amend and restate the trust
agreement establishing the Trust;
(e) WHEREAS, it is the intention of the parties that this Trust shall continue
to constitute an unfunded arrangement and shall not affect the status of the
Plan as an unfunded plan maintained for the purpose of providing deferred
compensation for a select group of management or highly compensated
employees for purposes of Title I of the Employee Retirement Income Security
Act of 1974;
(f) WHEREAS, it is the intention of Company to continue to make contributions to
the Trust to provide itself with a source of funds to assist it in the
meeting of its liabilities under the Plan;
NOW, THEREFORE, the parties do hereby amend and restate the terms of the
Trust and agree that the Trust shall be comprised, held and disposed of as
follows:
SECTION 1: ESTABLISHMENT OF TRUST.
(a) Company will make an initial deposit with Trustee, which shall become the
principal of the Trust to be held, administered and disposed of by Trustee
as provided in this Trust Agreement.
(b) The Trust hereby established shall be irrevocable, except as provided in
Sections 3 and 4 hereof.
(c) The Trust is intended to be a grantor trust, of which Company is the
grantor, within the meaning of subpart E, part I, subchapter J, chapter 1,
subtitle A of the Internal Revenue Code of 1986, as amended, and shall be
construed accordingly.
(d) The principal of the Trust, and any earnings thereon shall be held separate
and apart from other funds of Company and shall be used exclusively for the
uses and purposes of Plan participants and general creditors as herein set
forth. Plan participants and their
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beneficiaries shall have no preferred claim on, or any beneficial ownership
interest in, any assets of the Trust. Any rights created under the Plan and
this Trust Agreement shall be mere unsecured contractual rights of Plan
participants and their beneficiaries against Company. Any assets held by the
Trust will be subject to the claims of Company's general creditors under
federal and state law in the event of Insolvency, as defined in Section 3(a)
herein.
(e) Company, in its sole discretion, may at any time, or from time to time, make
additional deposits of cash or other property in trust with Trustee to
augment the principal to be held, administered and disposed of by Trustee as
provided in this Trust Agreement. Neither Trustee nor any Plan participant
or beneficiary shall have any right to compel such additional deposits.
SECTION 2. PAYMENTS TO PLAN PARTICIPANTS AND THEIR BENEFICIARIES.
(a) Company shall deliver to Trustee a schedule (the "Payment Schedule") that
indicates the amounts payable in respect of each Plan participant (and his
or her beneficiaries), that provides a formula or other instructions
acceptable to Trustee for determining the amounts so payable, the form in
which such amount is to be paid (as provided for or available under the
Plan), and the time of commencement for payment of such amounts. Except as
otherwise provided herein, Trustee shall make payments to the Plan
participants and their beneficiaries in accordance with such Payment
Schedule. The Trustee shall make provision for the reporting and withholding
of any federal, state or local taxes that may be required to be withheld
with respect to the payment of benefits pursuant to the terms of the Plan
and shall pay amounts withheld to the appropriate taxing authorities or
determine that such amounts have been reported, withheld and paid by
Company.
(b) The entitlement of a Plan participant or his or her beneficiaries to
benefits under the Plan shall be determined by Company or such party as it
shall designate under the Plan, and any claim for such benefits shall be
considered and reviewed under the procedures set out in the Plan.
(c) Company may make payment of benefits directly to Plan participants or their
beneficiaries as they become due under the terms of the Plan. Company shall
notify Trustee of its decision to make payment of benefits directly prior to
the time amounts are payable to participants or their beneficiaries. In
addition, if the principal of the Trust, and any earnings thereon, are not
sufficient to make payments of benefits in accordance with the terms of the
Plan, Company shall make the balance of each such payment as it falls due.
Trustee shall notify Company where principal and earnings are not
sufficient.
SECTION 3. TRUSTEE RESPONSIBILITY REGARDING PAYMENTS TO TRUST BENEFICIARY
WHEN COMPANY IS INSOLVENT.
(a) Trustee shall cease payment of benefits to Plan participants and their
beneficiaries if the Company is Insolvent. Company shall be considered
"Insolvent" for purposes of this Trust Agreement if (i) Company is unable to
pay its debts as they become due, or (ii) Company is subject to a pending
proceeding as a debtor under the United States Bankruptcy Code.
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(b) At all times during the continuance of this Trust, as provided in Section
1(d) hereof, the principal and income of the Trust shall be subject to
claims of general creditors of Company under federal and state law as set
forth below.
(1) The Board of Directors and the Chief Executive Officer of Company shall
have the duty to inform Trustee in writing of Company's Insolvency. If a
person claiming to be a creditor of Company alleges in writing to
Trustee that Company has become Insolvent, Trustee shall determine
whether Company is Insolvent and, pending such determination, Trustee
shall discontinue payment of benefits to Plan participants or their
beneficiaries.
(2) Unless Trustee has actual knowledge of Company's Insolvency, or has
received notice from Company or a person claiming to be a creditor
alleging that Company is Insolvent, Trustee shall have no duty to
inquire whether Company is Insolvent. Trustee may in all events rely on
such evidence concerning Company's solvency as may be furnished to
Trustee and that provides Trustee with a reasonable basis for making a
determination concerning Company's solvency.
(3) If at any time Trustee has determined that Company is Insolvent, Trustee
shall discontinue payments to Plan participants or their beneficiaries
and shall hold the assets of the Trust for the benefit of Company's
general creditors. Nothing in this Trust Agreement shall in any way
diminish any rights of Plan participants or their beneficiaries to
pursue their rights as general creditors of Company with respect to
benefits due under the Plan or otherwise.
(4) Trustee shall resume the payment of benefits to Plan participants or
their beneficiaries in accordance with Section 2 of this Trust Agreement
only after Trustee has determined that Company is not Insolvent (or is
no longer Insolvent).
(c) Provided that there are sufficient assets, if Trustee discontinues the
payment of benefits from the Trust pursuant to Section 3(b) hereof and
subsequently resumes such payments, the first payment following such
discontinuance shall include the aggregate amount of all payments due to
Plan participants or their beneficiaries under the terms of the Plan for the
period of such discontinuance, less the aggregate amount of any payments
made to Plan participants or their beneficiaries by Company in lieu of the
payments provided for hereunder during any such period of discontinuance.
SECTION 4. PAYMENTS TO COMPANY.
(a) Except as provided in Section 3 hereof, or in the event of excess trust
funding (defined herein), after the Trust has become irrevocable, Company
shall have no right or power to direct Trustee to return to Company or to
divert to others any of the Trust assets before all payment of benefits have
been made to Plan participants and their beneficiaries pursuant to the terms
of the Plan.
(b) "Excess trust funding" shall be defined as trust assets in excess of the
Plan's accrued liability. If and when trust assets exceed the Plan's accrued
liability, unless the Company is Insolvent, the Trustee shall, upon the
written request of the Company, pay to the Company
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the excess trust funding. For purposes of this Section 4, "accrued
liability" shall mean the total of Participants' "Deferred Compensation
Accounts" under the Plan.
SECTION 5. INVESTMENT AUTHORITY.
(a) Trustee may invest and reinvest the funds of the trust fund in any property,
real, personal or mixed, wherever situate, and whether or not productive of
income or consisting of wasting assets, including, without limitation,
common and preferred stock, bonds, notes, debentures, leaseholds, mortgages
(including without limiting the generality of the foregoing, any collective
or part interest in any bond and mortgage or note and mortgage),
certificates of deposit, and oil, mineral or gas properties, royalties,
interests or rights (including equipment pertaining thereto), without being
limited to the classes of property in which trustees are authorized by law
or any rule of court to invest trust funds and without regard to the
proportion any such property may bear to the entire amount of the trust
fund.
Trustee may invest and reinvest all or any portion of the trust fund
collectively with other funds through the medium of one (1) or more common,
collective or commingled trust funds which have been or may hereafter be
established and maintained by Trustee, the instrument or instruments
establishing such trust fund or funds, as amended from time to time, being
made part of this Trust by reference as if fully set forth herein so long as
any portion of the trust fund shall be invested through the medium thereof.
Trustee is expressly authorized to invest all or part of the trust fund in
savings accounts, time deposits, certificates of deposit, money market
accounts, repurchase agreements and/or any other interest-bearing accounts
(regardless of the term of such deposits or investments), if any, issued by
Trustee or any of its affiliates, which bear a reasonable interest rate .
Trustee is further expressly authorized to utilize the discount brokerage
operation, if any, offered by Trustee.
(b) Trustee may sell or exchange any property or asset of the trust fund at
public or private sale, with or without advertisement, upon terms acceptable
to Trustee and in such manner as Trustee may deem wise and proper. The
proceeds of any such sale or exchange may be reinvested as is provided
hereunder. The purchaser of any such property from Trustee shall not be
required to look to the application of the proceeds of any such sale or
exchange by Trustee.
(c) Trustee shall have full power to mortgage, pledge, lease or otherwise
dispose of the property of the trust fund without securing any order of
court therefor, without advertisement, and to execute any instrument
containing any provisions which Trustee may deem proper in order to carry
out such actions. Any such lease so made by Trustee shall be binding,
notwithstanding the fact that the term of the lease may extend beyond the
termination of the Plan.
(d) Trustee shall have the power to borrow money upon terms agreeable to Trustee
and pay interest thereon at rates agreeable to Trustee, and to repay any
debts so created.
(e) Trustee may participate in the reorganization, recapitalization, merger or
consolidation of any corporation wherein Trustee may own stock or securities
and may deposit such stock or
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other securities in any voting trust or protective committee or like
committee or trustee, or with the depositaries designated thereby, and may
exercise any subscription rights or conversion privileges, and generally may
exercise any of the powers of any owner with respect to any stock or other
securities or property comprising the trust fund.
(f) Trustee may, through any duly authorized officer or proxy, vote any share of
stock which Trustee may own from time to time.
(g) Trustee shall retain in cash and keep unproductive of income such funds as
from time to time it may deem advisable. Trustee shall not be required to
pay interest on any such cash in its hands pending investment, nor shall
Trustee be responsible for the adequacy of the trust fund to discharge any
and all payments under the Plan. All persons dealing with Trustee are
released from inquiry into the decision or authority of Trustee to act.
(h) Trustee may hold stocks, bonds, or other securities in its own name, or in
the name of a nominee selected by it for the purpose, but said Trustee shall
nevertheless be obligated to account for all securities received by it as
part of the corpus of the trust estate herein created, notwithstanding the
name in which the same may be held.
(i) If Company so desires, Trustee may use the trust fund to purchase insurance
policies or annuity contracts issued by a life insurance company.
(j) Trustee may invest in securities (including stock or rights to acquire
stock) or obligations issued by the Company. All rights associated with
assets of the Trust shall be exercised by Trustee or the person designated
by the Trustee, and shall in no event be exercisable by or rest with Plan
participants, except that voting rights with respect to Trust assets will be
exercised by the Company.
(k) Company shall have the right, at any time, and from time to time in its sole
discretion, to substitute assets of equal fair market value for any asset
held by the Trust.
SECTION 6. DISPOSITION OF INCOME.
During the term of this Trust, all income received by the Trust, net of
expenses and taxes, shall be accumulated and reinvested.
SECTION 7. ACCOUNTING BY TRUSTEE.
Trustees shall keep accurate and detailed records of all investments,
receipts, disbursements, and all other transactions required to be made,
including such specific records as shall be agreed upon in writing between
Company and Trustee. Within sixty (60) days following the close of each calendar
year and within sixty (60) days after the removal or resignation of Trustee,
Trustee shall deliver to Company a written account of its administration of the
Trust during such year or during the period from the close of the last preceding
year to the date of such removal or resignation, setting forth all investments,
receipts, disbursements and other transactions effected by it, including a
description of all securities and investments purchased and sold with the cost
or net proceeds or such purchases or sales (accrued interest paid or receivable
being separately), and showing all cash, securities and other property held in
the Trust at the end of such year or as of the date of such removal or
resignation, as the case may be.
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SECTION 8. RESPONSIBILITY OF TRUSTEE.
(a) Trustee shall act with the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent person acting in like capacity
and familiar with such matters would use in the conduct of an enterprise of
a like character and with like aims, provided, however, that Trustee shall
incur no liability to any person for any action taken pursuant to a
direction, request or approval given by Company which is contemplated by,
and in conformity with, the terms of the Plan or this Trust and is given in
writing by Company. In the event of a dispute between Company and a party,
Trustee may apply to a court of competent jurisdiction to resolve the
dispute.
(b) If Trustee undertakes or defends any litigation arising in connection with
this Trust, Company agrees to indemnify Trustee against Trustee's costs,
expenses and liabilities (including, without limitation, attorneys' fees and
expenses) relating thereto and to be primarily liable for such payments. If
Company does not pay such costs, expenses and liabilities in a reasonably
timely manner, Trustee may obtain payment from the Trust.
(c) Trustee may consult with legal counsel (who may also be counsel for Company
generally) with respect to any of its duties or obligations hereunder.
(d) Trustee may hire agents, accountants, actuaries, investment advisors,
financial consultants or other professionals to assist it in performing any
of its duties or obligations hereunder.
(e) Trustee shall have, without exclusion, all powers conferred on Trustees by
applicable law, unless expressly provided otherwise herein, provided,
however, that if an insurance policy is held as an asset of the Trust,
Trustee shall have no power to name a beneficiary of the policy other than
the Trust, to assign the policy (as distinct from conversion of the Policy
to a different form) other than to a successor Trustee, or to loan to any
person the proceeds of any borrowing against such policy.
(f) However, notwithstanding the provisions of Section 8(e) above, Trustee may
loan to Company the proceeds of any borrowing against an insurance policy
held as an asset of the Trust.
(g) Notwithstanding any powers granted to Trustee pursuant to this Trust
Agreement or to applicable law, Trustee shall not have any power that could
give this Trust the objective of carrying on a business and dividing the
gains therefrom, within the meaning of Section 301.7701-2 of the Procedure
and Administrative Regulations promulgated pursuant to the Internal Revenue
Code.
SECTION 9. COMPENSATION AND EXPENSES.
Company may pay some or all of the administrative, trust and other fees
and expenses of operating the Plan and the Trust. To the extent such fees and
expenses are not paid by the Company, they shall be paid from the Trust.
SECTION 10. RESIGNATION AND REMOVAL OF TRUSTEE.
(a) Trustee may resign at any time by written notice to Company, which shall be
effective sixty (60) days after receipt of such notice unless Company and
Trustee agree otherwise.
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(b) Trustee may be removed by Company on sixty (60) days notice or upon shorter
notice accepted by Trustee.
(c) Upon resignation or removal of Trustee and appointment of a successor
Trustee, all assets shall subsequently be transferred to the successor
Trustee. The transfer shall be completed within sixty (60) days after
receipt of notice of resignation, removal or transfer, unless Company
extends the time limit.
(d) If Trustee resigns or is removed, a successor shall be appointed, in
accordance with Section 11 hereof, by the effective date of resignation or
removal under paragraphs (a) or (b) of this section. If no such appointment
has been made, Trustee may apply to a court of competent jurisdiction for
appointment of a successor or for instructions. All expenses of Trustee in
connection with the proceeding shall be allowed as administrative expenses
of the Trust.
SECTION 11. APPOINTMENT OF SUCCESSOR.
(a) If Trustee resigns or is removed in accordance with Section 10(a) or (b)
hereof, Company may appoint any third party, such as a bank trust department
or other party that may be granted corporate trustee powers under state law,
as a successor to replace Trustee upon resignation or removal. The
appointment shall be effective when accepted in writing by the new Trustee,
who shall have all of the rights and powers of the former Trustee, including
ownership rights in the Trust assets. The former Trustee shall execute any
instrument necessary or reasonably requested by Company or the successor
Trustee to evidence the transfer.
(b) The successor Trustee need not examine the records and acts of any prior
Trustee and may retain or dispose of existing Trust assets, subject to
Sections 7 and 8 hereof. The successor Trustee shall not be responsible for
and Company shall indemnify and defend the successor Trustee from any claim
or liability resulting from any action or inaction of any prior Trustee or
from any other past event, or any condition existing at the time it becomes
successor Trustee.
SECTION 12. AMENDMENT OR TERMINATION.
(a) This Trust Agreement may be amended by a written instrument executed by
Trustee and Company. Notwithstanding the foregoing, no such amendment shall
conflict with the terms of the Plan or shall make the Trust revocable after
it has become irrevocable in accordance with Section 1(b) hereof.
(b) The Trust shall not terminate until the date on which Plan participants and
their beneficiaries are no longer entitled to benefits pursuant to the terms
of the Plan. Upon termination of the Trust any assets remaining in the Trust
shall be returned to Company.
(c) Upon written approval of participants or beneficiaries entitled to payment
of benefits pursuant to the terms of the Plan, Company may terminate this
Trust prior to the time all benefit payments under the Plan have been made.
All assets in the Trust at termination shall be returned to Company.
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SECTION 13. MISCELLANEOUS.
(a) Any provision of this Trust Agreement prohibited by law shall be ineffective
to the extent of any such prohibition, without invalidating the remaining
provisions hereof.
(b) Benefits payable to Plan participants and their beneficiaries under this
Trust Agreement may not be anticipated, assigned (either at law or in
equity), alienated, pledged, encumbered or subjected to attachment,
garnishment, levy, execution or other legal or equitable process.
(c) This Trust Agreement shall be governed by and construed in accordance with
the laws of Alabama to the extent not preempted by federal law.
SECTION 14. EFFECTIVE DATE.
The effective date of this amendment and restatement of the Trust
Agreement shall be the date of execution.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
executed by their duly authorized representatives on this _______ day of
_____________, 1999.
COMPANY:
SAKS INCORPORATED
Attest:____________________________ By:_________________________________
Title:______________________________
TRUSTEE:
TRUSTMARK NATIONAL BANK
Attest:_____________________________ By:_________________________________
Title:______________________________
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CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statements of
Saks Incorporated (formerly Xxxxxxxx'x, Inc.) listed below of our report dated
March 16, 1999, on our audits of the consolidated financial statements of Saks
Incorporated and Subsidiaries as of January 30, 1999 and January 31, 1998 and
for each of the three years in the period ended January 30, 1999 which report is
incorporated by reference in this Annual Report on Form 10-K for the years ended
January 30, 1999.
Registration Statements on Form S-3
Registration Numbers
333-66755
333-71933
Registration Statements on Form S-4
Registration Numbers
333-09043
333-41563
333-60123
Registration Statements on Form S-8
Registration Numbers
33-46306
33-88390
333-00695
333-25213
333-47535
333-66759
Birmingham, Alabama
April ____, 1999
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AMENDED AND RESTATED BYLAWS
OF
SAKS INCORPORATED
(As amended effective April 7, 1999)
ARTICLE I
IDENTIFICATION; OFFICES AND REGISTERED AGENT
Section 1. Identification. The name of the Corporation is SAKS
Incorporated, a Tennessee corporation (the "Corporation").
Section 2. Principal Office. The principal office of this Corporation is
located at 000 Xxxxxxxxx Xxxxxxx, Xxxxxxxxxx, Xxxxxxx 00000, as provided in the
Charter. The Board of Directors may, by resolution, amend the Charter to change
the address of the principal office.
Section 3. Registered Agent. The Corporation has designated and shall
continue to have a registered agent in the State of Tennessee. If the registered
agent resigns or is for any reason unable to perform his duties, the Corporation
shall promptly designate another registered agent. The Corporation may, by
resolution of the Board of Directors, appoint such other agents for the service
of process in such other jurisdictions as the Board of Directors may determine.
ARTICLE II
MEETINGS OF SHAREHOLDERS
Section 1. Meetings. All meetings of the shareholders for the election of
directors shall be held in the City of Alcoa, State of Tennessee, 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 Tennessee 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 Tennessee, as shall be stated in the
notice of the meeting or in a duly executed waiver of notice thereof
Section 2. Annual Meetings. Annual meetings of the shareholders,
commencing with fiscal year 1988, shall be held on the 2nd Monday of June if
said date is not a legal holiday, and if a legal holiday, then on the next day
following which is not a legal holiday, or at such other date and time as shall
be designated from time to time by the Board of Directors, for the purpose of
electing directors of the Corporation and for the transacting of such other
business as may properly come before the meeting. Written notice of the annual
meeting stating the place, date and hour of the meeting shall be given to each
shareholder entitled to vote at such meeting not less than 10 days nor more than
60 days before the date of the meeting.
Section 3. Shareholder List. The officer who has charge of the stock
ledger of the Corporation shall prepare and make, at least 10 days before every
meeting of the shareholders, a
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complete list of the shareholders entitled to vote at the meeting, arranged in
alphabetical order, and showing the address of each shareholder and the number
of shares registered in the name of each shareholder. Such list shall be open to
the examination of any shareholder, for the purpose germane to the meeting,
during ordinary business hours, for a period of at least 10 days prior to the
meeting, either at a place within the city where the meeting is to be held
(which place shall be specified in the notice of the meeting), or, if not so
specified at the place where the meeting is to be held. The list shall also be
produced and kept at the time and place of the meeting during the whole time
thereof, and may be inspected by any shareholder who is present.
Section 4. Special Meetings. Special meetings of the shareholders may be
called by the Board of Directors or by the Chairman of the Board, or by the
President, and shall be called by the Chairman, the President, the Secretary, or
an assistant Secretary at the request in writing of a majority of the Board of
Directors, or at the request in writing of the holders of record of at least
twenty-five percent (25%) of the outstanding shares of the Corporation entitled
to vote at the meeting. Each special meeting shall be held at such time as the
Board of Directors shall determine, or, in the absence of such determination by
the Board of Directors, at such time as the person or persons calling or
requesting the call of the meeting shall specify in the notice or in the written
request. Written notice of a special meeting stating the place, date and hour of
the meeting and the purpose or purposes for which the meeting is called, shall
be given to each shareholder entitled to vote at such meeting not less than 10
days or more than 60 days before the date of the meeting. The business
transacted at any special meeting shall be limited to the purposes stated in the
notice.
Section 5. Waiver of Notice. The shareholders may waive the requirement of
written notice of annual and special meetings by written waiver duly executed
and filed with the minutes of the meeting.
Section 6. Quorum. The holders of record of a majority of the stock issued
and outstanding and entitled to vote thereat, present in person or represented
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
Charter. A quorum once present, is not broken by the subsequent withdrawal of
any shareholder. If, however, such quorum shall not be present or represented at
any meeting of the shareholders, the shareholders entitled to vote thereat,
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 by proxy, any business
may be transacted which might have been transacted at the meeting as originally
notified. If the adjournment is for more than 30 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 of record entitled to
vote at the meeting. When a quorum is present at any meeting, the vote of the
holders of a majority of the stock having voting power present in person or
represented by proxy shall decide any question brought before such meeting,
unless the question is one upon which by express provision of the statutes or of
the Charter a different vote is required, in which case such express provision
shall govern and control the decision of such question.
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Section 7. Meeting Chairman. The Chairman of the Board, or if absent or
unable to serve, the President, or if absent or unable to serve, the Treasurer
or Secretary, shall call meetings of the shareholders to order and act as
Chairman of such meetings. The shareholders may elect any one of their number to
act as Chairman of any meeting in the absence of the aforenamed individuals.
Section 8. Proxies. Every shareholder entitled to vote at a shareholders'
meeting may authorize another person or persons to act for him by proxy. Each
proxy must be in writing and signed by the shareholder or by his attorney in
fact. No proxy shall be valid after the expiration of 11 months from the date
thereof unless otherwise provided in the proxy. Each proxy shall be revocable at
the pleasure of the shareholder executing it, unless it conforms to the
requirements of an irrevocable proxy, as provided by statute. All proxies must
be delivered to the Secretary of the Corporation prior to the opening of the
meeting, except for proxies granted after the meeting has opened, which proxies
shall be delivered to the Secretary as soon as practicable after execution.
Section 9. Determination of Shareholder. In order to determine
shareholders entitled to notice of or to vote at any meeting of shareholders, or
any adjournment thereof, or shareholders entitled to receive payment of any
dividend, or in order to make a determination of shareholders for any other
proper purpose, the Board of Directors may provide that the Stock Transfer Books
be closed for a stated period, but not to exceed 40 days. If the Stock Transfer
Books are closed for the purpose of determining shareholders entitled to notice
of or to vote at a meeting of shareholders, such books shall be closed for at
least 10 days immediately preceding such meeting. In lieu of closing the Stock
Transfer Books, the Board of Directors may fix in advance a date as the record
date for any such determination of shareholders, such date in any case to be not
less than 10 days prior to the date on which the particular action requiring
such determination of shareholders is to be taken. If the Stock Transfer Books
are not closed and no record date is fixed for determination of shareholders
entitled to notice of or entitled to vote at a meeting of shareholders or
shareholders entitled to receive payment of a dividend, the date on which notice
of the meeting is mailed, or the date on which the resolution of the Board
declaring such dividend is adopted, as the case may be, shall be the record date
for such determination of shareholders.
Section 10. Shareholder Action By Written Consent. Any action required or
permitted to be taken by the shareholders of the Corporation must be effected at
a duly called annual or special meeting of such holders and may not be effected
by any consent in writing by such holders.
ARTICLE III
NOTICE REQUIREMENTS AND CONDUCT OF SHAREHOLDERS MEETINGS
Section 1. Notice of Nominations. Nominations for the election of
directors may be made by the Board of Directors or a committee appointed by the
Board of Directors authorized to make such nominations or by any shareholder
entitled to vote in the election of directors generally. However, any such
shareholder nomination may be made only if written notice of such nomination has
been given, either by personal delivery or the United States mail, postage
prepaid, to the
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Secretary of the Corporation not later than (a) with respect to an election to
be held at an annual meeting of shareholders, one hundred twenty (120) days in
advance of the anniversary date of the proxy statement for the previous year's
annual meeting, and (b) with respect to an election to be held at a special
meeting of shareholders for the election of directors, the close of business on
the tenth day following the date on which notice of such meeting is first given
to shareholders. In the case of any nomination by the Board of Directors or a
committee appointed by the Board of Directors authorized to make such
nominations, compliance with the proxy rules of the Securities and Exchange
Commission shall constitute compliance with the notice provisions of the
preceding sentence.
In the case of any nomination by a shareholder, each such notice shall set
forth: (a) as to each person whom the shareholder proposes to nominate for
election or reelection as a director, (i) the name, age, business address, and
residence address of such person, (ii) the principal occupation or employment of
such person, (iii) the class and number of shares of the Corporation which are
beneficially owned by such person, and (iv) any other information relating to
such person that is required to be disclosed in solicitations of proxies with
respect to nominees for election as directors, pursuant to Regulation 14A under
the Securities Exchange Act of 1934, as amended (including without limitation
such person's written consent to being named in the proxy statement as a nominee
and to serving as a director, if elected); and (b) as to the shareholder giving
the notice (i) the name and address, as they appear on the Corporation's books,
of such shareholder, and (ii) the class and number of shares of the Corporation
which are beneficially owned by such shareholder; and (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. The President,
Chief Executive Officer, or chairman of the meeting may refuse to acknowledge
the nomination of any person not made in compliance with the foregoing
procedure.
Section 2. Notice of New Business. At an annual meeting of the
shareholders only such new business shall be conducted, and only such proposals
shall be acted upon, as have been properly brought before the meeting. To be
properly brought before the annual meeting, such new business must be (a)
specified in the notice of meeting (or any supplement thereto) given by or at
the direction of the Board of Directors, (b) otherwise properly brought before
the meeting by or at the direction of the Board of Directors, or (c) otherwise
properly brought before the meeting by a shareholder. For a proposal to be
properly brought before an annual meeting by a shareholder, the shareholder must
have given timely notice thereof in writing to the Secretary of the Corporation
and, if the Corporation is a reporting company under the Securities Exchange Act
of 1934 (the "Exchange Act"), the proposal and the shareholder must comply with
Rule 14a-8 under the Exchange Act. To be timely, a shareholder's notice must be
delivered to or mailed and received at the principal executive offices of the
Corporation within the time limits specified by Rule 14a-8, if applicable.
A shareholder's notice to the Secretary shall set forth as to each matter
the shareholder proposed to bring before the annual meeting (a) a brief
description of the proposal desired to be brought before the annual meeting and
the reasons for conducting such business at the annual
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meeting, (b) the name and address, as they appear on the Corporation's books, of
the shareholder proposing such business, (c) the class and number of shares of
the Corporation which are beneficially owned by the shareholder, and (d) any
financial interest of the shareholder in such proposal.
Notwithstanding anything in these Bylaws to the contrary, no business
shall be conducted at an annual meeting except in accordance with the procedures
set forth in this Section 2. The chairman of the meeting shall, if the facts
warrant, determine and declare to the meeting that new business or any
shareholder proposal was not properly brought before the meeting in accordance
with the provisions of this Section 2, and if he or she should so determine, he
or she shall so declare to the meeting and any such business or proposal not
properly brought before the meeting shall not be acted upon at the meeting.
Section 3. Conduct of Shareholders Meetings. The Board of Directors of the
Corporation shall be entitled to make such rules or regulations for the conduct
of meetings of shareholders as it shall deem necessary, appropriate or
convenient. Subject to such rules and regulations of the Board of Directors, if
any, the chairman of the meeting shall have the right and authority to prescribe
such rules, regulations and procedures and to do all such acts as, in the
judgment of such chairman, are necessary, appropriate or convenient for the
proper conduct of the meeting, including, without limitation, establishing an
agenda or order of business for the meeting, rules and procedures for
maintaining order at the meeting and the safety of those present, limitations on
participation in such meeting to shareholders of record of the corporation and
their duly authorized and constituted proxies, and such other persons as the
chairman shall permit, restrictions on entry to the meeting after the time fixed
for the commencement thereof, limitations on the time allotted to questions or
comments by participants and regulation of the opening and closing of the polls
for balloting and matters which are to be voted on by ballot. Unless and to the
extent determined by the board of directors or the chairman of the meeting,
meetings of shareholders shall not be required to be held in accordance with
rules of parliamentary procedure.
ARTICLE IV
BOARD OF DIRECTORS
Section 1. Number of Directors. The affairs of the Corporation shall be
managed by a Board of up to 18 directors.
Effective as of the annual meeting of shareholders in 1997, the Board
shall be divided into three classes, designated as Class I, Class II, and Class
III, as nearly equal in number as possible. The initial term of office of Class
I shall expire at the annual meeting of shareholders in 1998, that of Class II
shall expire at the annual meeting of shareholders in 1999, and that of Class
III shall expire at the annual meeting in 2000, and in all cases as to each
director until his or her successor shall be elected and shall qualify, or until
his or her earlier resignation, removal from office, death, or incapacity.
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Subject to the foregoing, at each annual meeting of shareholders the
successors to the class of directors whose term shall then expire shall be
elected to hold office for a term expiring at the third succeeding annual
meeting and until their successors shall be elected and qualified. Vacancies on
the Board for any reason, and newly created directorships resulting from any
increase in the authorized number of directors, may be filled by a vote of the
majority of the directors then in office, although less than a quorum, or by a
sole remaining director.
If the number of directors is changed, the Board shall determine the class
or classes to which the increased or decreased number of directors shall be
apportioned; provided that the directors in each class shall be as nearly equal
in number as possible. No decrease in the number of directors shall have the
effect of shortening the term of any incumbent director.
Notwithstanding any other provisions of the Charter or these Bylaws (and
notwithstanding that a lesser percentage may be specified by law, the Charter,
or these Bylaws), the affirmative vote of the holders of 80% or more of the
voting power of the then outstanding shares of capital stock of the Corporation
entitled to vote generally in the election of directors, voting together as a
single class, shall be required to amend or repeal, or adopt any provisions
inconsistent with this Article IV, Section 1 of these Bylaws.
Section 2. Removal of Directors. Any or all directors may be removed by a
vote of a majority of the shareholders entitled to vote, only for cause as
defined by the Tennessee Business Corporation Act.
Section 3. Filling of Vacancies. Vacancies and newly created directorships
resulting from any increase in the authorized number of directors, for any
reason, may be filled by a vote of the majority of the directors then in office,
although less than a quorum exists, or by a sole remaining director, and the
directors so chosen shall hold office until the next annual election and until
their successors are duly elected and qualified, unless sooner displaced. If
there are no directors in office, then an election of directors may be held in
the manner provided by statute. If, at the time of filling any vacancy or any
newly created directorship, the directors then in office shall constitute less
than a majority of the whole board (as constituted immediately prior to any such
increase), the vacancy or newly created directorship may be filled by vote of
the shareholders at any meeting of the shareholders, notice of which shall have
referred to the proposed election. Any director elected by the shareholders to
fill any vacancy shall be elected to hold office until the next annual meeting
of shareholders and until their successors are duly elected and qualified,
unless sooner displaced.
Section 4. Annual Meeting. The annual meeting of the Board of Directors
shall be held immediately after and at the same place as the annual meeting of
the shareholders, provided a quorum be present and no notice of such meeting
shall be necessary. In the event such meeting of the Board of Directors is not
held at such time and place, the meeting may be held at such time and place as
shall be specified in a notice given as hereinafter provided for special
meetings of the Board of Directors, or as shall be specified in a written waiver
signed by all of the directors.
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Section 5. Notice of Meetings. The annual and all regular meetings of the
Board of Directors may be held without notice at such time and at such place as
shall from time to time be determined by the Board. Special meetings shall be
held upon written notice not less than one day before the meeting.
Section 6. Special Meetings. Special meetings of the Board may be called
by the Chairman of the Board or President, or if either is absent or unable to
do so, by any Vice President, or by any two directors.
Section 7. Quorum. At all meetings of the Board, a majority of directors
shall constitute a quorum for the transaction of business and the act of a
majority of the directors present at any meeting at which there is a quorum
shall be the act of the Board of Directors, except as may be otherwise
specifically provided by law, the Charter or by these Bylaws. If a quorum shall
not be present at any meeting of the Board 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 8. Dissent to Action. A director who is present at a meeting of
the Board, at which any action is taken, shall be presumed to have concurred in
the action, unless his dissent thereto shall be entered in the Minutes of the
meeting, or unless he shall submit his written dissent to the person acting as
the Secretary of the meeting before the adjournment thereof, or shall deliver or
send such dissent to the Secretary of the Corporation promptly after the
adjournment of the meeting. Such rights to dissent shall not apply to a director
who voted in favor of any such action. A director who is absent from a meeting
at which such action is taken shall be presumed to have concurred in the action
unless he shall deliver or send by registered or certified mail his dissent
thereto to the Secretary of the Corporation or shall cause such dissent to be
filed with the Minutes of the proceedings of the Board within 10 days after
learning of such action.
Section 9. Action without Meeting. Unless otherwise restricted by the
Charter or these Bylaws, any action required or permitted to be taken at any
meeting of the Board of Directors or of any committee thereof may be taken
without a meeting, if all members of the Board or committee, as the case may be,
consent thereto in writing setting forth the actions so taken, signed by all of
the persons entitled to vote thereon, and the writing or writings are filed with
the minutes of proceedings of the Board or committee.
Section 10. Board Committees. The Board of Directors may, by resolution
passed by a majority of the whole Board, designate one or more committees, each
committee to consist of one or more of the directors of the Corporation. The
Board may designate one or more directors as alternate members of any committee,
who may replace any absent or disqualified member at any meeting of the
committee. Any such committee, to the extent provided in the resolution of the
Board of Directors, shall have and may exercise all the powers and authority of
the Board of Directors in the management of the business and affairs of the
Corporation, but no such committee shall have the power or authority in
reference to amending the Charter, adopting an agreement of merger or
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consolidation, recommending to the shareholders the sale, lease or exchange of
all or substantially all of the Corporation's property and assets, recommending
to the shareholders a dissolution of the Corporation or a revocation of the
dissolution, or amending the Bylaws of the Corporation; and, unless the
resolution or the Charter expressly so provide, no such committee shall have the
power or authority to declare a dividend or to authorize the issuance of stock.
Such committee or committees shall have such name or names as may be determined
from time to time by resolution adopted by the Board of Directors. Each
committee shall keep regular minutes of its meetings and report the same to the
Board of Directors when required.
Section 11. Compensation of Directors. Unless otherwise restricted by the
Charter, the Board of Directors shall have the authority to fix the compensation
of directors. The directors may be paid their expenses, if any, of attendance at
each meeting of the Board of Directors and may be paid a fixed sum for
attendance at each meeting of the Board of Directors and/or a stated salary as
director. No such payment shall preclude any director from serving the
Corporation in any other capacity and receiving compensation therefor. Members
of special or standing committees may be allowed like compensation for attending
committee meetings.
Section 12. Indemnification. The Corporation shall indemnify, to the full
extent authorized or permitted by the Tennessee Business Corporation Act, any
person made, or threatened to be made, a party to any threatened, pending or
completed action, suit or proceeding (whether civil, administrative or
investigative) by reason of the fact that he, his testator or intestate is or
was a director of the Corporation or serves or served as a director of any other
enterprise at the request of the Corporation.
Section 13. Mandatory Resignation. Directors who are also officers of the
Corporation shall submit a letter of resignation as such to the Board of
Directors upon any termination of employment as an officer of the Corporation,
and directors who are not officers of the Corporation shall likewise submit a
letter of resignation upon any change in that director's principal business or
other activity in which the director was engaged at the time of his or her
election.
ARTICLE V
OFFICERS
Section 1. Appointment. The Board of Directors at its first meeting after
each annual meeting of stockholders shall choose a Chairman of the Board, a
Chief Executive Officer, a President, an Executive Vice President, a Chief
Operating Officer, a Chief Financial Officer, a Treasurer, and a Secretary. The
Board of Directors may also choose additional vice presidents and one or more
assistant secretaries and assistant treasurers. Any two of the aforementioned
offices may be filled by the same person, except that no one person may be
Secretary and also President. No person shall purport to execute or attest any
document or instrument on behalf of the Corporation in more than one capacity.
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Section 2. Term. The officers of the Corporation shall hold office for one
year or until their successors are chosen and qualified subject, however, to the
removal of any officer pursuant to these Bylaws.
Section 3. Salaries. The salaries of all officers of the Corporation shall
be fixed by the Board of Directors.
Section 4. Removal. 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.
Section 5. Duties. All officers shall have such authority to perform such
duties in the management of the Corporation as are normally incident to their
offices and as the directors from time to time provide.
Section 6. The Chairman of the Board and Chief Executive Officer. The
Chairman of the Board and 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.
Section 7. Other Duties of the Chairman of the Board. He shall execute
bonds, mortgages and other contracts, 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 President. The President shall perform such duties as shall
be prescribed to him from time to time by the Board of Directors.
Section 9. Duties of the President and the Vice President(s). In the
absence of the Chief Executive Officer or in the event of his inability or
refusal to act, the President shall perform the duties of the Chief Executive
Officer and, when so acting, shall have all the powers of and be subject to all
the restrictions upon the Chief Executive Officer. The Vice President(s) shall
perform such other duties and have such other powers as the Board of Directors
may from time to time prescribe.
Section 10. The Secretary. The Secretary shall attend all meetings of the
Board of Directors and all meetings of the shareholders and record all the
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. He 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 the President, under whose supervision he shall be.
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Section 11. Assistant Secretary. The Assistant Secretary, or if there be
more than one, the assistant secretaries in the order determined by the Board of
Directors (or if there be no such determination, then in the order of their
election) shall, in the absence of the Secretary or in the event of his
inability or refusal to act, 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 12. The Chief Financial Officer and Treasurer. The Chief Financial
Officer and the Treasurer, in his capacity as such officers, 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.
Section 13. Duties of the Chief Financial Officer and Treasurer. He 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 transactions as the
Treasurer and of the financial condition of the Corporation.
Section 14. Bond. If required by the Board of Directors, the Chief
Financial Officer and the Treasurer shall give the Corporation a bond (which
shall be renewed every six years) 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 office and for the restoration to the Corporation, in case
of his death, resignation, retirement or removal from office, of all books,
papers, vouchers, money and other property of whatever kind in his possession or
under his control belonging to the Corporation.
Section 15. Assistant Treasurer(s). The Assistant Treasurer, or if there
shall be more than one, the Assistant Treasurers in the order determined by the
Board of Directors (or if there be no such determination, then in the order of
their election) shall, in the absence of the Treasurer or in the event of his
inability or refusal to act, perform the duties and exercise the powers of the
Treasurer and shall perform such other duties and have such other powers as the
Board of Directors may from time to time prescribe.
Section 16. Indemnification. The Corporation shall indemnify, to the full
extent authorized or permitted by the Tennessee Business Corporation Act, any
person made, or threatened to be made, a party to any threatened, pending or
completed action, suit or proceeding (whether civil, criminal, administrative or
investigative) by reason of the fact that he, his testator or intestate is or
was an officer of the Corporation or serves or served as a director or officer
of any other enterprise at the request of the Corporation.
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ARTICLE VI
CAPITAL STOCK
Section 1. Certificate. Every holder of stock in the Corporation shall be
entitled to have a certificate signed by, or in the name of the Corporation by,
the Chairman of the Board, the Chief Executive Officer or the President and the
Chief Operating Officer, a Vice President, the Treasurer (or an Assistant
Treasurer), or the Secretary (or an Assistant Secretary) of the Corporation,
certifying the number of shares owned by him in the Corporation.
Section 2. Facsimile Signatures. Where a certificate is countersigned (1)
by a transfer agent other than the Corporation or its employee, or (2) by a
registrar other than the Corporation or its employee, any other signature on the
certificate may be facsimile. In case an 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 he were such officer, transfer agent or registrar at the date of issuance.
Section 3. Notice of Restrictions. Each certificate of stock which is
restricted or limited as to its transferability or voting rights, or which is
callable under the Charter, which is preferred or limited as to dividends or
rights upon voluntary or involuntary dissolution, shall have a notice of such
restriction, limitation or preference conspicuously stated on the face or back
of the certificate. Upon the removal of expiration of any such restriction or
limitation, the holder of such certificate shall be entitled to receive a new
certificate upon the surrender of the old restricted or limited certificates,
and the payment of the reasonable expenses of the Corporation incurred in
connection therewith.
Section 4. Reissuance of Certificates. The Board of Directors may direct a
new certificate or certificates to be issued in place of any certificate or
certificates theretofore issued by the Corporation alleged to have been lost,
stolen or destroyed, upon the making of an affidavit of that fact by the person
claiming the certificate of stock to be lost, stolen or destroyed. When
authorizing such issue of a new certificate or certificates, the Board of
Directors may, in its discretion and as a condition precedent to the issuance
thereof, require the owner of such lost, stolen or destroyed certificate or
certificates, or his legal representative, to advertise the same in such manner
as it shall require and/or to give the Corporation a bond in such sum as it may
direct as indemnity against any claim that may be made against the Corporation
with respect to the certificate alleged to have been lost, stolen or destroyed.
Section 5. Transfer of Shares. The Corporation shall register a transfer
of a stock certificate presented to it for transfer if:
(a) the certificate is endorsed by the appropriate person or persons;
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(b) the signature of the appropriate person or persons has been
guaranteed by a national banking association, a bank organized and
operating under the statutes of the State of Tennessee, or a member
of the National Association of Security Dealers, and reasonable
assurance is given that the endorsements are effective, unless the
Secretary of the Corporation waives such requirements;
(c) there has been compliance with any applicable law relating to the
collection of taxes; and
(d) the transfer is in fact rightful or is to a bona fide purchaser.
Section 6. Endorsements. An endorsement of the stock certificate in
registered form is made when an appropriate person signs on it or on a separate
document an assignment or transfer of it, or a power to assign or transfer it,
or when the signature of this person is written without more upon the back of
the certificate. An endorsement may be in blank, which includes an endorsement
to bearer, or special, which specifies the person to whom the stock is to be
transferred, or who has the power to transfer it. The Corporation may elect to
require reasonable assurance beyond that specified in this Section.
Section 7. Registered Stockholders. The Corporation shall be entitled to
recognize the exclusive right of a person registered on its books as the owner
of shares to receive dividends, and to vote as such owner, and to hold liable
for calls and assessments 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 shall have express or other notice thereof, except as otherwise provided by
the laws of Tennessee.
ARTICLE VII
DIVIDENDS, SURPLUS AND RESERVE
Section 1. Dividends. The Board of Directors may from time to time
declare, and the Corporation may pay, dividends on its outstanding shares in
cash, property or its own shares, except where the Corporation is insolvent, as
that term is defined in Section 48-1-102 (14), Tennessee Code Annotated, or when
the payment thereof would render the Corporation insolvent, or when the
declaration of payment thereof would be contrary to any restrictions contained
in the Charter, these Bylaws, or in any applicable valid contract. The
declaration and payment of any such dividend shall be in accordance with Section
48-1-511, Tennessee Code Annotated, as it may be amended from time to time.
Section 2. Capital Distributions. The Board of Directors may distribute to
the shareholders of the Corporation out of capital surplus, a portion of its
assets, in cash or property, subject to the following provisions:
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(a) no such distribution shall be made at a time when the Corporation is
insolvent or when such distribution would render the Corporation
insolvent;
(b) no such distribution shall be made unless such distribution is
authorized by the affirmative vote of the holders of the majority of
all of the outstanding shares of stock entitled to vote thereon;
(c) no such distribution shall be made to the holders of any class of
shares unless all cumulative dividends accrued on all preferred or
special classes of shares entitled to preferential dividends shall
have been fully paid;
(d) no such distribution shall be made to the holders of any class of
shares which would reduce the remaining net assets of the
Corporation below the aggregate preferential amount payable in the
event of voluntary liquidation to the holders of shares having
preferential rights to the assets of the Corporation in the event of
liquidation; and
(e) each such distribution, when made, shall be identified as a
distribution from capital surplus and the amount per share shall be
disclosed to the shareholders receiving the same, concurrently with
the distribution thereof.
Section 3. Increases of Capital Surplus. The capital surplus of the
Corporation may be increased from time to time by resolution of the Board,
directing that all or part of the earned surplus of the Corporation be
transferred to capital surplus. The Board of Directors may, by resolution, apply
any part or all of the capital surplus of the Corporation to the reduction or
elimination of any deficit arising from losses however incurred; provided,
however, that the earned surplus has first been exhausted by charging such
losses to earned surplus and then only to the extent that such losses exceed the
earned surplus. Each such application of capital surplus shall, to the extent
thereof, effect a reduction of capital surplus.
Section 4. Seal. The Corporation shall have a corporate seal. The presence
or absence of a seal on any instrument shall not affect the character, validity,
or legal effect thereof in any respect. The affixing of a seal shall not be
necessary for the execution of any instrument or document by the Corporation.
ARTICLE VIII
AMENDMENTS
Subject to the provisions of the Charter of the Corporation, these Bylaws
may be altered, amended, or repealed or new bylaws may be adopted by the vote of
a majority of all of the shareholders or by the majority vote of the entire
Board of Directors, when such power is conferred upon the Board of Directors by
the Charter, at any regular meeting of the shareholders or of the Board of
Directors or at any special meeting of the shareholders or of the Board of
Directors if notice of such alteration, amendment, repeal or adoption of new
bylaws be contained in the notice of such special meeting.
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ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 1. Fiscal Year. The fiscal year of the Corporation shall be fixed
by resolution of the Board of Directors.
Section 2. Insurance. The Corporation may purchase and maintain insurance
on behalf of any person who is or was or has agreed to become a director or
officer of the Corporation, or is or was serving at the request of the
Corporation as a director or officer of another corporation, partnership, joint
venture, trust or other enterprise against any liability asserted against him
and incurred by him or on his behalf in any such capacity, or arising out of his
status as such, whether or not the Corporation would have the power to indemnify
him against such liability under the provisions of this Article, provided that
such insurance is available on acceptable terms, which determination shall be
made by a vote of a majority of the entire Board of Directors.
Section 3. Savings Clause. If this Article or any portion hereof shall be
invalidated on any ground by any court of competent jurisdiction, then the
Corporation may nevertheless indemnify each director or officer of the
Corporation as to costs, charges and expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement with respect to any action, suit
or proceeding, whether civil, criminal, administrative or investigative,
including an action by or in the right of the Corporation, to the full extent
permitted by any applicable portion of this Article that shall not have been
invalidated and to the full extent permitted by applicable law.
Section 4. Notices. Whenever, under the provisions of the statutes, the
Charter or 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 may
also be given by telegram or electronic facsimile, in which event it shall be
deemed to have been given when deposited with a telegraph or electronic
facsimile office for transmission.
Section 5. Indemnification. Notwithstanding anything in the Charter to the
contrary, the Corporation shall be permitted, but shall not be required, to
indemnify and hold harmless any employee or agent of the Corporation made, or
threatened to be made, a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative.
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