-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OZdbuoziDjem5RHkE6xWBZEAMZOeft6fAwYFjgZyMr00ZEZJkNGae1gKG11Km8kB WyQ2MuZMID32Ov9CvhUw5A== 0001019892-02-000046.txt : 20020617 0001019892-02-000046.hdr.sgml : 20020617 20020617160841 ACCESSION NUMBER: 0001019892-02-000046 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20020617 EFFECTIVENESS DATE: 20020617 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HOMEGOLD FINANCIAL INC CENTRAL INDEX KEY: 0000277028 STANDARD INDUSTRIAL CLASSIFICATION: PERSONAL CREDIT INSTITUTIONS [6141] IRS NUMBER: 570513287 STATE OF INCORPORATION: SC FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: 1933 Act SEC FILE NUMBER: 333-90624 FILM NUMBER: 02680690 BUSINESS ADDRESS: STREET 1: 3901 PELHAM ROAD CITY: GREENVILLE STATE: SC ZIP: 29615 BUSINESS PHONE: 8642895400 MAIL ADDRESS: STREET 1: 3901 PELHAM ROAD CITY: GREENVILLE STATE: SC ZIP: 29615 FORMER COMPANY: FORMER CONFORMED NAME: NRUC CORP DATE OF NAME CHANGE: 19911002 FORMER COMPANY: FORMER CONFORMED NAME: EMERGENT GROUP INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: NATIONAL RAILWAY UTILIZATION CORP DATE OF NAME CHANGE: 19840813 S-8 1 forms8-06172002.txt PLAN AMENDMENTS AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 17, 2002. REGISTRATION FILE NO. 333-_________ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------- FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 HOMEGOLD FINANCIAL, INC. (Exact name of registrant as specified in its charter) South Carolina 57-0513287 -------------- ---------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1021 BRIARGATE CIRCLE, SUITE B COLUMBIA, SOUTH CAROLINA 29210 (803) 365-2500 (TELEPHONE) (803) 365-2503 (FACSIMILE) (Address, including Zip code, and telephone number, including area code, of registrant's principal executive offices) HOMEGOLD FINANCIAL, INC. 1995 EMPLOYEE AND OFFICER STOCK OPTION PLAN HOMEGOLD FINANCIAL, INC. EMPLOYEE STOCK PURCHASE PLAN (Full title of plans) CT CORPORATION SYSTEM 75 BEATTIE PLACE GREENVILLE, SOUTH CAROLINA 29601 (864) 240-3302 --------------------------------------------- (Name, address, and telephone number, including area code, of agent for service) Copies to: ANDREW B. COBURN, ESQ. WYCHE, BURGESS, FREEMAN & PARHAM, P.A. POST OFFICE BOX 728 GREENVILLE, SOUTH CAROLINA 29602-0728 (864) 242-8200 (TELEPHONE) (864) 235-8900 (FACSIMILE) CALCULATION OF REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------------------ Proposed Maximum Proposed Maximum Title of Each Class Amount to Offering Price Aggregate Amount of of Securities to be Registered be Registered Per Security Offering Price (1) Registration Fee - ------------------------------------------------------------------------------------------------------------------------------------ Common Stock........ 900,000 shares $0.36(1) $324,000.00 $29.81 - ------------------------------------------------------------------------------------------------------------------------------------
(1) Pursuant to Rule 457(h), the average of the high and low prices as reported on the NASDAQ OTC Bulletin Board on June 13, 2002 is used for purposes of calculating the registration fee. The Exhibit Index appears on Page 6 hereof. PART I: INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS Pursuant to General Instruction G, information updating the Section 10(a) Prospectuses to the HomeGold Financial, Inc. 1995 Employee and Officer Stock Option Plan (the "Stock Option Plan") and the HomeGold Financial, Inc. Employee Stock Purchase Plan (the "ESPP") has been or will be provided to participants as specified in Rule 428(b)(1) and is not included in this Registration Statement. PART II: INFORMATION REQUIRED IN THE REGISTRATION STATEMENT In accordance with General Instruction E. to Form S-8, the contents of those certain registration statements on Form S-8, SEC File Nos. 333-20179, 333-07923 and 333-58861 filed January 22, 1997, July 11, 1996 and July 10, 1998 respectively, are incorporated herein by reference, except to the extent that the information therein is modified as indicated below. Effective April 28, 2000, the Stock Option Plan and ESPP were amended to increase the number of shares issuable thereunder by 500,000 and 400,000, respectively. ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE. The following documents or portions thereof are hereby incorporated by reference: The Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2001, Commission File No. 0-08909. The Company's Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2002, Commission File No. 0-08909. All other reports filed by the Company pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, since the end of the Company's 2001 fiscal year. The description of the Company's common stock contained in the Company's Form S-1 filed with the Securities and Exchange Commission on March 1, 1996, Commission File No. 333-01393. All documents subsequently filed by the Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended, prior to the filing of a post-effective amendment which indicates that all securities offered have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference in this Registration Statement and to be part thereof, from the date of filing of such documents. ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL. Wyche, Burgess, Freeman & Parham, P.A. served as counsel to the Company in connection with the preparation of this Registration Statement on Form S-8 and has rendered an opinion with respect to certain aspects of the legality of the shares of Common Stock of the Company to be issued pursuant to this Registration Statement. The attorneys of Wyche, Burgess, Freeman & Parham, P.A. beneficially own 95,355 shares of Common Stock of the Company. ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Sections 33-8-500 through 33-8-580 of the 1976 Code of Laws of South Carolina, as amended, (the "South Carolina Code") relating to permissible, 2 mandatory and court-ordered indemnification of directors and officers of South Carolina corporations in certain circumstances are set forth in Exhibit 99.3 of this Registration Statement and are incorporated herein by reference. Article V of the By-Laws of the Company provides for the indemnification of directors, employees and agents of the Company as set forth in Exhibit 99.4 of this Registration Statement and is incorporated herein by reference. The Company's Articles of Incorporation provide as follows: "A director of the corporation shall not be personally liable to the corporation or any of its shareholders for monetary damages for breach of fiduciary duty as a director, provided that this provision shall not be deemed to eliminate or limit the liability of a director (i) for any breach of the director's duty of loyalty to the corporation or its shareholders; (ii) for acts or omissions not in good faith or which involve gross negligence, intentional misconduct, or a knowing violation of law; (iii) imposed under Section 33-8-330 of the Act (improper distribution to shareholder); or (iv) for any transaction from which the director derived an improper personal benefit." Section 33-8-570 of the South Carolina Code permits a corporation to purchase and maintain insurance on behalf of a person who is or was an officer or director. The Company currently maintains directors' and officers' liability insurance. The Stock Option Plan provides as follows: "In addition to such other rights of indemnification as they may have as members of the Board, the members of the Board (or Committee, as applicable) shall, to the fullest extent permitted by law, be indemnified by the Company against the reasonable expenses, including attorney's fees, actually and necessarily incurred in connection with the defense of any action, suit or proceeding, or in connection with any appeal therein, to which they or any of them may be a party by reason of any action taken or failure to act under or in connection with the Plan or any Option granted thereunder, and against all amounts paid by them in settlement thereof (provided such settlement is approved by independent legal counsel selected by the Company) or paid by them in satisfaction of a judgment in any such action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such action, suit or proceeding that such Board member (or Committee member, as applicable) is liable for gross negligence or misconduct in the performance of his or her duties; provided that within 60 days after institution of any such action, suit or proceeding the Board member (or Committee member, as applicable) shall in writing offer the Company the opportunity, at its own expense, to handle and defend the same." ITEM 8. EXHIBITS. 4.1.1 Restated Articles of Incorporation as filed with the South Carolina Secretary of State on June 6, 1997: Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1998, Commission File No. 000-08909 (Exhibit 3.1). 4.1.2 Articles of Amendment as filed with the South Carolina Secretary of State on June 24, 1998: Incorporated by reference to the Company's Current Report on Form 8-K filed on July 7, 1998, Commission File No. 000-08909 (Exhibit 3.1). 4.1.3 Articles of Amendment filed with the South Carolina Secretary of State on May 9, 2000 (i) reducing par value of common stock from $0.05 per share to $0.001 per, (ii) eliminating cumulative voting with respect to election of directors and (iii) authorizing issuance of up to 20,000,000 shares of "blank check" preferred stock: Incorporated by 3 reference to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2000, Commission File No. 000-08909 (Exhibit 3.1.1). 4.1.4 Articles of Amendment filed with the South Carolina Secretary of State on May 9, 2000 containing Certificate of Designation of Series A Non-convertible Preferred Stock of the Company: Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2000, Commission File No. 000-8909 (Exhibit 3.1.2). 4.2 Amended and Restated Bylaws dated March 12, 1997: Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1998, Commission File No. 000-08909 (Exhibit 3.2). 5.1 Opinion of Wyche, Burgess, Freeman & Parham, P.A. regarding legality of shares of HomeGold Financial, Inc. 23.1 Consent of Elliott, Davis & Company, LLP. 23.2 Consent of Wyche, Burgess, Freeman & Parham, P.A.: Contained in Exhibit 5.1. 24.1 Power of Attorney: Contained on the signature page of this Registration Statement. 99.1 Amendment No. 4 to the HomeGold Financial, Inc. 1995 Officer and Employee Stock Option Plan: Incorporated by reference to Exhibit 10.2.2 of the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2000, Commission File No. 000-08909. 99.2 Amendment No. 1 to the HomeGold Financial, Inc. Employee Stock Purchase Plan: Incorporated by reference to the Company's Definitive Proxy Statement filed on March 21, 2000 for the 2000 Annual Meeting of the Company's shareholders held on April 28, 2000, Commission File No. 000-08909. 99.3 Sections 33-8-500 through - 580 of the 1976 Code of Laws of South Carolina, as amended. 99.4 Article V of the Amended and Restated By-Laws of the Company dated March 12, 1997. 4 SIGNATURES Pursuant to the requirements of the Securities Act, HomeGold Financial, Inc. certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Columbia, State of South Carolina, on June 14, 2002. HOMEGOLD FINANCIAL, INC. By: /s/ Kevin G. Martin -------------------------------------- Kevin G. Martin, Chief Financial Officer POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Kevin G. Martin and David C. Gaffney, and each of them, as true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, and to file the same, with all annexes thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all which said attorneys-in-fact and agents or any of them, or their or his or her substitute or substitutes, may lawfully do, or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and as of the dates indicated:
SIGNATURE TITLE DATE /s/ Ronald J. Sheppard Chief Executive Officer and June 14, 2002 - ------------------------------------ Director Ronald J. Sheppard (Principal Executive Officer) /s/ Kevin G. Martin Chief Financial Officer June 14, 2002 - ------------------------------------ (Principal Accounting and Financial Officer) Kevin G. Martin /s/ John M. Sterling, Jr. Chairman of the Board of Directors June 14, 2002 - ------------------------------------ John M. Sterling, Jr. /s/ Paul Banninger Director June 14, 2002 - ------------------------------------ Paul Banninger 5 SIGNATURE TITLE DATE Director - ------------------------------------ ------------------ Tecumseh Hooper, Jr. Director - ------------------------------------ ------------------ J. Robert Philpott, Jr.
INDEX TO EXHBITS CONTAINED HEREIN Exhibit 5.1 Opinion of Wyche, Burgess, Freeman & Parham, P.A. regarding legality of shares of HomeGold Financial, Inc. 23.1 Consent of Elliott, Davis & Company, LLP. 23.2 Consent of Wyche, Burgess, Freeman & Parham, P.A.: Contained in Exhibit 5.1. 24.1 Power of Attorney: Contained on the signature page of this Registration Statement. 99.3 Sections 33-8-500 through -580 of the 1976 Code of Laws of South Carolina, as amended. 99.4 Article V of the Amended and Restated By-Laws of the Company dated March 12, 1997. 6 EX-5 3 legalopinion-forms8.txt LEGAL OPINION EXHIBIT 5.1 May 20, 2002 HomeGold Financial, Inc. 1021 Briargate Circle, Suite B Columbia, SC 29210 RE: Registration Statement on Form S-8 of Common Stock Subject to HomeGold Financial, Inc. 1995 Employee and Officer Stock Option Plan & HomeGold Financial, Inc. Employee Stock Purchase Plan Ladies and Gentlemen: The opinion set forth below is rendered with respect to the 900,000 shares, $.001 par value, of common stock of HomeGold Financial, Inc., a South Carolina corporation (the "Company"), that will be registered with the Securities and Exchange Commission by the above-referenced Registration Statement on Form S-8 pursuant to the Securities Act of 1933, as amended, in connection with the HomeGold Financial, Inc. 1995 Employee and Officer Stock Option Plan and the HomeGold Financial, Inc. Employee Stock Purchase Plan (the "Plans"). We have examined the Company's Articles of Incorporation, and all amendments thereto, the Company's Bylaws, as amended, and reviewed the records of the Company's corporate proceedings. We have made such other investigation of law and fact as we have deemed necessary in order to enable us to render this opinion. With respect to matters of fact, we have relied upon information provided to us by the Company without further investigation. With respect to all examined documents, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to authentic originals of all documents submitted to us as copies and the accuracy and completeness of the information contained therein. Based on the foregoing and subject to the comments, limitations and qualifications set forth below, we are of the opinion that upon satisfaction of any vesting and other conditions set forth in the Plans and in any applicable stock award agreement or letter, shares of the Company's common stock covered by the above-referenced Registration Statement that are issued after the date hereof under and in compliance with the terms of the Plans will be legally issued, fully paid and non-assessable. The foregoing opinion assumes (i) that any action by the Board of Directors of the Company, or any committee thereof, approving the terms of any award under the Plans will be taken in compliance with the articles and bylaws of the Company and applicable provisions of the South Carolina Code, as amended, and (ii) that any committee of the Board of Directors of the Company that approves the terms of any stock award will have been duly established and authorized in accordance with the articles and bylaws of the Company, the terms of the Plans and all applicable provisions of the South Carolina Code, as amended. This opinion is limited to matters governed by the laws of the State of South Carolina in force on the date of this letter. We express no opinion with regard to any matter that may be (or which purports to be) governed by the laws of any other state or jurisdiction. In addition, we express no opinion with respect to any matter arising under or governed by the South Carolina Uniform Securities Act. This opinion is rendered as of the date of this letter and applies only to the matters specifically covered by this opinion, and we disclaim any continuing responsibility for matters occurring after the date of this letter. This opinion is rendered solely for your benefit in connection with the Registration Statement on Form S-8 respecting shares of the Company's common stock to be issued under the Plans and may not be relied upon, quoted or used by any other person or entity or for any other purpose without our prior written consent. We consent to the use of this opinion as an exhibit to the Registration Statement on Form S-8 respecting shares of the Company's common stock to be issued under the Plans. Very Truly Yours, /s/ WYCHE, BURGESS, FREEMAN & PARHAM, P.A. EX-23 4 consentofauditor-s8.txt CONSENT OF AUDITOR EXHIBIT 23.1 INDEPENDENT AUDITOR'S CONSENT The Board of Directors HomeGold Financial, Inc. We consent to incorporation by reference in the registration statements on Form S-8 (No. 333-07925) 1995 Director Stock Option Plan Stock Plan, (No. 333-07927) 1995 Restricted Stock Agreement Plan, (No. 333-07923) 1995 Employee Stock Option Plan, as amended by S-8 No. 333,58861, (No. 333-20179) Employee Stock Purchase Plan of HomeGold Financial, Inc. and the S-8 filed on or about June 11, 2002 (333-XXXXX) amending the HomeGold Financial, Inc. 1995 Employee and Officer Stock Option Plan and the HomeGold Financial, Inc. Employee Stock Purchase Plan to increase the issuable shares under the Plans by a total of 900,000 shares of our report dated April 8, 2002, relating to the consolidated balance sheets of HomeGold Financial, Inc. and subsidiaries (the "Company") as of December 31, 2001 and 2000 and the related consolidated statements of operations, shareholders deficit and cash flows for each of the years in the three-year period ended December 31, 2001, which report appears in the 2001 Annual Report on Form 10-K of the Company. /s/ Elliott Davis LLC Elliott Davis, LLC Greenville, South Carolina June 11, 2002 EX-99 5 sccode-section8.txt SC CODE SECTIONS Exhibit 99.3 SOUTH CAROLINA CODE CHAPTER 8. DIRECTORS AND OFFICERS ARTICLE 5. INDEMNIFICATION SECTION 33-8-500. Article definitions. In this subchapter: (1) "Corporation" includes any domestic or foreign predecessor entity of a corporation in a merger or other transaction in which the predecessor's existence ceased upon consummation of the transaction. (2) "Director" means an individual who is or was a director of a corporation or an individual who, while a director of a corporation, is or was serving at the corporation's request as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, employee benefit plan, or other enterprise. A director is considered to be serving an employee benefit plan at the corporation's request if his duties to the corporation also impose duties on, or otherwise involve services by, him to the plan or to participants in or beneficiaries of the plan. "Director" includes, unless the context requires otherwise, the estate or personal representative of a director. (3) "Expenses" include counsel fees. (4) "Liability" means the obligation to pay a judgment, settlement, penalty, fine (including an excise tax assessed with respect to an employee benefit plan), or reasonable expenses incurred with respect to a proceeding. (5) "Official capacity" means: (i) when used with respect to a director, the office of director in a corporation; and (ii) when used with respect to an individual other than a director, as contemplated in Section 33-8-560, the office in a corporation held by the officer, or the employment or agency relationship undertaken by the employee or agent on behalf of the corporation. "Official capacity" does not include service for any other foreign or domestic corporation or any partnership, joint venture, trust, employee benefit plan, or other enterprise. (6) "Party" includes an individual who was, is, or is threatened to be made a named defendant or respondent in a proceeding. (7) "Proceeding" means any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative and whether formal or informal. SECTION 33-8-510. Authority to indemnify. (a) Except as provided in subsection (d), a corporation may indemnify an individual made a party to a proceeding because he is or was a director against liability incurred in the proceeding if: (1) he conducted himself in good faith; and (2) he reasonably believed: (i) in the case of conduct in his official capacity with the corporation, that his conduct was in its best interest; and (ii) in all other cases, that his conduct was at least not opposed to its best interest; and (3) in the case of any criminal proceeding, he had no reasonable cause to believe his conduct was unlawful. (b) A director's conduct with respect to an employee benefit plan for a purpose he reasonably believed to be in the interests of the participants in and beneficiaries of the plan is conduct that satisfies the requirement of subsection (a)(2)(ii). (c) The termination of a proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent is not, of itself, determinative that the director did not meet the standard of conduct described in this section. (d) A corporation may not indemnify a director under this section: (1) in connection with a proceeding by or in the right of the corporation in which the director was adjudged liable to the corporation; or (2) in connection with any other proceeding charging improper personal benefit to him, whether or not involving action in his official capacity, in which he was adjudged liable on the basis that personal benefit was improperly received by him. (e) Indemnification permitted under this section in connection with a proceeding by or in the right of the corporation is limited to reasonable expenses incurred in connection with the proceeding. SECTION 33-8-520. Mandatory indemnification. Unless limited by its articles of incorporation, a corporation shall indemnify a director who was wholly successful, on the merits or otherwise, in the defense of any proceeding to which he was a party because he is or was a director of the corporation against reasonable expenses incurred by him in connection with the proceeding. SECTION 33-8-530. Advance for expenses. (a) A corporation may pay for or reimburse the reasonable expenses incurred by a director who is a party to a proceeding in advance of final disposition of the proceeding if: (1) the director furnishes the corporation a written affirmation of his good faith belief that he has met the standard of conduct described in Section 33-8-510; (2) the director furnishes the corporation a written undertaking, executed personally or on his behalf, to repay the advance if it is ultimately determined that he did not meet the standard of conduct; and (3) a determination is made that the facts then known to those making the determination would not preclude indemnification under this subchapter. (b) The undertaking required by subsection (a)(2) must be an unlimited general obligation of the director but need not be secured and may be accepted without reference to financial ability to make repayment. (c) Determinations and authorizations of payments under this section must be made in the manner specified in Section 33-8-550. SECTION 33-8-540. Court-ordered indemnification. Unless a corporation's articles of incorporation provide otherwise, a director of the corporation who is a party to a proceeding may apply for indemnification to the court conducting the proceeding or to another court of competent jurisdiction. On receipt of an application, the court after giving any notice the court considers necessary may order indemnification if it determines: (1) the director is entitled to mandatory indemnification under Section 33-8-520, in which case the court also shall order the corporation to pay the director's reasonable expenses incurred to obtain court-ordered indemnification; or (2) the director is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, whether or not he met the standard of conduct set forth in Section 33-8-510 or was adjudged liable as described in Section 33-8-510(d), but if he was adjudged so liable his indemnification is limited to reasonable expenses incurred. SECTION 33-8-550. Determination and authorization of indemnification. (a) A corporation may not indemnify a director under Section 33-8-510 unless authorized in the specific case after a determination has been made that indemnification of the director is permissible in the circumstances because he has met the standard of conduct set forth in Section 33-8-510. (b) The determination must be made: (1) by the board of directors by majority vote of a quorum consisting of directors not at the time parties to the proceeding; (2) if a quorum cannot be obtained under subdivision (1), by majority vote of a committee duly designated by the board of directors (in which designation directors who are parties may participate), consisting solely of two or more directors not at the time parties to the proceeding; (3) by special legal counsel: (i) selected by the board of directors or its committee in the manner prescribed in item (1) or (2); or (ii) if a quorum of the board of directors cannot be obtained under subdivision (1) and a committee cannot be designated under subdivision (2), selected by majority vote of the full board of directors (in which selection directors who are parties may participate); or (4) by the shareholders, but shares owned by or voted under the control of directors who are at the time parties to the proceeding may not be voted on the determination. (c) Authorization of indemnification and evaluation as to reasonableness of expenses must be made in the same manner as the determination that indemnification is permissible, except that, if the determination is made by special legal counsel, authorization of indemnification and evaluation as to reasonableness of expenses must be made by those entitled under subsection (b)(3) to select counsel. SECTION 33-8-560. Indemnification of officers, employees, and agents. Unless a corporation's articles of incorporation provide otherwise: (1) an officer of the corporation who is not a director is entitled to mandatory indemnification under Section 33-8-520, and is entitled to apply for court-ordered indemnification under Section 33-8-540, in each case to the same extent as a director; (2) the corporation may indemnify and advance expenses under this subchapter to an officer, employee, or agent of the corporation who is not a director to the same extent as to a director; and (3) a corporation also may indemnify and advance expenses to an officer, employee, or agent who is not a director to the extent, consistent with public policy, that may be provided by its articles of incorporation, bylaws, general or specific action of its board of directors, or contract. SECTION 33-8-570. Insurance. A corporation may purchase and maintain insurance on behalf of an individual who is or was a director, officer, employee, or agent of the corporation, or who, while a director, officer, employee, or agent of the corporation, is or was serving at the request of the corporation as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, employee benefit plan, or other enterprise, against liability asserted against or incurred by him in that capacity or arising from his status as a director, officer, employee, or agent, whether or not the corporation would have power to indemnify him against the same liability under Section 33-8-510 or 33-8-520. SECTION 33-8-580. Application of article. (a) A provision treating a corporation's indemnification of or advance for expenses to directors that is contained in its articles of incorporation, bylaws, a resolution of its shareholders or board of directors, or in a contract or otherwise is valid only if and to the extent the provision is consistent with this article. If articles of incorporation limit indemnification or advance for expenses, indemnification and advance for expenses are valid only to the extent consistent with the articles. (b) This article does not limit a corporation's power to pay or reimburse expenses incurred by a director in connection with his appearance as a witness in a proceeding at a time when he has not been made a named defendant or respondent to the proceeding. EX-99 6 bylaws-article5.txt EXCERPT FROM BYLAWS Exhibit 99.4 ARTICLE V. INDEMNIFICATION OF DIRECTORS, OFFICERS, AGENTS, AND EMPLOYEES Section 5.1 Indemnification of Directors and Officers. The corporation shall indemnify any individual made a party to a proceeding because he is or was a director or officer of the corporation against liability incurred in the proceeding to the fullest extent permitted by law. Section 5.2 Advance Expenses for Directors and Officers. The corporation shall pay for or reimburse the reasonable expenses incurred by a director who is a party to a proceeding in advance of final disposition of the proceeding to the fullest extent permitted by law. Section 5.3 Other Employees and Agents. In addition to any indemnification required by law, the corporation may, to the extent authorized from time to time by the board of directors, grant rights to indemnification, and rights to be paid by the corporation the expenses incurred in defending any proceeding in advance of its final disposition, to any employee or agent of the corporation to the fullest extent of the provisions of this By-Law with respect to the indemnification and advancement of expenses of directors and officers of the corporation. Section 5.4 Nature of Right to Indemnification. The right to indemnification conferred in this By-Law 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, such advances to be paid by the corporation within 30 days after the receipt by the corporation of a statement or statements from the claimant requesting such advances from time to time; provided, however, that the payment of such expenses, incurred by a person to whom indemnification is or may be available under this By-Law, in advance of the final disposition of a proceeding shall be made only pursuant to Section 33-8-530 of the Act, or such successor provision as may be in effect from time to time. Section 5.5 Request for Indemnification; Determination of Entitlement Thereto. To obtain indemnification under this By-Law, a claimant shall submit to the corporation a written request, including therein or therewith such documentation and information as is reasonably available to the claimant and is reasonably necessary to determine whether and to what extent the claimant is entitled to indemnification. Upon written request by a claimant for indemnification pursuant to the first sentence of this Section 5.5, a determination with respect to the claimant's entitlement thereto shall be made in accordance with Section 33-8-550 of the Act, or such successor provision as may be in effect from time to time. If it is so determined that the claimant is entitled to indemnification, payment to the claimant shall be made within 10 days after such determination. Section 5.6 Right of Action; No Presumption. If a claim under Sections 5.1, 5.2 or 5.3 of this By-Law is not paid in full by the corporation within thirty days after a written claim pursuant to Section 5.5 of this By-Law has been received by the corporation, the claimant may at any time thereafter bring suit against the corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall be entitled to be paid also the expense of prosecuting such claim to the extent permitted by law. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in defending any proceeding in advance of its final disposition where the requirements of Section 33-8-530 of the Act, or any successor provision thereto that may be in effect from time to time, have been complied with) that the claimant has not met the standard of conduct which makes it permissible under the Act for the corporation to indemnify the claimant for the amount claimed, but the burden of proving such defense shall be on the corporation. Neither the failure of the corporation (including its board of directors, special counsel or shareholders) 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 Act, nor an actual determination by the corporation (including its board of directors, special counsel or shareholders) that the claimant has not met such applicable standard of conduct, shall create a presumption that the claimant has not met the applicable standard of conduct. Section 5.7 Binding Effect on the Corporation. If a determination shall have been made pursuant to Section 5.5 of this By-Law that the claimant is entitled to indemnification, the corporation shall be bound by such determination in any judicial proceeding commenced pursuant to Section 5.6 of this By-Law. Section 5.8 No Challenge to Validity. The corporation shall be precluded from asserting in any judicial proceeding commenced pursuant to Section 5.6 of this By-Law that the procedures and presumptions of this By-Law are not valid, binding and enforceable and shall stipulate in such proceeding that the corporation is bound by all the provisions of this By-Law. Section 5.9 Exclusivity. The right to indemnification and the payment of expenses incurred in defending a proceeding in advance of its final disposition conferred in this By-Law 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, By-Laws, agreement, vote of shareholders or directors or otherwise. No repeal or modification of this By-Law shall in any way diminish or adversely affect the rights of any director, officer, employee or agent of the corporation hereunder in respect of any occurrence or matter arising prior to any such repeal or modification. Section 5.10 Severability. If any provision or provisions of this By-Law shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (1) the validity, legality and enforceability of the remaining provisions of this By-Law (including, without limitation, each portion of any Section of this By-Law containing any such provision held to be invalid, illegal or unenforceable, that is not itself held to be invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby; and (2) to the fullest extent possible, the provisions of this By-Law (including, without limitation, each such portion of any Section of this By-Law containing any such provision held to be invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable. Section 5.11 Notices. Any notice, request or other communication required or permitted to be given to the corporation under this By-Law shall be in writing and either delivered in person or sent by telecopy, telex, telegram, overnight mail or courier service, or certified or registered mail, postage prepaid, return receipt requested, to the Secretary of the corporation and shall be effective only upon receipt by the Secretary. -----END PRIVACY-ENHANCED MESSAGE-----