AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger, dated as of the 18th day of December,
1997 (the "Agreement"), by and among Dura Pharmaceuticals, Inc., a Delaware
corporation ("DURA"), SDC Acquisition Corp., a Delaware corporation and a
wholly-owned subsidiary of DURA ("SUB"), and Xxxxxx Development Corporation, a
Delaware corporation ("SDC").
RECITALS
WHEREAS, subject to and in accordance with the terms and conditions of this
Agreement, the respective Boards of Directors of DURA, SUB and SDC, the
stockholders of SDC and DURA as sole stockholder of SUB have each approved the
merger of SDC with SUB (the "Merger"), whereby all rights of each holder of any
issued and outstanding shares of callable common stock, par value $.001 per
share, of SDC ("SDC Common Stock") arising from such holder's ownership of such
SDC Common Stock will be converted into the right to receive the number of
shares of DURA common stock, par value $.001 per share ("DURA Common Stock") and
cash in lieu of fractional shares, if any set forth opposite such holder's name
on SCHEDULE A attached hereto, and the rights of each outstanding option to
acquire shares of SDC Common Stock shall by virtue of the Merger and, without
any action on the part of the holders thereof, be converted into the right to
receive cash payments pursuant to Section 1.7(b) hereof and be canceled and no
longer be outstanding;
WHEREAS, following the consummation of the transactions contemplated by the
Merger, DURA intends to merge SDC with and into itself, whereupon the separate
existence of SDC shall cease;
NOW, THEREFORE, in consideration of the mutual agreements, covenants,
conditions, representations and warranties contained herein, the parties hereto
hereby agree as follows:
ARTICLE I
THE MERGER
1.1 THE MERGER. Subject to and in accordance with the terms and
conditions of this Agreement and in accordance with the General Corporation Law
of the State of Delaware (the "DGCL"), at the Effective Time (as defined in
Section 1.3), SDC shall be merged with SUB. As a result of the Merger, the
separate corporate existence of SUB shall cease and SDC shall continue as the
surviving corporation (sometimes referred to herein as the "Surviving
Corporation"), and all the properties, rights, privileges, powers and franchises
of SDC and SUB shall vest in the Surviving Corporation, without any transfer or
assignment
having occurred, and all debts, liabilities and duties of SDC and SUB shall
attach to the Surviving Corporation, all in accordance with the DGCL.
1.2 CLOSING DATE. The closing of the transactions contemplated by this
Agreement shall take place at the offices of Xxxxxxx, Xxxxxxx & Xxxxxxxx, 000
Xxxx "X" Xxxxxx, Xxxxx 0000, Xxx Xxxxx, Xxxxxxxxxx 00000, on December 19, 1997
(the "Closing Date").
1.3 CONSUMMATION OF THE MERGER. As soon as practicable on or after the
Closing Date, the parties hereto will cause the Merger to be consummated by
filing with the Secretary of State of Delaware a certificate of merger in such
form as required by, and executed in accordance with, the relevant provisions of
the DGCL. The "Effective Time" of the Merger as that term is used in this
Agreement shall mean such time as the certificate of merger is duly filed with
the Secretary of State of Delaware.
1.4 EFFECTS OF THE MERGER. The Merger shall have the effects set forth in
the applicable provisions of the DGCL.
1.5 CERTIFICATE OF INCORPORATION; BYLAWS. The Certificate of
Incorporation and Bylaws of SDC, as amended by the Amended and Restated
Certificate of Incorporation of Xxxxxx Development Corporation attached hereto
as SCHEDULE B and the Bylaws, as amended, of Xxxxxx Development Corporation
attached hereto as SCHEDULE C, respectively, shall be the Certificate of
Incorporation and Bylaws, respectively, of the Surviving Corporation and
thereafter shall continue to be its Certificate of Incorporation and Bylaws
until amended as provided therein and under the DGCL.
1.6 DIRECTORS AND OFFICERS. The directors of SDC immediately prior to the
Effective Time shall be the directors of the Surviving Corporation at and after
the Effective Time, each to hold office in accordance with the Certificate of
Incorporation and Bylaws of the Surviving Corporation, and the officers of SDC
immediately prior to the Effective Time shall be the officers of the Surviving
Corporation at and after the Effective Time, in each case until their respective
successors are duly elected or appointed and qualified.
1.7 CONVERSION OF SECURITIES. Subject to the terms and conditions of this
Agreement, at the Effective Time, by virtue of the Merger and without any action
on the part of DURA, SDC, SUB or any of their respective stockholders:
(a) All rights of each holder of any shares of SDC Common Stock
issued and outstanding immediately prior to the Effective Time (the
"Shares") arising from such holder's ownership of such Shares shall be
converted into the right to receive the number of shares of DURA Common
Stock set forth opposite such holder's name on SCHEDULE A attached hereto;
PROVIDED, HOWEVER, that no fractional shares of DURA Common Stock shall be
issued, and, in lieu thereof, a cash payment shall be made in accordance
with subsection 1.8(e) hereof.
-2-
(b) All rights of each option to acquire shares of Callable Common
Stock of SDC outstanding immediately prior to the Effective Time shall in
full satisfaction of any of the rights thereto (i) be converted as of the
Closing Date into the right to receive upon surrender of the respective
Option a cash payment equal to Forty Six Dollars and Eighty Eight Cents
($46.88) (the exercise price for Dura's Purchase Option for all of the
outstanding SDC Common Stock) multiplied by the number of shares of SDC
Common Stock otherwise issuable upon the exercise of the respective
holder's option(s) less the exercise price per share of SDC Common Stock
multiplied by the number of shares of SDC Common Stock for which the
respective option is being exercised and (ii) be automatically canceled and
be no longer outstanding, as of the Closing Date, regardless of whether the
respective Option has been surrendered.
(c) Each issued and outstanding share of capital stock of SUB issued
and outstanding immediately prior to the Effective Time shall continue to
be issued and outstanding and shall be converted into one share of validly
issued, fully paid and non-assessable Common Stock of the Surviving
Corporation. Each stock certificate of SUB evidencing ownership of any
such shares shall continue to evidence ownership of such shares of Common
Stock of the Surviving Corporation.
1.8 EXCHANGE OF CERTIFICATES; FRACTIONAL SHARES.
(a) Prior to the Effective Time, DURA shall appoint a bank, transfer
agent or similar entity to act as the payment agent (the "Payment Agent")
in the Merger and shall make available for exchange, in accordance with
this Section 1.8, the shares of Dura Common Stock issuable pursuant to this
Section 1.8 (and cash to be paid pursuant to subsection 1.8(e)) in exchange
for the Shares.
(b) As soon as practicable after the Effective Time, each holder of a
certificate that prior thereto represented Shares shall be entitled, upon
surrender thereof to the Payment Agent, to receive in exchange therefor, a
certificate or certificates representing the number of whole shares of DURA
Common Stock into which the shares of SDC Common Stock so surrendered shall
have been converted as aforesaid, in such denominations and registered in
such names as such holder may request. Each certificate so surrendered
shall forthwith be canceled. Each holder of shares of SDC Common Stock who
would otherwise be entitled to a fraction of a share of DURA Common Stock
shall, upon surrender of the certificates representing such shares held by
such holder to the Payment Agent, be paid an amount in cash in accordance
with the provisions of subsection 1.8(e) hereof. Until so surrendered and
exchanged, each certificate that prior to the Effective Time represented
Shares shall represent solely the right to receive DURA Common Stock and
cash in lieu of fractional shares, if any. Unless and until any such
certificates shall be so surrendered and exchanged, no dividends or other
distributions payable to the holders of DURA Common Stock, as of any time
on or after the Effective Time, shall be paid to the holders of such
-3-
certificates that prior to the Effective Time represented Shares; PROVIDED,
HOWEVER, that, upon any such surrender and exchange of such certificates,
there shall be paid to the record holders of the certificates issued and
exchanged therefor the amount, without interest thereon, of dividends and
other distributions, if any, that theretofore were declared and became
payable after the Effective Time and respect to the number of whole shares
of DURA Common Stock issued to such holder.
(c) All shares of DURA Common Stock issued upon the surrender for
exchange of certificates that prior to the Effective Time represented
Shares in accordance with the terms hereof (including any cash paid
pursuant to subsection 1.8(e)) shall be deemed to have been issued in full
satisfaction of all rights pertaining to such Shares. At and after the
Effective Time, there shall be no further registration of transfers on the
stock transfer books of the Surviving Corporation of the Shares that were
outstanding immediately prior to the Effective Time. If, after the
Effective Time, certificates which prior to the Effective Time represented
Shares are presented to the Surviving Corporation for any reason, they
shall be cancelled and exchanged as provided in this Article I.
(d) If any certificate for shares of DURA Common Stock is to be
issued in a name other than that in which the certificate surrendered in
exchange therefor is registered, it shall be a condition of the issuance
thereof that the certificate so surrendered shall be properly endorsed and
otherwise in proper form for transfer and that the person requesting such
exchange shall have paid to DURA or its transfer agent any transfer or
other taxes required by reason of the issuance of a certificate for shares
of DURA Common Stock in any name other than that of the registered holder
of the certificate surrendered, or established to the satisfaction of DURA
or its transfer agent that such tax has been paid or is not payable.
(e) No fraction of a share of DURA Common Stock shall be issued, but
in lieu thereof each holder of SDC Common Stock who would otherwise be
entitled to a fraction of a share of DURA Common Stock shall, upon
surrender of the certificate formerly representing SDC Common Stock held by
such holder to the Payment Agent, be paid an amount in cash equal to the
amount set forth opposite such holder's name on SCHEDULE A attached hereto
under the heading "Fractional Share Payment." No interest shall be paid on
such amount. All shares of SDC Common Stock held by a record holder shall
be aggregated for purposes of computing the number of shares of DURA Common
Stock to be issued pursuant to this Article I and cash in lieu of
fractional shares payable hereunder.
(f) None of DURA, SUB, SDC, the Surviving Corporation, their transfer
agents or the Payment Agent shall be liable to a holder of the Shares for
any amount properly paid to a public official pursuant to applicable
property, escheat or similar laws.
-4-
1.9 TAKING OF NECESSARY ACTION; FURTHER ACTION. The parties hereto shall
take all such reasonable and lawful action as may be necessary or appropriate in
order to effectuate the Merger as promptly as possible. If, at any time after
the Effective Time, any such further action is necessary or desirable to carry
out the purposes of this Agreement and to vest the Surviving Corporation with
full right, title and possession to all assets, property, rights, privileges,
powers and franchises of SDC or SUB, such parties shall direct their respective
officers and directors to take all such lawful and necessary action.
ARTICLE II
MISCELLANEOUS
2.1 TERMINATION. This Agreement may be terminated and the Merger and the
other transactions contemplated herein may be abandoned by any party at any time
prior to the Effective Time.
2.2 AMENDMENTS AND WAIVERS. Any term of this Agreement may be amended and
the observance of any term of this Agreement may be waived (either generally or
in a particular instance and either retroactively or prospectively), by the
party that is, or whose stockholders are, entitled to the benefits thereof.
This Agreement may not be amended or supplemented at any time, except by an
instrument in writing signed on behalf of each party hereto and then only as may
be permitted by applicable provisions of the DGCL. Any amendment or waiver
effected in accordance with this paragraph shall be binding upon each holder of
any securities purchased under this Agreement at the time outstanding (including
securities into which such securities are convertible), each future holder of
all such securities, and each of the parties hereto.
2.3 SEVERABILITY. If one or more provisions of this Agreement are held to
be unenforceable under applicable law, such provision shall be excluded from
this Agreement and the balance of the Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its
terms.
2.4 COUNTERPARTS. This Agreement may be executed in counterparts, each of
which shall be an original, but all of which together shall constitute one and
the same instrument.
2.5 TITLES AND SUBTITLES. The titles and subtitles used in this Agreement
are used for convenience only and are not to be considered in construing or
interpreting this Agreement.
2.6 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
among the parties with respect to the subject matter hereof and no party shall
be liable or bound to any other party in any manner by any warranties,
representations, or covenants except as specifically set forth herein or
therein.
-5-
2.7 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Delaware, as applied to
agreements among Delaware residents to be performed entirely within the State of
Delaware.
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
as of the date first above written.
DURA PHARMACEUTICALS, INC.,
a Delaware corporation
By: /s/ Cam X. Xxxxxx
------------------------------------------
Cam X. Xxxxxx, Chairman, President and
Chief Executive Officer
ATTEST:
/s/ Xxxxxxxx X. Xxxxxxxx
-------------------------------
Xxxxxxxx X. Xxxxxxxx, Secretary
SDC ACQUISITION CORP.,
a Delaware corporation
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------------
Xxxxx X. Xxxxxxxx, President
ATTEST:
/s/ Xxxxxxxx X. Xxxxxxxx
-------------------------------
Xxxxxxxx X. Xxxxxxxx, Secretary
XXXXXX DEVELOPMENT
CORPORATION, a Delaware corporation
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------------
Xxxxx X. Xxxxxxxx, President
ATTEST:
/s/ Xxxxxxxx X. Xxxxxxxx
-------------------------------
Xxxxxxxx X. Xxxxxxxx, Secretary
-6-
SCHEDULE "A"
Number of Shares of
SDC Callable Number of Shares of Dura Common Cash in Lieu of
Record Name of Holder of Common Stock SDC Callable Stock to Be Fractional
SDC Callable Common Stock Certificate Number Common Stock Held Issued in Merger Share Payment
------------------------- --------------------- ------------------- ------------------------ ----------------------
PIRATE SHIP & CO., AS CC-1 66,667 64,044 $ 1.76
NOMINEE FOR THE GLOBAL
HEALTH SCIENCES FUND
OLD COURT LIMITED, AS CC-2 100,000 96,065 $ 28.00
NOMINEE FOR BIOTECHNOLOGY
INVESTMENTS LTD.
THE XXXXXXX XXXXXX TRUST CC-3 16,667 16,011 $ 12.16
COMPANY, TRUSTEE FOR THE
DURA PHARMACEUTICALS, INC.
DEFERRED COMPENSATION PLAN
ELAN INTERNATIONAL CC-4 333,333 320,218 $ 12.64
SERVICES LIMITED
H&Q HEALTHCARE INVESTORS CC-6 45,833 44,029 $ 35.84
H&Q LIFE SCIENCES CC-7 37,500 36,024 $ 28.80
INVESTORS
NEW ENTERPRISE ASSOCIATES CC-8 66,667 64,044 $ 1.76
VI, LIMITED PARTNERSHIP
X-X XXXXXXX CC-9 36,500 35,063 $ 45.60
LAKEMEDELSFONDEN,
STOCKHOLM
WPG LIFE SCIENCES FUND CC-11 10,000 9,606 $ 27.20
L.P.
WPG INSTITUTIONAL LIFE CC-12 6,667 6,404 $ 33.76
SCIENCES FUND L.P.
ABYDOS & CO., AS NOMINEE CC-13 100,000 96,065 $ 28.00
FOR G.T. GLOBAL HEALTH
CARE FUND
DOMAIN PARTNERS III, L.P. CC-14 96,656 92,853 $ 6.88
DP III ASSOCIATES, L.P. CC-15 3,344 3,212 $ 21.12
RUSH & CO., AS NOMINEE FOR CC-16 13,500 12,968 $ 41.60
X-X XXXXXX LUXEMBOURG S.A.
TOTAL: 933,334 896,606 $ 325.12
------- ------- -------
------- ------- -------
SCHEDULE B
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF XXXXXX DEVELOPMENT CORPORATION
a Delaware corporation
Xxxxxx Development Corporation, a corporation organized and existing under
the laws of the State of Delaware, hereby certifies as follows:
1. The name of the corporation is Xxxxxx Development Corporation. The
original Certificate of Incorporation of the corporation was filed with the
Secretary of State of the State of Delaware on December 5, 1995 and was amended
pursuant to a Restated Certificate of Incorporation filed with the Secretary of
State of the State of Delaware on December 29, 1995.
2. Pursuant to Sections 242 and 245 of the General Corporation Law of the
State of Delaware, the Amended and Restated Certificate of Incorporation was
adopted by the corporation's Board of Directors and stockholders, the
stockholders of the corporation having approved the Amended and Restated
Certificate of Incorporation by the written consent of the holders of at least a
majority of the outstanding shares in accordance with Section 228 thereof, and
written notice having been given in accordance with the requirements of such
Section. The Amended and Restated Certificate of Incorporation restates,
integrates and amends the provisions of the Certificate of Incorporation of this
corporation.
3. The text of the Certificate of Incorporation as heretofore amended or
restated is hereby restated and further amended to read in its entirety as
follows:
ARTICLE I
The name of this corporation is Xxxxxx Development Corporation.
ARTICLE II
The address of this corporation's registered office in the State of
Delaware is 00 Xxx Xxxxxxx Xxxx, Xxxx xx Xxxxx, Xxxxxx of Kent 19901. The name
of its registered agent at such address is CorpAmerica, Inc.
ARTICLE III
The purpose of this corporation is to engage in any lawful act or activity
for which a corporation may now or hereafter be organized under the Delaware
General Corporation Law.
ARTICLE IV
Effective at the time of the Corporation's filing with the Secretary of the
State of Delaware of this Amended and Restated Certificate of Incorporation (the
"Effective Time"), the Corporation shall be authorized to issue one class of
stock to be designated "Common Stock", with a par value of $.001 per share which
renames the previously designated "Callable Common Stock" with the same par
value. As a result, as of the Effective Time the total number of shares of all
classes of stock that the Corporation shall have authority to issue is 1,073,334
shares of Common Stock.
ARTICLE V
The corporation is to have a perpetual existence.
ARTICLE VI
The Board of Directors of the corporation is expressly authorized to make,
alter or repeal bylaws of the corporation, but the stockholders may make
additional bylaws and may alter or repeal any bylaw whether adopted by them or
otherwise.
ARTICLE VII
(A) EXCULPATION. A director of the corporation shall not be personally
liable to the corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach of the
director's duty of loyalty to the corporation or its stockholders, (ii) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the Delaware General
Corporation Law or (iv) for any transaction from which the director derived any
improper personal benefit. If the Delaware General Corporation Law is hereafter
amended to further reduce or to authorize, with the approval of the
corporation's stockholders, further reductions in the liability of the
corporation's directors for breach of fiduciary duty, then a director of the
corporation shall not be liable for any such breach to the fullest extent
permitted by the Delaware General Corporation Law as so amended.
(B) INDEMNIFICATION. To the extent permitted by applicable law, this
corporation is also authorized to provide indemnification of (and advancement of
expenses to) such agents (and any other persons to which Delaware law permits
this corporation to provide indemnification) through bylaw provisions,
agreements with such agents or other persons, vote of stockholders or
disinterested directors or otherwise, in excess of the indemnification and
advancement otherwise permitted by Section 145 of the Delaware General
Corporation Law, subject only to limits created by applicable Delaware law
(statutory or non-statutory), with respect to actions for breach of duty to the
corporation, its stockholders, and others.
-2-
(C) EFFECT OF REPEAL OR MODIFICATION. Any repeal or modification of any
of the foregoing provisions of this Article V shall be prospective and shall not
adversely affect any right or protection of a director, officer, agent or other
person existing at the time of, or increase the liability of any director of the
corporation with respect to any acts or omissions of such director occurring
prior to, such repeal or modification.
ARTICLE VIII
Elections of directors need not be by written ballot except and to the
extent provided in the Bylaws of the corporation.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
-3-
IN WITNESS WHEREOF, this Amended and Restated Certificate of Incorporation
has been signed under the seal of the corporation as of this 18 day of
December, 1997.
XXXXXX DEVELOPMENT CORPORATION,
a Delaware corporation
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------------
Xxxxx X. Xxxxxxxx, President
ATTEST:
/s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxxxx X. Xxxxxxxx, Secretary
SCHEDULE C
BYLAWS
OF
XXXXXX DEVELOPMENT CORPORATION
I.
OFFICES
Section 1. The registered office shall be in the City of Dover,
County of Kent, State of Delaware.
Section 2. The corporation may also have offices at such other places
both within and without the State of Delaware as the Board of Directors may from
time to time determine or the business of the corporation may require.
II.
MEETINGS OF STOCKHOLDERS
Section 1. All meetings of the stockholders for the election of
directors shall be held in the City of San Diego, State of California, at such
place as may be fixed from time to time by the Board of Directors, or at such
other place either within or without the State of Delaware as shall be
designated from time to time by the Board of Directors and stated in the notice
of the meeting. Meetings of stockholders for any other purpose may be held at
such time and place, within or without the State of Delaware, as shall be stated
in the notice of the meeting or in a duly executed waiver of notice thereof.
Section 2. Annual meetings of stockholders, commencing with the year
1995, shall be held on such date and at such time as shall be designated from
time to time by the Board of Directors and stated in the notice of the meeting,
at which they shall elect by a
plurality vote a board of directors, and transact such other business as may
properly be brought before the meeting.
Section 3. Written notice of the annual meeting stating the place,
date and hour of the meeting shall be given to each stockholder entitled to vote
at such meeting not less than ten (10) nor more than sixty (60) days before the
date of the meeting.
Section 4. The officer who has charge of the stock ledger of the
corporation shall prepare and make, at least ten days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder.
Such list shall be open to the examination of any stockholder, for any purpose
germane to the meeting, during ordinary business hours, for a period of at least
ten 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 stockholder who is
present.
Section 5. Special meetings of the stockholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the certificate of
incorporation, may be called by the president and shall be called by the
president or secretary at the request in writing of a majority of the Board of
Directors, or at the request in writing of stockholders owning a majority in
amount of the entire capital stock of the corporation issued and outstanding and
entitled to vote. Such request shall state the purpose or purposes of the
proposed meeting.
-2-
Section 6. 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 not less than ten (10) nor more than sixty (60) days
before the date of the meeting, to each stockholder entitled to vote at such
meeting.
Section 7. Business transacted at any special meeting of stockholders
shall be limited to the purposes stated in the notice.
Section 8. The holders 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 stockholders for the
transaction of business except as otherwise provided by statute or by the
certificate of incorporation. If, however, such quorum shall not be present or
represented at any meeting of the stockholders, the stockholders 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 any business may be
transacted which might have been transacted at the meeting as originally
notified. If the adjournment is for more than thirty 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 stockholder of record entitled to
vote at the meeting.
Section 9. 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 certificate of incorporation, a different vote is
-3-
required, in which case such express provision shall govern and control the
decision of such question.
Section 10. Unless otherwise provided in the certificate of
incorporation each stockholder shall at every meeting of the stockholders be
entitled to one vote in person or by proxy for each share of the capital stock
having voting power held by such stockholder, but no proxy shall be voted on
after three years from its date, unless the proxy provides for a longer period.
Section 11. Unless otherwise provided in the certificate of
incorporation, any action required to be taken at any annual or special meeting
of stockholders of the corporation, or any action which may be taken at any
annual or special meeting of such stockholders, may be taken without a meeting,
without prior notice and without a vote, if a consent in writing, setting forth
the action so taken, shall be signed by the holders of outstanding stock having
not less than the minimum number of votes that would be necessary to authorize
or take such action at a meeting at which all shares entitled to vote thereon
were present and voted. Prompt notice of the taking of the corporate action
without a meeting by less than unanimous written consent shall be given to those
stockholders who have not consented in writing.
III.
DIRECTORS
Section 1. The number of directors which shall constitute the whole
board shall be five (5). The directors shall be elected at the annual meeting
of the stockholders, except as provided in Section 2 of this Article, and each
director elected shall hold office until his successor is elected and qualified.
Directors need not be stockholders.
-4-
Section 2. Vacancies and newly created directorships resulting from
any increase in the authorized number of directors may be filled by a majority
of the directors then in office, though less than a quorum, 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 shall qualify,
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 Court of Chancery may, upon
application of any stockholder or stockholders holding at least ten percent of
the total number of the shares at the time outstanding having the right to vote
for such directors, summarily order an election to be held to fill any such
vacancies or newly created directorships, or to replace the directors chosen by
the directors then in office.
Section 3. The business of the corporation shall be managed by or
under the direction of its board of directors which may exercise all such powers
of the corporation and do all such lawful acts and things as are not by statute
or by the certificate of incorporation or by these bylaws directed or required
to be exercised or done by the stockholders.
MEETINGS OF THE BOARD OF DIRECTORS
Section 4. The Board of Directors of the corporation may hold
meetings, both regular and special, either within or without the State of
Delaware.
Section 5. The first meeting of each newly elected Board of Directors
shall be held at such time and place as shall be fixed by the vote of the
stockholders at the annual meeting and no notice of such meeting shall be
necessary to the newly elected directors in order legally to constitute the
meeting, provided a quorum shall be present. In the event of
-5-
the failure of the stockholders to fix the time or place of such first meeting
of the newly elected Board of Directors, or in the event such meeting is not
held at the time and place so fixed by the stockholders, 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.
Section 6. 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.
Section 7. Special meetings of the board may be called by the
President on four (4) days' notice to each director by mail or 48 hours' notice
to each director either personally or by telegram; special meetings shall be
called by the President or Secretary in like manner and on like notice on the
written request of two directors unless the board consists of only one director,
in which case special meetings shall be called by the President or Secretary in
like manner and on like notice on the written request of the sole director.
Section 8. At all meetings of the board a majority of the 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 statute or by the certificate of incorporation. 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 9. Unless otherwise restricted by the certificate of
incorporation 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
-6-
committee, as the case may be, consent thereto in writing, and the writing or
writings are filed with the minutes of proceedings of the board or committee.
Section 10. Unless otherwise restricted by the certificate of
incorporation or these bylaws, members of the Board of Directors, or any
committee designated by the Board of Directors, may participate in a meeting of
the Board of Directors, or any committee, by means of conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.
COMMITTEES OF DIRECTORS
Section 11. 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.
In the absence of disqualification of a member of a committee, the member
or members thereof present at any meeting and not disqualified from voting,
whether or not he or they constitute a quorum, may unanimously appoint another
member of the Board of Directors to act at the meeting in the place of any such
absent or disqualified member.
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, and may authorize the seal of the corporation to be affixed to all
papers which may require it; but no such committee shall have the power or
authority in reference to amending the certificate of incorporation,
-7-
adopting an agreement of merger or consolidation, recommending to the
stockholders the sale, lease or exchange of all or substantially all of the
corporation's property and assets, recommending to the stockholders a
dissolution of the corporation or a revocation of a dissolution, or amending the
bylaws of the corporation; and, unless the resolution or the certificate of
incorporation 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.
Section 12. Each committee shall keep regular minutes of its meetings
and report the same to the Board of Directors when required.
COMPENSATION OF DIRECTORS
Section 13. Unless otherwise restricted by the certificate of
incorporation or these bylaws, 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 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.
REMOVAL OF DIRECTORS
Section 14. Unless otherwise restricted by the certificate of
incorporation or bylaw, any director or the entire Board of Directors may be
removed, with or without cause, by the holders of a majority of shares entitled
to vote at an election of directors.
-8-
IV.
NOTICES
Section 1. Whenever, under the provisions of the statutes or of the
certificate of incorporation or of these bylaws, notice is required to be given
to any director or stockholder, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
director or stockholder, 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.
Section 2. Whenever any notice is required to be given under the
provisions of the statutes or of the certificate of incorporation or of these
bylaws, a waiver thereof in writing, signed by the person or persons entitled to
said notice, whether before or after the time stated therein, shall be deemed
equivalent thereto.
V.
OFFICERS
Section 1. The officers of the corporation shall be elected by the
Board of Directors and shall include a President and a Secretary. The Board of
Directors may elect from among its members a Chairman of the Board and a Vice
Chairman of the Board. The Board of Directors may also elect a Treasurer and/or
one or more Vice Presidents, Assistant Secretaries and Assistant Treasurers.
Any number of offices may be held by the same person, unless the certificate of
incorporation or these bylaws otherwise provide.
-9-
Section 2. The Board of Directors at its first meeting after each
annual meeting of stockholders shall elect a President and a Secretary and may
also elect Vice Presidents and a Treasurer.
Section 3. The Board of Directors may appoint such other officers and
agents as it shall deem necessary who shall hold their offices for such terms
and shall exercise such powers and perform such duties as shall be determined
from time to time by the board.
Section 4. The salaries of all officers and agents of the corporation
shall be fixed by the Board of Directors.
Section 5. The officers of the corporation shall hold office until
their successors are chosen and qualified. 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.
THE CHAIRMAN OF THE BOARD
Section 6. The Chairman of the Board, if any, shall preside at all
meetings of the Board of Directors and of the stockholders at which he shall be
present. He shall have and may exercise such powers as are, from time to time,
assigned to him by the Board and as may be provided by law.
Section 7. In the absence of the Chairman of the Board, the Vice
Chairman of the Board, if any, shall preside at all meetings of the Board of
Directors and of the stockholders at which he shall be present. He shall have
and may exercise such powers as are, from time to time, assigned to him by the
Board and as may be provided by law.
-10-
THE PRESIDENT AND VICE PRESIDENT
Section 8. The President shall be the chief executive officer of the
corporation; and in the absence of the Chairman and Vice Chairman of the Board
he shall preside at all meetings of the stockholders and the Board of Directors.
He 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 9. He shall execute bonds, mortgages and other contracts
requiring a seal, under the seal of the corporation, except where required or
permitted by law to be otherwise signed and executed and except where the
signing and execution thereof shall be expressly delegated by the Board of
Directors to some other officer or agent of the corporation.
Section 10. In the absence of the President or in the event of his
inability or refusal to act, the Vice President, if any, (or in the event there
be more than one Vice President, the Vice Presidents in the order designated by
the directors, or in the absence of any designation, then in the order of their
election) shall perform the duties of the President, and when so acting, shall
have all the powers of and be subject to all the restrictions upon the
President. The Vice Presidents shall perform such other duties and have such
other powers as the Board of Directors may from time to time prescribe.
THE SECRETARY AND ASSISTANT SECRETARY
Section 11. The Secretary shall attend all meetings of the Board of
Directors and all meetings of the stockholders 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 stockholders and special meetings of the Board of
-11-
Directors, and shall perform such other duties as may be prescribed by the Board
of Directors or President, under whose supervision he shall be. He shall have
custody of the corporate seal of the corporation and he, or an Assistant
Secretary, shall have authority to affix the same to any instrument requiring it
and when so affixed, it may be attested by his signature or by the signature of
such Assistant Secretary. The Board of Directors may give general authority to
any other officer to affix the seal of the corporation and to attest the
affixing by his signature.
Section 12. 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.
THE TREASURER AND ASSISTANT TREASURERS
Section 13. The Treasurer shall have the custody of the corporate
funds and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation and shall deposit all moneys
and other valuable effects in the name and to the credit of the corporation in
such depositories as may be designated by the Board of Directors.
Section 14. 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
-12-
so requires, an account of all his transactions as Treasurer and of the
financial condition of the corporation.
Section 15. If required by the Board of Directors, he 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 16. 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.
VI.
CERTIFICATE OF STOCK
Section 1. 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 or Vice Chairman of the Board of Directors, or the President or a Vice
President and 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.
-13-
Certificates may be issued for partly paid shares and in such case upon the
face or back of the certificates issued to represent any such partly paid
shares, the total amount of the consideration to be paid therefor, and the
amount paid thereon shall be specified.
If the corporation shall be authorized to issue more than one class of
stock or more than one series of any class, the powers, designations,
preferences and relative, participating, optional or other special rights of
each class of stock or series thereof and the qualification, limitations or
restrictions of such preferences and/or rights shall be set forth in full or
summarized on the face or back of the certificate which the corporation shall
issue to represent such class or series of stock, provided that, except as
otherwise provided in section 202 of the General Corporation Law of Delaware, in
lieu of the foregoing requirements, there may be set forth on the face or back
of the certificate which the corporation shall issue to represent such class or
series of stock, a statement that the corporation will furnish without charge to
each stockholder who so requests the powers, designations, preferences and
relative, participating, optional or other special rights of each class of stock
or series thereof and the qualifications, limitations or restrictions of such
preferences and/or rights.
Section 2. Any of or all the signatures on the certificate may be
facsimile. In case any officer, transfer agent or registrar who has signed or
whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificate is
issued, it may be issued by the corporation with the same effect as if he were
such officer, transfer agent or registrar at the date of issue.
LOST CERTIFICATES
Section 3. 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
-14-
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.
TRANSFER OF STOCK
Section 4. Upon surrender to the corporation or the transfer agent of
the corporation of a certificate for shares duly endorsed or accompanied by
proper evidence of succession, assignation or authority to transfer, it shall be
the duty of the corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction upon its books.
FIXING RECORD DATE
Section 5. In order that the corporation may determine the
stockholders entitled to notice of or to vote at any meeting of stockholders or
any adjournment thereof, or to express consent to corporate action in writing
without a meeting, or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled to exercise any rights in
respect of any change, conversion or exchange of stock or for the purpose of any
other lawful action, the Board of Directors may fix, in advance, a record date,
which shall not be more than sixty (60) nor less than ten (10) days before the
date of such meeting, nor more than sixty (60) days prior to any other action.
A determination of
-15-
stockholders of record entitled to notice of or to vote at a meeting of
stockholders shall apply to any adjournment of the meeting; provided, however,
that the Board of Directors may fix a new record date for the adjourned meeting.
REGISTERED STOCKHOLDERS
Section 6. 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
Delaware.
VII.
GENERAL PROVISIONS
DIVIDENDS
Section 1. Dividends upon the capital stock of the corporation,
subject to the provisions of the certificate of incorporation, if any, may be
declared by the Board of Directors at any regular or special meeting, pursuant
to law. Dividends may be paid in cash, in property, or in shares of the capital
stock, subject to the provisions of the certificate of incorporation.
Section 2. Before payment of any dividend, there may be set aside out
of any funds of the corporation available for dividends such sum or sums as the
directors from time to time, in their absolute discretion, think proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the corporation, or for such other
purposes as the directors shall think conducive to the interest of
-16-
the corporation, and the directors may modify or abolish any such reserve in the
manner in which it was created.
CHECKS
Section 3. All checks or demands for money and notes of the
corporation shall be signed by such officer or officers or such other person or
persons as the Board of Directors may from time to time designate.
FISCAL YEAR
Section 4. The fiscal year of the corporation shall be fixed by
resolution of the Board of Directors.
SEAL
Section 5. The Board of Directors may adopt a corporate seal having
inscribed thereon the name of the corporation, the year of its organization and
the words "Corporate Seal, Delaware." The seal may be used by causing it or a
facsimile thereof to be impressed or affixed or reproduced or otherwise.
INDEMNIFICATION
Section 6. The corporation shall, to the fullest extent authorized
under the laws of the State of Delaware, as those laws may be amended and
supplemented from time to time, indemnify any director made, or threatened to be
made, a party to an action or proceeding, whether criminal, civil,
administrative or investigative, by reason of being a director of the
corporation or a predecessor corporation or, at the corporation's request, a
director or officer of another corporation, provided, however, that the
corporation shall indemnify any such agent in connection with a proceeding
initiated by such agent only if such proceeding was authorized by the Board of
Directors of the corporation. The indemnification provided for in
-17-
this Section 6 shall: (i) not be deemed exclusive of any other rights to which
those indemnified may be entitled under the corporation's certificate of
incorporation, any bylaw, agreement or vote of stockholders or disinterested
directors or otherwise, both as to action in their official capacities and as to
action in another capacity while holding such office, (ii) continue as to a
person who has ceased to be a director, and (iii) inure to the benefit of the
heirs, executors and administrators of such a person. The corporation's
obligation to provide indemnification under this Section 6 shall be offset to
the extent of any other source of indemnification or any otherwise applicable
insurance coverage under a policy maintained by the corporation or any other
person.
-18-
Expenses incurred by a director of the corporation in defending a
civil or criminal action, suit or proceeding by reason of the fact that he is or
was a director of the corporation (or was serving at the corporation's request
as a director or officer of another corporation) shall be paid by the
corporation in advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of such director to
repay such amount if it shall ultimately be determined that he is not entitled
to be indemnified by the corporation as authorized by relevant sections of the
General Corporation Law of Delaware. Notwithstanding the foregoing, the
corporation shall not be required to advance such expenses to an agent who is a
party to an action, suit or proceeding brought by the corporation and approved
by a majority of the Board of Directors of the corporation which alleges willful
misappropriation of corporate assets by such agent, disclosure of confidential
information in violation of such agent's fiduciary or contractual obligations to
the corporation or any other willful and deliberate breach in bad faith of such
agent's duty to the corporation or its stockholders.
The foregoing provisions of this Section 6 shall be deemed to be a
contract between the corporation and each director who serves in such capacity
at any time while this bylaw is in effect, and any repeal or modification
thereof shall not affect any rights or obligations then existing with respect to
any state of facts then or theretofore existing or any action, suit or
proceeding theretofore or thereafter brought based in whole or in part upon any
such state of facts.
The Board of Directors in its discretion shall have power on behalf of
the corporation to indemnify any person, other than a director, made a party to
any action, suit or
-19-
proceeding by reason of the fact that he, his testator or intestate, is or was
an officer or employee of the corporation.
To assure indemnification under this Section 6 of all directors,
officers and employees who are determined by the corporation or otherwise to be
or to have been "fiduciaries" of any employee benefit plan of the corporation
which may exist from time to time, Section 145 of the General Corporation Law of
Delaware shall, for the purposes of this Section 6, be interpreted as follows:
an "other enterprise" shall be deemed to include such an employee benefit plan,
including without limitation, any plan of the corporation which is governed by
the Act of Congress entitled "Employee Retirement Income Security Act of 1974,"
as amended from time to time; the corporation shall be deemed to have requested
a person to serve an employee benefit plan where the performance by such person
of his duties to the corporation also imposes duties on, or otherwise involves
services by, such person to the plan or participants or beneficiaries of the
plan; excise taxes assessed on a person with respect to an employee benefit plan
pursuant to such Act of Congress shall be deemed "fines."
Section 7. The corporation shall indemnify its directors to the
fullest extent not prohibited by the California General Corporation Law;
PROVIDED, HOWEVER, that the corporation shall not be required to indemnify any
director in connection with any proceeding (or part thereof) initiated by such
person or any proceeding by such person against the corporation or its
directors, officers, employees or other agents unless (i) such indemnification
is expressly required to be made by law, (ii) the proceeding was authorized by
the board of directors of the corporation or (iii) such indemnification is
provided by the corporation, in its sole discretion, pursuant to the powers
vested in the corporation under the California General Corporation Law.
-20-
The corporation shall have power to indemnify its officers, employees and
other agents as set forth in the California General Corporation Law.
Promptly after receipt of a request for indemnification hereunder (and in
any event within 90 days thereof) a reasonable, good faith determination as to
whether indemnification of the director is proper under the circumstances
because each director has met the applicable standard of care shall be made by:
(i) a majority vote of a quorum consisting of directors who are not parties to
such proceeding; (ii) if such quorum is not obtainable, by independent legal
counsel in a written opinion; or (iii) approval or ratification by the
affirmative vote of a majority of the shares of this corporation represented and
voting at a duly held meeting at which a quorum is present (which shares voting
affirmatively also constitute at least a majority of the required quorum) or by
written consent of a majority of the outstanding shares entitled to vote; where
in each case the shares owned by the person to be indemnified shall not be
considered entitled to vote thereon.
For purposes of any determination under this bylaw, a director shall be
deemed to have acted in good faith and in a manner he reasonably believed to be
in the best interests of the corporation and its stockholders, and, with respect
to any criminal action or proceeding, to have had no reasonable cause to believe
that his conduct was unlawful, if his action is based on information, opinions,
reports and statements, including financial statements and other financial data,
in each case prepared or presented by: (i) one or more officers or employees of
the corporation whom the director believed to be reliable and competent in the
matters presented; (ii) counsel, independent accountants or other persons as to
matters which the director believed to be within such person's professional
competence; and (iii) a committee of the Board upon which such director does not
serve, as to matters within such committee's
-21-
designated authority, which committee the director believes to merit confidence;
so long as, in each case, the director acts without knowledge that would cause
such reliance to be unwarranted.
The termination of any proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in the best interests of the
corporation and its stockholders or that he had reasonable cause to believe that
his conduct was unlawful.
The provisions of the preceding two paragraphs shall not be deemed to be
exclusive or to limit in any way the circumstances in which a person may be
deemed to have met the applicable standard of conduct set forth by the
California General Corporation Law.
The corporation shall advance, prior to the final disposition of any
proceeding, promptly following request therefor, all expenses incurred by any
director in connection with such proceeding upon receipt of an undertaking by or
on behalf of such person to repay said amounts if it shall be determined
ultimately that such person is not entitled to be indemnified under this bylaw
or otherwise.
Without the necessity of entering into an express contract, all rights to
indemnification and advances to directors under this bylaw shall be deemed to be
contractual rights and be effective to the same extent and as if provided for in
a contract between the corporation and the director. Any right to
indemnification or advances granted by this bylaw to a director shall be
enforceable by or on behalf of the person holding such right in the forum in
which the proceeding is or was pending or, if such forum is not available or a
determination is made that such forum is not convenient, in any court of
competent jurisdiction if (i) the claim for
-22-
indemnification or advances is denied, in whole or in part, or (ii) no
disposition of such claim is made within ninety (90) days of request therefor.
The claimant in such enforcement action, if successful in whole or in part,
shall be entitled to be paid also the expense of prosecuting his claim. The
corporation shall be entitled to raise as a defense to any such action (other
than an action brought to enforce a claim for expenses incurred in connection
with any proceeding in advance of its final disposition when the required
undertaking has been tendered to the corporation) that the claimant has not met
the standards of conduct that make it permissible under the California General
Corporation Law for the corporation to indemnify the claimant for the amount
claimed. Neither the failure of the corporation (including its board of
directors, independent legal counsel or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the claimant is proper in the circumstances because he has met the applicable
standard of conduct set forth in the California General Corporation Law, nor an
actual determination by the corporation (including its board of directors,
independent legal counsel or its stockholders) that the claimant has not met
such applicable standard of conduct, shall be a defense to the action or create
a presumption that the claimant has not met the applicable standard of conduct.
To the fullest extent permitted by the corporation's Certificate of
Incorporation and the California General Corporation Law, the rights conferred
on any person by this bylaw shall not be exclusive of any other right which such
person may have or hereafter acquire under any statute, provision of the
Certificate of Incorporation, bylaws, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in his official capacity
and as to action in another capacity while holding office. The corporation is
specifically authorized to enter into individual contracts with any or all of
its directors, officers,
-23-
employees or agents respecting indemnification and advances, to the fullest
extent permitted by the California General Corporation Law and the corporation's
Certificate of Incorporation.
The rights conferred on any person by this bylaw shall continue as to a
person who has ceased to be a director and shall inure to the benefit of the
heirs, executors and administrators of such a person.
The corporation, upon approval by the board of directors, may purchase
insurance on behalf of any person required or permitted to be indemnified
pursuant to this bylaw. The corporation's obligation to provide indemnification
under this Section 7 shall be offset to the extent of any other source of
indemnification or any otherwise applicable insurance coverage under a policy
maintained by the corporation or any other person.
Any repeal or modification of this bylaw shall only be prospective and
shall not affect the rights under this bylaw in effect at the time of the
alleged occurrence of any action or omission to act that is the cause of any
proceeding against any agent of the corporation.
The corporation shall indemnify the directors and officers of the
corporation who serve at the request of the corporation as trustees, investment
managers or other fiduciaries of employee benefit plans to the fullest extent
permitted by the California General Corporation Law.
If this bylaw or any portion hereof shall be invalidated on any ground by
any court of competent jurisdiction, then the corporation shall nevertheless
indemnify each director to the fullest extent permitted by any applicable
portion of this bylaw that shall not have been invalidated, or by any other
applicable law.
For the purposes of this bylaw, the following definitions shall apply:
-24-
(i) The term "proceeding" shall be broadly construed and shall
include, without limitation, the investigation, preparation, prosecution,
defense, settlement and appeal of any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative, arbitrative or
investigative.
(ii) The term "expenses" shall be broadly construed and shall
include, without limitation, court costs, attorneys' fees, witness fees, fines,
amounts paid in settlement or judgment and any other costs and expenses of any
nature or kind incurred in connection with any proceeding, including expenses of
establishing a right to indemnification under this bylaw or any applicable law.
(iii) The term the "corporation" shall include, in addition to the
resulting corporation, any constituent corporation (including any constituent of
a constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers, and employees or agents, so that any person who is or was a
director, officer, employee or agent of such constituent corporation, or is or
was serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, shall stand in the same position under the provisions
of this bylaw with respect to the resulting or surviving corporation as he would
have with respect to such constituent corporation if its separate existence had
continued.
(iv) References to a "director," "officer," "employee," or "agent"
of the corporation shall include, without limitation, situations where such
person is serving at the request of the corporation as a director, officer,
employee, trustee or agent of another corporation, partnership, joint venture,
trust or other enterprise.
-25-
Section 8. In the event of any inconsistency between Section 6 and
Section 7 of this Article VII, the controlling Section as to any particular
issue with regard to any particular matter, shall be the one which authorizes
for the benefit of the agent or the other person in question the provision of
the fullest, promptest, most certain or otherwise most favorable indemnification
and/or advancement.
VIII.
AMENDMENT
Section 1. These bylaws may be altered, amended or repealed or new
bylaws may be adopted by the stockholders or by the Board of Directors, when
such power is conferred upon the Board of Directors by the certificate of
incorporation at any regular meeting of the stockholders or of the Board of
Directors or at any special meeting of the stockholders 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. If the power to
adopt, amend or repeal bylaws is conferred upon the Board of Directors by the
certificate of incorporation it shall not divest or limit the power of the
stockholders to adopt, amend or repeal bylaws.
7 [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
-26-
CERTIFICATE OF SECRETARY
AMENDMENT TO BYLAWS
OF XXXXXX DEVELOPMENT CORPORATION
The undersigned hereby certifies that:
I am the duly qualified and acting Secretary of Xxxxxx Development
Corporation, a duly organized and existing Delaware corporation.
The following is a true copy of a resolution duly adopted by the written
consent of the stockholders of the Corporation on December 19, 1997, which
appears in the minute book of the Corporation:
NOW, THEREFORE, BE IT RESOLVED, that Article III, Section 1, of the
Corporation's Bylaws is hereby amended in its entirety to read as follows:
"Section 1. The number of directors which shall constitute the whole
board shall be three (3). The directors shall be elected at the annual
meeting of the stockholders, except as provided in Section 2 of this
Article, and each director elected shall hold office until his or her
successor is elected and qualified. Directors need not be stockholders."
The foregoing resolution is in conformity with the Restated Certificate of
Incorporation and Bylaws of the Corporation, has never been modified or
repealed, and is now in full force and effect.
IN WITNESS WHEREOF, I have executed this Certificate of Secretary and
affixed the seal of the Corporation on December 19, 1997.
/s/ Xxxxxxxx X. Xxxxxxxx
---------------------------------
Xxxxxxxx X. Xxxxxxxx, Secretary
