SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported):
February 15, 2006
ASHLIN DEVELOPMENT CORPORATION
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(Exact Name of Registrant as Specified in its Charter)
Florida 000-29245 65-0452156
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State of Commission IRS Employer
Incorporation File Number I.D. Number
1479 North Clinton Avenue, Bay Shore, NY 11706
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Address of principal executive offices
Registrant's telephone number: (631) 968-5000
___________________________
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 3.03 MATERIAL MODIFICATION TO RIGHTS OF SECURITY HOLDERS
On February 15, 2006, Ashlin Development Corporation ("we" or the
"Company"), changed its name to Gales Industries Incorporated and changed its
legal domicile from Florida to Delaware. As a result, the rights of our
shareholders are now governed by Delaware law rather than Florida law. We filed
with the Commission on January 24, 2006 a definitive Information Statement on
Schedule 14C relating to the changes in our name and our jurisdiction of
incorporation. Such information statement describes certain effects on our
shareholders of our becoming a Delaware corporation. Our new certificate of
incorporation and by-laws are filed as exhibits to this report.
In addition, effective February 15, 2006, our trading symbol on the OTC
Bulletin Board was changed to "GLDS".
Item 5.03. AMENDMENT TO ARTICLES OF INCORPORATION OR BYLAWS
On February 15, 2006, we changed our name from Ashlin Development
Corporation to Gales Industries Incorporated, and changed our jurisdiction of
incorporation from Florida to Delaware, by merging our Company as of such date
into our new wholly-owned Delaware subsidiary called Gales Industries
Incorporated. Our Board of Directors and shareholders approved such changes. Our
shareholders may continue to make sales or transfers using stock certificates
which have our old name imprinted on them. Our new certificate of incorporation
and by-laws are filed as exhibits to this report.
Item 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
Exhibit No.
3.1 Certificate of Incorporation of Gales Industries Incorporated,
a Delaware corporation.
3.2 By-Laws of Gales Industries Incorporated
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Current Report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: February 15, 2006
ASHLIN DEVELOPMENT CORPORATION
By: /s/ Michael A. Gales
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Michael A. Gales, Executive Chairman
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EXHIBIT 3.1
CERTIFICATE OF INCORPORATION
OF
GALES INDUSTRIES INCORPORATED
FIRST: The name of the Corporation is Gales Industries Incorporated.
SECOND: The address of the corporation's registered office in the State of
Delaware is 2711 Centerville Road, Suite 400, in the City of Wilmington, County
of New Castle, Zip Code 19808. The name of its registered agent at such address
is Corporation Service Company.
THIRD: The nature of the business or purposes to be conducted or promoted
by the Corporation is to engage in any lawful act or activity for which
corporations may be organized under the General Corporation Law of the State of
Delaware.
FOURTH: The total number of shares of each class that the corporation
shall have the authority to issue is 128,059,462 shares, consisting of:
(a) 120,055,746 shares of common shares (the "Common Shares"), par value
$.001 per share;
(b) 8,003,716 shares of preferred shares (the "Preferred Shares"), par
value $.001 per share.
The designations, powers, preferences and relative participating, optional
or other special rights, and the qualifications, limitations, and restrictions
thereof in respect of the Common Shares and Preferred Shares, are as follows:
A. COMMON SHARES
1. Voting. Except as otherwise expressly provided by law, and
subject to the voting rights provided to the holders of Preferred Shares by this
Certificate of Incorporation, as such Certificate may be further amended, the
Common Shares shall have exclusive voting rights on all matters requiring a vote
of shareholders.
2. Other Rights. Each share of Common Shares issued and outstanding
shall be identical in all respects one with the other, and no dividends shall be
paid on any shares of Common Shares unless the same is paid on any shares of
Common Shares outstanding at the time of such payment. Except for and subject to
those rights expressly granted to the holders of the Preferred Shares, or except
as may be provided by the laws of the State of Delaware, the holders of Common
Shares shall have exclusively all other rights of shareholders.
B. PREFERRED SHARES
1. Issuance. The Preferred Shares may be issued from time to time in
one or more series. Subject to the limitations set forth herein and any
limitations prescribed by law, the Board of Directors is expressly authorized,
prior to issuance of any series of Preferred Shares, to fix by resolution or
resolutions providing for the issue of any series the number of shares included
in such series and the designations, relative powers, preferences and rights,
and the qualifications, limitations or restrictions of such series. Pursuant to
the foregoing general authority vested in the Board of Directors, but not in
limitation of the powers conferred on the Board of Directors thereby and by the
Delaware General Corporation Law, the Board of Directors is expressly authorized
to determine with respect to each series of Preferred Shares:
(a) voting rights, if any, which may include the right to vote
together as a single class with the Common Shares and any other series of the
blank check preferred shares with the number of votes per share accorded to
shares of such series being the same as or different from that accorded to such
other shares,
(b) the dividend rate per annum, if any, and the terms and
conditions pertaining to dividends and whether such dividends shall be
cumulative,
(c) the amount or amounts payable upon such voluntary or
involuntary liquidation,
(d) the redemption price or prices, if any, and the terms and
conditions of the redemption,
(e) sinking fund provisions, if any for the redemption or
purchase of such shares,
(f) the terms and conditions on which such shares are
convertible, in the event the shares are to have conversion rights, and
(g) any other rights, preferences and limitations pertaining
to such series which may be fixed by the Board of Directors pursuant to the
Delaware General Corporation Law.
C. SERIES A CONVERTIBLE PREFERRED SHARES
1. Number of Shares. The series of Preferred Shares designated and
known as "Series A Convertible Preferred Shares" shall consist of 1,000 shares.
2. Voting. Commencing on the 181st day following December 15, 2005,
the Series A Convertible Preferred Shares shall vote together with all other
classes and series of stock of the Corporation as a single class on all actions
to be taken by the stockholders of the Corporation (such date as of which the
Series A Convertible Preferred Shares shall commence voting being referred to
herein as the "Vote Commencement Date"); provided, however, that, in the event
the Corporation defaults in its obligation to file the Registration Statement
(defined in subparagraph 3(b)) by the 45th day following December 15, 2005, then
the Vote Commencement Date will be the date on which such default first occurs
and such voting rights of the Series A Convertible Preferred Shares will
continue until such default is cured. Commencing on the Vote Commencement Date,
each share of Series A Convertible Preferred Shares shall entitle the holder
thereof to such number of votes per share on each such action as shall equal the
number of shares of Common Shares (including fractions of a share) into which
each share of Series A Convertible Preferred Shares is then convertible.
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3. Dividends.
(a) Dividends Payable in Kind. The holders of record of the
Series A Convertible Preferred Shares shall be entitled to receive quarterly
dividends, payable in shares of Series A Convertible Preferred Shares, at the
rate of 8% per annum; provided, however, that dividends will not accrue on
shares of Series A Convertible Preferred Shares which are issued as a dividend.
Dividends with respect to each share of Series A Convertible Preferred Shares
will be credited in arrears as of the last day of each calendar quarter
(December 31, March 31, June 30 and September 30) beginning with the last day of
the calendar quarter in which such share is issued by the Corporation.
Fractional shares of Series A Convertible Preferred Shares may be issued as a
dividend on the Series A Convertible Preferred Shares. Each share of Series A
Convertible Preferred Shares (other than shares of Series A Convertible
Preferred Shares which are issued as a dividend) will be entitled to receive as
a dividend .08 shares of Series A Convertible Preferred Shares per year, or .02
shares of Series A Convertible Preferred Shares per quarter. Dividends will no
longer accrue on shares of Series A Convertible Preferred Shares if such shares
are converted into shares of Common Shares or on the effective date of a
mandatory conversion, as provided in subparagraph 6(a)(ii) below.
(b) Dividends Payable in Cash. If a registration statement
("Registration Statement") for the resale by the holders of the Series A
Convertible Preferred Shares of the Common Shares into which the Series A
Convertible Preferred Shares may be converted is not (i) filed with the
Securities and Exchange Commission ("SEC") under the Securities Act of 1933 (the
"Securities Act") within 45 days after December 15, 2005 or (ii) declared
effective within 180 days of December 15, 2005 (either case being referred to
herein as a "Registration Default"), the dividend on the Series A Convertible
Preferred Shares will be payable in cash, rather than in shares, from the date
of such Registration Default until such Registration Default is cured, at the
same rate as set forth in subparagraph 3(a). For such purpose, each share of
Series A Convertible Preferred Shares shall have a stated value of $10,000.00
per share ("Stated Value") and cash dividends will accrue at the rate of $80.00
per year on each share of Series A Convertible Preferred Shares. Such cash
dividends will be paid (or accrued if the Corporation is unable to pay dividends
or no funds are legally available to pay dividends) until the Series A
Convertible Preferred Shares are converted into shares of Common Shares or on
the effective date of a mandatory conversion, as provided in subparagraph
6(a)(ii) below.
4. Liquidation. Upon any liquidation, dissolution or winding up of
the Corporation, whether voluntary or involuntary, the holders of the shares of
Series A Convertible Preferred Shares shall be entitled, before any distribution
or payment is made upon any stock ranking on liquidation junior to the Series A
Convertible Preferred Shares, to be paid an amount equal to the greater of (i)
$20,000.00 per share (two times the Stated Value), after taking into account all
payment-in-kind dividends accrued thereon, computed to the date payment thereof
is made available, or (ii) such amount per share as would have been payable had
each such share been converted to Common Shares pursuant to subparagraph 6
immediately prior to such liquidation, dissolution or winding up, and the
holders of Series A Convertible Preferred Shares shall not be entitled to any
further payment, such amount payable with respect to one share of Series A
Convertible Preferred Shares being sometimes referred to as the "Liquidation
Preference Payment" and with respect to all shares of Series A Convertible
Preferred Shares being sometimes referred to as the "Liquidation Preference
Payments." If upon such liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, the assets to be distributed
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among the holders of Series A Convertible Preferred Shares shall be insufficient
to permit payment to the holders of Series A Convertible Preferred Shares of the
amount distributable as aforesaid, then the entire assets of the Corporation to
be so distributed shall be distributed ratably among the holders of Series A
Convertible Preferred Shares. Upon any such liquidation, dissolution or winding
up of the Corporation, after the holders of Series A Convertible Preferred
Shares shall have been paid in full the amounts to which they shall be entitled,
the remaining net assets of the Corporation may be distributed to the holders of
stock ranking on liquidation junior to the Series A Convertible Preferred
Shares. Written notice of such liquidation, dissolution or winding up, stating a
payment date, the amount of the Liquidation Preference Payments and the place
where said Liquidation Preference Payments shall be payable, shall be delivered
in person, mailed by certified or registered mail, return receipt requested, or
sent by telecopier or telex, not less than 20 days prior to the payment date
stated therein, to the holders of record of Series A Convertible Preferred
Shares, such notice to be addressed to each such holder at its address as shown
by the records of the Corporation. For purposes hereof, the Common Shares shall
rank on liquidation junior to the Series A Convertible Preferred Shares.
5. Restrictions. For so long as at least 25% of the shares of Series
A Convertible Preferred Shares are outstanding, except where the vote or written
consent of the holders of a greater number of shares of the Corporation is
required by law or by the Certificate of Incorporation, and in addition to any
other vote required by law or the Certificate of Incorporation, without the
prior approval of the holders of at least a majority of the then outstanding
shares of Series A Convertible Preferred Shares, given in writing or by vote at
a meeting, consenting or voting (as the case may be) separately as a series, the
Corporation will not:
(a) Create or authorize the creation of any additional class
or series of shares of stock unless the same ranks junior to the Series A
Convertible Preferred Shares as to (i) the distribution of assets on the
liquidation, dissolution or winding up of the Corporation or (ii) the right to
receive dividends;
(b) Amend, alter or repeal its Certificate of Incorporation or
By-Laws in a manner that would adversely affect the rights of the holders of the
Series A Convertible Preferred Shares;
(c) Redeem any shares of the Series A Convertible Preferred
Shares or Common Shares; or
(d) Purchase or set aside any sums for the purchase of, or pay
any dividend or make any distribution on, any shares of stock junior to or pari
passu with the Series A Convertible Preferred Shares, except for dividends or
other distributions payable on the Common Shares solely in the form of
additional shares of Common Shares and except for the purchase of shares of
Common Shares from former employees of the Corporation who acquired such shares
directly from the Corporation, which purchases are authorized by the Board of
Directors.
6. Conversions. The holders of shares of Series A Convertible
Preferred Shares shall have the following conversion rights:
(a) Right to Convert.
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(i) Subject to the terms and conditions of this
subparagraph 6, the holder of any share or shares of Series A Convertible
Preferred Shares shall have the right, at its option at any time, to convert any
such shares of Series A Convertible Preferred Shares (including shares of Series
A Convertible Preferred Shares accrued as dividends; except that upon any
liquidation of the Corporation the right of conversion shall terminate at the
close of business on the business day fixed for payment of the amount
distributable on the Series A Convertible Preferred Shares) into such number of
fully paid and nonassessable shares of Common Shares as is obtained by (i)
multiplying the number of shares of Series A Convertible Preferred Shares so to
be converted by $10,000.00 (the Stated Value of each share of Series A
Convertible Preferred Shares) and (ii) dividing the result by the conversion
price of $.22 per share or, in case an adjustment of such price has taken place
pursuant to the further provisions of this subparagraph 6, then by the
conversion price as last adjusted and in effect at the date any share or shares
of Series A Convertible Preferred Shares are surrendered for conversion (such
price, or such price as last adjusted, being referred to as the "Conversion
Price"). Such rights of conversion shall be exercised by the holder thereof by
giving written notice that the holder elects to convert a stated number of
shares of Series A Convertible Preferred Shares into Common Shares and by
surrender of a certificate or certificates for the shares so to be converted to
the Corporation at its principal office (or such other office or agency of the
Corporation as the Corporation may designate by notice in writing to the holders
of the Series A Convertible Preferred Shares) at any time during its usual
business hours on the date set forth in such notice, together with a statement
of the name or names (with address) in which the certificate or certificates for
shares of Common Shares shall be issued.
(ii) Automatic Conversion. Each outstanding share of
Series A Convertible Preferred Shares, including shares of Series A Convertible
Preferred Shares accrued as dividends, shall automatically be converted into
Common Shares, at the Conversion Price at the time in effect for such share,
immediately as of the date that a Registration Statement is declared effective
by the SEC under the Securities Act. Holders of shares of Series A Convertible
Preferred Shares so converted may deliver to the Corporation at its principal
office (or such other office or agency of the Corporation as the Corporation may
designate by notice in writing to such holders) during its usual business hours,
the certificate or certificates for the shares so converted. As promptly as
practicable thereafter, the Corporation shall issue and deliver to such holder a
certificate or certificates for the number of whole shares of Common Shares to
which such holder is entitled, together with any cash payment in lieu of
fractional shares to which such holder may be entitled pursuant to subparagraph
6(c). Until such time as a holder of shares of Series A Convertible Preferred
Shares shall surrender his or its certificates therefor as provided above, such
certificates shall be deemed to represent the shares of Common Shares to which
such holder shall be entitled upon the surrender thereof.
(b) Issuance of Certificates; Time Conversion Effected. In the
case of conversions made pursuant to subparagraph 6(a)(i), promptly after the
receipt of the written notice referred to in subparagraph 6(a)(i) and surrender
of the certificate or certificates for the share or shares of Series A
Convertible Preferred Shares to be converted (if such certificates have been
issued), the Corporation shall issue and deliver, or cause to be issued and
delivered, to the holder, registered in such name or names as such holder may
direct, a certificate or certificates for the number of whole shares of Common
Shares issuable upon the conversion of such share or shares of Series A
Convertible Preferred Shares. To the extent permitted by law, such conversion
shall be deemed to have been effected and the Conversion Price shall be
determined as of the close of business on the date on which such written notice
shall have been received by the Corporation and the certificate or certificates
for such share or shares (except where no certificate has been issued) shall
have been surrendered as aforesaid, and at such time the rights of the holder of
such share or shares of Series A Convertible Preferred Shares shall cease, and
the person or persons in whose name or names any certificate or certificates for
shares of Common Shares shall be issuable upon such conversion shall be deemed
to have become the holder or holders of record of the shares represented
thereby.
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(c) Fractional Shares; Partial Conversion. No fractional
shares of Common Shares shall be issued upon conversion of Series A Convertible
Preferred Shares into Common Shares. In case the number of shares of Series A
Convertible Preferred Shares represented by the certificate or certificates
surrendered pursuant to subparagraph 6(a) exceeds the number of shares
converted, the Corporation shall, upon such conversion, execute and deliver to
the holder, at the expense of the Corporation, a new certificate or certificates
for the number of shares of Series A Convertible Preferred Shares represented by
the certificate or certificates surrendered which are not to be converted. If
any fractional share of Common Shares would, except for the provisions of the
first sentence of this subparagraph 6(a), be delivered upon such conversion, the
Corporation, in lieu of delivering such fractional share, shall pay to the
holder surrendering the Series A Convertible Preferred Shares for conversion an
amount in cash equal to the current market price of such fractional share as
determined in good faith by the Board of Directors of the Corporation.
(d) Adjustment of Price Upon Issuance of Common Shares. Except
as provided in subparagraph 6(e), if and whenever the Corporation shall issue or
sell, or is, in accordance with subparagraphs 6(d)(i) through 6(d)(vii), deemed
to have issued or sold, any shares of Common Shares for a consideration per
share less than the Conversion Price in effect immediately prior to the time of
such issue or sale, then, forthwith upon such issue or sale, the Conversion
Price shall be reduced to the price determined by dividing (i) an amount equal
to the sum of (a) the number of shares of Common Shares outstanding immediately
prior to such issue or sale multiplied by the then existing Conversion Price and
(b) the consideration, if any, received by the Corporation upon such issue or
sale, by (ii) the total number of shares of Common Shares outstanding
immediately after such issue or sale. The provisions of this paragraph 6(d) may
be waived in any instance, without a meeting, prospectively or retroactively, by
obtaining the written consent of the holders of a majority in interest of the
then outstanding shares of Series A Convertible Preferred Shares, taken
separately as a class.
For purposes of this subparagraph 6(d), the following subparagraphs
6(d)(i) through 6(d)(vii) shall also be applicable:
(i) Issuance of Rights or Options. In case at any time
the Corporation shall in any manner grant (whether directly or by assumption in
a merger or otherwise) any warrants or other rights to subscribe for or to
purchase, or any options for the purchase of, Common Shares or any stock or
security convertible into or exchangeable for Common Shares (such warrants,
rights or options being called "Options" and such convertible or exchangeable
stock or securities being called "Convertible Securities") whether or not such
Options or the right to convert or exchange any such Convertible Securities are
immediately exercisable, and the price per share for which Common Shares is
issuable upon the exercise of such Options or upon the conversion or exchange of
such Convertible Securities (determined by dividing (i) the total amount, if
any, received or receivable by the Corporation as consideration for the granting
of such Options, plus the minimum aggregate amount of additional consideration
payable to the Corporation upon the exercise of all such Options, plus, in the
case of such Options which relate to Convertible Securities, the minimum
aggregate amount of additional consideration, if any, payable upon the issue or
sale of such Convertible Securities and upon the conversion or exchange thereof,
by (ii) the total maximum number of shares of Common Shares issuable upon the
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exercise of such Options or upon the conversion or exchange of all such
Convertible Securities issuable upon the exercise of such Options) shall be less
than the Conversion Price in effect immediately prior to the time of the
granting of such Options, then the total maximum number of shares of Common
Shares issuable upon the exercise of such Options or upon conversion or exchange
of the total maximum amount of such Convertible Securities issuable upon the
exercise of such Options shall be deemed to have been issued for such price per
share as of the date of granting of such Options or the issuance of such
Convertible Securities and thereafter shall be deemed to be outstanding. Except
as otherwise provided in subparagraph 6(d)(iii), no adjustment of the Conversion
Price shall be made upon the actual issue of such Common Shares or of such
Convertible Securities upon exercise of such Options or upon the actual issue of
such Common Shares upon conversion or exchange of such Convertible Securities.
(ii) Issuance of Convertible Securities. In case the
Corporation shall in any manner issue (whether directly or by assumption in a
merger or otherwise) or sell any Convertible Securities, whether or not the
rights to exchange or convert any such Convertible Securities are immediately
exercisable, and the price per share for which Common Shares is issuable upon
such conversion or exchange (determined by dividing (i) the total amount
received or receivable by the Corporation as consideration for the issue or sale
of such Convertible Securities, plus the minimum aggregate amount of additional
consideration, if any, payable to the Corporation upon the conversion or
exchange thereof, by (ii) the total maximum number of shares of Common Shares
issuable upon the conversion or exchange of all such Convertible Securities)
shall be less than the Conversion Price in effect immediately prior to the time
of such issue or sale, then the total maximum number of shares of Common Shares
issuable upon conversion or exchange of all such Convertible Securities shall be
deemed to have been issued for such price per share as of the date of the issue
or sale of such Convertible Securities and thereafter shall be deemed to be
outstanding, provided that (a) except as otherwise provided in subparagraph
6(d)(iii), no adjustment of the Conversion Price shall be made upon the actual
issue of such Common Shares upon conversion or exchange of such Convertible
Securities and (b) if any such issue or sale of such Convertible Securities is
made upon exercise of any Options to purchase any such Convertible Securities
for which adjustments of the Conversion Price have been or are to be made
pursuant to other provisions of this subparagraph 6(d), no further adjustment of
the Conversion Price shall be made by reason of such issue or sale.
(iii) Change in Option Price or Conversion Rate. Upon
the happening of any of the following events, namely, if the purchase price
provided for in any Option referred to in subparagraph 6(d)(i), the additional
consideration, if any, payable upon the conversion or exchange of any
Convertible Securities referred to in subparagraph 6(d)(i) or 6(d)(ii), or the
rate at which Convertible Securities referred to in subparagraph 6(d)(i) or
6(d)(ii) are convertible into or exchangeable for Common Shares shall change at
any time (including, but not limited to, changes under or by reason of
provisions designed to protect against dilution), the Conversion Price in effect
at the time of such event shall forthwith be readjusted to the Conversion Price
which would have been in effect at such time had such Options or Convertible
Securities still outstanding provided for such changed purchase price,
additional consideration or conversion rate, as the case may be, at the time
initially granted, issued or sold, but only if as a result of such adjustment
the Conversion Price then in effect hereunder is thereby reduced; and on the
termination of any such Option or any such right to convert or exchange such
Convertible Securities, the Conversion Price then in effect hereunder shall
forthwith be increased to the Conversion Price which would have been in effect
at the time of such termination had such Option or Convertible Securities, to
the extent outstanding immediately prior to such termination, never been issued.
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(iv) Stock Dividends. In case the Corporation shall
declare a dividend or make any other distribution upon any stock of the
Corporation (other than the Common Shares) payable in Common Shares, Options or
Convertible Securities, then any Common Shares, Options or Convertible
Securities, as the case may be, issuable in payment of such dividend or
distribution shall be deemed to have been issued or sold without consideration.
(v) Consideration for Stock. In case any shares of
Common Shares, Options or Convertible Securities shall be issued or sold for
cash, the consideration received therefor shall be deemed to be the amount
received by the Corporation therefor, without deduction therefrom of any
expenses incurred or any underwriting commissions or concessions paid or allowed
by the Corporation in connection therewith. In case any shares of Common Shares,
Options or Convertible Securities shall be issued or sold for a consideration
other than cash, the amount of the consideration other than cash received by the
Corporation shall be deemed to be the fair value of such consideration as
determined in good faith by the Board of Directors of the Corporation, without
deduction of any expenses incurred or any underwriting commissions or
concessions paid or allowed by the Corporation in connection therewith. In case
any Options shall be issued in connection with the issue and sale of other
securities of the Corporation, together comprising one integral transaction in
which no specific consideration is allocated to such Options by the parties
thereto, such Options shall be deemed to have been issued for such consideration
as determined in good faith by the Board of Directors of the Corporation.
(vi) Record Date. In case the Corporation shall take a
record of the holders of its Common Shares for the purpose of entitling them (i)
to receive a dividend or other distribution payable in Common Shares, Options or
Convertible Securities or (ii) to subscribe for or purchase Common Shares,
Options or Convertible Securities, then such record date shall be deemed to be
the date of the issue or sale of the shares of Common Shares deemed to have been
issued or sold upon the declaration of such dividend or the making of such other
distribution or the date of the granting of such right of subscription or
purchase, as the case may be.
(vii) Treasury Shares. The number of shares of Common
Shares outstanding at any given time shall not include shares owned or held by
or for the account of the Corporation, and the disposition of any such shares
shall be considered an issue or sale of Common Shares for the purpose of this
subparagraph 6(d).
(e) Certain Issues of Common Shares Excepted. Anything herein
to the contrary notwithstanding, the Corporation shall not be required to make
any adjustment of the Conversion Price in the case of the issuance from and
after the date of filing of this Certificate of Incorporation of (i) any shares
or other securities in connection with any employee, management or director
stock option or incentive plans; (ii) any shares or other securities issued in
connection with any acquisition or merger transactions entered into by the
Corporation or its subsidiaries; (iii) any shares or other securities issued to
the placement agent in the Financing; and (iv) any shares of Common Shares
issuable upon conversion or exercise of the Series A Convertible Preferred
Shares or any other convertible or derivative security (the existence of which
was disclosed to the investors in the Financing) which the Corporation or Gales
Industries Incorporated will have outstanding as of the completion of the
Financing or had outstanding prior to the completion of the Financing.
(f) Subdivision or Combination of Common Shares. In case the
Corporation shall at any time subdivide (by any stock split, stock dividend or
otherwise) its outstanding shares of Common Shares into a greater number of
shares, the Conversion Price in effect immediately prior to such subdivision
shall be proportionately reduced, and, conversely, in case the outstanding
shares of Common Shares shall be combined into a smaller number of shares, the
Conversion Price in effect immediately prior to such combination shall be
proportionately increased.
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(g) Reorganization or Reclassification. If any capital
reorganization or reclassification of the capital stock of the Corporation shall
be effected in such a way that holders of Common Shares shall be entitled to
receive stock, securities or assets with respect to or in exchange for Common
Shares, then, as a condition of such reorganization or reclassification, lawful
and adequate provisions shall be made whereby each holder of a share or shares
of Series A Convertible Preferred Shares shall thereupon have the right to
receive, upon the basis and upon the terms and conditions specified herein and
in lieu of the shares of Common Shares immediately theretofore receivable upon
the conversion of such share or shares of Series A Convertible Preferred Shares,
such shares of stock, securities or assets as may be issued or payable with
respect to or in exchange for a number of outstanding shares of such Common
Shares equal to the number of shares of such Common Shares immediately
theretofore receivable upon such conversion had such reorganization or
reclassification not taken place, and in any such case appropriate provisions
shall be made with respect to the rights and interests of such holder to the end
that the provisions hereof (including without limitation provisions for
adjustments of the Conversion Price) shall thereafter be applicable, as nearly
as may be, in relation to any shares of stock, securities or assets thereafter
deliverable upon the exercise of such conversion rights.
(h) Notice of Adjustment. Upon any adjustment of the
Conversion Price, then and in each such case the Corporation shall give written
notice thereof, by delivery in person, certified or registered mail, return
receipt requested, telecopier or telex, addressed to each holder of shares of
Series A Convertible Preferred Shares at the address of such holder as shown on
the books of the Corporation, which notice shall state the Conversion Price
resulting from such adjustment, setting forth in reasonable detail the method
upon which such calculation is based.
(i) Other Notices. In case at any time and without limiting
the applicability of subparagraph 5:
(i) the Corporation shall declare any dividend upon its
Common Shares payable in cash or stock or make any other distribution to the
holders of its Common Shares;
(ii) the Corporation shall offer for subscription pro
rata to the holders of its Common Shares any additional shares of stock of any
class or other rights;
(iii) there shall be any capital reorganization or
reclassification of the capital stock of the Corporation, or a consolidation or
merger of the Corporation with or into another entity or entities, or a sale,
lease, abandonment, transfer or other disposition of all or substantially all
its assets; or
(iv) there shall be a voluntary or involuntary
dissolution, liquidation or winding up of the Corporation;
then, in any one or more of said cases, the Corporation shall give, by delivery
in person, certified or registered mail, return receipt requested, telecopier or
telex, addressed to each holder of any shares of Series A Convertible Preferred
9
Shares at the address of such holder as shown on the books of the Corporation,
(a) at least 20 days' prior written notice of the date on which the books of the
Corporation shall close or a record shall be taken for such dividend,
distribution or subscription rights or for determining rights to vote in respect
of any such reorganization, reclassification, consolidation, merger,
disposition, dissolution, liquidation or winding up and (b) in the case of any
such reorganization, reclassification, consolidation, merger, disposition,
dissolution, liquidation or winding up, at least 20 days' prior written notice
of the date when the same shall take place. Such notice in accordance with the
foregoing clause (a) shall also specify, in the case of any such dividend,
distribution or subscription rights, the date on which the holders of Common
Shares shall be entitled thereto and such notice in accordance with the
foregoing clause (b) shall also specify the date on which the holders of Common
Shares shall be entitled to exchange their Common Shares for securities or other
property deliverable upon such reorganization, reclassification, consolidation,
merger, disposition, dissolution, liquidation or winding up, as the case may be.
(j) Stock to be Reserved. The Corporation will at all times
reserve and keep available out of its authorized Common Shares, solely for the
purpose of issuance upon the conversion of Series A Convertible Preferred Shares
as herein provided, such number of shares of Common Shares as shall then be
issuable upon the conversion of all outstanding shares of Series A Convertible
Preferred Shares. The Corporation covenants that all shares of Common Shares
which shall be so issued shall be duly and validly issued and fully paid and
nonassessable and free from all taxes, liens and charges with respect to the
issue thereof, and, without limiting the generality of the foregoing, the
Corporation covenants that it will from time to time take all such action as may
be requisite to assure that the par value per share of the Common Shares is at
all times equal to or less than the Conversion Price in effect at the time. The
Corporation will take all such action as may be necessary to assure that all
such shares of Common Shares may be so issued without violation of any
applicable law or regulation, or of any requirement of any national securities
exchange upon which the Common Shares may be listed. The Corporation will not
take any action which results in any adjustment of the Conversion Price if the
total number of shares of Common Shares issued and issuable after such action
upon conversion of the Series A Convertible Preferred Shares would exceed the
total number of shares of Common Shares then authorized by the Certificate of
Incorporation; provided, however, that the Corporation will use its reasonable
best efforts to increase its authorized Common Shares so that such adjustment
can be made as promptly as practicable.
(k) No Reissuance of Series A Convertible Preferred Shares.
Shares of Series A Convertible Preferred Shares which are converted into shares
of Common Shares as provided herein shall not be reissued.
(l) Issue Tax. The issuance of certificates for shares of
Common Shares upon conversion of Series A Convertible Preferred Shares shall be
made without charge to the holders thereof for any issuance tax in respect
thereof, provided that the Corporation shall not be required to pay any tax
which may be payable in respect of any transfer involved in the issuance and
delivery of any certificate in a name other than that of the holder of the
Series A Convertible Preferred Shares which is being converted.
(m) Closing of Books. The Corporation will at no time close
its transfer books against the transfer of any Series A Convertible Preferred
Shares or of any shares of Common Shares issued or issuable upon the conversion
of any shares of Series A Convertible Preferred Shares in any manner which
interferes with the timely conversion of such Series A Convertible Preferred
Shares, except as may otherwise be required to comply with applicable securities
laws.
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(n) Definition of Common Shares. As used in subparagraph 6,
the term "Common Shares" shall mean and include the Corporation's authorized
Common Shares, as constituted on the date of filing of these terms of the Series
A Convertible Preferred Shares, and shall also include any capital stock of any
class of the Corporation thereafter authorized which shall not be limited to a
fixed sum or percentage in respect of the rights of the holders thereof to
participate in dividends or in the distribution of assets upon the voluntary or
involuntary liquidation, dissolution or winding up of the Corporation; provided
that the shares of Common Shares receivable upon conversion of shares of Series
A Convertible Preferred Shares shall include only shares designated as Common
Shares of the Corporation on the date of filing of this instrument, or in case
of any reorganization or reclassification of the outstanding shares thereof, the
stock, securities or assets provided for in subparagraph 6(g).
7. Amendments. No provision of these terms of the Series A
Convertible Preferred Shares may be amended (whether by merger, consolidation or
otherwise), modified or waived without the written consent or affirmative vote
of the holders of at least two-thirds of the then outstanding shares of Series A
Convertible Preferred Shares.
FIFTH: The name and mailing address of the incorporator is Michael A.
Gales, 1479 North Clinton Avenue, Bay Shore, NY 11706.
SIXTH: Unless otherwise provided for in the corporation's bylaws, a
majority of the shares entitled to vote, represented in person or by proxy,
shall be required to constitute a quorum at a meeting of shareholders.
SEVENTH: This Corporation shall have at least one director. The number of
directors may be either increased or decreased from time to time in the manner
provided in the Bylaws, but shall be never less than one.
EIGHTH: The Corporation is to have perpetual existence.
NINTH: The Corporation reserves the right to amend, alter, change or
repeal any provision contained in this Certificate of Incorporation in the
manner now or hereinafter prescribed herein and by the laws of the State of
Delaware, and all rights conferred upon stockholders herein are granted subject
to this reservation.
TENTH: (a) Limitation of Liability.
(i) To the fullest extent permitted by the Delaware
General Corporation Law as it now exists or may hereafter be amended (but, in
the case of any such amendment, only to the extent that such amendment permits
the Corporation to provide broader indemnification rights than permitted prior
thereto), and except as otherwise provided in the Corporation's By-laws, no
Director of the Corporation shall be liable to the Corporation or its
stockholders for monetary damages arising from a breach of fiduciary duty owed
to the Corporation or its stockholders.
(ii) Any repeal or modification of the foregoing
paragraph by the stockholders of the Corporation shall not adversely affect any
right or protection of a Director of the Corporation existing at the time of
such repeal or modification.
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(b) Right to Indemnification. Each person who was or is made a
party or is threatened to be made a party to or is otherwise involved (including
involvement as a witness) in any action, suit or proceeding, whether civil,
criminal, administrative or investigative (a "proceeding"), by reason of the
fact that he or she is or was a Director or officer of the Corporation or, while
a Director or officer of the Corporation, is or was serving at the request of
the Corporation as a Director, officer, employee or agent of another corporation
or of a partnership, joint venture, trust or other enterprise, including service
with respect to an employee benefit plan (an "indemnitee"), whether the basis of
such proceeding is alleged action in an official capacity as a Director or
officer or in any other capacity while serving as a Director or officer, shall
be indemnified and held harmless by the Corporation to the fullest extent
authorized by the Delaware General Corporation Law, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the extent
that such amendment permits the Corporation to provide broader indemnification
rights than permitted prior thereto), against all expense, liability and loss
(including attorneys' fees, judgments, fines, excise taxes or penalties and
amounts paid in settlement) reasonably incurred or suffered by such indemnitee
in connection therewith and such indemnification shall continue as to an
Indemnitee who has ceased to be a Director, officer, employee or agent and shall
inure to the benefit of the indemnitee's heirs, executors and administrators;
provided, however, that, except as provided in Section (c) of this ARTICLE TENTH
with respect to proceedings to enforce rights to indemnification, the
Corporation shall indemnify any such Indemnitee in connection with a proceeding
(or part thereof) initiated by such indemnitee only if such proceeding (or part
thereof) was authorized by the Board of Directors of the Corporation. The right
to indemnification conferred in this Section (b) of this ARTICLE TENTH shall be
a contract right and shall include the obligation of the Corporation to pay the
expenses incurred in defending any such proceeding in advance of its final
disposition (an "advance of expenses"); provided, however, that, if and to the
extent that the Delaware General Corporation Law requires, an advance of
expenses incurred by an indemnitee in his or her capacity as a Director or
officer (and not in any other capacity in which service was or is rendered by
such indemnitee, including, without limitation, service to an employee benefit
plan) shall be made only upon delivery to the Corporation of an undertaking (an
"undertaking"), by or on behalf of such indemnitee, to repay all amounts so
advanced if it shall ultimately be determined by final judicial decision from
which there is no further right to appeal (a "final adjudication") that such
indemnitee is not entitled to be indemnified for such expenses under this
Section (b) or otherwise. The Corporation may, by action of its Board of
Directors, provide indemnification to employees and agents of the Corporation
with the same or lesser scope and effect as the foregoing indemnification of
Directors and officers.
(c) Procedure for Indemnification. Any indemnification of a
Director or officer of the Corporation or advance of expenses under Section (b)
of this ARTICLE TENTH shall be made promptly, and in any event within forty-five
(45) days (or, in the case of an advance of expenses, twenty (20) days), upon
the written request of the Director or officer. If a determination by the
Corporation that the Director or officer is entitled to indemnification pursuant
to this ARTICLE TENTH is required, and the Corporation fails to respond within
sixty (60) days to a written request for indemnity, the Corporation shall be
deemed to have approved the request. If the Corporation denies a written request
for indemnification or advance of expenses, in whole or in part, or if payment
in full pursuant to such request is not made within forty-five (45) days (or, in
the case of an advance of expenses, twenty (20) days), the right to
indemnification or advances as granted by this ARTICLE TENTH shall be
enforceable by the Director or officer in any court of competent jurisdiction.
Such person's costs and expenses incurred in connection with successfully
establishing his or her right to indemnification, in whole or in part, in any
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such action shall also be indemnified by the Corporation. It shall be a defense
to any such action (other than an action brought to enforce a claim for the
advance of expenses where the undertaking required pursuant to Section (b) of
this ARTICLE TENTH, if any, has been tendered to the Corporation) that the
claimant has not met the standards of conduct which make it permissible under
the Delaware General Corporation Law for the Corporation to indemnify the
claimant for the amount claimed, but the burden of such defense shall be on the
Corporation. Neither the failure of the Corporation (including its Board of
Directors, independent legal counsel or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the claimant is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in the Delaware 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. The procedure for indemnification of other employees and agents for
whom indemnification is provided pursuant to Section (b) of this ARTICLE TENTH
shall be the same procedure set forth in this Section (c) for Directors or
officers, unless otherwise set forth in the action of the Board of Directors
providing indemnification for such employee or agent.
(d) Insurance. The Corporation may purchase and maintain
insurance on its own behalf and on behalf of any person who is or was a
Director, officer, employee or agent of the Corporation or was serving at the
request of the Corporation as a Director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against any
expense, liability or loss asserted against him or her and incurred by him or
her in any such capacity, whether or not the Corporation would have the power to
indemnify such person against such expense, liability or loss under the Delaware
General Corporation Law.
(e) Service for Subsidiaries. Any person serving as a
Director, officer, employee or agent of another corporation, partnership,
limited liability company, joint venture or other enterprise, at least 50% of
whose equity interests are owned by the Corporation (a "subsidiary" for this
ARTICLE TENTH) shall be conclusively presumed to be serving in such capacity at
the request of the Corporation.
(f) Reliance. Persons who after the date of the adoption of
this provision become or remain Directors or officers of the Corporation or who,
while a Director or officer of the Corporation, become or remain a Director,
officer, employee or agent of a subsidiary, shall be conclusively presumed to
have relied on the rights to indemnity, advance of expenses and other rights
contained in this ARTICLE TENTH in entering into or continuing such service. The
rights to indemnification and to the advance of expenses conferred in this
ARTICLE TENTH shall apply to claims made against an indemnitee arising out of
acts or omissions which occurred or occur both prior and subsequent to the
adoption hereof.
(g) Non-Exclusivity of Rights. The rights to indemnification
and to the advance of expenses conferred in this ARTICLE TENTH shall not be
exclusive of any other right which any person may have or hereafter acquire
under this Certificate or under any statute, by-law, agreement, vote of
stockholders or disinterested Directors or otherwise.
(h) Merger or Consolidation. For purposes of this ARTICLE
TENTH, references to 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 this ARTICLE
TENTH with respect to the resulting or surviving Corporation as he or she would
have with respect to such constituent Corporation if its separate existence had
continued.
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ELEVENTH: Whenever a compromise or arrangement is proposed between this
Corporation and its creditors or any class of them and/or between this
Corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware, may, on the application in a summary
way of this Corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for this Corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or receivers appointed
for the Corporation under the provisions of Section 279 of Title 8 of the
Delaware Code, order a meeting of the creditors or class of creditors, and/or of
the stockholders or class of stockholders of this Corporation, as the case may
be, to be summoned in such manner as the said court directs. If a majority in
number representing three fourths in value of the creditors or class of
creditors, and/or of the stockholders or class of stockholders of this
Corporation, as the case may be, agree to any compromise or arrangement and to
any reorganization of this Corporation as a consequence of such compromise or
arrangement, the said compromise or arrangement and the said reorganization
shall, if sanctioned by the court to which the said application has been made,
be binding on all the creditors or class of creditors, and/or on all the
stockholders or class of stockholders, of this Corporation, as the case may be,
and also on this Corporation.
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IN WITNESS WHEREOF, the undersigned, being the incorporator herein named, for
the purpose of forming a corporation pursuant to the General Corporation Law of
the State of Delaware, does make this Certificate, hereby declaring and
certifying that this is his act and deed and the facts herein stated are true,
and accordingly has hereunto set his hand this13th day of January 2006.
/s/ Michael A. Gales
------------------------------
Michael A. Gales, Incorporator
15
EXHIBIT 3.2
BYLAWS
OF
GALES INDUSTRIES INCORPORATED
(a Delaware corporation)
ARTICLE I
OFFICES
SECTION 1.01. Registered Office. The registered office of Gales Industries
Incorporated (the "Corporation") in the State of Delaware shall be located at
2711 Centerville Road, Suite 400, in the City of Wilmington, County of New
Castle, Delaware 19805. The name of the Corporation's registered agent at such
address shall be Corporation Service Company. The registered office and/or
registered agent of the Corporation may be changed from time to time by action
of the Board of Directors.
SECTION 1.02. Other Offices. The Corporation may also have an office or
offices at such other place or places either within or without the State of
Delaware as the Board of Directors may from time to time determine or the
business of the Corporation may require.
ARTICLE II
MEETINGS OF SHAREHOLDERS
SECTION 2.01. Place of Meetings. All meetings of the shareholders of the
Corporation shall be held at the principal office of the Corporation or at such
other place, within or without the State of Delaware, as shall be fixed by the
Board of Directors and specified in the respective notices or waivers of notice
of said meetings.
SECTION 2.02. Annual meetings. The annual meeting of the shareholders for
the election of directors and for the transaction of such other business as may
properly come before such meeting, shall be held at the time and place
designated by the Board of Directors of the Corporation.
SECTION 2.03. Special Meetings. A special meeting of the shareholders for
any purpose or purposes, unless otherwise prescribed by statute, may be called
at any time by the President, by order of the Board of Directors or by a
shareholder or shareholders holding of record at least [twenty-eight percent
(28%)] in the voting power of the outstanding shares of the Corporation entitled
to vote at such meeting.
SECTION 2.04. Notice of Meetings. Notice of each meeting of the
shareholders shall be given to each shareholder of record entitled to vote at
such meeting at least ten (10) days but not more than sixty (60) days before the
day on which the meeting is to be held. Such notice shall be given by telephone,
telegraph, teletype or other form of electronic communication or by delivering a
written or printed notice thereof personally or by mail. If mailed, such notice
shall be deemed to be delivered when deposited in the United States mail,
postage prepaid, addressed to the shareholder at the address of such shareholder
as it appears upon the stock record books of the Corporation, or at such other
address as such shareholder shall have provided to the Corporation for such
purpose. No publication of any notice of a meeting of shareholders shall be
required. Every such notice shall state the time and place of the meeting, and,
in case of a special meeting, shall state the purpose or purposes thereof.
Notice of any meeting of shareholders shall not be required to be given to any
shareholder who shall attend such meeting in person or by proxy or who shall
waive notice thereof in the manner hereinafter provided. Notice of any adjourned
meeting of the shareholders shall not be required to be given.
SECTION 2.05. Quorum. At each meeting of the shareholders, a majority of
the outstanding shares of the Corporation entitled to vote, represented in
person or by proxy, shall constitute a quorum for the transaction of business.
In the absence of a quorum, a majority of the shares so represented at such
meeting, or, in the absence of all the shareholders entitled to vote, any
officer entitled to preside or to act as secretary at such meeting, may adjourn
the meeting from time to time without further notice. At any 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
noticed. The absence from any meeting of shareholders holding a sufficient
number of shares required for action on any given matter shall not prevent
action at such meeting upon any other matter or matters which properly come
before the meeting, if shareholders holding a sufficient number of shares
required for action on such other matter or matters shall be present. The
shareholders present or represented at any duty organized meeting may continue
to transact business until adjournment, notwithstanding the withdrawal of enough
shareholders to leave less than a quorum.
SECTION 2.06 Voting. Each shareholder of the Corporation shall, whether
the voting is by one or more classes voting separately or by two or more classes
voting as one class, be entitled to one vote in person or by proxy for each
share of the Corporation registered in the name of such shareholder on the books
of the Corporation. The Corporation shall not vote directly or indirectly any
shares held in its own name. Any vote of shares may be given by the shareholder
entitled to vote such shares in person or by proxy appointed by an instrument in
writing. At all meetings of the shareholders at which a quorum is present, all
matters (except where other provision is made law or by these Bylaws) shall be
decided by the affirmative vote of holders of a majority of the shares present
in person or represented by proxy and entitled to vote thereat.
ARTICLE III
BOARD OF DIRECTORS
SECTION 3.01. General Powers. The property, affairs and business of the
Corporation shall be managed by the Board of Directors, and the Board shall
have, and may exercise, all of the powers of the Corporation, except such as are
conferred by these Bylaws upon the shareholders.
SECTION 3.02. Number, Qualifications and Term of Office. The number of
directors to constitute the Board of Directors shall be such number, not less
than one (1) nor more than nine (9), as shall be fixed from time to time by the
shareholders at any annual meeting or at any special meeting called for the
purpose; provided, however, that between such meetings of shareholders the
number so fixed may at any time be increased or decreased, subject to the
above-specified limits, by the affirmative vote of a majority of the Board of
Directors. Directors shall be elected by the shareholders at each annual meeting
of shareholders, or at any special meeting held in place thereof, except as
provided in this Article. Each director shall hold office until the next annual
election of directors and until his successor shall have been duly elected and
qualified, or until the death, resignation or removal of such directors in the
manner herein provided. No director need be a shareholder.
2
SECTION 3.03. Election of Directors. Subject to any provisions in the
Certificate of Incorporation providing for cumulative voting, at each meeting of
the shareholders for the election of directors at which a quorum is present, the
persons receiving the greatest number of votes shall be the directors, and each
shareholder entitled to vote at such election shall have the right to vote, in
person or by proxy, for as many nominees as the number of directors fixed as
constituting the Board of Directors and to cast for each such nominee as many
votes as the number of shares which such shareholder is entitled to vote,
without the right to cumulate such votes.
SECTION 3.04 Quorum and Manner of Acting. A majority of the total number
of directors at the time in office shall constitute a quorum for the transaction
of business at any meeting and, except as otherwise provided by these Bylaws,
the act of a majority of the directors present at any meeting at which a quorum
is present shall be the act of the Board of Directors. In the absence of a
quorum, a majority of the directors present may adjourn any meeting from time to
time without further notice until a quorum be had. The directors shall act only
as a Board, and the individual directors shall have no power as such.
SECTION 3.05. Place of Meetings. The Board of Directors may hold its
meetings at any place within or without the State of Delaware as it may from
time to time determine or shall be specified or fixed in the respective notices
or waivers of notice thereof.
SECTION 3.06. Annual Meeting. The Board of Directors shall meet for the
purpose of organization, the election of officers and the transaction of other
business, as soon as practicable after each annual election of directors on the
same day and at the same place at which such election of directors was held.
Notice of such meeting need not be given. Such meeting may be held at any other
time or place which shall be specified in a notice given as hereinafter provided
for special meetings of the Board of Directors or in a consent and waiver of
notice thereof signed by all the directors.
SECTION 3.07. Regular Meetings. Regular meetings of the Board of Directors
shall be held at such places and at such times as the Board shall from time to
time by vote determine. If any day fixed for a regular meeting shall be a legal
holiday at the place where the meeting is to be held, then the meeting which
would otherwise be held on that day shall be held at the same hour on the next
succeeding business day not a legal holiday. Notice of regular meetings need not
be given.
SECTION 3.08. Special Meetings; Notice. Special meetings of the Board of
Directors shall be held whenever called by the President or by not less than
twenty-five percent (25%) of the members of the Board of Directors. Notice of
each such meeting shall be given by, or at the order of, the Secretary or the
person calling the meeting to each director by telephone or by mailing the same
addressed to the director's residence or usual place of business, or personally
by delivery or by telegraph, cable or telephone, at least two (2) days before
the day on which the meeting is to be held. Every such notice shall describe, if
by telephone notice, or if in writing, state the time and place of the meeting
but need not state the purpose thereof except as otherwise in these Bylaws
expressly provided.
SECTION 3.09. Presumption of Assent. A director of the Corporation who is
present at a meeting of the Board of Directors at which action on any corporate
matter is taken shall be presumed to have assented to the action taken unless
his dissent shall be entered in the minutes of the meeting or unless he shall
file his written dissent to such action with the person acting as the secretary
of the meeting before the adjournment thereof or shall forward such dissent by
registered mail to the Secretary of the Corporation immediately after the
adjournment of the meeting. Such right to dissent shall not apply to a director
who voted in favor of such action.
3
SECTION 3.10. Telephone Meetings. Meetings of the Board of Directors,
regular or special, may be held by means of a telephone conference circuit and
connection to such circuit shall constitute presence at such meeting.
SECTION 3.11. Removal of Directors. Any director may be removed, either
with or without cause, at any time, by the affirmative vote of the holders of
record of a majority of the issued and outstanding shares entitled to vote for
the election of directors of the Corporation given at a special meeting of the
shareholders called and held for the purpose.
SECTION 3.12. Resignation. Any director of the Corporation may resign at
any time by giving written notice to the Board of Directors or to the Chairman
of the Board or to the Secretary of the Corporation. The resignation of any
director shall take effect at the time specified therein; and, unless otherwise
specified therein, the acceptance of such resignation shall not be necessary to
make it effective.
SECTION 3.13. Vacancies. Subject to any provisions of the Certificate of
Incorporation providing for cumulative voting, any vacancy in the Board of
Directors caused by death, resignation, removal, disqualification, an increase
in the number of directors, or any other cause, may be filled by a majority vote
of the remaining directors then in office, though less than a quorum, at any
regular meeting or special meeting, including the meeting at which any such
vacancy may arise, or by the shareholders of the Corporation at the meeting at
which any such vacancy may arise or the next annual meeting or any special
meeting, and each director so elected shall hold office until the next annual
election of directors, and until a successor shall have been duly elected and
qualified, or until the death or resignation or removal of such director in the
manner herein provided.
ARTICLE IV
EXECUTIVE COMMITTEE
SECTION 4.01. Appointment. The Board of Directors may designate two or
more of its members to constitute an Executive Committee. The designation of
such committee and the delegation thereto of authority shall not operate to
relieve the Board of Directors, or any member thereof, of any responsibility
imposed by law.
SECTION 4.02. Authority. The Executive Committee, when the Board of
Directors is not in session, shall have and may exercise all of the authority of
the Board of Directors except to the extent, if any, that such authority shall
be limited by the resolution appointing the Executive Committee and except also
that the Executive Committee shall not have the authority of the Board of
Directors in reference to amending the Certificate of Incorporation, adopting a
plan of merger or consolidation, recommending to the shareholders the sale,
lease or other disposition of all or substantially all of the property and
assets of the Corporation otherwise than in the usual and regular course of its
business, recommending to the shareholders a voluntary dissolution of the
Corporation or a revocation thereof, increasing the number of directors
constituting the Board of Directors, filling any vacancies on the Board of
Directors, removing or electing any officer of the Corporation or amending the
Bylaws of the Corporation.
SECTION 4.03. Tenure and Qualifications. Each member of the Executive
Committee shall hold office until the next regular annual meeting of the Board
of Directors following designation and until a successor is designated as a
member of the Executive Committee and is elected and qualified or until the
death or resignation or removal of such member in the manner herein provided.
4
SECTION 4.04. Meetings. Regular meetings of the Executive Committee may be
held without notice at such times and places as the Executive Committee may fix
from time to time by resolution. Special meetings of the Executive Committee may
be called by any member thereof upon not less than two (2) days' notice stating
the place, date and hour of the meeting, which notice may be written or oral,
and if mailed, shall be deemed to be delivered when deposited in the United
States mail addressed to the member of the Executive Committee at such member's
business address. Any member of the Executive Committee may waive notice of any
meeting and no notice of any meeting need be given to any member thereof who
attends in person. The notice of a meeting of the Executive Committee need not
state the business proposed to be transacted at the meeting.
SECTION 4.05. Telephone Meetings. Meetings of the Executive Committee may
be held by means of a telephone conference circuit shall constitute attendance
at such meeting.
SECTION 4.06. Quorum. A majority of the members of the Executive Committee
shall constitute a quorum for the transaction of business at any meeting
thereof, and action of the Executive Committee shall be authorized by the
affirmative vote of a majority of the members present at a meeting at which a
quorum is present.
SECTION 4.07. Vacancies. Any vacancy in the Executive Committee may be
filled by a resolution adopted by a majority of the full Board of Directors.
SECTION 4.08. Resignations and Removal. Any member of the Executive
Committee may be removed at any time with or without cause by the Board of
Directors. Any member of the Executive Committee may resign from the Executive
Committee at any time by giving written notice to the President or Secretary of
the Corporation, and unless otherwise specified therein, the acceptance of such
resignation shall not be necessary to make it effective.
SECTION 4.09. Procedure. The Executive Committee may elect a presiding
officer from its members and may fix its own rules of procedure which shall not
be inconsistent with these Bylaws. It shall keep regular minutes of its
proceedings and report the same to the Board of Directors for its information at
the meeting thereof held next after the proceedings shall have been taken.
ARTICLE V
WAIVER OF NOTICE: WRITTEN CONSENT
SECTION 5.01. Waiver of Notice. Notice of the time, place and purpose of
any meeting of the shareholders, Board of Directors or Executive Committee may
be waived in writing by any shareholder or director either before or after such
meeting. Attendance in person, or in case of a meeting of the shareholders, by
proxy, at a meeting of the shareholders, Board of Directors or Executive
Committee shall be deemed to constitute a waiver of notice thereof.
SECTION 5.02. Written Consent of Shareholders. Unless otherwise restricted
by the Certificate of Incorporation, any action required or permitted to be
taken at a meeting of shareholders may be taken without a meeting upon the
written consent of less than all of the shareholders entitled to vote thereon,
or their proxies, to the extent and in the manner permitted by the Delaware
General Corporation Law, as amended from time to time.
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SECTION 5.03. Written Consent of Directors. 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 Executive
Committee may be taken without a meeting if a consent in writing, setting forth
the action so to be taken, shall be signed before or after such action by all of
the directors, or all of the members of the Executive Committee, as the case may
be. Such written consent shall be filed with the records of the Corporation.
ARTICLE VI
OFFICERS
SECTION 6.01. Number. The officers of the Corporation shall be a Chairman
of the Board, a Vice Chairman of the Board, a Chief Executive Officer, a
President, one or more Vice Presidents, a Secretary, a Chief Financial Officer
and Treasurer, and such other officers and assistant officers as the Board of
Directors may from time to time appoint, including one or more Assistant
Secretaries and one or more Assistant Treasurers. One person may hold the
offices and perform the duties of any two or more of said officers.
SECTION 6.02. Election, Qualifications and Term of Office. Each officer
shall be elected annually by the Board of Directors, or from time to time to
fill any vacancy, and shall hold office until a successor shall have been duly
elected and qualified, or until the death, resignation or removal of such
officer in the manner hereinafter provided.
SECTION 6.03. Removal. Any officer may be removed by the vote of a
majority of the whole Board of Directors at a special meeting called for the
purpose, whenever in the judgment of the Board of Directors the best interests
of the Corporation will be served thereby, but such removal shall be without
prejudice to the contract rights, if any, of the officer so removed. Election or
appointment of an officer or agent shall not of itself create contract rights.
SECTION 6.04. Resignation. Any officer may resign at any time by giving
written notice to the Board of Directors or to the President or the Secretary.
Any such resignation shall take effect at the date of receipt of such notice or
at any later time specified therein; and unless otherwise specified therein the
acceptance of such resignation shall not be necessary to make it effective.
SECTION 6.05. Vacancies. A vacancy in any office because of death,
resignation, removal, disqualification or any other cause shall be filled for
the unexpired portion of the term by the Board of Directors at any regular or
special meeting.
SECTION 6.06. Chairman of the Board. The Chairman of the Board shall be a
director and shall preside at all meetings of the Board of Directors and
shareholders. Subject to determination by the Board of Directors, the Chairman
shall have general executive powers and such specific powers and duties as from
time to time may be conferred or assigned by the Board of Directors.
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SECTION 6.07. Vice Chairman of the Board. Whenever the Chairman of the
board is unable to serve, by reason of sickness, absence, or otherwise, the Vice
Chairman shall have the powers and perform the duties of the chairman of the
board. The Vice Chairman shall have such other powers and perform such other
duties as may be prescribed by the Chairman of the board, the board of directors
or these By-laws.
SECTION 6.08. Chief Executive Officer. The Chief Executive Officer shall
have the powers and perform the duties incident to that position. Subject to the
powers of the Board of Directors and the Chairman of the board, the Chief
Executive Officer shall be in the general and active charge of the entire
business and affairs of the Corporation, and shall be its chief policymaking
officer. The Chief Executive Officer shall have such other powers and perform
such other duties as may be prescribed by the Board of Directors or provided in
these By-laws. The Chief Executive Officer is authorized to 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. Whenever the President is unable to serve, by reason of
sickness, absence or otherwise, the chief executive officer shall perform all
the duties and responsibilities and exercise all the powers of the president.
SECTION 6.09. The President. The President shall have general and active
management of the daily operations of the Corporation subject to the direction
of the Board of Directors. In addition, the President shall perform such other
duties and have such other responsibilities as the Board of Directors may from
time to time determine.
SECTION 6.10. The Vice Presidents. The Vice President, or if there shall
be more than one, the Vice Presidents in the order determined by the Board of
Directors, shall, in the absence or disability of the President, perform the
duties and exercise the powers of the President and shall perform such other
duties and have such other powers as the Board of Directors may from time to
time prescribe.
SECTION 6.11. The Secretary. The Secretary shall record or cause to be
recorded in books provided for the purpose all the proceedings of the meetings
of the Corporation, including the shareholders, the Board of Directors,
Executive Committee and all committees of which a secretary shall not have been
appointed; shall see that all notices are duly given in accordance with the
provisions of these Bylaws and as required by law; shall be custodian of the
records (other than financial) and of the seal of the Corporation; and in
general, shall perform all duties incident to the office of Secretary and such
other duties as may, from time to time, be assigned by the Board of Directors or
the President.
SECTION 6.12. The Assistant Secretaries. At the request, or in absence or
disability, of the Secretary, the Assistant Secretary designated by the
Secretary or the Board of Directors shall perform all the duties of the
Secretary and, when so acting, shall have all the powers of the Secretary. The
Assistant Secretaries shall perform such other duties as from time to time may
be assigned to them by the Board of Directors, the President or the Secretary.
SECTION 6.13. The Chief Financial Officer and Treasurer. The Chief
Financial Officer and Treasurer shall have charge and custody of, and be
responsible for, all funds and securities of the Corporation, and deposit all
such funds to the credit of the Corporation in such banks, trust companies or
other depositaries as shall be selected in accordance with the provisions of
these Bylaws; disburse the funds of the Corporation under the general control of
the Board of Directors, based upon proper vouchers for such disbursements;
receive, and give receipts for, moneys due and payable to the corporation from
any source whatsoever, render a statement of the condition of the finances of
the Corporation at all regular meetings of the Board of Directors, and a full
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financial report at the annual meeting of the shareholders, if called upon to do
so; and render such further statements to the Board of Directors and the
President as they may respectively require concerning all transactions as Chief
Financial Officer and Treasurer or the financial condition of the Corporation.
The Chief Financial Officer and Treasurer shall also have charge of the books
and records of account of the Corporation, which shall be kept at such office or
offices of the Corporation as the Board of Directors shall from time to time
designate; be responsible for the keeping of correct and adequate records of the
assets, liabilities, business and transactions of the Corporation; at all
reasonable times exhibit the books and records of account to any of the
directors of the Corporation upon application at the office of the Corporation
where such books and records are kept; be responsible for the preparation and
filing of all reports and returns relating to or based upon the books and
records of the Corporation kept under the direction of the Chief Financial
Officer and Treasurer; and, in general, perform all the duties incident to the
office of Treasurer and such other duties as from time to time may be assigned
by the Board of Directors or the President.
SECTION 6.14. The Assistant Treasurers. At the request, or in the absence
or disability, of the Treasurer, the Assistant Treasurer designated by the
Treasurer or the Board of Directors shall perform all the duties of the
Treasurer, and when so acting, shall have all the powers of the Treasurer. The
Assistant Treasurers shall perform such other duties as from time to time may be
assigned to them by the Board of Directors, the President or the Treasurer.
SECTION 6.15. General Powers. Each officer shall, subject to these Bylaws,
have, in addition to the duties and powers herein set forth, such duties and
powers as are commonly incident to the respective office, and such duties and
powers as the Board of Directors shall from time to time designate.
SECTION 6.16. Bonding. Any officer, employee, agent or factor shall give
such bond with such surety or sureties for the faithful performance of his or
her duties as the Board of Directors may, from time to time, require.
ARTICLE VII
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Each person who at any time is, or shall have been, a director or officer
of the Corporation, and is threatened to be or is 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 or she
is, or was, a director, officer, employee or agent of the Corporation, or is or
has served at the request of the Corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, shall be indemnified against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
in connection with any such action, suit or proceeding to the full extent
permitted under the Delaware General Corporation Law, as from time to time
amended. The foregoing right of indemnification shall in no way be exclusive of
any other rights of indemnification to which such director, officer, employee or
agent may be entitled, under any bylaw, agreement, vote of shareholders or
disinterested directors or otherwise, and shall continue as to a person who has
ceased to be a director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such a person.
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ARTICLE VIII
EXECUTION OF DOCUMENTS
SECTION 8.01. Contract, etc., How Executed. The Board of Directors may
authorize any or officer or officers, or any agent or agents, of the Corporation
to enter into any contract or to execute and deliver any contract or other
instrument in the name and on behalf of the Corporation, and such authority may
be general or confined to specific instances. Unless authorized so to do by
these Bylaws or by the Board of Directors, no officer, agent or employee shall
have any power or authority to bind the Corporation by any contract or
engagement, or to pledge its credit, or to render it liable pecuniarily for any
purpose or to any amount.
SECTION 8.02. Checks, Drafts, etc. All checks, drafts, bills of exchange
or other orders for the payment of money, obligations, notes, or other evidences
of indebtedness, bills of lading, warehouse receipts and insurance certificates
of the Corporation, shall be signed or endorsed by such officer or officers,
employee or employees, of the Corporation as shall from time to time be
determined by resolution of the Board of Directors.
ARTICLE IX
BOOKS AND RECORDS
SECTION 9.01. Place. The books and records of the Corporation, including
the stock record books, shall be kept at such places within or without the State
of Delaware, as may from time to time be determined by the Board of Directors.
SECTION 9.02. Addresses of Shareholders. Each shareholder shall designate
to the Secretary of the Corporation an address at which notices of meetings and
all other corporate notices may be served upon or mailed, and if any shareholder
shall fail to designate such address, corporate notices may be served by mail
directed to the shareholder's last known post office address, or by transmitting
a notice thereof to such address by telegraph, cable, or telephone.
SECTION 9.03. Inspection of Books and Records. The Board of Directors
shall have power from time to time to determine to what extent and at what times
and places and under what conditions and regulations the accounts and books of
the Corporation, or any of them, shall be open to the inspection of the
stockholders; and no stockholder shall have any right to inspect any account or
book or document of the Corporation, except as conferred by the laws of the
State of Delaware, unless and until authorized so to do by resolution of the
Board of Directors or of the stockholders of the Corporation.
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ARTICLE X
SHARES AND THEIR TRANSFER
SECTION 10.01. Certificates of Shares. 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 secretary or an assistant secretary of the Corporation,
certifying the number of shares owned by such holder in the Corporation. If such
a certificate is countersigned (i) by a transfer agent or an assistant transfer
agent other than the Corporation or its employee or (ii) by a registrar, other
than the Corporation or its employee, the signature of any such chairman of the
board, chief executive officer, president, secretary or assistant secretary may
be facsimiles. In case any officer or officers who have signed, or whose
facsimile signature or signatures have been used on, any such certificate or
certificates shall cease to be such officer or officers of the Corporation
whether because of death, resignation or otherwise before such certificate or
certificates have been delivered by the Corporation, such certificate or
certificates may nevertheless be issued and delivered as though the person or
persons who signed such certificate or certificates or whose facsimile signature
or signatures have been used thereon had not ceased to be such officer or
officers of the Corporation. All certificates for shares shall be consecutively
numbered or otherwise identified. The name of the person to whom the shares
represented thereby are issued, with the number of shares and date of issue,
shall be entered on the books of the Corporation. Shares of stock of the
Corporation shall only be transferred on the books of the Corporation by the
holder of record thereof or by such holder's attorney duly authorized in
writing, upon surrender to the Corporation of the certificate or certificates
for such shares endorsed by the appropriate person or persons, with such
evidence of the authenticity of such endorsement, transfer, authorization and
other matters as the Corporation may reasonably require, and accompanied by all
necessary stock transfer stamps. In that event, it shall be the duty of the
Corporation to issue a new certificate to the person entitled thereto, cancel
the old certificate or certificates and record the transaction on its books. The
Board of Directors may appoint a bank or trust company organized under the laws
of the United States or any state thereof to act as its transfer agent or
registrar, or both in connection with the transfer of any class or series of
securities of the Corporation.
SECTION 10.02. Lost Certificates. The Board of Directors may direct a new
certificate or certificates to be issued in place of any certificate or
certificates previously 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 Corporation
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 or her legal representative, to give the Corporation a bond sufficient to
indemnify the Corporation against any claim that may be made against the
Corporation on account of the loss, theft or destruction of any such certificate
or the issuance of such new certificate.
SECTION 10.03. Fixing a Record Date for Stockholder Meetings. 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, the Board of
Directors may fix a record date, which record date shall not precede the date
upon which the resolution fixing the record date is adopted by the Board of
Directors, and which record date shall not be more than 60 nor less than 10 days
before the date of such meeting. If no record date is fixed by the Board of
Directors, the record date for determining stockholders entitled to notice of or
to vote at a meeting of stockholders shall be the close of business on the next
day preceding the day on which notice is first given. A determination of
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.
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SECTION 10.04. Fixing a Record Date for Other Purposes. In order that the
Corporation may determine the stockholders entitled to receive payment of any
dividend or other distribution or allotment or any rights or the stockholders
entitled to exercise any rights in respect of any change, conversion or exchange
of stock, or for the purposes of any other lawful action, the Board of Directors
may fix a record date, which record date shall not precede the date upon which
the resolution fixing the record date is adopted, and which record date shall be
not more than 60 days prior to such action. If no record date is fixed, the
record date for determining stockholders for any such purpose shall be at the
close of business on the day on which the Board of Directors adopts the
resolution relating thereto.
SECTION 10.05. Record. A record shall be kept of the name of the person,
firm or corporation owning the shares of the Corporation issued, the number of
shares represented by each certificate, and the date thereof, and, in the case
of cancellation, the date of cancellation. The person in whose name shares stand
on the books of the Corporation shall be deemed the owner thereof for all
purposes as regards the Corporation.
SECTION 10.06. Registered Stockholders. Prior to the surrender to the
Corporation of the certificate or certificates for a share or shares of stock
with a request to record the transfer of such share or shares, the Corporation
may treat the registered owner as the person entitled to receive dividends, to
vote, to receive notifications and otherwise to exercise all the rights and
powers of an owner. The Corporation 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.
ARTICLE XI
DIVIDENDS
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, in accordance with
applicable 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.
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 any other purpose, and the Directors may
modify or abolish any such reserve in the manner in which it was created.
ARTICLE XII
SEAL
The Board of Directors may provide for a corporate seal, which shall be in
the form of a circle and shall bear the name of the Corporation and the state
and year of incorporation.
ARTICLE XIII
FISCAL YEAR
Except as from time to time otherwise provided by the Board of Directors,
the fiscal year of the Corporation shall be the year or other fiscal period
ending on the last day of December of each year.
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ARTICLE XIV
AMENDMENTS
Except as provided otherwise herein, all Bylaws of the Corporation shall
be subject to alteration or repeal, and new Bylaws may be adopted either by the
vote of a majority of the outstanding shares of the Corporation entitled to vote
in respect thereof, or by the vote of the Board of Directors, provided that in
each case notice of the proposed alteration or repeal or of the proposed new
Bylaws be included in the notice of the meeting at which such alteration, repeal
or adoption is acted upon, and provided further that any such action by the
Board of Directors may be changed by the shareholders, except that no such
change shall affect the validity of any actions theretofore taken pursuant to
the Bylaws as altered, repealed or adopted by the Board of Directors.
If authorized by the Certificate of Incorporation, the adoption or
amendment of a bylaw that adds, changes or deletes a greater quorum or voting
requirement for shareholders must meet the same quorum requirement and be
adopted by the same vote and voting groups required to take action under the
quorum and voting requirement then in effect or proposed to be adopted,
whichever is greater. A bylaw that fixes a greater quorum or voting requirement
for shareholders may not be adopted, amended or repealed by the Board of
Directors.
Action by the Board of Directors to adopt or amend a bylaw that changes
the quorum or voting requirement for the Board of Directors must meet the same
quorum requirement and be adopted by the same vote required to take action under
the quorum and voting requirement then in effect or proposed to be adopted,
whichever is greater.
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