8-K

UNITED STATES

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

October 12, 2010 (October 8, 2010)

Date of Report (Date of earliest event reported)

ZYMOGENETICS, INC.

(Exact name of registrant as specified in its charter)

Washington	000-33489	91-1144498
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)
1201 Eastlake Avenue East Seattle, Washington		98102-3702
(Address of principal executive offices)		(Zip Code)

(206) 442-6600

(Registrant’s telephone number, including area code)

(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.):

¨ 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 1.02. Termination of a Material Definitive Agreement.

On September 7, 2010, ZymoGenetics, Inc., a Washington corporation (the “Company”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Bristol-Myers Squibb Company, a Delaware corporation (“Parent”), and Zeus Acquisition Corporation, a Washington corporation and a wholly owned subsidiary of Parent (“Merger Sub”). Pursuant to the Merger Agreement and upon the terms and subject to the conditions thereof, Merger Sub commenced a tender offer (the “Offer”) to acquire all of the issued and outstanding shares of voting common stock, without par value, of the Company (the “Shares”) for $9.75 per Share, net to the holder thereof in cash, without interest and subject to applicable withholding. At 12:00 midnight, New York City time, on October 7, 2010, the Offer expired as scheduled. The Offer was not extended. Based on the information provided by the Depositary to Parent, as of the expiration of the Offer, approximately 82,605,529 Shares were validly tendered and not validly withdrawn prior to the expiration of the Offer. As of the close of business on October 11, 2010, approximately 981,756 Shares remained subject to guaranteed delivery procedures. On October 8, 2010, Merger Sub accepted for payment all Shares validly tendered and not validly withdrawn in the Offer. The Shares validly tendered and not validly withdrawn represented approximately 94.9% of the Shares outstanding.

Upon Merger Sub’s acceptance for payment of all Shares validly tendered and not validly withdrawn in the Offer, the Company repaid and satisfied all borrowings, redemption amounts, accrued and unpaid interest and royalty payments outstanding under the Company’s funding arrangements with Deerfield Private Design Fund, L.P., Deerfield Private Design International, L.P. and Deerfield ZG Corporation (collectively, the “Deerfield Funds”). The financing agreements between the Company and the Deerfield Funds, including (i) the Facility Agreement dated June 26, 2008, between the Company and the Deerfield Funds (as amended from time to time, the “Facility Agreement”), (ii) the Promissory Notes dated June 26, 2008 (the “Promissory Notes”), (iii) the Royalty Agreement dated June 26, 2008, between the Company and the Deerfield Funds (as amended from time to time, the “Royalty Agreement”), (iv) the Warrants issued by the Company to the Deerfield Funds on November 5, 2008 (the “Warrants”), and (v) the Registration Rights Agreement dated June 26, 2008, between the Company and the Deerfield Funds (as amended from time to time, the “Registration Rights Agreement” and together with the Facility Agreement, the Promissory Notes, the Royalty Agreement and the Warrants, the “Deerfield Financing Documents”), were each terminated and are of no further force or effect as of October 8, 2010.

A summary of the terms of the Deerfield Financing Documents is set forth in the Form 8-K filed by the Company with the Securities and Exchange Commission (the “SEC”) on June 30, 2008, which summary is incorporated by reference in this Item 1.02.

Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

The effective time (“Effective Time”) of the merger (the “Merger”) of the Company into Merger Sub with Merger Sub continuing as the surviving corporation (the “Surviving Corporation”) occurred on October 12, 2010. On October 12, 2010, the Company notified The NASDAQ Global Market (“NASDAQ”) of the effectiveness of the Merger. As a result of the Merger, the Company no longer meets the numerical listing requirements of NASDAQ. The Company also notified NASDAQ that the Shares issued and outstanding immediately prior to the Effective Time (other than Shares owned by Parent or Merger Sub, Shares owned by the Company as treasury stock or Shares held by shareholders who properly exercise their dissenters’ rights pursuant to and in compliance with the Washington Business Corporation Act (the “WBCA”)), were converted into the right to receive $9.75 per Share net to the selling shareholder in cash, without interest and less any required withholding taxes (the “Merger Consideration”), and requested that NASDAQ file with the SEC an application on Form 25 to report that the Shares are no longer listed on NASDAQ. Trading of the Shares on NASDAQ has been suspended effective as of the close of business on October 12, 2010. The Company intends to file with the SEC a Form 15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), requesting the deregistration of the Shares and the suspension of the Company’s reporting obligations under Section 13 and 15(d) of the Exchange Act.

Item 3.03. Material Modification to Rights of Security Holders.

The information set forth above in the first paragraph under Item 1.02 is incorporated by reference into this Item 3.03.

2

In connection with the consummation of the Merger, each Share issued and outstanding immediately prior to the Effective Time (other than Shares owned by Parent or Merger Sub, Shares owned by the Company as treasury stock or Shares held by shareholders who properly exercise their dissenters’ rights pursuant to and in compliance with the WBCA) was cancelled and converted into the right to receive the Merger Consideration. At the Effective Time, the Company’s shareholders immediately prior to the Effective Time ceased to have any rights as shareholders in the Company (other than their right to receive the Merger Consideration) and accordingly no longer have any interest in the Company’s future earnings or growth.

Item 5.01. Changes in Control of Registrant.

The information set forth above in the first paragraph under Item 1.02 is incorporated by reference into this Item 5.01.

The aggregate purchase price paid by Parent in connection with the Offer and the Merger is approximately $885 million, plus related transaction fees. Parent funded the acquisition from available cash.

As a result of the expiration of the offering period for the Offer on October 7, 2010, and Parent’s acceptance for purchase of all validly tendered and not validly withdrawn Shares on October 8, 2010, a change in control of the Company occurred and the Company became an indirect subsidiary of Parent. As of October 12, 2010, as a result of the Merger, the Surviving Corporation is a wholly-owned subsidiary of Parent.

The information set forth below in the first paragraph under Item 5.02 is incorporated by reference into this Item 5.01.

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On October 8, 2010, in connection with the completion of the Offer and pursuant to the terms of the Merger Agreement, Parent became entitled to designate up to such number of members of the Company’s Board of Directors (the “Board”) as is equal to the proportionate number of Shares owned by Parent and Merger Sub relative to the number of Shares then outstanding. In accordance with the Merger Agreement, effective October 8, 2010, the following directors of the Company resigned: James A. Harper, David I. Hirsh, Ph.D., Lars Fruergaard Jørgensen, Jonathan S. Leff, A. Bruce Montgomery, M.D., and Edward E. Penhoet, Ph.D. On the same date, and after such resignations, the Board filled the vacancies created by such resignations by appointing Paul R. Biondi, David J. Brienza, P. Joseph Campisi, Jr., Jeffrey Galik, Jeremy Levin and Kabir Nath to serve as directors of the Company.

Pursuant to the Merger Agreement, upon the Effective Time, the directors of Merger Sub became the directors of the Surviving Corporation and the officers of Merger Sub became the officers of the Surviving Corporation. As of October 12, 2010, the board of directors of the Surviving Corporation is comprised of: Jeremy Levin, Jeffrey Galik, Kabir Nath and David T. Bonk. As of October 12, 2010, the executive officers of the Surviving Corporation include: Jeremy Levin, President, David T. Bonk, Vice President, P. Joseph Campisi, Jr., Vice President, Sonia Vora, Secretary and Jeffrey Galik, Treasurer.

The other information required by Item 5.02 of Form 8-K is contained in the Company’s Solicitation/Recommendation on Schedule 14D-9 originally filed by the Company with the SEC on September 15, 2010, including the Information Statement comprising Annex I thereto, and such information is incorporated by reference into this Item 5.02.

Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

Pursuant to the Merger Agreement, upon the Effective Time, the name of Merger Sub, as the Surviving Corporation, was changed to “ZymoGenetics, Inc.”, and the Articles of Incorporation of the Surviving Corporation were amended and restated in their entirety as set forth in the Merger Agreement. Also, pursuant to the Merger Agreement, upon the Effective Time, the Bylaws of Merger Sub, as in effect immediately prior to the Effective Time, became the Bylaws of the Surviving Corporation except that the name of the corporation set forth therein was

3

changed to “ZymoGenetics, Inc.” Copies of the Articles of Incorporation and Bylaws of the Surviving Corporation are filed as Exhibit 3.1 and Exhibit 3.2, respectively, to this report and are incorporated by reference into this Item 5.03.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

3.1	Amended and Restated Articles of Incorporation of ZymoGenetics, Inc., dated as of October 12, 2010.
3.2	Bylaws of ZymoGenetics, Inc., effective as of October 12, 2010.
20.1	Information Statement pursuant to Section 14(f) of the Securities Exchange Act of 1934, as amended, and Rule 14f-1 thereunder (incorporated by reference to Exhibit (a)(1)(C) of the Company’s Solicitation/Recommendation Statement on Schedule 14D-9 filed with the Securities and Exchange Commission on September 15, 2010, as amended).

4

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated as of October 12, 2010

ZYMOGENETICS, INC.
By:	/s/ Jeremy Levin
Name:	Dr. Jeremy Levin
Title:	President

5

EXHIBIT INDEX

Exhibit No.	Description
3.1	Amended and Restated Articles of Incorporation of ZymoGenetics, Inc., dated as of October 12, 2010.
3.2	Bylaws of ZymoGenetics, Inc., effective as of October 12, 2010.
20.1	Information Statement pursuant to Section 14(f) of the Securities Exchange Act of 1934, as amended, and Rule 14f-1 thereunder (incorporated by reference to Exhibit (a)(1)(C) of the Company’s Solicitation/Recommendation Statement on Schedule 14D-9 filed with the Securities and Exchange Commission on September 15, 2010, as amended).

6

EX-3.1

Exhibit 3.1

AMENDED AND RESTATED

ARTICLES OF INCORPORATION

OF

ZYMOGENETICS, INC.

Pursuant to RCW 23B.10.070 of the Washington Business Corporation Act (the “Act”), the following constitutes the Amended and Restated Articles of Incorporation of ZymoGenetics, Inc., a Washington corporation:

I.

NAME

The name of this corporation is ZymoGenetics, Inc.

II.

PURPOSE

This corporation is organized for the purpose of engaging in any business, trade or activity which may be conducted lawfully by a corporation organized under the Act.

III.

SHARES

This corporation is authorized to issue ten thousand (10,000) shares of common stock.

IV.

NO PREEMPTIVE RIGHTS

Except as may otherwise be provided by the Board of Directors, no preemptive rights shall exist with respect to shares of stock or securities convertible into shares of stock of this corporation.

V.

NO CUMULATIVE VOTING

At each election for directors, every shareholder entitled to vote at such election has the right to vote in person or by proxy the number of shares held by such shareholder for as many persons as there are directors to be elected. No cumulative voting for directors shall be permitted.

VI.

BYLAWS

The Board of Directors shall have the power to adopt, amend or repeal the Bylaws or adopt new Bylaws. Nothing herein shall deny the concurrent power of the shareholders to adopt, alter, amend or repeal the Bylaws.

VII.

SHAREHOLDER VOTING REQUIREMENTS

FOR CERTAIN TRANSACTIONS

In order to obtain shareholder approval in connection with the following corporate actions, such actions must be approved by each voting group of shareholders entitled to vote thereon by a majority of all the votes entitled to be cast by that voting group: (1) amendment of the Articles of Incorporation; (2) a plan of merger or share exchange; (3) the sale, lease, exchange, or other disposition of all, or substantially all, of the corporation’s assets other than in the usual and regular course of business; or (4) dissolution of the corporation.

VIII.

SHAREHOLDER ACTION ON LESS THAN

UNANIMOUS CONSENT

In any matter requiring shareholder action, the shareholders may act by consent of the shareholders holding of record, or otherwise entitled to vote in the aggregate, the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote on the action were present and voted. At least one (1) day before any action to be taken under this Article VIII is effective, notice of such action shall be given to all shareholders who did not join in the consent to such action and who would be entitled to vote on such action or would have received notice of a meeting in which such action would be taken. Provided that, if the action authorizes or approves of a significant business transaction, as defined under RCW 23B.19.020(15), then the notice shall be given to such non-consenting shareholders at least twenty (20) days before the effective date of such authorization or approval. The notice shall be in the form of a record, and shall state the action or actions to be taken by the shareholders. For purposes of these articles, “record” means information inscribed on a tangible medium or contained in an electronic transmission. The notice shall be transmitted in the same manner as all other shareholder notices, as stated in the corporation’s Articles or Bylaws. Notice to shareholders in an electronic transmission is effective only with respect to shareholders that have consented, in the form of a record, to receive electronically transmitted notices under the Act and designated in the consent the address, location, or system to which these notices may be electronically transmitted and with respect to a notice that otherwise complies with any other requirement of the Act and applicable federal law.

IX.

LIMITATION OF DIRECTORS’ LIABILITY

To the full extent that the Washington Business Corporation Act, as it exists on the date hereof or may hereafter be amended, permits the limitation or elimination of the liability of directors, a director of this corporation shall not be liable to this corporation or its shareholders for monetary damages for conduct as a director. Any amendments to or repeal of this Article IX shall not adversely affect any right or protection of a director of this corporation for or with respect to any acts or omissions of such director occurring prior to such amendment or repeal.

X.

INDEMNIFICATION OF DIRECTORS AND OFFICERS

A. Right to Indemnification. Each person who was, is, or is threatened to be made a party to or is otherwise involved (including, without limitation, as a witness) in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative and whether formal or informal, 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, he or she is or was serving at the request of the corporation as a director, trustee, officer, partner, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans, whether the basis of such proceeding is alleged action in an official capacity as a director, trustee, officer, partner, employee or agent or in any other capacity while serving as a director, trustee, officer, partner, employee or agent, shall be indemnified and held harmless by the corporation, to the full extent permitted by applicable law as then in effect, against all expense, liability and loss (including attorney’s fees, judgments, fines, ERISA excise taxes or penalties and amounts to be paid in settlement) actually and reasonably incurred or suffered by such person in connection therewith, and such indemnification shall continue as to a person who has ceased to be a director, trustee, officer, partner, employee or agent and shall inure to the benefit of his or her heirs, executors and administrators; provided, however, that except as provided in Section B of this Article with respect to proceedings seeking to enforce rights to indemnification, the corporation shall indemnify any such person seeking indemnification in connection with a proceeding (or part thereof) initiated by such person only if such proceeding (or part thereof) was authorized by the board of directors of the corporation. The right to indemnification conferred in this Article shall be a contract right and shall include the right to be paid by the corporation the expenses incurred in defending any such proceeding in advance of its final disposition, without regard to the limitations in RCW 23B.08.510 through 23B.08.550, or any other limitation which may hereafter be enacted to the extent such limitation may be disregarded if authorized by these Articles of Incorporation, to the full extent and under all circumstances permitted by applicable law.

B. Right of Claimant to Bring Suit. If a claim under Section A of this Article is not paid in full by the corporation within sixty (60) days after a written claim has been received by the corporation, except in the case of a claim for expenses incurred in defending a proceeding in advance of its final disposition, in which case the applicable period shall be twenty (20) days, the claimant may at any time thereafter bring suit against the corporation to recover the unpaid amount of the claim and, to the extent successful in whole or in part, the claimant shall be entitled to be paid also the expense of prosecuting such claim. The claimant shall be presumed to be entitled to indemnification under this Article upon submission of a written claim (and, in an action brought to enforce a claim for expenses incurred in defending any proceeding in advance of its final disposition, where the required undertaking has been tendered to the corporation), and thereafter the corporation shall have the burden of proof to overcome the presumption that the claimant is so entitled. Neither the failure of the corporation (including its board of directors, independent legal counsel or its shareholders) to have made a determination prior to the commencement of such action that indemnification of or reimbursement or advancement of expenses to the claimant is proper in the circumstances nor an actual determination by the corporation (including its board of directors, independent legal counsel or its shareholders) that the claimant is not entitled to indemnification or to the reimbursement or advancement of expenses shall be a defense to the action or create a presumption that the claimant is not so entitled.

C. Nonexclusivity of Rights. The right to indemnification and the payment of expenses incurred in defending a proceeding in advance of its final disposition conferred in this Article shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, provision of the Articles of Incorporation, Bylaws, agreement, vote of shareholders or disinterested directors or otherwise.

D. Insurance, Contracts and Funding. The corporation may maintain insurance, at its expense, to protect itself and any director, trustee, officer, partner, employee or agent of the corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the corporation would have the power to indemnify such person against such expense, liability or loss under the Act. The corporation may, without further shareholder action, enter into contracts with any director, trustee, officer, partner, employee or agent of the corporation in furtherance of the provisions of this Article and may create a trust fund, grant a security interest or use other means (including, without limitation, a letter of credit) to ensure the payment of such amounts as may be necessary to effect indemnification as provided in this Article.

E. Indemnification of Employees and Agents of the Corporation. The corporation may, by action of its board of directors from time to time, provide indemnification and pay expenses in advance of the final disposition of a proceeding to employees and agents of the corporation with the same scope and effect as the provisions of this Article with respect to the indemnification and advancement of expenses of directors and officers of the corporation or pursuant to rights granted pursuant to, or provided by, the Act or otherwise.

F. Persons Serving Other Entities. Any person who, while a director, officer or employee of the corporation, is or was serving (a) as a director or officer of another foreign or domestic corporation of which a majority of the shares entitled to vote in the election of its directors is held by the corporation or (b) as a trustee, partner or otherwise in an executive or management capacity in a partnership, joint venture, trust or other enterprise of which the corporation or a wholly owned subsidiary of the corporation is a general partner or has a majority ownership shall be deemed to be so serving at the request of the corporation and entitled to indemnification and advancement of expenses under this Article.

EX-3.2

Exhibit 3.2

BYLAWS

OF

ZYMOGENETICS, INC.

Effective October 12, 2010.

TABLE OF CONTENTS

			Page
ARTICLE I REGISTERED OFFICE AND REGISTERED AGENT			1
ARTICLE II SHAREHOLDERS’ MEETINGS			1
	Section 2.1	Annual Meetings	1
	Section 2.2	Special Meetings	1
	Section 2.3	Notice of Meetings	1
	Section 2.4	Waiver of Notice	2
	Section 2.5	Record Date	2
	Section 2.6	Shareholders’ List for Meeting	3
	Section 2.7	Quorum and Adjourned Meetings	3
	Section 2.8	Proxies	3
	Section 2.9	Voting of Shares	4
ARTICLE III DIRECTORS			4
	Section 3.1	General Powers	4
	Section 3.2	Number	4
	Section 3.3	Tenure and Qualifications	4
	Section 3.4	Election	4
	Section 3.5	Vacancies	4
	Section 3.6	Resignation	4
	Section 3.7	Removal of Directors	4
	Section 3.8	Meetings	5
	Section 3.9	Quorum and Voting	6
	Section 3.10	Compensation	6
	Section 3.11	Presumption of Assent	6
	Section 3.12	Committees	6
ARTICLE IV SPECIAL MEASURES FOR CORPORATE ACTION			7
	Section 4.1	Action Without a Meeting	7
	Section 4.2	Meetings by Conference Telephone	7
ARTICLE V OFFICERS			7
	Section 5.1	Officers Designated	7
	Section 5.2	Election, Qualification and Term of Office	8
	Section 5.3	Powers and Duties	8
	Section 5.4	Assistant Secretaries and Assistant Treasurers	8
	Section 5.5	Removal	9

i

	Section 5.6	Vacancies	9
	Section 5.7	Compensation	9
ARTICLE VI SHARE CERTIFICATES			9
	Section 6.1	Issuance, Form and Signing of Certificates	9
	Section 6.2	Transfers	9
	Section 6.3	Loss or Destruction of Certificates	9
ARTICLE VII BOOKS AND RECORDS			10
	Section 7.1	Books of Accounts, Minutes and Share Register	10
	Section 7.2	Financial Statements	10
	Section 7.3	Copies of Resolutions	10
ARTICLE VIII CORPORATE SEAL			11
ARTICLE IX AMENDMENT OF BYLAWS			11
	Section 9.1	By the Shareholders	11
	Section 9.2	By the Board of Directors	11
ARTICLE X FISCAL YEAR			11
ARTICLE XI RULES OF ORDER			11

ii

BYLAWS

OF

ZYMOGENETICS, INC.

ARTICLE I

REGISTERED OFFICE AND REGISTERED AGENT

The registered office of the corporation shall be located in the State of Washington at such place as may be fixed from time to time by the board of directors upon filing of such notices as may be required by law, and the registered agent shall have a business office identical with such registered office. Any change in the registered agent or registered office shall be effective upon filing such change with the office of the Secretary of State of the State of Washington.

ARTICLE II

SHAREHOLDERS’ MEETINGS

Section 2.1 Annual Meetings. The annual meeting of the shareholders of this corporation, for the purpose of election of directors and for such other business as may come before it, shall be held annually either at the principal office of the corporation or at such other place which may be within or without the State of Washington, on such date and at such time in each case as may be determined by the board of directors and specified in the notice of the meeting.

Section 2.2 Special Meetings. Special meetings of the shareholders of this corporation may be called at any time by the holders of twenty-five percent (25%) of the voting shares of the corporation, or by the president, or by the board of directors. No business shall be transacted at any special meeting of shareholders except as is specified in the notice calling for said meeting. The place of any special meeting shall be the principal office of the corporation or as otherwise determined, within or without the State of Washington, by the board of directors and specified in the notice of the meeting.

Section 2.3 Notice of Meetings. Notice of annual or special meetings of shareholders stating the place, day, and hour of the meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called, shall be given by the secretary or persons authorized to call the meeting to each shareholder of record entitled to vote at the meeting. Such notice shall be given no fewer than ten (10) nor more than sixty (60) days before the meeting date, except that notice of a meeting to act on an amendment to the Articles of Incorporation, a plan of merger or share exchange, a proposed sale, lease, exchange or other disposition of all or substantially all of the assets of the corporation other than in the usual or regular course of business, or the dissolution of the corporation shall be given no fewer than twenty (20) nor more than sixty (60) days before the meeting date. Notice provided in a tangible medium may be transmitted by mail, private carrier, or personal delivery; telegraph or teletype; or telephone, wire, or wireless equipment which transmits a facsimile of the notice. Notice may be provided in

an electronic transmission and be electronically transmitted. Notice to shareholders in an electronic transmission is effective only with respect to shareholders that have consented, in the form of a record (as defined in section 7.1), to receive electronically transmitted notices under the Washington Business Corporation Act (hereinafter the “Act”) and designated in the consent the address, location, or system to which these notices may be electronically transmitted and with respect to a notice that otherwise complies with any other requirements of the Act and applicable federal law. Notice in a tangible medium, if correctly addressed to the shareholder’s address shown on the corporation’s stock transfer books, is effective: (a) when deposited in the United States mail, if mailed with first class postage prepaid; and (b) when dispatched, if prepaid, by air courier. Otherwise, notice in a tangible medium shall be effective when received. Notice provided in an electronic transmission is effective when it: (a) is electronically transmitted to an address, location, or system designated by the recipient for that purpose; or (b) has been posted on an electronic network and a separate record (as defined in section 7.1) of the posting has been delivered to the recipient together with comprehensible instructions regarding how to obtain access to the posting on the electronic network. For purposes of these bylaws, “deliver” includes (a) mailing; and (b) for purposes of delivering a demand, consent, notice, or waiver to the corporation or one of its officers, directors, or shareholders, transmission by facsimile equipment and delivery by electronic transmission.

Section 2.4 Waiver of Notice. Notice of the time, place, and purpose of any meeting may be waived (either before or after such meeting). The waiver must be delivered (as defined in section 2.3) by the shareholder entitled to notice to the corporation for inclusion in the minutes or filing with the corporate records, which waiver shall be set forth either (a) in an executed and dated record (as defined in section 7.1) or (b) if the corporation has designated an address, location, or system to which the waiver may be electronically transmitted and the waiver is electronically transmitted to the designated address, location, or system, in an executed and dated electronically transmitted record. “Execute” means (a) signed with respect to a written record, or (b) electronically transmitted along with sufficient information to determine the sender’s identity with respect to an electronic transmission. Notice of the time or place of a meeting will be waived by any shareholder by that shareholder’s attendance in person or by proxy, unless the shareholder at the beginning of the meeting objects to holding the meeting or transacting business at the meeting. Objection to consideration of a particular matter that is not within the purposes described in a special meeting notice will be waived unless the shareholder objects to considering the matter when it is presented. Any shareholder so waiving shall be bound by the proceedings of any such meeting in all respects as if due notice thereof had been given.

Section 2.5 Record Date. The board of directors may fix in advance a record date in order to determine the shareholders entitled to notice of a shareholders’ meeting, to demand a special meeting, to vote, or to take any other action, such date to be not more than seventy (70) days prior to the date on which the particular action requiring such determination of shareholders is to be taken. If no record date is fixed for the determination of shareholders entitled to notice of or to vote at a meeting of shareholders, or shareholders entitled to receive payment of a share dividend or a distribution (other than one involving the purchase, redemption, or other acquisition of the corporation’s shares), the day before the date on which notice of the meeting is effective or the date on which the board of directors authorizes such share dividend or

2

distribution, as the case may be, shall be the record date for such determination of shareholders. When a determination of shareholders entitled to vote at any meeting of shareholders has been made as provided in this section, such determination is effective for any adjournment thereof, unless the board of directors fixes a new record date, which it must do if the meeting is adjourned to a date more than one hundred twenty (120) days after the date fixed for the original meeting.

Section 2.6 Shareholders’ List for Meeting. After fixing a record date for a shareholders’ meeting, the corporation shall prepare an alphabetical list of the names of all shareholders on the record date who are entitled to notice of the shareholders’ meeting. The list shall be arranged by voting group, and within each voting group by class or series of shares, and show the address of and number of shares held by each shareholder. A shareholder, shareholder’s agent, or shareholder’s attorney may inspect the shareholder list, beginning ten (10) days prior to the shareholders’ meeting and continuing through the meeting, at the corporation’s principal office or at a place identified in the meeting notice in the city where the meeting will be held, during regular business hours and at the shareholder’s expense. The shareholders’ list shall be kept open for inspection during such meeting or any adjournment.

Section 2.7 Quorum and Adjourned Meetings. A majority of the votes entitled to be cast on a matter by a voting group shall constitute a quorum of that voting group at a meeting of shareholders. Once a share is represented for any purpose at a meeting, in person or by proxy, other than solely to object to holding the meeting or transacting business at the meeting, it is deemed present for quorum purposes for the remainder of the meeting and for any adjournment of that meeting, unless a new record date is or must be set for that adjourned meeting.

Section 2.8 Proxies. A shareholder may vote the shareholder’s shares in person or by proxy. A shareholder or the shareholder’s agent or attorney-in-fact may appoint a proxy to vote or otherwise act for the shareholder by: (a) executing (as defined in section 2.4) a writing authorizing another person or persons to act for the shareholder as proxy. Execution may be accomplished by the shareholder or the shareholder’s authorized officer, director, employee, or agent signing the writing or causing his or her signature to be affixed to the writing by any reasonable means including, but not limited to, by facsimile signature; or (b) authorizing another person or persons to act for the shareholder as proxy by transmitting or authorizing the transmission of a recorded telephone call, voice mail, or other electronic transmission to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service organization, or like agent duly authorized by the person who will be the holder of the proxy to receive the transmission, provided that the transmission must either set forth or be submitted with information, including any security or validation controls used, from which it can reasonably be determined that the transmission was authorized by the shareholder. An appointment of a proxy is effective when a signed appointment form or telegram, cablegram, recorded telephone call, voicemail, or other transmission of the appointment is received by the inspectors of election or the officer or agent of the corporation authorized to tabulate votes. An appointment is valid for eleven (11) months unless a longer period is expressly provided in the appointment.

3

Section 2.9 Voting of Shares. Except as otherwise provided in the Articles of Incorporation or in these Bylaws, every shareholder of record shall have the right at every shareholders’ meeting to one vote for every share standing in his or her name on the books of the corporation. If a quorum exists, action on a matter, other than election of directors, is approved by a voting group of shareholders if the votes cast within the voting group favoring the action exceed the votes cast within the voting group opposing the action, unless a greater number of affirmative votes is required by the Washington Business Corporation Act or by the Articles of Incorporation.

ARTICLE III

DIRECTORS

Section 3.1 General Powers. All corporate powers shall be exercised by or under the authority of, and the business and affairs of the corporation shall be managed under the direction of, the board of directors except as otherwise provided by the laws under which this corporation exists or in the Articles of Incorporation.

Section 3.2 Number. The number of directors of the corporation shall be one (1). The number of directors can be increased or decreased by resolution of the board of directors or the shareholders; provided, that no decrease in the number of directors shall shorten the term of any incumbent director.

Section 3.3 Tenure and Qualifications. The term of each director shall expire at the next annual meeting of shareholders. Despite the expiration of a director’s term, the director shall continue to serve until the director’s successor shall have been elected and qualified or until there is a decrease in the number of directors. Directors need not be residents of the state or shareholders of the corporation.

Section 3.4 Election. The directors shall be elected at the shareholders’ annual meeting each year; and if, for any cause, the directors shall not have been elected at an annual meeting, they may be elected at a special meeting of shareholders called for that purpose in the manner provided by these Bylaws. Directors shall be elected by the holders of classes or series of shares entitled to elect them.

Section 3.5 Vacancies. In case of any vacancy in the board of directors, including a vacancy resulting from an increase in the number of directors, the board of directors, a majority of the remaining directors if they do not constitute a quorum, or the shareholders may fill the vacancy.

Section 3.6 Resignation. Any director may resign at any time by delivering (as defined in section 2.3) an executed (as defined in section 2.4) notice to the board of directors, its chairperson, or the president or secretary of the corporation. A resignation shall be effective when the notice is delivered, unless the notice specifies a later effective date.

Section 3.7 Removal of Directors. At a meeting of shareholders called expressly for that purpose, the entire board of directors, or any member thereof, may be removed, with or

4

without cause, by a vote of the holders of the shares entitled to vote at an election of such directors. A director may not be removed if the number of votes sufficient to elect the director under cumulative voting is voted against the director’s removal.

Section 3.8 Meetings.

(a) The board of directors shall hold an annual meeting immediately after the annual shareholders’ meeting, at the same place as the annual shareholders’ meeting or at such other place and at such time as may be determined by the directors. No notice of the annual meeting of the board of directors shall be necessary.

(b) Special meetings may be called at any time and place by the president, secretary, or any one (1) director. Notice of the time and place of each special meeting shall be given by the secretary, or the persons calling the meeting. The notice may be provided in the form of a record (as defined in section 7.1) or given orally. The notice shall be given at least two (2) days in advance of the meeting. The purpose of the meeting need not be given in the notice. Notice provided in a tangible medium may be transmitted by mail, private carrier, or personal delivery; telegraph or teletype; or telephone, wire, or wireless equipment which transmits a facsimile of the notice. Notice may be provided in an electronic transmission and be electronically transmitted. Notice to directors in an electronic transmission is effective only with respect to directors that have consented, in the form of a record (as defined in section 7.1), to receive electronically transmitted notices under the Act and designated in the consent the address, location, or system to which these notices may be electronically transmitted and with respect to a notice that otherwise complies with any other requirements of the Act and applicable federal law. Oral notice may be communicated in person, by telephone, wire, or wireless equipment which does not transmit a facsimile of the notice, or by any electronic means which does not create a record. Notice provided in a tangible medium shall be effective at the earlier of (i) when it is received, or (ii) five (5) days after it is deposited in the United States mail, first-class postage prepaid, and correctly addressed. Notice provided in an electronic transmission is effective when it: (i) is electronically transmitted to an address, location, or system designated by the recipient for that purpose; or (ii) has been posted on an electronic network and a separate record (as defined in section 7.1) of the posting has been delivered (as defined in section 2.3) to the recipient together with comprehensible instructions regarding how to obtain access to the posting on the electronic network. Oral notice is effective when received. Notice of any special meeting may be waived (either before or after such meeting). The waiver must be delivered by the director entitled to the notice to the corporation for inclusion in the minutes or filing with the corporate records, which waiver shall be set forth either (i) in an executed (as defined in section 2.4) record or (ii) if the corporation has designated an address, location, or system to which the waiver may be electronically transmitted and the waiver has been electronically transmitted to the designated address, location, or system, in an executed electronically transmitted record. Notice of the special meeting will be waived by any director by that director’s attendance at or participation in the meeting, unless the director at the beginning of the meeting, or promptly upon the director’s arrival, objects and does not thereafter vote for or assent to action taken at the meeting.

5

(c) Regular meetings of the board of directors may be held at such place and on such day and hour as shall from time to time be fixed by resolution of the board of directors. No notice of regular meetings of the board of directors shall be necessary.

(d) At any meeting of the board of directors, any business may be transacted, and the board may exercise all of its powers.

Section 3.9 Quorum and Voting.

(a) A majority of the number of directors specified in or fixed in accordance with the Articles of Incorporation or these Bylaws shall constitute a quorum, but a lesser number may adjourn any meeting from time to time until a quorum is obtained, and no further notice thereof need be given.

(b) If a quorum is present when a vote is taken, the affirmative vote of a majority of the directors present at the meeting is the act of the board of directors. If enough directors withdraw from a meeting to leave less than a quorum, the remaining directors may not continue to transact business at such meeting.

Section 3.10 Compensation. By resolution of the board of directors, the directors may be paid their expenses, if any, of attendance at each meeting of the board of directors and may be paid a fixed sum for attendance at each meeting of the board of directors or a stated salary as director. No such payment shall preclude any director from serving the corporation in any other capacity and receiving compensation therefor.

Section 3.11 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 deemed to have assented to the action taken unless:

(a) the director objects at the beginning of the meeting, or promptly upon the director’s arrival, to holding it or transacting business at the meeting;

(b) the director’s dissent or abstention from the action taken is entered in the minutes of the meeting; or

(c) the director delivers (as defined in section 2.3) notice of the director’s dissent or abstention to the presiding officer of the meeting before its adjournment or to the corporation within a reasonable time after adjournment of the meeting.

The right of dissent or abstention is not available to a director who votes in favor of the action taken.

Section 3.12 Committees. The board of directors, by resolution approved by a majority of the full board of directors, may designate from among its members one or more committees, each of which must have two (2) or more members and, to the extent provided in such resolution, such committees shall have and may exercise all the authority of the board of

6

directors, except that no such committee shall have the authority to: authorize or approve a distribution except according to a general formula or method prescribed by the board of directors; approve or propose to shareholders action that the Washington Business Corporation Act requires to be approved by shareholders; fill vacancies on the board of directors or on any of its committees; adopt amendments to the Articles of Incorporation not requiring shareholder approval; adopt, amend or repeal the Bylaws; approve a plan of merger not requiring shareholder approval; or authorize or approve the issuance or sale or contract for sale of shares, or determine the designation and relative rights, preferences, and limitations of a class or series of shares, except that the board of directors may authorize a committee, or a senior executive officer of the corporation, to do so within limits specifically prescribed by the board of directors.

ARTICLE IV

SPECIAL MEASURES FOR CORPORATE ACTION

Section 4.1 Action Without a Meeting. Any corporate action required or permitted by the Articles of Incorporation, Bylaws, or the Washington Business Corporation Act, to be voted upon or approved at a duly called meeting of the directors, committee of directors, or shareholders may be accomplished without a meeting if one or more consents of the respective directors, committee members, or shareholders entitled to vote on the actions, setting forth the actions so taken, shall be executed (as defined in section 2.4) by all the directors, or committee members, entitled to vote thereon, or by the shareholders holding of record or otherwise entitled to vote in the aggregate the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote on the action were present and voted, as the case may be. Such consents may be executed in counterpart. In the case of action by the directors or a committee of the directors, the consents may be executed before or after the action is taken. Action taken by unanimous consent of the directors or a committee of the directors is effective when the last director or committee member executes the consent, unless the consent specifies a later effective date. Action taken by nonunanimous consent of the shareholders is effective when consents sufficient to authorize taking the action have been delivered (as defined in section 2.3) to the corporation, and the period of advance notice required by the corporation’s Articles of Incorporation to be given to any nonconsenting shareholders has been satisfied, unless the consent specifies a later effective date.

Section 4.2 Meetings by Conference Telephone. Members of the board of directors, members of a committee of directors, or shareholders may participate in or conduct their respective meetings by means of a conference telephone or similar communications equipment by which all persons participating in the meeting can hear each other at the same time, and participation in a meeting by such means shall constitute presence in person at such meeting.

ARTICLE V

OFFICERS

Section 5.1 Officers Designated. The officers of the corporation shall be a president, one or more vice presidents (the number thereof to be determined by the board of directors), a secretary, and a treasurer, each of whom shall be elected by the board of directors. Such other officers and assistant officers as may be deemed necessary may be elected or appointed by the board of directors. Any two (2) or more offices may be held by the same person.

7

The board of directors may, in its discretion, elect a chairperson of the board of directors and, if a chairperson has been elected, the chairperson shall, when present, preside at all meetings of the board of directors and the shareholders and shall have such other powers as the board may prescribe.

Section 5.2 Election, Qualification and Term of Office. Each of the officers shall be elected by the board of directors. The officers shall be elected by the board of directors at each annual meeting of the board of directors. Except as hereinafter provided, each of said officers shall hold office from the date of his or her election until the next annual meeting of the board of directors and until a successor shall have been duly elected and qualified.

Section 5.3 Powers and Duties.

(a) President. Unless otherwise determined by the board of directors, the president shall be the chief executive officer of the corporation and, subject to the direction and control of the board of directors, shall have general charge and supervision over its property, business, and affairs. If the president is a director, the president shall, unless a chairperson of the board of directors has been elected and is present, preside at meetings of the shareholders and the board of directors.

(b) Vice President. In the absence of the president or the president’s inability to act, the senior vice president shall act in the president’s place and stead and shall have all the powers and authority of the president, except as limited by resolution of the board of directors.

(c) Secretary. The secretary shall: (i) keep the minutes of the shareholders’ and of the board of directors’ meetings in one or more books provided for that purpose; (ii) see that all notices are duly given in accordance with the provisions of these Bylaws or as required by law; (iii) be custodian of the corporate records and of the seal of the corporation and affix the seal of the corporation to all documents as may be required; (iv) keep, or cause to be kept, a register of the post office address of each shareholder which shall be furnished to the secretary by such shareholder; (v) have general charge of the stock transfer books of the corporation; and (vi) in general perform all duties incident to the office of secretary and such other duties as from time to time may be assigned to the secretary by the president or by the board of directors.

(d) Treasurer. Subject to the direction and control of the board of directors, the treasurer shall have the custody, control, and disposition of the funds and securities of the corporation and shall account for the same, and at the expiration of term of office, the treasurer shall turn over to his or her successor all property of the corporation in his or her possession.

Section 5.4 Assistant Secretaries and Assistant Treasurers. The assistant secretaries and assistant treasurers shall perform such duties as shall be assigned to them by the secretary or the treasurer, respectively, or by the president or the board of directors.

8

Section 5.5 Removal. The board of directors shall have the right to remove any officer whenever in its judgment the best interests of the corporation will be served thereby.

Section 5.6 Vacancies. The board of directors shall fill any office which becomes vacant with a successor who shall hold office for the unexpired term and until a successor shall have been duly elected and qualified.

Section 5.7 Compensation. The compensation of all officers of the corporation shall be fixed by the board of directors.

ARTICLE VI

SHARE CERTIFICATES

Section 6.1 Issuance, Form and Signing of Certificates. No shares of the corporation shall be issued unless authorized by the board. Such authorization shall include the maximum number of shares to be issued, the consideration to be received for each share, and a statement that the board has determined that such consideration is adequate. Certificates for shares of the corporation shall be in such form as is consistent with the provisions of the Washington Business Corporation Act and shall state:

(a) the name of the corporation and that the corporation is organized under the laws of this state;

(b) the name of the person to whom issued; and

(c) the number and class of shares and the designation of the series, if any, which such certificate represents.

Certificates shall be signed by two (2) officers of the corporation, and the seal of the corporation may be affixed thereto. If any officer who has signed or whose facsimile signature has been placed upon any certificate shall have ceased to be such officer before such certificate is issued, it may be issued by the corporation with the same effect as if the person were such officer at the date of its issue. Certificates may be issued for fractional shares. No certificate shall be issued for any share until the consideration established for its issuance has been paid.

Section 6.2 Transfers. Shares may be transferred by delivery of the certificate therefor, accompanied either by an assignment in writing on the back of the certificate or by a written power of attorney to assign and transfer the same, signed by the record holder of the certificate. The board of directors may, by resolution, provide that beneficial owners of shares shall be deemed holders of record for certain specified purposes. Except as otherwise specifically provided in these Bylaws, no shares shall be transferred on the books of the corporation until the outstanding certificate therefor has been surrendered to the corporation.

Section 6.3 Loss or Destruction of Certificates. In case of loss or destruction of any certificate of shares, another may be issued in its place upon proof of such loss or destruction and upon the giving of a satisfactory indemnity bond to the corporation. A new certificate may be issued without requiring any bond when, in the judgment of the board of directors, it is proper to do so.

9

ARTICLE VII

BOOKS AND RECORDS

Section 7.1 Books of Accounts, Minutes and Share Register. The corporation shall keep as permanent records minutes of all meetings of its shareholders and board of directors, a record of all actions taken by the shareholders and board of directors without a meeting, and a record of all actions taken by a committee of the board of directors exercising the authority of the board of directors on behalf of the corporation. The corporation shall maintain appropriate accounting records. The corporation or its agent shall maintain a record of its shareholders, in a form that permits preparation of a list of the names and addresses of all shareholders, in alphabetical order by class of shares showing the number and class of shares held by each. The corporation shall keep a copy of the following records at its principal office: the Articles or Restated Articles of Incorporation and all amendments to them currently in effect; the Bylaws or Restated Bylaws and all amendments to them currently in effect; the minutes of all shareholders’ meetings and records of all actions taken by shareholders without a meeting, for the past three (3) years; its financial statements for the past three (3) years, including balance sheets showing in reasonable detail the financial condition of the corporation as of the close of each fiscal year, and an income statement showing the results of its operations during each fiscal year; all communications in the form of a record to shareholders generally within the past three (3) years; a list of the names and business addresses of its current directors and officers; and its most recent annual report delivered (as defined in section 2.3) to the Secretary of State of Washington. “Record” means information inscribed on a tangible medium or contained in an electronic transmission.

Section 7.2 Financial Statements. The annual financial statements for shareholders shall be prepared not later than four (4) months after the close of each fiscal year and in any event prior to the annual meeting of shareholders. If financial statements are prepared by the corporation for any purpose on a particular basis (i.e., on the basis of generally accepted accounting principles or on some other basis), the annual financial statements must be prepared, and disclose that they are prepared, on that same basis. If the annual financial statements are reported upon by a public accountant, the accountant’s report must accompany them. If not, the statements must be accompanied by a statement of the president or the person responsible for the corporation’s accounting records, stating the person’s reasonable belief whether the statements were prepared on the basis of generally accepted accounting principles and, if not, describing the basis of preparation, and describing any respects in which the statements were not prepared on a basis of accounting consistent with the basis used for statements prepared for the preceding year.

Section 7.3 Copies of Resolutions. Any person dealing with the corporation may rely upon a copy of any of the records of the proceedings, resolutions, or votes of the board of directors or shareholders, when certified by the president or secretary.

10

ARTICLE VIII

CORPORATE SEAL

The board of directors may provide for a corporate seal which shall have inscribed thereon the name of the corporation, the year and state of incorporation and the words “corporate seal.”

ARTICLE IX

AMENDMENT OF BYLAWS

Section 9.1 By the Shareholders. These Bylaws may be amended, altered, or repealed at any annual or special meeting of the shareholders; provided that, in the case of a special meeting, notice of the proposed alteration or amendment is contained in the notice of the meeting.

Section 9.2 By the Board of Directors. These Bylaws may be amended, altered, or repealed by the board of directors at any annual, regular or special meeting of the board.

ARTICLE X

FISCAL YEAR

The fiscal year of the corporation shall be set by resolution of the board of directors.

ARTICLE XI

RULES OF ORDER

The rules contained in the most recent edition of Robert’s Rules of Order, Newly Revised, shall govern all meetings of shareholders and directors where those rules are not inconsistent with the Articles of Incorporation, these Bylaws, or special rules of order of the corporation.

11