-----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, SPHyRhVtDCWRHyO6uADXVO3jsq0u2bP29kF/s7CKDmcmwLtRDHatMqr8ozwWqR60 HCIFQ0GXqL471yvHz2snkg== 0000914760-99-000211.txt : 19991115 0000914760-99-000211.hdr.sgml : 19991115 ACCESSION NUMBER: 0000914760-99-000211 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19990930 FILED AS OF DATE: 19991112 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MAYNARD OIL CO CENTRAL INDEX KEY: 0000063528 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 751362284 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-05704 FILM NUMBER: 99748780 BUSINESS ADDRESS: STREET 1: 8080 N CENTRAL EXPWY STE 660 CITY: DALLAS STATE: TX ZIP: 75206 BUSINESS PHONE: 2148918880 MAIL ADDRESS: STREET 1: 8080 N CENTRAL EXPWY STE 660 CITY: DALLAS STATE: TX ZIP: 75206 FORMER COMPANY: FORMER CONFORMED NAME: HOMA OIL & GAS CO DATE OF NAME CHANGE: 19710902 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ending September 30, 1999 Commission File #0-5704 ------------------ ------- MAYNARD OIL COMPANY - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 75-1362284 - -------------------------------------------------------------------------------- (State or other jurisdic- (IRS Employer tion of incorporation) Identification No.) 8080 N. Central Expressway, Suite 660, Dallas, Texas 75206 - -------------------------------------------------------------------------------- Registrant's telephone number, including area code: (214)891-8880 ---------------------------- Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes X No --- --- Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of November 5, 1999. 4,883,390 shares of common stock, par value $0.10 - -------------------------------------------------------------------------------- MAYNARD OIL COMPANY AND SUBSIDIARIES Index to Consolidated Financial Statements and Schedules Page ---- Part I. Financial Information Consolidated Balance Sheets September 30, 1999 and December 31, 1998 3 Consolidated Statements of Operations Nine Months and Three Months ended September 30, 1999 and 1998 4 Consolidated Statements of Shareholders' Equity Nine Months ended September 30, 1999 5 Consolidated Statements of Cash Flows Nine Months ended September 30, 1999 and 1998 6 Notes to Consolidated Financial Statements 7 Management's Discussion and Analysis of Financial Condition and Results of Operations 9 Part II. Other Information Item 1. Legal Proceedings Item 6. Exhibits and Reports on Form 8-K 15 Signatures 16 MAYNARD OIL COMPANY AND SUBSIDIARIES Consolidated Balance Sheets
September 30 December 31, ------------ ------------ 1999 1998 ---- ---- (Unaudited) ASSETS Current assets: Cash and cash equivalents $ 12,125,349 $ 20,889,742 Accounts receivable, trade 4,178,165 2,568,807 Income taxes receivable 750,000 977,587 Other current assets 468,014 478,680 ----------- ----------- Total current assets 17,521,528 24,914,816 ----------- ----------- Property and equipment, at cost: Oil and gas properties, successful efforts method 119,379,541 107,292,314 Other property and equipment 460,475 460,475 ----------- ----------- 119,840,016 107,752,789 Less accumulated depreciation and amortization (77,435,605) (72,985,138) ----------- ----------- Net property and equipment 42,404,411 34,767,651 ----------- ----------- Deferred income taxes 381,000 681,000 ----------- ----------- $ 60,306,939 $ 60,363,467 =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Current installments of long-term debt $ 5,000,000 $ 5,000,000 Accounts payable 2,943,727 2,583,357 Accrued expenses 1,674,221 842,368 Income taxes payable 320,212 40,799 ----------- ----------- Total current liabilities 9,938,160 8,466,524 ----------- ----------- Long-term debt 2,500,000 6,250,000 Shareholders' equity: Preferred stock of $.50 par value. Authorized 1,000,000 shares; none issued -- -- Common stock of $.10 par value. Authorized 20,000,000 shares; 4,883,390 and 4,884,597 shares issued and outstanding 488,339 488,460 Additional paid-in capital 18,831,138 18,831,138 Retained earnings 28,549,302 26,327,345 ----------- ----------- Total shareholders' equity 47,868,779 45,646,943 ----------- ----------- Contingencies and commitments $ 60,306,939 $ 60,363,467 =========== =========== See accompanying Notes to Consolidated Financial Statements.
MAYNARD OIL COMPANY AND SUBSIDIARIES Consolidated Statements of Operations (Unaudited)
Nine Months ended Three Months ended September 30, September 30, ----------------- ---------------- 1999 1998 1999 1998 ---- ---- ---- ---- Revenues: Oil and gas sales $14,519,100 $12,694,374 $ 6,523,657 $ 3,871,029 Interest and other 661,430 1,038,331 167,599 361,019 Gain (loss) on disposition of assets 303,000 6,390 (99,781) (3,405) ---------- ---------- ---------- ---------- 15,483,530 13,739,095 6,591,475 4,228,643 ---------- ---------- ---------- ---------- Costs and expenses: Operating expenses 6,004,292 6,462,956 2,309,050 2,031,659 Exploration, dry holes and abandonments 486,720 56,554 380,543 11,244 General and administrative, net 846,443 700,135 187,786 161,452 Depreciation and amortization 4,617,436 5,391,277 1,641,157 1,775,015 Interest and other 456,133 766,498 132,780 230,800 ---------- ---------- ---------- ---------- 12,411,024 13,377,420 4,651,316 4,210,170 ---------- ---------- ---------- ---------- Income before income taxes 3,072,506 361,675 1,940,159 18,473 Income tax expense (benefit) 840,000 85,000 540,000 (30,000) ---------- ---------- ---------- --------- Net income $ 2,232,506 $ 276,675 $ 1,400,159 $ 48,473 ========== ========== ========== ========= Weighted average number of common shares outstanding 4,883,664 4,888,652 4,883,429 4,887,274 ========= ========= ========= ========= Net income per common share $ .46 $ .06 $ .29 $ .01 ==== ==== ==== ==== (Basic and diluted) See accompanying Notes to Consolidated Financial Statements.
MAYNARD OIL COMPANY AND SUBSIDIARIES Consolidated Statements of Shareholders' Equity Nine Months Ended September 30, 1999 (Unaudited)
Additional Common Stock Paid-in ------------ Capital Retained Shares Amount Amount Earnings Total ------ ------ ------ -------- ----- Balance at December 31, 1998 4,884,597 $488,460 $18,831,138 $26,327,345 $45,646,943 Net income -- -- -- 2,232,506 2,232,506 Purchase and retirement of common stock (1,207) (121) -- (10,549) (10,670) --------- ------- ---------- ---------- ---------- Balance at September 30, 1999 4,883,390 $488,339 $18,831,138 $28,549,302 $47,868,779 ========= ======= ========== ========== ========== See accompanying Notes to Consolidated Financial Statements.
MAYNARD OIL COMPANY AND SUBSIDIARIES Consolidated Statements of Cash Flows (Unaudited)
Nine Months Ended September 30, ------------------------------- 1999 1998 ---- ---- Cash flows from operating activities: Net income $ 2,232,506 $ 276,675 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 4,617,436 5,391,277 Deferred income taxes 300,000 200,000 Dry holes and abandonments 405,773 13,305 Current year costs of dry holes and abandonments (312,556) (13,305) (Gain) on disposition of assets (303,000) (6,390) (Increase) decrease in current assets: Accounts receivable (1,609,358) 146,015 Income taxes receivable 227,587 -- Prepaid expenses and other current assets 10,666 (65,748) Increase (decrease) in current liabilities: Accounts payable 360,370 (1,738,446) Accrued expenses 831,853 383,721 Income taxes payable 279,413 (179,999) ----------- ---------- Net cash provided by operating activities 7,040,690 4,407,105 ----------- ---------- Cash flows from investing activities: Proceeds from disposition of assets 545,275 28,337 Additions to property and equipment (12,589,688) (1,392,814) ----------- ---------- Net cash used by investing activities (12,044,413) (1,364,477) ----------- ---------- Cash flows from financing activities: Principal payments on long-term debt (3,750,000) (3,750,000) Purchase of common stock (10,670) (27,913) ----------- ---------- Net cash used by financing activities (3,760,670) (3,777,913) ----------- ---------- Net decrease in cash and cash equivalents (8,764,393) (735,285) Cash and cash equivalents at beginning of year 20,889,742 24,584,288 ----------- ---------- Cash and cash equivalents at end of period $ 12,125,349 $23,849,003 =========== ========== See Accompanying Notes to Consolidated Financial Statements.
MAYNARD OIL COMPANY AND SUBSIDIARIES Notes to Consolidated Financial Statements September 30, 1999 Note 1 Unaudited Financial Statements The accompanying consolidated financial statements of Maynard Oil Company (the "Company") have been prepared in accordance with generally accepted accounting principles, pursuant to the rules and regulations of the Securities and Exchange Commission included in the instructions to Form 10-Q and Article 10 of Regulation S-X. The financial information included herein is unaudited but, in the opinion of management, contains all adjustments, consisting of all recurring adjustments, necessary to present fairly the Company's financial position as of September 30, 1999 and December 31, 1998, the results of operations for the three and nine months ended September 30, 1999 and 1998 and changes in cash and cash equivalents for the nine months ended September 30, 1999 and 1998. The December 31, 1998 consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles. The accounting policies followed by the Company are set forth in Note 1 to the Company's financial statements in the 1998 Annual Report to Shareholders. Note 2 Earnings Per Share Net income per common share is based on the weighted average number of shares outstanding in each period, which was 4,883,664 and 4,888,652 shares at September 30, 1999 and 1998, respectively. As of September 30, 1999 and 1998, the Company had no potentially dilutive common shares, and therefore, basic and diluted earnings per common share were the same. Note 3 Income Taxes The provision for income taxes consists of the following (thousands of dollars): Nine Months Ended Three Months Ended September 30, September 30, ----------------- ---------------- 1999 1998 1999 1998 ---- ---- ---- ---- Federal: Current (benefit) $ 540 $(115) $ 370 $(180) Deferred 300 200 170 150 ---- ---- ---- ---- $ 840 $ 85 $ 540 $ (30) ==== ==== ==== ==== Note 4 Asset Acquisitions Effective August 1, 1999, the Company purchased interests in 15 producing wells in Hardeman, Webb, and Duval counties, Texas from Phillips Petroleum Company for $10.4 million. The Company's existing cash resources were utilized to fund this acquisition. Note 5 Asset Dispositions During the second and third quarters of 1999, the Company sold certain producing properties for approximately $545,000, resulting in a net gain of approximately $300,000. Note 6 Commitments and Contingencies The Company is the defendant in certain non-environmental litigation arising from operations in the normal course of business. While it is not feasible to determine the outcome of these actions, it is the Company's opinion that the ultimate outcome of the litigation will not have a material adverse effect on the financial position or results of the operations of the Company. All of the Company's operations are generally subject to Federal, state and local environmental regulations. To the best of management's knowledge, the Company is in substantial compliance with such laws and regulations. Note 7 Subsequent Event Effective November 1, 1999, the Company has agreed to purchase interests in 170 producing oil and gas properties located in Southeastern New Mexico and West Texas at a cost of $32,000,000. The Company estimates these properties will add 1,000 net barrels of oil and 3 million net cubic feet of gas to its daily production and anticipates closing this transaction by November 15, 1999. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS - -------------------------------------------------------------------------------- OF OPERATIONS - ------------- Recent Activities The Company has mentioned in its communications with shareholders that its strategy to build oil and gas reserves and corporate value is to acquire producing properties. On July 21, 1999, the Company was successful in purchasing interests in fifteen producing wells located in three counties in Texas (Hardeman, Webb and Duval Counties) for cash consideration of $10,400,000. The Company assumed ownership effective August 1, 1999, and this acquisition contributed 12,140 net barrels of oil and 232,350 net mcf of gas to Maynard's third quarter production. Additionally, on October 7, 1999, Maynard agreed to purchase interests in 170 oil and gas properties in Southeastern New Mexico and West Texas, effective November 1, 1999, at a cost of $32,000,000. The Company expects this transaction to add 1,000 net barrels of oil and 3 million net cubic feet of gas to its daily production and anticipates closing this purchase not later than November 15, 1999. Results of Operations Quarter Ended September 30, 1999 Compared with Quarter Ended September 30, 1998 - ------------------------------------------------------------------------------- For the quarter ended September 30, 1999, the Company earned $1,400,159, or twenty-nine cents per share, on revenues of $6,591,475, compared with net income of $48,473, or one cent per share, on revenues of $4,228,643, for the same quarter a year ago. The current quarter's results were favorably impacted by increased oil and gas revenues. Revenues Oil and gas sales for the third quarter of 1999 totaled $6,523,657, a 69% increase from the third quarter of 1998, due to increased gas production from the July acquisition referenced above and higher quarterly oil and gas prices ($19.81/bbl and $2.82/mcf during the 1999 quarter compared to $12.07/bbl and $2.04/mcf during the 1998 quarter). Comparable production volumes for the third quarters of 1999 and 1998, respectively, were 243,742 barrels of oil versus 253,674 barrels of oil and 600,899 mcf of gas versus 395,638 mcf of gas. The increase in oil and gas revenues was partially offset by a decrease in interest income reflecting the utilization of cash required to fund the acquisition and also by a third quarter loss from the sale of a non-strategic property. Costs and Expenses Reducing the revenue gains during the third quarter was an increase of $277,391 in lease operating expenses over the same period in 1998 resulting from additional workover expense and higher severance taxes, which relate proportionally to increased oil and gas revenues. Maynard also expensed the costs associated with two exploratory dry holes during the third quarter of 1999, which amounted to a $369,299 rise in this expense category over the same quarter a year ago. Lower depreciation and amortization expense of $4.77 per net equivalent barrel (NEB) during the 1999 quarter compared with $5.56 per NEB during the 1998 quarter offset the expense increases referred to in the above paragraph. Also contributing to a more profitable current quarter was lower interest expense due to scheduled debt payments. Nine Months Ended September 30, 1999 Compared to Nine Months Ended September 30, - -------------------------------------------------------------------------------- 1998 - ---- The Company reported net income of $2,232,506, or forty-six cents per share, on revenues of $15,483,530 for the nine months ended September 30, 1999 compared with net income of $276,675, or six cents per share, on revenues of $13,739,095 for the same period a year ago. Earnings for the 1999 period were favorably affected by a combination of increased revenues and lower costs and expenses. Revenues Oil and gas revenues rose $1,824,726 between the two nine month periods, or slightly over 14%, primarily because of price increases from oil and gas sales. Product pricing during the current period was $15.80/bbl and $2.35/mcf compared with $12.93/bbl and $2.17/mcf a year ago. Nine month production volumes for 1999 and 1998, respectively, were 709,748 barrels compared with 773,590 barrels of oil and 1,407,820 mcf compared with 1,237,870 mcf of gas. Interest income also declined $376,901 due to the utilization of cash for acquisitions, capital expenditures, and normal debt repayments. However, revenue levels were aided during the current nine month period by non-recurring property sales which resulted in net gains in excess of $300,000. Costs and Expenses Exploration costs rose $430,166 between the two nine month periods due primarily to two exploratory dry holes being drilled. Because the Company follows the successful efforts method of accounting, the Company's results of operations may be adversely affected during any accounting period in which seismic costs, exploratory dry hole costs, and unproved property costs are expensed. General and administrative (G&A) expenses increased $146,308, or almost 21% to reflect higher phantom stock expense (which relates to fluctuations in the Company's common stock price). This increase in G&A expense was partially offset by increased overhead billings on Company operated properties, which are recorded as reductions to G&A expenses. Additionally, depreciation and amortization expense declined approximately 14% during the current nine months (from $5.50 per NEB for the 1998 period to $4.89 per NEB currently) and interest expense decreased $310,365 in the 1999 period reflecting lower outstanding bank debt due to scheduled loan repayments. Liquidity and Capital Resources Cash and cash equivalents totaled $12.1 million and $20.9 million at September 30, 1999, and December 31, 1998, respectively. Working capital was $7.5 million at September 30, 1999, compared with $16.4 million at December 31, 1998. The following summary table reflects cash flows for the Company for the nine months ended September 30, 1999 (in thousands): Net cash provided by operating activities $ 7,041 Net cash used by investing activities $12,044 Net cash used by financing activities $ 3,761 At September 30, 1999, the Company's total debt was $7,500,000. The Company believes that it has sufficient cash being generated from operating activities plus cash currently in the bank, or additional borrowing capacity, to fund its planned development and exploratory work or to make additional property acquisitions. Year 2000 Issues The Company's Year 2000 Readiness Team is continuing to monitor and evaluate information obtained from vendors, suppliers, customers, and other significant business relationships with regard to the potential impact of the century change on the Company's operations. To date, the Company has not received information suggesting the Company is vulnerable to potential Year 2000 failures by these parties. Testing of the Company's financial systems are continuing and should be completed by December 1, 1999. The costs associated with assessing Year 2000 readiness and related systems upgrades have been funded from cash flow from operations and have not been material. Given the complexity of the Year 2000 issue, there can be no assurance that the Company will be able to address these problems without costs and uncertainties that might affect future financial results or cause reported financial information to not necessarily be indicative of future operating results or future financial condition. Certain Factors that Could Affect Future Operations Certain information contained in this report, as well as written and oral statements made or incorporated by reference from time to time by the Company and its representatives in other reports, filings with the Securities and Exchange Commission, press releases, conferences or otherwise, may be deemed to be 'forward-looking statements' within the meaning of Section 21E of the Securities and Exchange Act of 1934 and are subject to the 'Safe Harbor' provisions of that section. Forward-looking statements include statements concerning the Company's and management's plans, objectives, goals, strategies and future operations and performance and the assumptions underlying such forward-looking statements. These statements are based on current expectations and involve a number of risks and uncertainties, including those described in the context of such forward-looking statements. Actual results and developments could differ materially from those expressed in or implied by such statements. Such factors include, among others, the volatility of oil and gas prices, the Company's drilling results, the Company's ability to compete in the acquisition of producing property, the Company's ability to replace reserves, the availability of capital resources, the reliance upon estimates of proved reserves, operating hazards, uninsured risks, competition, government regulation, and other factors referenced in this Form 10-Q. ITEM 3. QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISKS - -------------------------------------------------------------------- Oil and gas sold by the Company is normally priced with reference to a defined benchmark. Actual prices received vary from the benchmark depending on quality and location differentials. PART II. OTHER INFORMATION ITEM 1. Legal Proceedings ----------------- See discussion of legal proceeding in Note 6 Commitments and Contingencies. ITEM 5. Other Iformation ---------------- On August 26, 1999, the Board of Directors amended and restated the Corporation's By-Laws to revise Sections 2.11 and 3.13 with respect to stockholder proposals. Accordingly, stockholders wishing to make proposals at the Corporation's next annual meeting, but not have them included in the Corporation's proxy statement, should give notice in writing to the Secretary of the Corporation not less than ninety nor more than one hundred twenty days prior to the anniversary of the preceding year's annual meeting of the stockholders. A copy of the Amended and Restated By-Laws is attached to this form 10-Q as Exhibit 3.2 ITEM 6. Exhibit and Reports on Form 8-K ------------------------------- (a) Exhibits: Exhibit 3.2 - Amended and Restated By-Laws (effective August 26, 1999) of Maynard Oil Company Exhibit 27 - Financial Data Schedule (b) Reports on Form 8-K: On August 4, 1999, the Registrant filed its Current Report on Form 8-K with the Securities and Exchange Commission reporting the acquisition of certain producing oil and gas properties on July 21, 1999. SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. MAYNARD OIL COMPANY By: /s/ Glenn R. Moore ------------------------- Glenn R. Moore President BY: /s/ Kenneth W. Hatcher ------------------------- Kenneth W. Hatcher Vice President of Finance Dated: November 12, 1999 EX-3.2 2 AMENDED AND RESTATED BY-LAWS (Effective August 26, 1999) OF MAYNARD OIL COMPANY ARTICLE I --------- OFFICES ------- Section 1.1. Registered Office. The registered office of the corporation shall be maintained in the City of Wilmington, State of Delaware, and the registered agent in charge thereof is The Corporation Trust Company. Section 1.2. Other Offices. The corporation may also have offices at such other places both within and without the State of Delaware as the board of directors of the corporation (the "Board of Directors"), may from time to time determine or the business of the corporation may require. ARTICLE II ---------- STOCKHOLDERS' MEETINGS ---------------------- Section 2.1. Place of Meetings. All meetings of the stockholders, whether annual or special, shall be held at the offices of the corporation in Dallas, Texas, or at such other place as may be fixed from time to time by the Board of Directors. Section 2.2. Annual Meetings. An annual meeting of the stockholders, commencing with the year 1994, shall be held on the third Thursday of May in each year, but if a legal holiday then on the next secular day following, at 9:30 a.m., or at such other date and time as the Board of Directors may determine, at which they shall elect a Board of Directors, and transact such other business as may properly be brought before the meeting. Section 2.3. Notice of Meeting. Written notice of the annual meeting stating the place, date and hour of the meeting, shall be given not less than ten nor more than sixty days before the date of the meeting to each stockholder entitled to vote at such meeting. If mailed, notice is given when deposited in the United States mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the corporation. Section 2.4. Stockholders' List. At least ten days before every meeting of stockholders, a complete list of the stockholders entitled to vote at said meeting, arranged in alphabetical order and showing the address of each stockholder and the number of shares registered in the name of each stockholder, shall be prepared by the Secretary. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. Section 2.5. 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 or by the President and shall be called by the Secretary at the request in writing of a majority of the Board of Directors, or at the request in writing of stockholders owning at least 30% of the number of shares of the corporation issued and outstanding and entitled to vote. Such request shall state the purpose or purposes of the proposed meeting. Section 2.6. Notice of Special Meetings. Written notice of a special meeting, stating the place, date and hour of the meeting and the purpose or purposes for which the meeting is called, shall be given not less than ten nor more than sixty days before the date of the meeting to each stockholder entitled to vote at such meeting. If mailed, notice is given when deposited in the United States mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the corporation. Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice. Section 2.7. Quorum. The holders of a majority of the shares issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall be requisite and shall constitute a quorum at all meetings of the stockholders for the transaction of business except as otherwise provided by statute, by the Certificate of Incorporation or by these By-Laws. If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders entitled to vote thereat, present in person or represented by proxy, shall have the power to adjourn the meeting from time to time, without notice other than announcement at the meeting, of the place, date and hour of the adjourned meeting, until a quorum shall again be present or represented by proxy. At the adjourned meeting at which a quorum shall be present or represented by proxy, the corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than thirty days, or if after the adjournment, a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. Section 2.8. Voting. When a quorum is present at any meeting, and subject to the provisions of the General Corporation Law of the State of Delaware, the Certificate of Incorporation or by these By-Laws in respect of the vote that shall be required for a specified action, the vote of the holders of a majority of the shares having voting power, present in person or represented by proxy, shall decide any question brought before such meeting, unless the question is one upon which, by express provision of the statutes or of the Certificate of Incorporation or of these By-Laws, a different vote is required in which case such express provision shall govern and control the decision of such question. Each stockholder shall have one vote for each share of stock having voting power registered in his name on the books of the corporation, except as otherwise provided in the Certificate of Incorporation. Section 2.9. Proxies. Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person or persons to act for him by proxy, but no such proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period, and, except where the transfer books of the corporation have been closed or a date has been fixed as a record date for the determination of the stockholders entitled to vote, no share of stock shall be voted on at any election for directors which has been transferred on the books of the corporation within twenty days next preceding such election of directors. At each meeting of stockholders, and before any voting commences, all proxies filed at or before the meeting shall be submitted to and examined by the Secretary or a person designated by the Secretary, and no shares may be represented or voted under a proxy that has been found to be invalid or irregular. Section 2.10. Majority Consent. Whenever the vote of stockholders at a meeting thereof is required or permitted to be taken for or in connection with any corporate action by any provisions of the statutes or of the Certificate of Incorporation or these By-Laws, the meeting, notice of the meeting, and vote of stockholders may be dispensed with if stockholders owning stock having not less than the minimum number of votes which, by statute, the Certificate of Incorporation or these By-Laws, is required to authorize such action at a meeting at which all shares entitled to vote thereon were present and voted shall consent in writing to such corporate action being taken; provided that prompt notice of the taking of such action must be given to those stockholders who have not consented in writing. No written consent shall be effective to take the corporate action referred to therein unless, within sixty days of the earliest dated consent delivered to the corporation as required by this section, written consents signed by the holders of a sufficient number of shares to take such corporate action are so recorded. Any action taken pursuant to such written consent or consents of the stockholders shall have the same force and effect as if taken by the stockholders at a meeting thereof. Section 2.11. Stockholder Proposals. Any proposals which may be made by stockholders of the corporation with respect to actions to be taken by the Board of Directors of the corporation, other than nominations for the election of the directors, must be made by notice in writing, delivered or mailed by first class United States mail, postage prepaid, to the Secretary of the corporation not less than ninety nor more than one hundred twenty days prior to the anniversary of the preceding year's annual meeting of the stockholders; provided, however, that in the event that the date of the annual meeting is advanced by more than 30 days or delayed by more than 60 days from such anniversary date, notice by the stockholder, to be timely, must be so delivered not later than the 14th day following the date on which public announcement of the date of such meeting is first made. Each notice hereunder shall set forth (i) the name, age, business address and residence address of the proponent of each proposal in such notice, (ii) the principal occupation or employment of each such proponent, and (iii) the number of shares of stock of the corporation which are beneficially owned by each such proponent. The Chairman of the meeting may, if the facts warrant, determine and declare to the meeting that a proposal was not made in accordance with the foregoing procedure, and, in such case, the defective proposal shall be disregarded. ARTICLE III ----------- DIRECTORS --------- Section 3.1. General Powers. The business and affairs of the corporation shall be managed by or under the direction of the Board of Directors which may exercise all such powers of the corporation and do all such acts and things as are not by the General Corporation Law of the State of Delaware nor by the Certificate of Incorporation nor by these By-Laws directed or required to be exercised or done by the stockholders. Section 3.2. Number of Directors. The Board of Directors shall consist of between three and nine directors. The specific number of directors shall be established by resolution of the directors then in office. The directors shall be elected at the annual meeting of stockholders, and each director shall hold office until his successor is elected and qualified or until his earlier resignation or removal. Section 3.3. Vacancies. If the office of any director or directors becomes vacant by reason of death, resignation, retirement, disqualification, removal from office, or otherwise, or a new directorship is created, vacancies may be filled by a majority of the directors then in office, though less than a quorum, and each director so chosen shall hold office until a successor is duly elected and qualified or his earlier resignation or removal. Section 3.4. Removal and Resignation. Any director or the entire Board of Directors may be removed at any time, with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors. Any director may resign at any time upon written notice to the corporation. Such written resignation shall take effect at the time specified therein, and if no time be specified, at the time of its receipt by the Chairman of the Board, the President or Secretary. The acceptance of a resignation shall not be necessary to make it effective. Section 3.5. Place of Meetings. The Board of Directors may hold its meetings outside of the State of Delaware, at the offices of the corporation or at such other places as they may from time to time determine, or as shall be fixed in the respective notices or waivers of notice of such meetings. Section 3.6. Committees of Directors. The Board of Directors may, by resolution or resolutions 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. Any such committee, to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the corporation, and may authorize the seal of the corporation to be affixed to all papers which may require it; but no such committee shall have the power or authority in reference to amending the Certificate of Incorporation, adopting an agreement of merger or consolidation, recommending to the stockholders the sale, lease or exchange of all or substantially all of the corporation's property and assets, recommending to the stockholders a dissolution of the corporation or a revocation of a dissolution, or amending the By-Laws, of the corporation; and, unless the resolution, By-Laws, or Certificate of Incorporation expressly so provides, no such committee shall have the power or authority to declare a dividend, to authorize the issuance of stock or to adopt a certificate of ownership and merger. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the Board of Directors. The committees shall keep regular minutes of their proceedings and report the same to the Board of Directors when required. Section 3.7. Compensation of Directors. Directors, as such, may receive such stated salary for their services and/or such fixed sums and expenses of attendance for attendance at each meeting of the Board of Directors as may be established by resolution of the Board; provided that nothing herein contained shall be construed to preclude any director from serving the corporation in any other capacity and receiving compensation therefor. Members of special or standing committees may be allowed like compensation for attending committee meetings. Section 3.8. Annual Meeting. The annual meeting of the Board of Directors shall be held each year at such date and time as the Board of Directors may determine following the annual meeting of stockholders. Notice of such meeting, unless waived, shall be given by mail or telegram to each director elected at such annual meeting, at his address as the same may appear on the records of the corporation, or in the absence of such address, at his residence or usual place of business, at least three days before the day on which such meeting is to be held. Said meeting may be held at such place as the Board may fix from time to time or as may be specified or fixed in such notice or waiver thereof. Section 3.9. Special Meetings. Special meetings of the Board of Directors may be held at any time on the call of the Chairman of the Board, the President or at the request in writing of any two (2) directors. Notice of any such meeting, unless waived, shall be given by mail or telegram, telecopier or telex to each director at his address as the same appears on the records of the corporation not less than one day prior to the day on which such meeting is to be held if such notice is by telegram, telecopier or telex, and not less than two days prior to the day on which the meeting is to be held if such notice is by mail. If the Secretary shall fail or refuse to give such notice, then the notice may be given by the officer or any one of the directors making the call. Any such meeting may be held at such place as the Board may fix from time to time or as may be specified or fixed in such notice or waiver thereof. Any meeting of the Board of Directors shall be a legal meeting without any notice thereof having been given, if all the directors shall be present thereat, and no notice of a meeting shall be required to be given to any director who shall attend such meeting. Section 3.10. Action Without Meeting. Any action required or permitted to be taken at any meeting of the Board of Directors or any committee thereof may be taken without a meeting, if a written consent to such action is signed by all members of the Board or of such committee, as the case may be, and such written consent is filed with the minutes of proceedings of the Board of Directors. Section 3.11. Presence at Meeting. Members of the Board of Directors, or any committee designated by the Board, may participate in a meeting of the Board or 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 section shall constitute presence in person at such meeting. Section 3.12. Quorum and Manner of Acting. Except as otherwise provided in these By-Laws, a majority of the total number of directors as at the time specified by the By-Laws shall constitute a quorum at any meeting of the Board of Directors. Except as otherwise provided by statute, by the Certificate of Incorporation or by these By-Laws, the vote of a majority of the directors present at any meeting at which a quorum is present shall be the act of the Board of Directors. In the absence of a quorum, a majority of the directors present may adjourn the meeting from time to time until a quorum shall be present. Notice of any adjourned meeting need not be given, except that notice shall be given to all directors if the adjournment is for more than thirty days. Section 3.13. Nominations. Nominations for the election of directors may be made by the Board of Directors or by any stockholder entitled to vote for the election of directors. Such nominations shall be made by notice in writing, delivered or mailed by first class United States mail, postage prepaid, to the Secretary of the corporation not less than ninety nor more than one hundred twenty days prior to the anniversary of the preceding year's annual meeting of the stockholders; provided, however, that in the event that the date of the annual meeting is advanced by more than 30 days or delayed by more than 60 days from such anniversary date, notice by the stockholder, to be timely, must be so delivered not later than the 14th day following the date on which public announcement of the date of such meeting is first made. Each notice hereunder shall set forth (i) the name, age, business address and if known, residence address of each nominee proposed in such notice, (ii) the principal occupation or employment of each such nominee, and (iii) the number of shares of stock of the corporation which are beneficially owned by each such nominee. The Chairman of the meeting may, if the facts warrant, determine and declare to the meeting that a nomination was not made in accordance with the foregoing procedure, and, in such case, the defective nomination shall be disregarded. ARTICLE IV ---------- OFFICERS -------- Section 4.1. Executive Officers. The executive officers of the corporation shall be a Chairman of the Board, President, such number of Vice Presidents, if any, as the Board of Directors may determine, a Secretary and a Treasurer. One person may hold any number of said offices. Section 4.2. Election, Term of Office and Eligibility. The executive officers of the corporation shall be elected annually by the Board of Directors at its annual meeting; provided that new or additional officers may be elected at any meeting of the Board. Each officer, except such officers as may be appointed in accordance with the provisions of Section 4.3, shall hold office until the next annual election of officers or until his death, resignation or removal. The Chairman of the Board shall be and remain a member of the Board of Directors. None of the other officers need be members of the Board. Section 4.3. Subordinate Officers. The Board of Directors may appoint such Assistant Secretaries, Assistant Treasurers, Controller and other officers, and such agents as the Board may determine, to hold office for such period and with such authority and to perform such duties as the Board may from time to time determine. The Board may, by specific resolution, empower the chief executive officer of the corporation or a committee of the Board of Directors to appoint any such subordinate officers or agents. Section 4.4. Removal. The Chairman of the Board, the President, any Vice President, the Secretary and/or the Treasurer may be removed at any time, either with or without cause, but only by the affirmative vote of the majority of the total number of directors as at the time specified by the By-Laws. Any subordinate officer appointed pursuant to Section 4.3 may be removed at any time, either with or without cause, by the majority vote of the directors present at any meeting of the Board or by any committee or officer empowered to appoint such subordinate officers. Section 4.5 The Chairman of the Board. The Chairman of the Board shall be the chief executive officer of the corporation. He shall have executive authority to see that all orders and resolutions of the Board of Directors are carried into effect, and, subject to the control vested in the Board of Directors by statute, by the Certificate of Incorporation or by these By-Laws, shall administer and be responsible for the management of the business and affairs of the corporation. He shall preside at all meetings of stockholders and of the Board of Directors; and in general shall perform all duties incident to the office of the Chairman of the Board and such other duties as from time to time may be assigned to him by the Board of Directors. Section 4.6. The President. The President shall perform such duties as may from time to time be assigned by the Board of Directors, or the Chairman of the Board, and in the absence or disability of the Chairman of the Board, shall perform the duties of the Chairman of the Board. Section 4.7. The Vice Presidents. In the event of the absence or disability of the President, the Board of Directors may designate which one of the Vice Presidents shall perform the duties of the President. The Vice Presidents shall also perform such other duties as from time to time may be assigned to them by the Board of Directors or by the chief executive officer of the corporation. Section 4.8. The Secretary. The Secretary shall: (a) Keep the minutes of the meetings of the stockholders and of the Board of Directors; (b) See that all notices are duly given in accordance with the provisions of these By-Laws or as required by law; (c) Be custodian of the records and of the seal of the corporation and see that the seal or a facsimile or equivalent thereof is affixed to or reproduced on all documents, the execution of which on behalf of the corporation under its seal is duly authorized; (d) Have charge of the stock record books of the corporation; and (e) In general, perform all duties incident to the office of Secretary, and such other duties as are provided by these By-Laws and as from time to time are assigned to him by the Board of Directors or by the chief executive officer of the corporation. Section 4.9. The Assistant Secretaries. If one or more Assistant Secretaries shall be appointed pursuant to the provisions of Section 4.3 respecting subordinate officers, then, at the request of the Secretary, or in his absence or disability, the Assistant Secretary designated by the Secretary (or in the absence of such designations, then any one of such Assistant Secretaries) shall perform the duties of the Secretary and when so acting shall have all the powers of, and be subject to all the restrictions upon, the Secretary. Section 4.10. The Treasurer. The Treasurer shall: (a) Receive and be responsible for all funds of and securities owned or held by the corporation and, in connection therewith, among other things: keep or cause to be kept full and accurate records and accounts for the corporation; deposit or cause to be deposited to the credit of the corporation all moneys, funds and securities so received in such bank or other depositary as the Board of Directors or an officer designated by the Board may from time to time establish; and disburse or supervise the disbursement of the funds of the corporation as may be properly authorized; (b) Render to the Board of Directors at any meeting thereof, or from time to time whenever the Board of Directors or the chief executive officer of the corporation may require, financial and other appropriate reports on the condition of the corporation; and (c) In general, perform all the duties incident to the office of Treasurer and such other duties as from time to time may be assigned to him by the Board of Directors or by the chief executive officer of the corporation. Section 4.11. The Assistant Treasurers. If one or more Assistant Treasurers shall be appointed pursuant to the provisions of Section 4.3 respecting subordinate officers, then, at the request of the Treasurer, or in his absence or disability, the Assistant Treasurer designated by the Treasurer (or in the absence of such designation, then any one of the Assistant Treasurers) shall perform all the duties of the Treasurer and when so acting shall have all the powers of and be subject to all the restrictions upon, the Treasurer. Section 4.12. Salaries. The salaries of the officers shall be fixed from time to time by the Board of Directors, and no officer shall be prevented from receiving such salary by reason of the fact that he is also a director of the corporation. Section 4.13. Bonds. If the Board of Directors or the chief executive officer shall so require, any officer or agent of the corporation shall give bond to the corporation in such amount and with such surety as the Board of Directors or the chief executive officer, as the case may be, may deem sufficient, conditioned upon the faithful performance of their respective duties and offices. Section 4.14. Delegation of Duties. In case of the absence of any officer of the corporation or for any other reason which may seem sufficient to the Board of Directors, the Board of Directors may, for the time being, delegate his powers and duties, or any of them, to any other officer or to any director. ARTICLE V --------- SHARES OF STOCK --------------- Section 5.1. Regulation. Subject to the terms of any contract of the corporation, the Board of Directors may make such rules and regulations as it may deem expedient concerning the issue, transfer, and registration of certificates for shares of the stock of the corporation, including the issue of new certificates for lost, stolen or destroyed certificates, and including the appointment of transfer agents and registrars. Section 5.2. Stock Certificates. Certificates for shares of the stock of the corporation shall be respectively numbered serially for each class of stock, or series thereof, as they are issued, shall be impressed with the corporate seal or a facsimile thereof, and shall be signed by the Chairman of the Board, the President or a Vice President, and by the Secretary or Treasurer, or an Assistant Secretary or an Assistant Treasurer, provided that such signatures may be facsimiles on any certificate countersigned by a transfer agent other than the corporation or its employee. Each certificate shall exhibit the name of the corporation, the class (or series of any class) and number of shares represented thereby, and the name of the holder. Each certificate shall be otherwise in such form as may be prescribed by the Board of Directors. Section 5.3. Restriction on Transfer of Securities. A restriction on the transfer or registration of transfer of securities of the corporation may be imposed either by the Certificate of Incorporation or by these By-Laws or by an agreement among any number of security holders or among such holders and the corporation. No restriction so imposed shall be binding with respect to securities issued prior to the adoption of the restriction unless the holders of the securities are parties to an agreement or voted in favor of the restriction. A restriction on the transfer of securities of the corporation is permitted by this Section if it: (a) Obligates the holder of the restricted securities to offer to the corporation or to any other holders of securities of the corporation or to any other person or to any combination of the foregoing a prior opportunity, to be exercised within a reasonable time, to acquire the restricted securities; or (b) Obligates the corporation or any holder of securities of the corporation or any other person or any combination of the foregoing to purchase the securities which are the subject of an agreement respecting the purchase and sale of the restricted securities; or (c) Requires the corporation or the holders of any class of securities of the corporation to consent to any proposed transfer of the restricted securities or to approve the proposed transferee of the restricted securities; or (d) Prohibits the transfer of the restricted securities to designated persons or classes of persons; and such designation is not manifestly unreasonable; or (e) Restricts transfer or registration of transfer in any other lawful manner. Unless noted conspicuously on the security, a restriction, even though permitted by this Section, is ineffective except against a person with actual knowledge of the restriction. Section 5.4. Transfer of Shares. Subject to the restrictions permitted by Section 5.3, shares of the capital stock of the corporation shall be transferable on the books of the corporation by the holder thereof in person or by his duly authorized attorney, upon the surrender or cancellation of a certificate or certificates for a like number of shares. Upon surrender to the corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, it shall be the duty of the corporation to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books. As against the corporation, a transfer of shares can be made only on the books of the corporation and in the manner hereinabove provided, and the corporation shall be entitled to treat the registered holder of any share as the owner thereof and shall not be bound to recognize any equitable or other claim to or interest in such share on the part of any other person, whether or not it shall have express or other notice thereof, save as expressly provided by the statutes of the State of Delaware. Section 5.5. Fixing Date for Determination of Stockholders of Record. (a) In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than sixty nor less than ten days before the date of such meeting. If no record date is fixed by the Board of Directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be 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. 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; providing, however, that the Board of Directors may fix a new record date for the adjourned meeting. (b) 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, 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 ten days after the date upon which the resolution fixing the record date is adopted by the Board of Directors. If no record date has been fixed by the Board of Directors, 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 the General Corporation Law of the State of Delaware, 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 by stockholders are recorded. Delivery made to a 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 the General Corporation Law of the State of Delaware, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action. (c) In order that the corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights or the stockholders 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 a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than sixty days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto. Section 5.6. Lost Certificate. Any stockholder claiming that a certificate representing shares of stock has been lost, stolen or destroyed may make an affidavit or affirmation of the fact and, if the Board of Directors so requires, advertise the same in a manner designated by the Board, and give the corporation a bond of indemnity in form and with security for an amount satisfactory to the Board (or an officer or officers designated by the Board), whereupon a new certificate may be issued of the same tenor and representing the same number, class and/or series of shares as were represented by the certificate alleged to have been lost, stolen or destroyed. Section 5.7. Registered Stockholders. The corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and to hold liable for calls and assessments a person registered on its books as the owner of shares, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other persons, whether or not it shall have express or other notice thereof, except as otherwise provided by the General Corporation Law of the State of Delaware. Section 5.8. Stock Subscriptions. Unless otherwise provided for in the subscription agreement, subscriptions for shares shall be paid in full at such time, or in such installments and at such times, as shall be determined by the Board of Directors. Any call made by the Board of Directors for payment on subscriptions shall be uniform as to all shares of the same class or as to all shares of the same series. In case of default in the payment of any installment or call when such payment is due, the corporation may proceed to collect the amount due in the same manner as any debt due the corporation. ARTICLE VI ---------- BOOKS AND RECORDS ----------------- Section 6.1. Location. The books, accounts and records of the corporation may be kept at such place or places within or without the State of Delaware as the Board of Directors may from time to time determine, except as otherwise provided by statute. Section 6.2. Inspection. The books, accounts, and records of the corporation shall be open to inspection by any member of the Board of Directors at all times; and open to inspection by stockholders at such times, and subject to such regulations as the Board of Directors may prescribe, except as otherwise provided by statute. Section 6.3. Corporate Seal. The corporate seal shall contain two concentric circles between which shall be the name of the corporation and the word "Delaware" and in the center shall be inscribed the words "Corporate Seal." ARTICLE VII ----------- DIVIDENDS AND RESERVES ---------------------- Section 7.1. Dividends. The Board of Directors of the corporation, subject to any restrictions contained in the Certificate of Incorporation and other lawful commitments of the corporation, may declare and pay dividends upon the shares of its capital stock either out of the surplus of the corporation, as defined in and computed in accordance with the General Corporation Law of the State of Delaware, or in case there shall be no such surplus, out of the net profits of the corporation for the fiscal year in which the dividend is declared and/or the preceding fiscal year. If the capital of the corporation, computed in accordance with the General Corporation Law of the State of Delaware, shall have been diminished by depreciation in the value of its property, or by losses, or otherwise, to an amount less than the aggregate amount of the capital represented by the issued and outstanding stock of all classes having a preference upon the distribution of assets, the Board of Directors of the corporation shall not declare and pay out of such net profits any dividends upon any shares of any classes of its capital stock until the deficiency in the amount of capital represented by the issued and outstanding stock of all classes having a preference upon the distribution of assets shall have been repaired. Section 7.2. Reserves. Before payment of any dividend, the Board of Directors of the corporation may set apart such sum or sums as the directors, in their absolute discretion, think proper as a reserve or reserves for any proper purpose and may abolish any such reserve. ARTICLE VIII ------------ MISCELLANEOUS PROVISIONS ------------------------ Section 8.1. Fiscal Year. The fiscal year of the corporation shall end on the 31st day of December of each year. Section 8.2. Depositories. The Board of Directors or an officer designated by the Board shall appoint banks, trust companies, or other depositories in which shall be deposited from time to time the money or securities of the corporation. Section 8.3. Checks, Drafts and Notes. All checks, drafts, or other orders for the payment of money and all notes or other evidences of indebtedness issued in the name of the corporation shall be signed by such officer or officers or agent or agents as shall from time to time be designated by resolution of the Board of Directors or by an officer appointed by the Board. Section 8.4. Contracts and Other Instruments. The Board of Directors may authorize any officer, agent or agents to enter into any contract or execute and deliver any instrument in the name and on behalf of the corporation and such authority may be general or confined to specific instances. Section 8.5. Notices. Whenever under the provisions of the statutes or of the Certificate of Incorporation or of these By-Laws notice is required to be given to any director or stockholder, it shall not be construed to mean personal notice, but such notice may be given in writing, by mail, by depositing the same in a post office or letter box, in a postpaid sealed wrapper, or by delivery to a telegraph company, addressed to such director or stockholder at such address as appears on the records of the corporation, or, in default of other address, to such director or stockholder at the General Post Office in the City of Wilmington, Delaware, and such notice shall be deemed to be given at the time when the same shall be thus mailed or delivered to a telegraph company. Section 8.6. Waivers of Notice. Whenever any notice is required to be given under the provisions of the statutes or of the Certificate of Incorporation or of these By-Laws, a waiver thereof in writing signed by the person or persons entitled to said notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders, directors or members of a committee of directors need be specified in any written waiver of notice. Section 8.7. Stock in Other Corporations. Any shares of stock in any other corporation which may from time to time be held by this corporation may be represented and voted at any meeting of shareholders of such corporation by the Chairman of the Board, the President or a Vice President, or by any other person or persons thereunto authorized by the Board of Directors, or by any proxy designated by written instrument of appointment executed in the name of this corporation by its Chairman of the Board, the President or a Vice President. Shares of stock belonging to the corporation need not stand in the name of the corporation, but may be held for the benefit of the corporation in the individual name of the Treasurer or of any other nominee designated for the purpose by the Board of Directors. Certificates for shares so held for the benefit of the corporation shall be endorsed in blank or have proper stock powers attached so that said certificates are at all times in due form for transfer, and shall be held for safekeeping in such manner as shall be determined from time to time by the Board of Directors. Section 8.8. Annual Statement. The Board of Directors shall present at each annual meeting, and at any special meeting of the stockholders when called for by vote of the stockholders, a full and clear statement of the business and condition of the corporation. Section 8.9. Loans. The corporation may lend money to, or guarantee any obligation of, or otherwise assist any officer or other employee of the corporation or of its subsidiary, including any officer or employee who is a director of the corporation or its subsidiary, whenever, in the judgement of the directors, 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 Board of Directors shall approve, including, without limitation,a pledge of shares of stock of the corporation. Nothing is this section shall be deemed to deny, limit or restrict the powers of guaranty or warranty of the corporation at common law or under any statute. Section 8.10. Inconsistent Provisions. In the event that any provision of these By-Laws is or becomes inconsistent with any provision of the Certificate of Incorporation, the General Corporation Law of the State of Delaware or any other applicable law, the provision of these By-Laws shall not be given any effect to the extent of such inconsistency but shall otherwise be given full force and effect. Section 8.11. Indemnification. (a) Each person who was or is a party or is threatened to be made a party to or is involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a "proceeding"), 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 a director or officer of the corporation who is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans, shall be indemnified and held harmless by the corporation to the fullest extent authorized by the laws of Delaware as the same now or may hereafter exist (but, in the case of any change, only to the extent that such change authorizes the corporation to provide broader indemnification rights than said law permitted the corporation to provide prior to such change) against all costs, charges, expenses, liabilities and losses (including attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts paid or to be paid in settlement) reasonably incurred or suffered by such person in connection therewith and such indemnification shall continue as to a person who has ceased to be a director or officer and shall inure to the benefit of his heirs, executors and administrators. The right to indemnification conferred in this Section 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 upon receipt by the corporation of an undertaking, by or on behalf of such director or officer, to repay all amounts so advanced if it shall ultimately be determined that the director or officer is not entitled to be indemnified under this Section or otherwise. The corporation may, by action of its Board of Directors, provide indemnification to employees and agents of the corporation with the same scope and effect as the foregoing indemnification of directors and officers. (b) If a claim under subsection (a) of this Section is not paid in full by the corporation within thirty days after a written claim 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 also be entitled to be paid the expense of prosecuting such claim. It shall be a defense to any 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 required undertaking has been tendered to the corporation) that the claimant has failed to meet a standard of conduct which makes it permissible under Delaware law 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, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is permissible in the circumstances because he has met such standard of conduct, nor an actual determination by the corporation (including its Board of Directors, independent legal counsel, or its stockholders) that the claimant has not met such standard of conduct, nor the termination of any proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent, shall be a defense to the action or create a presumption that the claimant has failed to meet the required standard of conduct. (c) The right to indemnification and the payment of expenses incurred in defending a proceeding in advance of its final disposition conferred in this Section shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, provision of the Certificate of Incorporation, by-law, agreement, vote of stockholders or disinterested directors or otherwise. (d) The corporation may maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of the corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the corporation would have the power to indemnify such person against such expense, liability or loss under Delaware law. (e) To the extent that any director, officer, employee or agent of the corporation is by reason of such position, or a position with another entity at the request of the corporation, a witness in any proceeding, he shall be indemnified against all costs and expenses actually and reasonably incurred by him or on his behalf in connection therewith. (f) Any amendment, repeal or modification of any provision of this Section by the stockholders or the directors of the corporation shall not adversely affect any right or protection of a director or officer of the corporation existing at the time of such amendment, repeal or modification. Section 8.12. Amendment of By-Laws. The stockholders, by the affirmative vote of the holders of a majority of the stock issued and outstanding and having voting power may, at any annual or special meeting if notice of such alteration or amendment of the By-Laws is contained in the notice of such meeting, adopt, amend, or repeal these By-Laws, and alterations or amendments of By-Laws made by stockholders shall not be altered or amended by the Board of Directors. The Board of Directors, by the affirmative vote of a majority of the whole Board, may adopt, amend, or repeal these By-Laws at any meeting, except as provided in the above paragraph. By-Laws made by the Board of Directors may be altered or repealed by the stockholders. EX-27 3 WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE. EXHIBIT 27
5 1,000 9-MOS DEC-31-1999 SEP-30-1999 12,125 0 4,231 53 205 17,522 119,840 77,436 60,607 9,938 0 0 0 488 47,381 60,607 14,519 15,484 6,004 12,411 0 0 456 3,073 840 2,233 0 0 0 2,233 0.46 0.46
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