0000356446-01-500010.txt : 20011009
0000356446-01-500010.hdr.sgml : 20011009
ACCESSION NUMBER: 0000356446-01-500010
CONFORMED SUBMISSION TYPE: DEF 14A
PUBLIC DOCUMENT COUNT: 2
CONFORMED PERIOD OF REPORT: 20010924
FILED AS OF DATE: 20010921
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: PURE WORLD INC
CENTRAL INDEX KEY: 0000356446
STANDARD INDUSTRIAL CLASSIFICATION: INVESTORS, NEC [6799]
IRS NUMBER: 953419191
STATE OF INCORPORATION: DE
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: DEF 14A
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-10566
FILM NUMBER: 1742225
BUSINESS ADDRESS:
STREET 1: P O BOX 74
STREET 2: 376 MAIN ST
CITY: BEDMINSTER
STATE: NJ
ZIP: 07921
BUSINESS PHONE: 9082349220
MAIL ADDRESS:
STREET 1: P O BOX 74
STREET 2: 376 MAIN STREET
CITY: BEDMINSTER
STATE: NJ
ZIP: 07921
FORMER COMPANY:
FORMER CONFORMED NAME: AMERICAN HOLDINGS INC /DE/
DATE OF NAME CHANGE: 19940411
FORMER COMPANY:
FORMER CONFORMED NAME: COMPUTER MEMORIES INC
DATE OF NAME CHANGE: 19920908
FORMER COMPANY:
FORMER CONFORMED NAME: COMPUTER MEMORIES INC /DE/
DATE OF NAME CHANGE: 19940411
DEF 14A
1
pxy01edgar.txt
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
OCTOBER 29, 2001
TO THE STOCKHOLDERS:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Pure
World, Inc. (the "Company") will be held on Monday, October 29, 2001 at 8:30
a.m., local time, at The Olde Mill Inn, 225 Route 202, Basking Ridge, New Jersey
07920 for the purpose of considering and acting upon the following matters:
1. To elect three directors to serve until the next Annual Meeting or until
their respective successors are duly elected and qualified;
2. To transact such other business as may properly come before the Annual
Meeting or any adjournment(s), postponement(s) or continuation(s) thereof.
Only stockholders of record at the close of business on September 10, 2001,
are entitled to notice of and to vote at the Annual Meeting and at any and all
adjournments, postponements or continuations thereof. A list of stockholders
entitled to vote at the Annual Meeting will be available for inspection during
ordinary business hours by any stockholder for any purposes germane to the
meeting, at the Company's offices at 376 Main Street, Bedminster, New Jersey
07921, for a period of at least ten days prior to the Annual Meeting and will
also be available for inspection at the Annual Meeting.
All stockholders are cordially invited to attend the Annual Meeting in
person, however, to assure your representation at the Annual Meeting, you are
urged to mark, sign, date and return the enclosed Proxy as promptly as possible
in the envelope enclosed for that purpose. If you attend the Annual Meeting, you
may vote in person even though you returned a Proxy.
By Order of the Board of Directors
/s/ Paul O. Koether
-------------------------------------
Paul O. Koether
Chairman
Date: September 24, 2001
YOUR VOTE IS IMPORTANT
In order to assure your representation at the meeting, you are requested to
complete, sign and date the enclosed Proxy as promptly as possible and return it
in the enclosed envelope.
PURE WORLD, INC.
376 MAIN STREET
P.O. BOX 74
BEDMINSTER, NEW JERSEY 07921
(908) 234-9220
------------------------
PROXY STATEMENT FOR THE ANNUAL MEETING
OCTOBER 29, 2001
INFORMATION CONCERNING SOLICITATION AND VOTING
General
This Proxy Statement is being furnished to the stockholders of Pure World,
Inc., a Delaware corporation (the "Company"), in connection with the
solicitation of proxies, in the form enclosed, by the Board of Directors of the
Company, for use at the Annual Meeting of Stockholders (the "Annual Meeting") to
be held on Monday, October 29, 2001, at 8:30 a.m. at The Olde Mill Inn, 225
Route 202, Basking Ridge, New Jersey 07920, and at any and all adjournments,
postponements or continuations thereof, for the purposes set forth herein and in
the accompanying Notice of Annual Meeting of Stockholders. The Company's
telephone number is (908) 234-9220.
These proxy solicitation materials are first being mailed on or about
September 24, 2001 to all stockholders entitled to vote at the meeting.
Voting Rights and Solicitation of Proxies
Only stockholders of record at the close of business on September 10, 2001
(the "Record Date"), are entitled to notice of and to vote at the Annual
Meeting. On the Record Date, 8,254,455 shares of the Company's common stock,
$.01 par value per share (the "Common Stock"), were issued and outstanding. The
presence, either in person or by proxy, of the holders of a majority of the
total number of shares of Common Stock outstanding on the Record Date is
necessary to constitute a quorum at the Annual Meeting.
Holders of Common Stock are entitled to one vote, in person or by proxy,
for each share of Common Stock owned on the Record Date.
Valid proxies will be voted in accordance with the instructions indicated
thereon. In the absence of contrary instructions, shares represented by valid
proxies will be voted FOR the proposal to elect as directors the three nominees
listed under the caption "Election of Directors". No other business is expected
to come before the Annual Meeting but should any other matter requiring a vote
of stockholders properly arise, it is the intention of the persons named in the
enclosed form of proxy to vote such proxy in accordance with their best judgment
on such matter.
Execution of the enclosed proxy card will not prevent a stockholder from
attending the Annual Meeting and voting in person. Any proxy may be revoked at
any time prior to the exercise thereof by delivering a written revocation or a
new proxy bearing a later date to the Secretary of the Company, 376 Main Street,
P.O. Box 74, Bedminster, New Jersey 07921, or by attending the Annual Meeting
and voting in person. Attendance at the Annual Meeting will not, however, in and
of itself constitute revocation of a proxy.
The cost of soliciting proxies will be borne by the Company. In addition,
the Company will reimburse brokerage firms and other persons representing
beneficial owners of shares for their expenses in forwarding solicitation
materials to such beneficial owners. Proxies may be solicited by certain of the
Company's directors, officers and regular employees, without additional
compensation, personally or by telephone or telegram.
Abstentions and broker "non-votes" are included in the determination of the
number of shares present at the meeting for quorum purposes, but will not count
as votes cast for the election of directors or any other question and
accordingly will have no effect.
ELECTION OF DIRECTORS
Nominees
At the Annual Meeting, three directors are to be elected to hold office
until the next annual meeting of stockholders or until their successors are duly
elected and qualified. Unless otherwise indicated, the persons named in the
enclosed form of proxy will vote FOR the election of each nominee named below
(each a "Nominee"). Each Nominee has consented to serve as a director if
elected. It is not expected that any Nominee will be unable to serve, but, in
the event that any Nominee should be unable to serve, the shares represented by
the enclosed proxy card will be voted for a substitute candidate selected by the
Board of Directors.
Certain information regarding each Nominee is set forth below.
Position and Office Director
Name of Nominee Age Presently Held with Company Since
--------------- --- --------------------------- --------
Paul O. Koether 65 Chairman and Director 1988
of the Company and of
Pure World Botanicals, Inc.
Alfredo Mena 48 Director of the Company 1992
William Mahomes 54 Director of the Company 1993
2
Paul O. Koether is the husband of Natalie I. Koether, President of the
Company and Pure World Botanicals, Inc., ("PWBI") a wholly-owned subsidiary of
the Company. Information concerning each nominee's business history and
experience is set forth below.
Paul O. Koether is principally engaged in the following: (i) the Company,
as Chairman since April 1988, President from April 1989 to February 1997, a
director since March 1988, and for more than five years as the Chairman and
President of Sun Equities Corporation ("Sun"), a private, closely-held
corporation which is the Company's principal stockholder; (ii) as Chairman of
PWBI, since January 1995 and as a director since December 1994; (iii) as
Chairman and director since July 1987 and President since October 1990 of Kent
Financial Services, Inc. ("Kent") which engages in various financial services,
including the operation of a retail brokerage business through its wholly-owned
subsidiary, T. R. Winston & Company, Inc. ("Winston") and the general partner
since 1990 of Shamrock Associates, an investment partnership which is the
principal stockholder of Kent; (iv) various positions with affiliates of Kent,
including Chairman since 1990 and a registered representative since 1989 of
Winston; (v) from July 1992 to January 2000, Chairman of Golf Rounds.com, Inc.
("Golf Rounds"), which operates internet golf and skiing sites; and (vi) since
September 1998 as a director and Chairman of Cortech, Inc., ("Cortech"), a
biopharmaceutical company.
Alfredo Mena. Since 1976, Mr. Mena has been president of Alimentos de El
Salvador S.A. de C.V., having previously served as Director and General Manager.
The Company is engaged in coffee growing, processing and exporting. From October
1995 until June 1997, he served as Presidential Commissioner for the
Modernization of the Public Sector, in charge of its decentralization,
debureaucratization, deregulation, and privatization. Mr. Mena is a citizen of
El Salvador.
William Mahomes, Jr. In March 1997, Mr. Mahomes formed Mahomes &
Associates, a Professional Corporation, involved in the practice of law,
specializing in mediation of real estate and commercial transactions. From 1994
to March 1997, Mr. Mahomes was a Senior Shareholder of the law firm of Locke
Purnell Rain Harrell. From 1990 to 1994 he was an international partner in the
Dallas office of Baker & McKenzie. Mr. Mahomes currently serves as a director of
a variety of organizations, including The Salvation Army Adisory Board of
Dallas, the Texas Pension Review Board, The Pegasus Charter School and the Texas
Affiliate Board of Healthcare Service Corporation, formerly known as Blue Cross
and Blue Shield of Texas.
Board Meetings and Committees
The Board held five meetings during the fiscal year ended December 31, 2000
and otherwise acted by written consent. The Board has two standing committees,
the Audit Committee, which reviews the Company's internal controls, accounting
practices and procedures and results of operations and the Compensation
Committee. The Compensation Committee, which consists of Directors Mahomes and
Mena, did not meet during the current fiscal year. The Audit Committee met four
times since December 31, 1999 with all members present. Directors Mahomes and
Mena currently serve as members of the Audit Committee. Prior to August, 2001,
the Audit Committee consisted of Director Mark Jaindl and Director Mahomes.
3
Directors' Fees
Each director who is not an employee of the Company receives a fee of
$1,800 plus expenses for attending each meeting of the Board or a committee
meeting. Aggregate directors' fees in fiscal 2000 were approximately $47,000.
BENEFICIAL OWNERSHIP
Security Ownership of Officers, Directors,
Nominees and Certain Stockholders
The following table sets forth the beneficial ownership of Common Stock of
the Company as of August 31, 2001, by each person who was known by the Company
to beneficially own more than 5% of the Common Stock, by each current director
and nominee and by all current directors, nominees and officers as a group:
Number of Shares Approximate
Name and Address of Common Stock Percent
of Beneficial Owner Beneficially Owned (1) of Class
------------------- ------------------ ---------------
Paul O. Koether
211 Pennbrook Road
Far Hills, NJ 07931 3,390,965(2) 37.83%
Natalie I. Koether
211 Pennbrook Road
Far Hills, NJ 07931 3,390,965(3) 37.83%
Sun Equities Corporation
376 Main Street
Bedminster, NJ 07921 2,457,725 29.77%
Mark W. Jaindl
3150 Coffeetown Road
Orefield, PA 18069 239,382(4) 2.65%
William Mahomes, Jr.
900 Jackson Street
Suite 540
Dallas, TX 75202 11,000 *
Alfredo Mena
P. O. Box 520656
Miami, FL 33152 18,700 *
Voldemar Madis
375 Huyler Street
South Hackensack, NJ 07606 124,070 *
Dr. Qun Yi Zheng
375 Huyler Street
South Hackensack, NJ 07606 71,500 *
Dimensional Fund Advisors, Inc.
1299 Ocean Ave, 11th Floor
Santa Monica, CA 90401 547,190(5) 6.63%
4
Donald G. Drapkin
35 East 62nd Street
New York, NY 10021 749,000(6) 9.07%
All directors and
officers as a group
(9 persons) 3,922,307(7) 43.38%
----------------------------
* Represents less than one percent.
(1) The beneficial owner has both sole voting and sole investment powers
with respect to these shares except as set forth in this footnote or
in other footnotes below.Included in such number of shares beneficially
owned are shares subject to options currently exercisable or becoming
exercisable within sixty days:Paul O. Koether (165,000 shares); Natalie
I. Koether (275,000 shares); Mark W. Jaindl (77,000 shares); Alfredo
Mena (16,500 shares); Voldemar Madis (120,000 shares); Qun Yi Zheng
(71,500 shares); and all directors and officers as a group (787,150
shares).
(2) Includes 517,550 shares beneficially owned by his wife, including
110,000 shares owned by Emerald Partners of which she is the sole
general partner; 275,000 shares which she has the right to acquire
upon exercise of stock options; and 132,550 shares held in custodial
accounts. Mr. Koether may also be deemed to be the beneficial owner of
the 2,457,725 shares owned by Sun, of which Mr. Koether is a principal
stockholder and Chairman, 126,500 shares held in discretionary accounts
of certain of his brokerage customers and 14,190 shares held in Mr.
Koether's IRA account. Mr. Koether disclaims beneficial ownership of
all of the foregoing shares.
(3) Includes (1) 110,000 shares owned by Emerald Partners of which Mrs.
Koether is the sole general partner; (2) 275,000 shares which she has
the right to acquire upon exercise of stock options; (3) 132,550 shares
held in custodial accounts; and (4) the shares beneficially owned by
her husband, described above in footnote (2). Mrs. Koether may also be
deemed to be the beneficial owner of the 2,457,725 shares owned by Sun,
of which she is a principal stockholder and her husband is a principal
stockholder and Chairman. Mrs. Koether disclaims beneficial ownership
of all of the foregoing shares.
(4) Includes 15,092 shares held in Mr. Jaindl's IRA account and 4,400
shares held by a trust for the benefit of his son, for which Mr. Jaindl
serves as a trustee.
5
(5) According to Schedule 13G filed on February 2, 2001 by Dimensional Fund
Advisors, Inc. ("Dimensional"), an investment advisor registered under
Section 203 of the Investment Advisors Act of 1940, furnishes
investment advice to four investment companies registered under the
Investment Company Act of 1940, and serves as investment manager to
certain other commingled group trusts and separate accounts. These
investment companies, trusts and accounts are the "Funds". In its role
as investment power over the securities of the Issuer described in this
schedule that are owned by the Funds. All securities reported in this
schedule are owned by the Funds. Dimensional disclaims beneficial
ownership of such securities.
(6) According to Schedule 13G filed on February 14, 2001 by Donald G.
Drapkin.
(7) Includes shares owned by Mark Jaindl, whose term as a director expires
at this meeting.
Compliance with Section 16(a) of the Securities Exchange Act
Section 16(a) of the Securities Exchange Act and the regulations and rules
promulgated thereunder require that the Company's officers, directors and
persons who own more than ten percent of a registered class of the Company's
equity securities ("Principal Owners"), (i) file reports of ownership and
changes in ownership on Forms 3, 4 and 5 with the Securities and Exchange
Commission and the NASD and (ii) furnish copies of these filings to the Company.
Based solely on the Company's review of the copies of such forms it has
received and written representations from certain reporting persons that they
were not required to file Forms 5 for specified fiscal years, the Company
believes that all its officers, directors and Principal Owners complied with all
filing requirements applicable to them.
EXECUTIVE COMPENSATION
The table below sets forth for the fiscal years ended December 31, 2000,
1999 and 1998, the compensation of any person who, as of December 31, 2000, was
an Executive Officer of the Company with annual compensation in excess of
$100,000 ("Executive Officers").
Summary Compensation Table
Long-Term
Name and Annual Compensation (1) (2) Compensation
--------------------------- ------------
Principal Position Year Salary Bonus Options (3)
------------------ ---- ---------- --------- ------------
Paul O. Koether 2000 $ 161,652 - -
Chairman 1999 197,283 - -
1998 215,000 $75,000 -
Natalie I. Koether 2000 $ 270,374 - -
President 1999 247,981 - -
1998 270,000 $75,000 -
Voldemar Madis 2000 $ 160,937 - -
Vice Chairman 1999 161,291 - -
1998 163,461 $ 6,000 -
Qun Yi Zheng 2000 $ 188,753 $ 6,923 100,000
Exec. Vice President 1999 182,080 20,000 -
1998 166,051 75,000 55,000
6
-----------------------------------------
(1) The Company has no bonus plan.
(2) Certain Executive Officers received incidental personal benefits during the
fiscal years covered by the table. The value of these incidental benefits
did not exceed the lesser of either $50,000 or 10% of the total annual
salary and bonus reported for any of the Executive Officers. Such amounts
are excluded from the table.
(3) Stock options restated to reflect a 10% stock dividend declared on November
17, 1998 to stockholders of record on January 7, 1999, distributed on
January 15, 1999.
---------------------------------------------------
The table below contains information concerning the fiscal year-end value
of unexercised options held by the Executive Officers.
Fiscal Year-End Options Values
-----------------------------------------------------
Value of Unexercised
Number of Unexercised In-the-Money
Options at 12/31/00 Option at 12/31/00
Name Exercisable/Unexercisable Exercisable/Unexercisable
-------- ------------------------- --------------------------
Paul O. Koether 165,000 / - $ - / $ -
Natalie I. Koether 275,000 / - - / -
Voldemar Madis 120,000 / - - / -
Qun Yi Zheng 71,500 / 193,500 - / -
Employment Agreements
In April 1990 the Company entered into an employment agreement (the
"Agreement") with Mr. Koether, the Company's Chairman, for an initial three-year
term commencing on April 1, 1990 (the "Effective Date") at an annual salary of
$185,000 ("Base Salary"), which may be increased but not decreased at the
discretion of the Board of Directors. The term is to be automatically extended
one day for each day elapsed after the Effective Date. In December 1992, the
Board of Directors voted to increase the Chairman's Base Salary to $215,000
effective December 1, 1992.
The Chairman may terminate his employment under the Agreement at any time
for "good reason" (defined below) within 36 months after the date of a Change in
Control (defined below) of the Company. Upon his termination, he shall be paid
the greater of (i) the Base Salary and any bonuses payable under the Agreement
through the expiration date of the Agreement or (ii) an amount equal to three
times the average annual Base Salary and bonuses paid to him during the
preceding five years.
7
Change in Control is deemed to have occurred if (i) any individual or
entity, other than individuals beneficially owning, directly or indirectly,
common stock of the Company representing 30% or more of the Company's stock
outstanding as of April 1, 1990, is or becomes the beneficial owner, directly or
indirectly, of 30% or more of the Company's outstanding stock or (ii)
individuals constituting the Board of Directors on April 1, 1990 ("Incumbent
Board"), including any person subsequently elected to the Board whose election
or nomination for election was approved by a vote of at least a majority of the
Directors comprising the Incumbent Board, cease to constitute at least a
majority of the Board. "Good reason" means a determination made solely by Mr.
Koether, in good faith, that as a result of a Change in Control he may be
adversely affected (i) in carrying out his duties and powers in the fashion he
previously enjoyed or (ii) in his future prospects with the Company.
Mr. Koether may also terminate his employment if the Company fails to
perform its obligations under the Agreement (including any material change in
Mr. Koether's duties, responsibilities and powers or the removal of his office
to a location more than five miles from its current location) which failure is
not cured within specified time periods.
In connection with the PWBI acquisition on January 3, 1995, Voldemar Madis
entered into an employment agreement with PWBI for a term of four years at an
annual salary of $150,000. The agreement may be terminated for cause, as defined
in the contract. The agreement has been extended for an additional three year
period.
In February 1996, the Company entered into an employment agreement with Dr.
Qun Yi Zheng, Executive Vice President of the Company for an initial one-year
term. In July 1997, this agreement was amended (the "Amended Zheng Agreement").
The Amended Zheng Agreement is for a three-year term commencing on August 1,
1997 (the "Commencement Date"). The term is to be automatically extended one day
for each day elapsed after the Commencement Date.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Chairman of the Company is also the President of Sun Equities
Corporation ("Sun"), the Company's principal stockholder. The Company reimburses
Sun for the Company's proportionate share of the cost of group medical insurance
and certain general and administrative expenses. Such reimbursements for the
years ended December 31, 2000 and 1999 amounted to approximately $781,000 and
$412,000, respectively. Sun received no remuneration or administrative fees for
performing this service.
Rosenman & Colin LLP ("R&C") performed legal work for the Company for which
it billed the Company an aggregate of approximately $269,000 in 2000 and
$135,000 in 1999. Natalie I. Koether, Esq., President of the Company and of PWBI
and wife of the Chairman of the Company, is of Counsel to R&C.
American Bank, located in Allentown, Pennsylvania, has issued certain loans
to PWBI, totaling approximately $358,000 at December 31, 2000. Mark W. Jaindl,
whose term as director of the Company expires at this meeting, is President of
American Bank.
8
AUDIT COMMITTEE REPORT
The Audit Committee consists of two directors, each of whom is independent
as that term is defined in Rule 4200 (a)(14) of the National Association of
Securities Dealers' Marketplace Rules. A brief description of the
responsibilities of the Audit Committee is set forth above under the caption
"Board Meetings and Committees." A copy of the Audit Committee Charter is
attached hereto in Appendix A.
The Audit Committee has received and discussed the Company's audited
financial statements for fiscal 2000 with the management of the Company. The
Audit Committee has discussed with Deloitte & Touche LLP, the Company's
independent public accountants, the matters required to be discussed by
Statement on Auditing Standards No. 61 (as modified and supplemented). The
Company also has received the written disclosure and letter from Deloitte &
Touche LLP required by Independence Standards Board Standard No. 1 (as modified
and supplemented), and has discussed with Deloitte & Touche LLP its
independence.
Based on the review and discussions referred to above the Audit Committee
recommended to the Board of Directors that the Company's audited financial
statements be included in the Company's Annual Report on Form 10-KSB for the
year ended December 31, 2000 for filing with the Securities and Exchange
Commission.
The Audit Committee
William Mahomes, Jr., Chairman
Alfredo Mena
INDEPENDENT PUBLIC ACCOUNTANTS
Deloitte & Touche LLP ("Deloitte") served as the Company's independent
public accountants for the fiscal year ended December 31, 2000 and have been
selected to serve as the Company's independent public accountants for the fiscal
year ending December 31, 2001. It is not expected that a representative of
Deloitte will be present at the Annual Meeting.
The services to be provided by Deloitte in 2001 will include performing the
audit of the 2001 financial statements and reviewing quarterly reports.
Deloitte, a nationally known firm, has no direct or indirect interest in the
Company.
Audit Fees
The aggregate fees billed to the Company by Deloitte for professional
services rendered for the audit of the Company's annual financial statements for
2000 and the reviews of the financial statements included in the Company's Form
10-QSB for 2000 were $66,500.
9
Financial Information System Design & Implementation Fees
Deloitte did not render any services to the Company during 2000 related to
financial information systems design and implementation. Therefore, the Company
was not billed for any services of that type.
All Other Fees
No other fees were billed by Deloitte.
STOCKHOLDERS' PROPOSALS
Any stockholder who desires to present proposals to the next annual meeting
and to have such proposals set forth in the proxy statement mailed in
conjunction with such annual meeting must submit such proposals to the Company
not later than June 30, 2002. All stockholder proposals must comply with Rule
14a-8 promulgated by the Securities and Exchange Commission.
ADDITIONAL INFORMATION
A copy of the Company's Annual Report on Form 10-KSB for the fiscal year
ended December 31, 2000 accompanies this Proxy Statement.
Your cooperation in promptly marking, signing, dating and mailing the
enclosed proxy card will be greatly appreciated.
By Order of the Board of Directors
/s/ Paul O. Koether
-----------------------------------
Paul O. Koether
Chairman
Dated: September 24, 2001
10
APPENDIX A
PURE WORLD, INC. AUDIT COMMITTEE CHARTER
----------------------------------------
Introduction
------------
This Audit Committee Charter ("Charter") has been adopted by the Board of
Directors (the "Board") of Pure World, Inc. (the "Company"). The Audit Committee
of the Board (the "Committee") shall review and reassess this Charter annually
and recommend any proposed changes to the Board for approval.
The Committee assists the Board in fulfilling its responsibility for
oversight of the quality and integrity of the accounting, auditing, internal
control and financial reporting practices of the Company. It may also have such
other duties as may from time to time be assigned to it by the Board.
The membership of the Committee shall consist of at least two directors,
who are each free of any relationship that, in the opinion of the Board, may
interfere with such member's individual exercise of independent judgment. Each
Committee member shall also meet the independence and financial literacy
requirements for serving on audit committees, and at least one member shall have
accounting or related financial management expertise, all as set forth in the
applicable rules of NASDAQ.
The Committee shall maintain free and open communication with the
independent auditors, and Company management. In discharging its oversight role,
the Committee is empowered to investigate any matter relating to the Company's
accounting, auditing, internal control or financial reporting practices brought
to its attention, with full access to all Company books, records, facilities and
personnel. The Committee at Company expense may retain outside counsel, auditors
or other advisors as the Committee may deem appropriate.
One member of the Committee shall be appointed as chair. The chair shall be
responsible for leadership of the Committee, including scheduling and presiding
over meetings, preparing agendas, and making regular reports to the Board. The
chair will also maintain regular liaison with the CEO, CFO and the lead
independent audit partner.
The Committee shall meet at least four times a year, or more frequently as
the Committee considers necessary. At least once each year the Committee shall
have separate private meetings with the independent auditors and management.
Responsibilities
----------------
Although the Committee may wish to consider other duties from time to time,
the general recurring activities of the Committee in carrying out its oversight
role are described below. The Committee shall be responsible for:
A-1
a. Recommending to the Board the independent auditors to be retained (or
nominated for stockholder approval) to audit the financial statements of the
Company. Such auditors are ultimately accountable to the Board and the
Committee, as representatives of the stockholders.
b. Evaluating, together with the Board and management, the performance of
the independent auditors and, where appropriate, replacing such auditors.
c. Obtaining annually from the independent auditors a formal written
statement describing all relationships between the auditors and the Company,
consistent with Independence Standards Board Standard Number 1. The Committee
shall actively engage in a dialogue with the independent auditors with respect
to any relationships that may impact the objectivity or independence of the
auditors and shall take, or recommend that the Board take, appropriate actions
to oversee and satisfy itself as to the auditors' independence.
d. Reviewing the audited financial statements and discussing them with
management and the independent auditors. These discussions shall include the
matters required to be discussed under Statement of Auditing Standards No. 61
and consideration of the quality of the Company's accounting principles as
applied in its financial reporting, including a review of particularly sensitive
accounting estimates, pricing of securities held by the Company, reserves and
accruals, judgmental areas, audit adjustments (whether or not recorded), and
other such inquiries as the Committee or the independent auditors shall deem
appropriate. Based on such review, the Committee shall make its recommendation
to the Board as to the inclusion of the Company's audited financial statements
in the Company's Annual Report on Form 10-KSB and any Annual Report to
Shareholders.
e. Issuing annually a report to be included in the Company's proxy
statement as required by the rules of the Securities and Exchange Commission.
f. Overseeing the relationship with the independent auditors, including
discussing with the auditors the nature and rigor of the audit process,
receiving and reviewing audit reports, and providing the auditors full access to
the Committee (and the Board) to report on any and all appropriate matters.
g. Discussing with a representative of management and the independent
auditors: (1) the interim financial information contained in the Company's
Quarterly Reports on Form 10-QSB prior to their filing, (2) earnings
announcements prior to release (if practicable), and (3) the results of the
review of any such information by the independent auditors. (These discussions
may be held with the Committee as a whole or with the Committee chair, either in
person or by telephone.)
h. Discussing with management, and the independent auditors the quality and
adequacy of and compliance with the Company's internal controls.
A-2
i. Discussing with management and/or Company counsel any legal matters
(including the status of pending litigation) that may have a material impact on
the Company's financial statements, and any material reports or inquiries from
regulatory or governmental agencies.
j. Reviewing management "conflict of interest" transactions.
The Committee's job is one of oversight. Management is responsible for the
preparation of the Company's financial statements and the independent auditors
are responsible for auditing those financial statements. The Committee and the
Board recognize that management and the independent auditors have more resources
and time, and more detailed knowledge and information regarding the Company's
accounting, auditing, internal control and financial reporting practices than
the Committee does. Accordingly the Committee's oversight role does not provide
any expert or special assurance as to the financial statements and other
financial information provided by the Company to its stockholders and others.
A-3
EX-3.(II)
2
bylawsed01.txt
PURE WORLD, INC.
BY-LAWS
ARTICLE I
OFFICES
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Section 1.1 REGISTERED OFFICE IN DELAWARE
The registered office of the corporation required by Section
131 of the General Corporation Law of the State of Delaware (the "GCL") shall
be in the City of Wilmington, County of New Castle, State of Delaware.
Section 1.2 OTHER OFFICES
The corporation may have offices at such other places both
within and without the State of Delaware as the Board of Directors may from time
to time determine or the business of the corporation may require.
ARTICLE II
STOCKHOLDERS' MEETINGS
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Section 2.1 PLACE OF MEETINGS
All meetings of the stockholders shall be held at such place
either within or without the State of Delaware as shall be designated from time
to time by the board of directors and stated in the notice of the meeting.
Section 2.2 ANNUAL MEETINGS
Annual meetings of stockholders shall be held within 150 days of
the close of the corporation's fiscal year, or at such other date and time as
shall be designated from time to time by the board of directors at which they
shall elect by a simple majority vote a board of directors, and transact such
other business as may properly be brought before the meeting.
Section 2.3 SPECIAL MEETINGS
Special meetings of the stockholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the certificate of
incorporation, may be called by the Chairman of the Board of Directors, or by
the President, and shall be called by the President or Secretary at the request
in writing of a majority of the Board of Directors, or at the request in writing
of one or more stockholders holding not less than twenty percent (20%) of the
voting power entitled to be present or represented at the meeting. Such request
shall state the purpose or purposes of the proposed meeting.
Section 2. 4 NOTICE OF MEETINGS AND ADJOURNED MEETINGS
2.4.1 Written notice of each meeting of stockholders, annual or
special,shall be given which shall state the place,date and hour of the meeting,
and, in the case of a special meeting, the purpose or purposes for which the
meeting is called. Unless otherwise provided by the GCL, the written notice of
any meeting shall be given not less than ten (10) nor more than sixty (60) days
before the date of the meeting to each stockholder entitled to vote at such
meeting. If mailed,such notice shall be deemed to be given when deposited in the
mail, postage prepaid, directed to the stockholder at his address as it appears
on the records of the corporation. An affidavit of mailing of any notice or
report, executed by the Secretary, Assistant Secretary or any transfer agent of
the corporation, shall be prima facie evidence of the facts stated therein.
2.4.2 Any meeting of stockholders,annual or special,may adjourn
from time to time to reconvene at the same or some other place, and, except as
otherwise provided in this section, notice need not be given of any such
adjourned meeting if the time and place thereof are announced at the meeting at
which the adjournment is taken. At the adjourned meeting, the corporation may
transact any business which might have been transacted at the original meeting.
If the adjournment is for more than thirty (30) days,or if after the adjournment
a new record date is fixed for the adjourned meeting, a notice of the adjourned
meeting shall be given to each stockholder of record entitled to vote at the
meeting.
Section 2.5 WAIVER OF NOTICE
Notice of a meeting need not be given to any stockholder who
signs a written waiver of notice or a consent to holding the meeting or an
approval of the minutes thereof, whether before or after the meeting, or who
attends the meeting without protesting, prior thereto or at its commencement,
the lack of notice to such stockholder. No stockholder who so protests shall be
considered present at any such meeting. All such waivers, consents and approvals
shall be filed with the corporate records or made a part of the minutes of the
meeting.
Section 2.6 ACTION WITHOUT MEETING
2.6.1 Unless otherwise provided in the Certificate of
Incorporation of this corporation, any action which may be taken at any annual
or special meeting of stockholders may be taken without a meeting, and without
prior notice, if a consent in writing, setting forth the action so taken, is
signed by the holders of the outstanding shares having not less than the minimum
number of votes that would be necessary to authorize or take such action at a
meeting at which all shares entitled to vote thereon were present and voted;
provided, however, that directors may not be elected by written consent except
by unanimous written consent of all shares entitled to vote for the election of
directors.
2.6.2 Any stockholder giving a written consent, or the
stockholder's proxyholders, or a transferee of the shares or a personal
representative of the stockholder or their respective proxyholders, may revoke
the consent by a writing received by the corporation prior to the time that
written consents of the number of shares required to authorize the proposed
action have been filed with the Secretary of the Corporation, but may not do so
thereafter. Such revocation is effective upon its receipt by the Secretary of
the Corporation.
2
2.6.3 Determination of a Record Date of Action by Written
Consent. In order that the corporation may determine the stockholders entitled
to consent to corporate action in writing without a meeting, the Board of
Directors may fix a record date for determination of stockholders entitled to
consent to such action, which record date shall not precede the date upon which
the resolution fixing the record date is adopted by the Board of Directors, and
which date shall not be more than 10 days after the date upon which the
resolution fixing the record date is adopted by the Board of Directors. Any
stockholder seeking to have stockholders authorize or take corporate action by
written consent shall, by written notice to the Secretary, request the Board of
Directors to fix a record date. The Board of Directors shall, not more than 10
days after the date on which such a request is received, adopt a resolution
fixing the record date. If no record date has been fixed by the Board of
Directors within 10 days of the date on which such a request is received, the
record date for determining stockholders entitled to consent to corporate action
in writing without a meeting, when no prior action by the Board of Directors is
required by applicable law, shall be the first date on which a signed written
consent setting forth the action taken or proposed to be taken is delivered to
the corporation by delivery to its registered office in the State of Delaware,
its principal place of business, or an officer or agent of the corporation
having custody of the book in which proceedings of meetings of stockholders are
recorded. Delivery made to the corporation's registered office shall be by hand
or by certified or registered mail, return receipt requested. If no record date
has been fixed by the Board of Directors and prior action by the Board of
Directors is required by applicable law, the record date for determining
stockholders entitled to consent to corporate action in writing without a
meeting shall be the close of business on the date on which the Board of
Directors adopts the resolution taking such prior action.
2.6.4 Inspectors of Election; Procedures for Counting Consents.
Within three (3) business days after receipt of the earliest dated consent
delivered to the corporation in the manner provided in Section 228(c) of the
Delaware General Corporation Law or the determination by the Board of Directors
of the corporation that the corporation should seek corporate action by written
consent, as the case may be, the Secretary shall engage nationally recognized
independent inspectors of elections for the purpose of performing a ministerial
review of the validity of the consents and revocations. The cost of retaining
inspectors of election shall be borne by the corporation.
Consents and revocations shall be delivered to the inspectors upon receipt
by the corporation, the stockholder or stockholders soliciting consents or
soliciting revocations in opposition to action by consent proposed by the
corporation (the "Soliciting Stockholders") or their proxy solicitors or other
designated agents. As soon as consents and revocations are received, the
inspectors shall review the consents and revocations and shall maintain a count
of the number of valid and unrevoked consents. The inspectors shall keep such
count confidential and shall not reveal the count to the corporation, the
Soliciting Stockholders or their representative or any other entity. As soon as
practicable the earlier of (i) sixty (60) days after the date of the earliest
3
dated consent delivered to the corporation in the manner provided in Section
228(c) of the Delaware General Corporation Law or (ii) a written request
therefor by the corporation or the Soliciting Stockholders (whichever is
soliciting consents), notice of which request shall be given to the party
opposing the solicitation of consents, if any, which request shall state that
the corporation or Soliciting Stockholders, as the case may be, have a good
faith belief that the requisite number of valid and unrevoked consents to
authorize or take the action specified in the consents has been received in
accordance with these By-Laws, the inspectors shall issue a preliminary report
to the corporation and the Soliciting Stockholders stating: (i) the number of
valid consents; (ii) the number of valid revocations; (iii) the number of valid
and unrevoked consents; (iv) the numbers of invalid consents; (v) the number of
invalid revocations; (vi) whether, based on their preliminary count, the
requisite number of valid and unrevoked consents has been obtained to authorize
or take the action specified in the consents.
Unless the corporation and the Soliciting Stockholders shall agree to a
shorter or longer period, the corporation and the Soliciting Stockholders shall
have 48 hours to review the consents and revocations and to advise the
inspectors and the opposing party in writing as to whether they intend to
challenge the preliminary report of the inspectors. If no written notice of an
intention to challenge the preliminary report is received within 48 hours after
the inspectors' issuance of the preliminary report, the inspectors shall issue
to the corporation and the Soliciting Stockholders their final report containing
the information from the inspectors' determination with respect to whether the
requisite number of valid and unrevoked consents was obtained to authorize and
take the action specified in the consents. If the corporation or the Soliciting
Stockholders issue written notice of an intention to challenge the inspectors'
preliminary report within 48 hours after the issuance of that report, a
challenge session shall be scheduled by the inspectors as promptly as
practicable. A transcript of the challenge session shall be recorded by a
certified court reporter. Following completion of the challenge session, the
inspectors shall as promptly as practicable issue their final report to the
Soliciting Stockholders and the corporation, which report shall contain the
information included in the preliminary report, plus all changes in the vote
totals as a result of the challenge and a certification of whether the requisite
number of valid and unrevoked consents was obtained to authorize or take the
action specified in the consents. A copy of the final report of the inspectors
shall be included in the book in which the proceedings of meetings of
stockholders are recorded.
The corporation shall give prompt notice to the stockholders of the results
of any consent solicitation or the taking of the corporate action without a
meeting and by less than unanimous written consent.
Section 2.7 QUORUM
2.7.1 The presence in person or by proxy of the persons entitled
to vote a majority of the voting shares at any meeting constitutes a quorum for
the transaction of business. Shares shall not be counted to make up a quorum for
a meeting if the voting of them at the meeting has been enjoined or if for any
reason they cannot be lawfully voted at the meeting. In the absence of a quorum,
the stockholders so present may, by majority vote, adjourn the meeting from time
to time in the manner provided in Section 2.4.2 of these By-Laws until a quorum
shall attend.
4
2.7.2 The stockholders present at a duly called or held meeting
at which a quorum is present may continue to transact business until adjournment
notwithstanding the withdrawal of enough stockholders to leave less than a
quorum, if any action taken (other than adjournment) is approved by at least a
majority of the shares required to constitute a quorum.
Section 2.8 VOTING RIGHTS
Unless otherwise provided in the certificate of incorporation,
each stockholder shall at every meeting of the stockholders be entitled to one
vote in person or by proxy for each share of the capital stock having voting
power held by such stockholder, but no proxy shall be voted on or after three
years from its date, unless the proxy provides for a longer period.
Section 2.9 PROXIES
Each stockholder entitled to vote at a meeting of stockholders
may authorize another person or persons to act for him by proxy, but no such
proxy shall be voted or acted upon after three (3) years from its date, unless
the proxy provides for a longer period. A duly executed proxy shall be
irrevocable if it states that it is irrevocable and if, and only so long as, it
is coupled with an interest sufficient in law to support an irrevocable power. A
stockholder may revoke any proxy which is not irrevocable by attending the
meeting and voting in person or by filing an instrument in writing revoking the
proxy or another duly executed proxy bearing a later date with the Secretary of
the corporation.
Section 2.10 MANNER OF CONDUCTING MEETINGS
2.10.1 Meetings of stockholders shall be presided over by the
Chairman of the Board, if any, or in his absence by the Vice Chairman of the
Board, if any, or in his absence by the President, or in his absence by a Vice
President, or in the absence of the foregoing persons by a chairman designated
by the Board of Directors, or in the absence of such designation by a chairman
chosen at the meeting. The Secretary shall act as secretary of the meeting, but
in his absence the chairman of the meeting may appoint any person to act as
secretary of the meeting.
2.10.2 To the extent not in conflict with the provisions of
the GCL relating thereto, the Certificate of Incorporation,or express provisions
of these By-Laws, meetings shall be conducted pursuant to such rules as may be
adopted by the Board of Directors prior to the meeting or, if no rules have been
so adopted, pursuant to such rules as may be promulgated by the Chairman.
5
Section 2.11 INSPECTORS OF ELECTION
At all elections of directors, or in any other case in which
inspectors may act, two inspectors of election shall be appointed by the
Chairman of the meeting, except as otherwise provided by law. The inspectors of
election shall take and subscribe an oath faithfully to execute the duties of
inspectors at such meeting with strict impartiality, and according to the best
of their ability, and shall take charge of the polls and after the vote shall
have been taken shall make a certificate of the result thereof. No director or
candidate for the office of director shall be appointed as an inspector.
Section 2.12 LIST OF STOCKHOLDERS ENTITLED TO VOTE
The Secretary shall prepare and make, at least ten (10) days
before every meeting of stockholders, a complete list of the stockholders
entitled to vote at the meeting, arranged in alphabetical order, and showing the
address of each stockholder and the number of shares registered in the name of
each stockholder. Such list shall be open to the examination of any stockholder,
for any purpose germane to the meeting, during ordinary business hours, for a
period of at least ten (10) days prior to the meeting either at a place within
the city where the meeting is to be held, which place shall be specified in the
notice of meeting, or, if not so specified, at the place where the meeting is to
be held. The list also shall be produced and kept at the place of the meeting
during the whole time thereof and may be inspected by any stockholder who is
present. The stock ledger shall be the only evidence as to who are the
stockholders entitled to examine the stock ledger, the list of stockholders or
the books of the corporation, or to vote in person or by proxy at any meeting of
stockholders.
ARTICLE III
DIRECTORS
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Sections 3.1 POWERS
Subject to the provisions of the GCL and any limitations in the
Certificate of Incorporation relating to actions required to be authorized or
approved by the stockholders, the business and affairs of the corporation shall
be managed by or under the direction of the Board of Directors.
Section 3.2 AUTHORIZED NUMBER
The authorized number of directors shall be three (3). This
number may be changed by a duly adopted amendment to the certificate of
incorporation or by an amendment to this by-law adopted by the vote or written
consent of the holders of a majority of the stock issued and outstanding and
entitled to vote or by resolution of a majority of the board of directors.
No reduction of the authorized number of directors shall have
the effect of removing any director before that director's term of office
expires.
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Section 3.3 ELECTION AND TENURE OF OFFICE
Directors shall be elected at the annual meeting of
stockholders, except as provided in Section 3.4 of this Article. Directors shall
hold office until the election and qualification of their successors or until
their earlier resignation or removal.
Section 3.4 VACANCIES
3.4.1 Vacancies in the Board of Directors may be filled by the
Board of Directors, acting by a majority of the directors then in office,
although less than a quorum, or by a sole remaining director. The stockholders
may at any time elect a director or directors to fill any vacancy or vacancies
not filled by the directors.
3.4.2 A vacancy shall be deemed to exist on the Board of
Directors whenever any authorized position of director is not filled by a duly
elected director, whether caused by death, resignation, removal, an increase in
the authorized number of directors or otherwise.
3.4.3 Any director may resign effective upon giving written
notice to the Chairman of the Board, the President, the Secretary or the Board
of Directors of the corporation. The notice shall be effective upon delivery
unless a later date is specified therein. If a resignation of a director is
effective at a future time, a successor may be elected to take office when the
resignation becomes effective.
3.4.4 No reduction of the number of directors shall have the
effect of removing any director prior to the expiration of his term of office.
Section 3.5 REMOVAL OF DIRECTORS
At any regular or special meeting of stockholders duly called
and held in the manner provided herein, any director or the entire Board of
Directors may be removed at any time by the affirmative vote of the holders of a
majority of the shares then entitled to vote at an election of directors;
provided, however, that if less than the entire Board of Directors is to be
removed, no director may be removed without cause if the votes cast against his
removal would be sufficient to elect him if then voted cumulatively at an
election of the entire Board of Directors. No director may be removed from
office except as provided in this section.
Section 3.6 MEETINGS AFTER ANNUAL STOCKHOLDERS' MEETINGS
Immediately following each annual meeting of stockholders, the
Board of Directors shall hold a regular meeting at the place where said annual
meeting has been held or at such other place as shall be fixed by the Board of
Directors, to elect officers and to transact other proper business. Call and
notice of such regular meetings are hereby dispensed with.
7
Section 3.7 OTHER REGULAR MEETINGS
Regular meetings of the Board of Directors may be held at such
times and at such places within or without the State of Delaware as may be
determined from time to time by the Board. No notice need be given of such
regular meetings, except that notice shall be given to each director (as for a
special meeting) of the resolution establishing regular meeting dates, which
notice shall contain the date, time and place of the regular meetings.
Section 3.8 SPECIAL MEETINGS - NOTICES
3.8.1 Special meetings of the Board of Directors for any
purpose or purposes may be called at any time by the Chairman of the Board or
the President or any Vice President or any two directors.
3.8.2 Special meetings of the Board of Directors shall be held
upon at least four (4) days' notice by mail or 24 hours' notice delivered
personally or by telephone or telegraph. A notice need not specify the purpose
of any meeting of the Board of Directors.
3.8.3 Notice by mail shall be deemed given at the time a
written notice is deposited in the United States mails, first class postage
prepaid, addressed to the director at his address as it is shown upon the
records of the corporation, or, if it is not so shown on such records and is not
readily ascertainable, at the principal executive office of the corporation.
Notice by telegraph shall be deemed given when it is actually transmitted by the
telegraph company, addressed as in the preceding sentence. Notice by telephone
shall be deemed given when it is communicated by telephone to the director or to
a person at the office of the director who the person giving the notice has
reason to believe will promptly communicate it to the director.
Section 3.9 TELEPHONIC MEETINGS
Members of the Board of Directors, or any committee designated
by the Board, may participate in a meeting of the Board or such committee by
means of conference telephone or similar communications equipment, by means of
which all persons participating in the meeting can hear each other, and
participation in a meeting pursuant to this by-law shall constitute presence in
person at such meeting.
Section 3.10 WAIVER OF NOTICE
Notice of a meeting need not be given to any director who signs
a written waiver of notice or a consent to holding the meeting or an approval of
the minutes thereof, whether before or after the meeting, or who attends the
meeting without protesting, prior thereto or at its commencement, the lack of
notice to such director. No director who so protests shall be considered present
at any such meeting. All such waivers, consents and approvals shall be filed
with the corporate records or made a part of the minutes of the meeting.
8
Section 3.11 ACTION AT A MEETING
A majority of the authorized number of directors present in
person constitutes a quorum of the Board of Directors for the transaction of
business at a meeting. Every act or decision done or made by a majority of the
directors present at a meeting duly held at which a quorum is present is the act
of the Board of Directors, unless a greater number is required by law, by the
Certificate of Incorporation or by the By-Laws. A meeting at which a quorum is
initially present may continue to transact business notwithstanding the
withdrawal of directors, so long as any action taken is approved by at least a
majority of the required quorum for such meeting.
Section 3.12 ADJOURNMENT
A majority of the directors present at a meeting, whether or
not a quorum is present, may adjourn the meeting to another time and place. If
the meeting is adjourned for more than 24 hours, at least two (2) days' notice
by mail or 24 hours' notice delivered personally or by telephone or telegraph,
stating the time and place at which the meeting will reconvene, shall be given
to each director who was not present at the time of the adjournment. Notice by
mail, telephone or telegraph shall be deemed given as provided in section 3.8.3.
Section 3.13 ORGANIZATION
Meetings of the Board of Directors shall be presided over by the
Chairman of the Board, if any, or in his absence, by the Vice Chairman of the
Board, if any,or in his absence by the President if he is also a director, or in
their absence by a chairman chosen at the meeting. The Secretary shall act as
secretary of the meeting, but in his absence the chairman of the meeting may
appoint any person to act as secretary of the meeting.
Section 3.14 ACTION BY UNANIMOUS WRITTEN CONSENT
Any action required or permitted to be taken by the Board of
Directors may be taken without a meeting, if all of the members of the Board of
Directors shall individually or collectively consent in writing to such action.
Such written consent or consents shall be filed with the minutes of the
proceedings of the Board of Directors. Such action by written consent shall have
the same force and effect as an unanimous vote of such directors.
Section 3.15 INTERESTED DIRECTORS; QUORUM
No contract or transaction between the corporation and one or
more of its directors or officers or between the corporation and any other
corporation, partnership, association or other organization in which one or more
of its directors or officers are directors or officers, or have a financial
interest, shall be void or voidable solely for this reason, or solely because
the director or officer is present at or participates in the meeting of the
Board or committee thereof which authorizes the contract or transaction, or
9
solely because his or their votes are counted for such purpose, if: (a) the
material facts as to his relationship or interest and as to the contract or
transaction are disclosed or are known to the Board of Directors or the
committee, and the Board or committee in good faith authorizes the contract or
transaction by the affirmative votes of a majority of the disinterested
directors, even though the disinterested directors be less than a quorum; or (b)
the material facts as to his relationship or interest and as to the contract or
transaction are disclosed or are known to the stockholders entitled to vote
thereon, and the contract or transaction is specifically approved in good faith
by a vote of the stockholders; or (c) the contract or transaction is fair as to
the corporation as of the time it is authorized, approved or ratified by the
Board of Directors, a committee thereof or the stockholders. Common or
interested directors may be counted in determining the presence of a quorum at a
meeting of the Board of Directors or of a committee which authorizes the
contract or transaction.
Section 3.16 COMPENSATION
The directors may be paid their expenses of attending each
meeting of the Board of Directors. In addition, the Board of Directors may from
time to time, in its discretion, pay to directors fixed compensation for
attendance at each meeting of the Board of Directors or may pay a stated fee or
other compensation for services as a director. No such payment shall preclude
any director from serving the corporation in any other capacity and receiving
compensation therefor. Members of special or standing committees may be allowed
like reimbursement and compensation for attending committee meetings.
ARTICLE IV
COMMITTEES
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Section 4.1 COMMITTEES
The Board of Directors may, by resolution passed by a majority
of the whole Board, designate one or more committees, each committee to consist
of one or more of the directors of the corporation. The Board may designate one
or more directors as alternate members of any committee, who may replace any
absent or disqualified member at any meeting of the committee. In the absence or
disqualification of a member of the committee, the member or members thereof
present at any meeting and not disqualified from voting, whether or not he or
they constitute a quorum, may unanimously appoint another member of the Board of
Directors to act at the meeting in place of any such absent or disqualified
member. Any such committee, to the extent provided in the resolution of the
Board of Directors, shall have and may exercise all the powers and authority of
the Board of Directors in the management of the business and affairs of the
corporation, and may authorize the seal of the corporation to be affixed to all
papers which may require it; but no such committee shall have power or authority
in reference to amending the Certificate of Incorporation, adopting an agreement
of merger or consolidation, recommending to the stockholders the sale, lease or
exchange of all or substantially all of the corporation's property and assets,
recommending to the stockholders a dissolution of the corporation or a
revocation of dissolution, or amending these By-Laws; and, unless the resolution
expressly so provides, no such committee shall have the power or authority to
declare a dividend or to authorize the issuance of stock.
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Section 4.2 COMMITTEE RULES
Unless the Board of Directors otherwise provides, each committee
designated by the Board may make, alter and repeal rules for the conduct of its
business. In the absence of such rules,each committee shall conduct its business
in the same manner as the Board of Directors conducts its business pursuant to
Article II of these By-Laws.
Section 4.3 COMMITTEE RECORDS
Each committee shall keep regular minutes of its meetings and
shall report the same to the Board of Directors when required.
ARTICLE V
OFFICERS
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Section 5.1 OFFICERS
The officers of the corporation shall be a Chairman of the Board
or a President or both,one or more Vice Presidents,a Secretary,a Chief Financial
Officer and such other officers with such titles as shall be determined by the
Board of Directors and with such duties as shall be delegated to them by the
Board of Directors or any supervisory officer. Any number of offices may be held
by the same person.
Section 5.2 ELECTION, REMOVAL AND RESIGNATION
Officers shall be chosen by the Board of Directors and shall
serve and shall be subject to removal, with or without cause, at the pleasure of
the Board of Directors, subject to the rights, if any, of officers under
contracts of employment with the corporation. Any officer may resign at any time
upon written notice to the corporation without prejudice to the rights, if any,
of the corporation under any contract to which the officer is a party.
Section 5.3 CHAIRMAN OF THE BOARD
The Chairman of the Board, if there be such officer, shall, if
present, preside at all meetings of the Board of Directors and the stockholders
and shall exercise and perform such other powers and duties as may be assigned
from time to time to the Chairman of the Board by the Board of Directors.
Whenever there is no President of the corporation, the Chairman of the Board
shall have the powers and duties of the President.
11
Section 5.4 PRESIDENT
Subject to such supervisory powers, if any, as may be given by
the Board of Directors to the Chairman of the Board, if there be such an
officer, the President shall be the general manager and chief executive officer
of the corporation and, subject to the control of the Board of Directors, shall
supervise, direct and control the business and affairs of the corporation. In
the absence of the Chairman of the Board or if there be none, he shall preside
at all meetings of the stockholders and, provided the President is also a
director, at all meetings of the Board of Directors. He shall have the general
powers and duties of management usually vested in the office of president of a
corporation and such other powers and duties as may be prescribed by the Board
of Directors of the By-Laws.
Section 5.5 VICE PRESIDENTS
The Vice Presidents shall have such powers and perform such
duties as from time to time may be prescribed for them by the Board of Directors
, the Chairman of the Board, the President or any other officer supervising such
Vice Presidents. In the absence or disability of the President and Chairman of
the Board, a Vice President designated by the Board of Directors shall
substitute for and assume the duties, powers and authority of the President.
Section 5.6 SECRETARY AND ASSISTANT SECRETARY
5.6.1 The Secretary shall attend all meetings of the Board of
Directors and all meetings of the stockholders, shall record or cause to be
recorded all votes and minutes thereof, shall give notice of each meeting of the
stockholders and Board of Directors requiring notice and shall perform such
other duties as may be prescribed by the Board of Directors, the Chairman of the
Board or the President. The Secretary shall keep in safe custody the seal of the
corporation, and, when authorized by the Board of Directors,shall affix the same
to any instrument.
5.6.2 The Assistant Secretary shall perform such corporate
secretarial duties as may be prescribed by the Board of Directors, the Chairman
of the Board, the President or the Secretary, and in the absence or disability
of the Secretary shall substitute for and assume the duties,powers and authority
of the Secretary.
Section 5.7 CHIEF AND SUBORDINATE FINANCIAL OFFICERS
5.7.1 The Chief Financial Officer shall keep and maintain or
cause to be kept and maintained adequate and correct accounts of the properties
and business transactions of the corporation, including accounts of its assets,
liabilities, receipts, disbursements,gains,losses,capital and retained earnings.
The books of account shall be open to inspection by all directors at all
reasonable times. The Chief Financial Officer shall deposit or cause to be
deposited all moneys and other valuables in the name and to the credit of the
corporation with such depositories as may be designated by the Board of
Directors. The Chief Financial Officer shall disburse or cause to be disbursed
the funds of the corporation as may be ordered by the Board of Directors.
The Chief Financial Officer shall supervise the subordinate financial officers.
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5.7.2 The subordinate financial officers, which may be a
Treasurer, a Controller and one or more Assistant Treasurers and Assistant
Controllers, shall perform such duties and exercise such powers as shall be
delegated to them by the Board of Directors, the Chairman of the Board, the
President or the Chief Financial Officer.
Section 5.8 ADDITIONAL POWERS, SENIORITY AND SUBSTITUTION OF OFFICERS
In addition to the foregoing powers and duties specifically
prescribed for the respective officers, the Board of Directors may from time to
time by resolution impose or confer upon any of the officers such additional
duties and powers as the Board of Directors may see fit and/or determine the
order of seniority among the officers. Any such resolution may be final, subject
only to further action by the Board of Directors, or the resolution may grant
such discretion, as the Board of Directors deems appropriate, to the Chairman of
the Board or to the President (or in his absence the Vice President serving in
his place) to impose or confer additional duties and powers and to determine the
order of seniority among officers. The Board of Directors, the Chairman of the
Board or the President may designate any officer or officers to substitute for
and assume the duties, powers and authority of any absent officer or officers in
any instances not provided for above.
Section 5.9 COMPENSATION
The officers of this corporation shall receive such compensation
as shall be fixed from time to time by the Board of Directors, except that
the Board of Directors may delegate to any officer or officers the power to fix
the compensation or any other officer or officers. No officer shall be prevented
from receiving compensation by reason of the fact that the officer is also a
director of the corporation.
Section 5.10 LOANS AND GUARANTEES
The corporation may lend money to,or guaranty any obligation of,
or otherwise assist any officer or other employee of the corporation or its
subsidiaries, including any officer or employee who is a director of the
corporation or its subsidiaries, whenever, in the judgment of a majority of the
disinterested directors (even though the disinterested directors may be less
than a quorum), such loan, guaranty or assistance may reasonably be expected to
benefit the corporation. The loan, guaranty or other assistance may be with or
without interest, and may be unsecured or secured in such manner as the majority
of disinterested directors (even if the disinterested directors are less than a
quorum) shall approve, including, without limitation, a pledge of shares of
stock of the corporation. Nothing in this section contained shall be deemed to
deny, limit or restrict the powers of guaranty or warranty of the corporation at
common law or under any statute.
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ARTICLE VI
CORPORATE RECORDS AND AUTHORIZATIONS
------------------------------------
Section 6.1 RECORDS
6.1.1 The corporation shall keep, at its principal executive
office or at the office of its transfer agent or registrar, (a) adequate and
correct books and records of account, (b) minutes of the proceedings of the
stockholders, Board of Directors and committees of the Board of Directors, and
(c) a record of its shareholders giving the names and addresses of all
shareholders an the number and class of shares held by each.
6.1.2 Any records maintained by the corporation in the regular
course of its business, including its stock ledger, books of account and minute
books,may be kept on,or be in the form of,punch cards,magnetic tape,photographs,
microphotographs or any other information storage device, provided that the
records so kept can be converted into clearly legible form within a reasonable
time. The corporation shall so convert any records so kept upon the request of
any person entitled to inspect the same.
Section 6.2 CHECKS, DRAFTS, ETC.
All checks, drafts, or other orders for payment of money, notes
or other evidences of indebtedness, issued in the name of, or payable to, the
corporation, shall be signed or endorsed by such person or persons and in such
manner as shall be determined from time to time by resolution of the Board of
Directors.
Section 6.3 EXECUTION OF CONTRACTS
The Board of Directors, except as in these By-Laws otherwise
provided, may authorize any officer or officers or agent or agents to enter into
any contract or execute any instrument in the name of and on behalf of the
corporation. Such authority may be general, or confined to specific instances.
Unless so authorized by the Board of Directors, no officer, agent or employee
shall, or shall have any power or authority to, bind the corporation by any
contract or engagement, or pledge its credit or render it liable for any purpose
or in any amount; provided, however, that nothing contained in this section
shall be construed to prevent any officer of the corporation from performing his
regular duties in the ordinary course of business pursuant to the authority
granted to said officer by Article V of these By-Laws.
Section 6.4 REPRESENTATION OF SHARES OF OTHER CORPORATIONS
All shares of any other corporation standing in the name of
this corporation shall be voted, represented and all rights incidental thereto
exercised as directed by written consent or resolution of the Board of Directors
expressly referring thereto. In general, such rights shall be delegated by the
Board of Directors, under express instructions from time to time as to each
exercise thereof, to the President or any Vice President, or any other person
expressly appointed by the Board of Directors. Such authority may be exercised
by the designated officers in person, or by any other person authorized so to do
by proxy or power of attorney duly executed by such officers.
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Section 6.5 DIVIDENDS
The Board of Directors may from time to time declare, and the
corporation may pay, dividends on its outstanding shares in the manner and on
the terms and conditions provided by law and the Certificate of Incorporation,
subject to any contractual restrictions to which the corporation is then
subject. If a dividend is declared, the stock transfer books shall not be
closed, but a record date shall be set by the Board of Directors on which date
the transfer agent or, where no transfer agent is appointed, the Secretary will
take a record of all stockholders entitled to the dividend without actually
closing the books for transfers of stock.
ARTICLE VII
STOCK CERTIFICATES AND TRANSFER OF SHARES
-----------------------------------------
Section 7.1 STOCK CERTIFICATES
7.1.1 Every holder of stock shall be entitled to have a
certificate signed by or in the name of the corporation by the Chairman or Vice
Chairman of the Board of Directors, if any, or the President or a Vice
President, and by the Treasurer or Assistant Treasurer, or the Secretary or an
Assistant Secretary, of the corporation, certifying the number of shares owned
by him in the corporation. Any of or all the signatures on the certificate may
be a facsimile. In case any officer, transfer agent or registrar who has signed
or whose facsimile signature has been placed upon a certificate shall have
ceased to be such officer, transfer agent or registrar before such certificate
is issued, it may be issued by the corporation with the same effect as if he
were such officer, transfer agent or registrar at the date of issue.
7.1.2 If the corporation is authorized to issue more than one
class of stock, or more than one series of any class, the powers, designations,
preferences and relative, participating, optional or other special rights of
each class of stock or series thereof and the qualifications, limitations or
restrictions of such preferences and/or rights shall be set forth in full or
summarized on the face or back of the certificate which the corporation shall
issue to represent such class of stock; provided, however, that except as
otherwise provided in Section 202 of the GCL, in lieu of the foregoing
requirements, there may be set forth on the face or back of the certificate
which the corporation shall issue to represent such class or series of stock, a
statement that the corporation will furnish without charge to each stockholder
who so requests, the powers,designations,preferences and relative,participating,
optional or other special rights of each class of stock or series thereof and
the qualifications, limitations or restrictions of such preferences and/or
rights.
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Section 7.2 TRANSFER ON THE BOOKS
Upon (a) the surrender to the Secretary or transfer agent of the
corporation of a certificate representing shares of stock in the corporation,
duly endorsed or accompanied by proper evidence of succession, assignment or
authority to transfer and (b) delivery to the corporation of evidence sufficient
to indicate that the transfer of such shares would not be in violation of the
Certificate of Incorporation or By-Laws, any legend appearing on said
certificates or any applicable law, it shall be the duty of the corporation to
issue a new certificate to the person entitled thereto, cancel the old
certificate and record the transaction upon its books.
Section 7.3 STOLEN, LOST OR DESTROYED CERTIFICATES
The Board of Directors or any officer designated by the Board
of Directors may direct a new certificate or certificates to be issued in place
of any certificate or certificates theretofore issued by the corporation alleged
to have been stolen, lost or destroyed, upon the making of an affidavit of that
fact by the person claiming the certificate for shares so stolen, lost or
destroyed. When authorizing such issue of a new certificate or certificates, the
Board of Directors or such officer, as a condition precedent to the issuance
thereof, may require the person claiming such stolen, lost or destroyed
certificate or certificates to give the corporation a bond or other adequate
security sufficient to indemnify it against any claim that may be made against
it, including any expense or liability, on account of the alleged loss, theft or
destruction of any such certificate or the issuance of such new certificate.
Section 7.4 TRANSFER AGENTS AND REGISTRARS
The Board of Directors may appoint one or more transfer agents
or transfer clerks, and one or more registrars, who may be the same person, and
may be the Secretary of the corporation, or an incorporated bank or trust
company, either domestic or foreign, who shall be appointed at such times and
places as the requirements of the corporation may necessitate and the Board of
Directors may designate.
Section 7.5 FIXING DATE FOR DETERMINATION OF STOCKHOLDERS OF RECORD
In order that the corporation may determine the stockholders
entitled to notice of or to vote at any meeting of stockholders or any
adjournment thereof, or to express consent to corporate action in writing
without a meeting, or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled to exercise any rights in
respect of any change, conversion or exchange of stock or for the purpose of any
other lawful action, the Board of Directors may fix, in advance, a record date,
which shall not be more than sixty (60) nor less than ten (10) days before the
date of such meeting, nor more than sixty (60) days prior to any other action.
If no record date is fixed: (a) the record date for determining stockholders
entitled to notice of or to vote at a meeting of stockholders shall be at the
close of business on the day next preceding the day on which notice is given,
or, if notice is waived, at the close of business on the day next preceding the
day on which the meeting is held; and (b) the record date for determining
stockholders for any other purpose shall be at the close of business on the day
on which the Board of Directors adopts the resolution relating thereto. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting; provided,
however, that the Board of Directors may fix a new record date for the adjourned
meeting.
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ARTICLE VIII
CORPORATE SEAL
--------------
The corporate seal shall have inscribed thereon the name of
the corporation, the year of its organization, the state of incorporation and
the words "Corporate Seal".
ARTICLE IX
AMENDMENTS TO BY-LAWS
---------------------
Section 9.1 BY STOCKHOLDERS
The stockholders of the corporation may make or adopt additional
By-Laws and may alter, amend or repeal any By-Law, whether adopted by them or
otherwise, by the affirmative vote of a majority of all outstanding shares
entitled to vote at a duly held meeting at which a quorum is present
or represented by proxy.
Section 9.2 BY DIRECTORS
Subject to the right of the stockholders to adopt, alter, amend
or repeal By-Laws, as provided in Section 9.1, the Board of Directors may alter,
amend or repeal these By-Laws or may adopt new By-Laws.
Section 9.3 RECORD OF AMENDMENTS
Whenever an amendment or new By-Law is adopted, it shall be
copied in the book of minutes with the original By-Laws. If any By-Law is
repealed, the fact of repeal and the date on which the repeal was enacted shall
be stated in said book.
ARTICLE X
INTERPRETATION
--------------
Reference in these By-Laws to any provision of the GCL shall
be deemed to include all amendments thereof.
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ARTICLE XI
INDEMNIFICATION OF DIRECTORS, OFFICERS,
---------------------------------------
EMPLOYEES AND OTHER AGENTS
--------------------------
Section 11.1 INDEMNIFICATION OF DIRECTORS AND OFFICERS
The corporation, to the maximum extent permitted by the GCL
(or any other applicable law, rule or regulation), shall indemnify and hold
harmless each person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative, by reason of the fact that he,
or a person of whom he is the legal representative, is or was a director or
officer of the corporation, or is or was serving at the request of the
corporation as a director or officer of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding. Expenses
incurred by any such person in defending a civil or criminal action, suit or
proceeding shall be paid by the corporation in advance of the final disposition
of such action, suit or proceeding, to the maximum extent permitted by law.
Notwithstanding any subsequent alteration, amendment or repeal of this Section
11.1, the rights to indemnification and to advance payments created by this
Section 11.1 shall apply to (a) any claims made or asserted at any time while
this Section 11.1 is in effect and (b) any claims based on or arising from any
act, omission or event occurring at any time while this Section 11.1 is in
effect.
Section 11.2 OTHER AGENTS
The Board of Directors in its discretion may provide for
indemnification of or an advance of expenses to other agents of the corporation
and likewise may refuse to provide for such indemnification or advance of
expenses except to the extent such indemnification is mandatory under the GCL.
Section 11.3 ARTICLE NOT EXCLUSIVE
The indemnification provided by this Article shall not be
deemed exclusive of any other rights to which any person seeking indemnification
may be entitled under any statute, rule of law, agreement, vote of stockholders
or disinterested directors or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office, and
shall continue as to a person who has ceased to be a director or officer, and
shall inure to the benefit of the heirs, executors and administrators of such a
person.
Section 11.4 INTERPRETATION
References in this Article to "the corporation", "other
enterprises", "fines" and "serving at the request of the corporation" shall
include the meanings attributed to them in Section 145 of the GCL or any
successor Section thereto.
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