UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (date of earliest event reported):
June 27, 2011
GERMAN AMERICAN BANCORP, INC.
(Exact Name of Registrant as Specified in Its Charter)
Indiana
(State or Other Jurisdiction of Incorporation)
001-15877
35-1547518
(Commission File Number)
(IRS Employer Identification No.)
711 Main Street
Box 810
Jasper, Indiana
47546
(Address of Principal Executive Offices)
(Zip Code)
(812) 482-1314
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 5.02. Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.
German American Bancorp, Inc. (the "Company"), compensates its directors for their service to the Company and the Company's subsidiaries based on a twelve-month period commencing with each year's annual reorganization meeting of the Board of Directors of the Company (the “Board”). The Board’s Governance/Nominating Committee made a recommendation with respect to director compensation for the new twelve-month service period to the Board and the Board approved such recommendation at its annual reorganization meeting on June 27, 2011.
For services of directors during the current annual period that commenced at the 2011 annual reorganization meeting, the Company is compensating its directors, including the CEO, through an annual retainer of $20,000 payable in cash during July 2011 in a lump sum (which is earned regardless of the number of meetings held or attended, and regardless of committee membership or attendance) and is paying an additional attendance fee of $500 for each meeting of the Board that they attend during this period.
In addition, directors of the Company will receive a meeting fee for each committee meeting that they attend during the current annual period of $350.
Additional annual retainers (earned regardless of numbers of meetings held or attended) will be paid in July 2011 in a lump sum for Director Klem’s services during the current annual period as the Board’s lead independent director ($3,500) and for the services of Directors Forbes, Klem and Bawel as the Chairmen of the Board’s Audit Committee, Compensation/Human Resources Committee, and Credit Risk Management Committee, respectively ($3,500 to each such Chairman).
In addition, those members of the Board (other than the CEO, who as a salaried employee of the Company is ineligible) who serve on the board of directors (including any regional advisory board) of at least one of the subsidiaries receives additional compensation for his or her service to such subsidiaries in the form of director/advisory fees for meetings actually attended of (i) $500 per meeting of the board of directors of German American Bancorp (our bank subsidiary), (ii) $350 for any meeting of a committee of the board of directors of our bank subsidiary or for any meeting of any regional advisory board of the bank subsidiary, and (ii) $350 (combined for attendance at both meetings) per meeting of the boards of directors of German American Financial Advisors & Trust Company and German American Insurance, Inc. (which are held quarterly and sequentially).
Members of the Board who attend sessions of the Board of German American Bancorp, Inc., or of the Board’s committees that are held concurrently with sessions of the board of directors of the bank subsidiary (German American Bancorp) or of committees of that subsidiary’s board of directors receive a single meeting fee of $500 for the combination of the two concurrent meetings.
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year
Effective June 29, 2011, the Company amended, and completely restated, its articles of incorporation through the filing of Articles of Restatement of Articles of Incorporation with the Indiana Secretary of State. The only amendments to the prior Articles of Incorporation of the Company that were made by the June 29, 2011, filing with the Indiana Secretary of State were (a) to increase the number of Common Shares that the Company has the corporate authority to issue (as designated by Article V) from 20 million to 30 million and the total number of shares of capital stock that the Company has the corporate authority to issue (including 0.5 million Preferred Shares) from 20.5 million to 30.5 million and (b) to delete in its entirety prior Section 6.04 (included in Article VI) of the prior Restatement of the Articles of Incorporation.
The amendment to Article V increasing the number of authorized common shares had been proposed by the Board of Directors of the Company for approval by the shareholders of the Company at the annual meeting of shareholders held May 19, 2011, and the shareholders at the annual meeting approved that amendment.
The amendment to eliminate Section 6.04 was approved by the Board of Directors on June 27, 2011. The Board of Directors had added Section 6.04 to the Company’s articles of incorporation in 2000 in order to create a new series of Preferred Shares of the Company, which were designated as Series A Preferred Shares and included 400,000 of the 500,000 total number of authorized Preferred Shares of the Company. Such Series A Preferred Shares were reserved for issuance exclusively upon exercise of certain preferred stock purchase rights that were created by the Company in 2000 under a certain shareholder rights plan, all of which rights expired without having been exercised in 2010. As a result, none of such Series A Preferred Shares were ever issued by the Company. Subsection (j) of the now-deleted Section 6.04 provided that, upon the expiration of the 2000 rights agreement prior to the issuance of any Series A Preferred Shares, all of the Series A Preferred Shares would then again become authorized but unissued Preferred Shares which the Company could thereafter reissue as part of a new series of Preferred Shares. Accordingly, the Board amended the Articles of Incorporation on June 27, 2011, as a matter of housekeeping to eliminate any appearance that such Series A Preferred Shares remained a part of the Company’s capital structure, and resolved that all 400,000 of the unissued Preferred Shares that were previously designated as Series A Preferred Shares by former Section 6.04 had been restored to the status of authorized and unissued Preferred Shares of the Corporation that are undesignated as to series.
The text of the Restatement of the Articles of Incorporation of German American Bancorp, Inc., which completely restate the prior Restatement to give effect to the amendments to Article V and VI, is set forth in Exhibit 3.1 to this report, which exhibit is incorporated herein by reference.
Item 8.01. Other Events.
The Board of Directors of the Company on June 27, 2011, adopted Corporate Governance Guidelines, which Guidelines are set forth in Exhibit 99.1 to this report and are incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
3.1
Restatement of the Articles of Incorporation of German American Bancorp, Inc. (filed June 29, 2011, with the Indiana Secretary of State).
99.1
Corporate Governance Guidelines.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
GERMAN AMERICAN BANCORP, INC.
Date: July 1, 2011
By: /s/ Mark A. Schroeder
Mark A. Schroeder, Chairman and CEO
INDEX TO EXHIBITS
3.1
Restatement of the Articles of Incorporation of German American Bancorp, Inc. (as filed June 29, 2011, with the Indiana Secretary of State).
99.1
Corporate Governance Guidelines.
RESTATEMENT OF THE ARTICLES OF INCORPORATION
OF
GERMAN AMERICAN BANCORP, INC.
(as filed with the Indiana Secretary of State in June 2011)
ARTICLE I
NAME
The name of the Corporation is German American Bancorp, Inc.
ARTICLE II
PURPOSES AND POWERS
Section 2.1.
Purposes of the Corporation. The purposes for which the Corporation is formed are to transact any or all lawful business permitted by applicable law and for which corporations may now or hereafter be incorporated under the Corporation Law.
Section 2.2.
Powers of the Corporation. The Corporation shall have (a) all powers now or hereafter authorized by or vested in corporations pursuant to the provisions of the Corporation Law, (b) all powers now or hereafter vested in corporations by common law or any other statute or act, and (c) all powers authorized by or vested in the Corporation by the provisions of these Articles of Incorporation or by the provisions of its Bylaws as from time to time in effect.
ARTICLE III
TERM OF EXISTENCE
The period during which the Corporation shall continue is perpetual.
ARTICLE IV
REGISTERED OFFICE
The street address of the Corporation's registered office is 711 Main Street, P.O. Box 810, Jasper, Indiana 47546.
ARTICLE V
SHARES
The total number of shares of capital stock the Corporation has authority to issue shall be 30,500,000 shares consisting of 30,000,000 common shares (the "Common Shares") and 500,000 preferred shares (the "Preferred Shares"). The Corporation's shares shall have no par value. Solely for the purpose of any statute or regulation imposing any tax or fee based upon the capitalization of the Corporation, however, all of the shares shall be deemed to have a stated value of $1.00 per share.
ARTICLE VI
TERMS OF SHARES
Section 6.1.
General Terms of All Shares. The Corporation shall have the power to acquire (by purchase, redemption, or otherwise), hold, own, pledge, sell, transfer, assign, reissue, cancel, or otherwise dispose of the shares of the Corporation in the manner and to the extent now or hereafter permitted by the laws of the State of Indiana. The power to purchase, redeem, or otherwise acquire the Corporation's own shares, directly or indirectly, may be exercised without pro rata treatment of the owners or holders of any class or series of shares. The Corporation may not purchase, redeem or otherwise acquire the Corporation's own shares if, after giving effect thereto, the Corporation would not be able to pay its debts as they become due in the usual course of business or the Corporation's total assets would be less than its total liabilities (without regard to any amounts that would be needed, if the Corporation were to be dissolved at the time of the purchase, redemption, or other acquisition, to satisfy the preferential rights upon dissolution of shareholders whose preferential rights are superior to those of the holders of the shares of the Corporation being purchased, redeemed, or otherwise acquired, unless otherwise expressly provided with respect to a series of Preferred Shares in the provisions of these Articles of Incorporation adopted by the Board of Directors pursuant to Section 6.03(a) of this Article VI describing the terms of such series). Shares of the Corporation purchased, redeemed, or otherwise acquired by it shall constitute authorized but unissued shares, unless the Board of Directors shall at any time adopt a resolution providing that such shares constitute authorized and issued but not outstanding shares.
The Board of Directors of the Corporation may dispose of, issue, and sell shares in accordance with, and in such amounts as may be permitted by, the laws of the State of Indiana and the provisions of these Articles of Incorporation and for such consideration, at such price or prices, at such time or times and upon such terms and conditions (including the privilege of selectively repurchasing the same) as the Board of Directors of the Corporation shall determine, without the authorization or approval by any shareholders of the Corporation. Shares may be disposed of, issued, and sold to such persons, firms, or corporations as the Board of Directors may determine, without any preemptive or other right on the part of the owners or holders of other shares of the Corporation of any class or kind to acquire such shares by reason of their ownership of such other shares.
The Corporation shall have the power to declare and pay dividends or other distributions upon the issued and outstanding shares of the Corporation, subject to the limitation that a dividend or other distribution may not be made if, after giving it effect, the Corporation would not be able to pay its debts as they become due in the usual course of business or the Corporation's total assets would be less than its total liabilities (without regard to any amounts that would be needed, if the Corporation were to be dissolved at the time of the dividend or other distribution, to satisfy the preferential rights upon dissolution of shareholders whose preferential rights are superior to those of the holders of shares receiving the dividend or other distribution, unless otherwise expressly provided with respect to a series of Preferred Shares in the provisions of these Articles of Incorporation adopted by the Board of Directors pursuant to Section 6.03(a) of this Article VI describing the terms of such series). The Corporation shall have the power to issue shares of one class or series as a share dividend or other distribution in respect of that class or series or one or more other classes or series, except as may be otherwise provided with respect to a series of Preferred Shares in the provisions of these Articles of Incorporation adopted by the Board of Directors pursuant to Section 6.03(a) of this Article VI describing the terms of such series.
Section 6.2.
Terms of Common Shares. The Common Shares shall be equal in every respect insofar as their relationship to the Corporation is concerned, but such equality of rights shall not imply equality of treatment as to redemption or other acquisition of shares by the Corporation. Subject to the rights of the holders of any issued and outstanding Preferred Shares under this Article VI, the holders of Common Shares shall be entitled to share ratably in such dividends or other distributions (other than purchases, redemptions, or other acquisitions of Common Shares of the Corporation), if any, as are declared and paid from time to time on the Common Shares at the discretion of the Board of Directors. In the event of any liquidation, dissolution, or winding up of the Corporation, either voluntary or involuntary, after payment shall have been made to the holders of the Preferred Shares of the full amount to which they shall be entitled under this Article VI, the holders of Common Shares shall be entitled, to the exclusion of the holders of the Preferred Shares of any and all series, to share, ratably according to the number of Common Shares held by them, in all remaining assets of the Corporation available for distribution to its shareholders.
Section 6.3.
Terms of Preferred Shares.
(a)
Preferred Shares may be issued from time to time in one or more series, each such series to have such distinctive designation and such preferences, limitations, and relative voting and other rights as shall be set forth in these Articles of Incorporation. Subject to the requirements of the Corporation Law and subject to all other provisions of these Articles of Incorporation, the Board of Directors of the Corporation may create one or more series of Preferred Shares and may determine the preferences, limitations, and relative voting and other rights of one or more series of Preferred Shares before the issuance of any shares of that series by the adoption of an amendment to these Articles of Incorporation that specifies the terms of that series of Preferred Shares. All shares of a series of Preferred Shares must have preferences, limitations, and relative voting and other rights identical to those of other shares of the same series. No series of Preferred Shares need have preferences, limitations, or relative voting or other rights identical with those of any other series of Preferred Shares. Before issuing any shares of a series of Preferred Shares, the Board of Directors shall adopt an amendment to these Articles of Incorporation, which shall be effective without any shareholder approval or other action, that fixes and sets forth the distinctive designation of such series; the number of shares that shall constitute such series, which number may be increased or decreased (but not below the number of shares thereof then outstanding) from time to time by action of the Board of Directors; and the preferences, limitations, and relative voting and other rights of the series. Authority is hereby expressly vested in the Board of Directors, by such amendment, to fix all of the preferences or rights, and any qualifications, limitations, or restrictions of such preferences or rights, of such series to the full extent permitted by the Corporation Law; provided, however, that no such preferences, rights, qualifications, limitations, or restrictions shall be in conflict with these Articles of Incorporation or any amendment hereof.
(b)
Preferred Shares of any series that have been redeemed (whether through the operation of a sinking fund or otherwise) or purchased by the Corporation, or that, if convertible, have been converted into shares of the Corporation of any other class or series, may be reissued as a part of such series or of any other series of Preferred Shares, subject to such limitations (if any) as may be fixed by the Board of Directors with respect to such series of Preferred Shares in accordance with Section 6.03(a) of this Article VI.
ARTICLE VII
VOTING RIGHTS
Section 7.1.
Common Shares. Except as otherwise provided by the Corporation Law or by the provisions of these Articles of Incorporation adopted by the Board of Directors pursuant to Section 6.03(a) of Article VI hereof describing the Preferred Shares or a series thereof, and subject to such shareholder disclosure and recognition procedures (which may include sanctions for noncompliance therewith to the fullest extent permitted by the Corporation Law) as the Corporation may by action of the Board of Directors establish, the Common Shares have unlimited voting rights. At every meeting of the shareholders of the Corporation every holder of Common Shares shall be entitled to one vote in person or by proxy for each Common Share standing in such holder's name on the share transfer records of the Corporation.
Section 7.2.
Preferred Shares. Except as required by the Corporation Law or by the provisions of these Articles of Incorporation adopted by the Board of Directors pursuant to Section 6.03(a) of Article VI hereof describing the terms of Preferred Shares or a series thereof, the holders of Preferred Shares shall have no voting rights or powers. Preferred Shares shall, when validly issued by the Corporation, entitle the record holder thereof to vote on such matters, but only on such matters, as the holders thereof are entitled to vote under the Corporation Law or under these Articles of Incorporation adopted by the Board of Directors pursuant to Section 6.03(a) of Article VI hereof describing the terms of Preferred Shares or a series thereof (which provisions may provide for special, conditional, limited, or unlimited voting rights, including multiple or fractional votes per share, or for no right to vote, except to the extent required by the Corporation Law) and subject to such shareholder disclosure and recognition procedures (which may include sanctions for noncompliance therewith to the fullest extent permitted by the Corporation Law) as the Corporation may by action of the Board of Directors establish.
ARTICLE VIII
DIRECTORS
Section 8.1.
Number. The number of Directors shall be fixed by, or fixed in accordance with, the Bylaws. Whenever there are nine or more Directors, the Bylaws may also provide for staggering the terms of the members of the Board of Directors by dividing the total number of Directors into two or three groups (with each group containing one-half or one-third of the total, as near as may be) whose terms of office expire at different times.
Section 8.2.
Election of Directors by Holders of Preferred Shares. The holders of one or more series of Preferred Shares may be entitled to elect all or a specified number of Directors, but only to the extent and subject to limitations as may be set forth in the provisions of these Articles of Incorporation adopted by the Board of Directors pursuant to Section 6.03(a) of Article VI hereof describing the terms of the series of Preferred Shares.
Section 8.3.
Vacancies. Vacancies occurring in the Board of Directors shall be filled in the manner provided in the Bylaws or, if the Bylaws do not provide for the filling of vacancies, in the manner provided by the Corporation Law.
Section 8.4.
Removal of Directors. Any or all of the members of the Board of Directors may be removed, with or without cause, at a meeting of the shareholders called expressly for that purpose, by the affirmative vote of the holders of at least 80 percent of the outstanding shares then entitled to vote at an election of Directors. However, a Director elected by the holders of a series of Preferred Shares as authorized by Section 8.02 of this Article VIII may be removed only by the affirmative vote of the holders of at least 80 percent of the outstanding shares of that series then entitled to vote at an election of Directors. Directors may not be removed by the Board of Directors.
Section 8.5.
Liability of Directors. A Director's responsibility to the Corporation shall be limited to discharging his duties as a Director, including his duties as a member of any committee of the Board of Directors upon which he may serve, in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances, and in a manner the Director reasonably believes to be in the best interests of the Corporation, all based on the facts then known to the Director.
In discharging his duties, a Director is entitled to rely on information, opinions, reports or statements, including financial statements and other financial data, if prepared or presented by:
(a)
one or more officers or employees of the Corporation whom the Director reasonably believes to be reliable and competent in the matters presented
(b)
Legal counsel, public accountants, or other persons as to matters the Director reasonably believes are within such person's professional or expert competence; or
(c)
A committee of the Board of which the Director is not a member if the Director reasonably believes the committee merits confidence;
but a Director is not acting in good faith if the Director has knowledge concerning the matter in question that makes reliance otherwise permitted by this Section 8.05 unwarranted. A Director may, in considering the best interests of the Corporation, consider the effects of any action on shareholders, employees, suppliers, and customers of the Corporation, and communities in which offices or other facilities of the Corporation are located, and any other factors the Director considers pertinent.
Directors shall be immune from personal liability for any action taken as a Director, or any failure to take any action, to the fullest extent permitted by the applicable provisions of the Corporation Law from time to time in effect and by general principles of corporate law.
ARTICLE IX
PROVISIONS FOR REGULATION OF BUSINESS
AND CONDUCT OF AFFAIRS OF CORPORATION
Section 9.1.
Bylaws. The Board of Directors shall have the exclusive power to make, alter, amend, or repeal, or to waive provisions of, the Bylaws of the Corporation by the affirmative vote of a majority of the number of Directors then in office, except as provided by the Corporation Law. All provisions for the regulation of the business and management of the affairs of the Corporation not stated in these Articles of Incorporation shall be stated in the Bylaws. The Board of Directors may also adopt Emergency Bylaws of the Corporation and shall have the exclusive power (except as may otherwise be provided therein) to make, alter, amend, or repeal, or to waive provisions of, the Emergency Bylaws by the affirmative vote of a majority of the entire number of Directors at the time.
Section 9.2.
Amendment or Repeal.
(a)
Any amendment, change or repeal of Section 8.04 of Article VIII, Sections 9.02 or 9.03 of Article IX, or Article X of these Articles of Incorporation, or any other amendment of these Articles of Incorporation which would have the effect of modifying or permitting circumvention of those provisions, shall require the affirmative vote, at a meeting of shareholders of the Corporation, by the holders of a least 80 percent of the outstanding shares of all classes of Voting Shares of the Corporation (considered for purposes of this Section 9.02(a) as a single class and as defined in Article X) and, if the amendment, change or repeal shall be proposed by or on behalf of a Related Person (as that term is defined in Article X), by an Independent Majority of Shareholders (as defined in Article X); provided, however, that this Section 9.02(a) shall not apply to, and such vote shall not be required for, any such amendment, change or repeal recommended to shareholders by the favorable vote of not less than two-thirds of the Board of Directors and, if the amendment, change or repeal shall be proposed by or on behalf of a Related Person, by the favorable vote of not less than two-thirds of the Continuing Directors (as defined in Article X and computed with reference to the Related Person who shall propose such amendment, change or repeal), and any such amendment, change or repeal so recommended shall require only the shareholder vote required under the applicable provisions of the Corporation Law.
(b)
Except as otherwise expressly provided in Section 9.02(a) above, the Corporation shall be deemed, for all purposes, to have reserved the right to amend, alter, change or repeal any provision contained in these Articles of Incorporation to the extent and in the manner now or hereafter permitted or prescribed by statute, and all rights herein conferred upon shareholders are granted subject to such reservation.
Section 9.3.
Removal of Chairman of the Board and President. The Chairman of the Board and the President, and each of them, may be removed from office at any time, with or without cause, at a meeting of the Board of Directors called expressly for that purpose, but only by the affirmative vote of two-thirds of all other members of the entire Board of Directors. Any vacancy created by the removal of the chairman or the President may be filled only by the affirmative vote of two-thirds of all remaining members of the Board.
ARTICLE X
APPROVAL OF BUSINESS COMBINATIONS
Section 10.1.
Supermajority Vote. Except as provided in Sections 10.02 and 10.03 of this Article X, neither the Corporation nor any of its Subsidiaries shall become party to any Business Combination with a Related Person without the prior affirmative vote at a meeting of the Corporation's shareholders:
(a)
By the holders of not less than 80 percent of the outstanding shares of all classes of Voting Shares of the Corporation considered for purposes of this Article X as a single class, and
(b)
By an Independent Majority of Shareholders.
Such favorable votes shall be in addition to any shareholder vote that would be required without reference to this Section 10.01 and shall be required notwithstanding the fact that no vote may be required, or that some lesser percentage may be specified by law or in other Articles of these Articles of Incorporation or the Bylaws of the Corporation or otherwise.
Section 10.2.
Reduced Supermajority Vote for Fair Pricing. The provisions of Section 10.01 shall apply to a Business Combination, except that the percentage vote required by Section 10.01(a) shall be reduced from not less than 80 percent to not less than two-thirds, if all of the conditions set forth in subsections (a) through (d) of this Section 10.02 are satisfied.
(a)
The fair market value of the property, securities or other consideration to be received per share by holders of each class or series of capital shares of the Corporation in the Business Combination is not less, as of the date of the consummation of the Business Combination (the "Consummation Date"), than the higher of the following:
(i)
the highest per share price (with appropriate adjustments for recapitalizations and for share splits, share dividends and like distributions) including brokerage commissions and solicitation fees paid by the Related Person in acquiring any of its holdings of such class or series of capital shares within the two-year period immediately prior to the first public announcement of the proposed Business Combination ("Announcement Date") or in the transaction in which it became a Related Person, whichever is higher, plus interest compounded annually, from the later of the date that the Related Person became a Related Person (the "Determination Date"), or the date two years before the consummation Date, through the consummation Date, at the rate publicly announced as the "prime rate" of interest of Citibank, N.A. (or of such other major bank headquartered in New York as may be selected by a majority of the Continuing Directors) from time to time in effect, less the aggregate amount of any cash dividends paid and the fair market value of any dividends paid in other than cash on each such share from the date from which interest accrues under the preceding clause through the Consummation Date up to but not exceeding the amount of interest so payable per share; or
(ii)
if such class or series is then traded on an exchange or is the subject of regularly published quotations from three or more broker/dealers who make a market in such class or series for their own accounts, the fair market value per share of such class or series on the Announcement Date, as determined by the highest closing sales price on such exchange or the highest closing bid quotation with respect to such shares during the 30-day period immediately preceding the Announcement Date. In the event of a Business Combination upon consummation of which the Corporation would be the surviving corporation or company or would continue to exist (unless it is provided, contemplated or intended that as part of such Business Combination or within one year after consummation thereof a plan of liquidation or dissolution of the Corporation will be effected), the term "other consideration to be received" shall include (without limitation) Common Shares and/or the shares of any other class of shares retained by shareholders of the Corporation other than Related Persons who are parties to such Business Combination;
(b)
The consideration to be received in such Business Combination by holders of each class or series of capital shares other than the Related Person involved shall, except to the extent that a shareholder agrees otherwise as to all or part of the shares which he or she owns, be in the same form and of the same kind as the consideration paid by the Related Person in acquiring the majority of the capital shares of such class or Series already Beneficially owned by it within the two-year period ending on the Determination Date;
(c)
After such Related Person became a Related Person and prior to the consummation of such Business Combination: (i) such Related Person shall have taken steps to insure that the Board of Directors of the Corporation included at all times representation by Continuing Directors proportionate to the ratio that the number of Voting Shares of the Corporation from time to time not Beneficially Owned by the Related Person bears to all Voting Shares of the Corporation outstanding at the time in question (with a Continuing Director to occupy any resulting fractional position among the Directors); (ii) such Related Person shall not have acquired from the Corporation, directly or indirectly, any shares of the Corporation (except upon conversion of convertible securities acquired by it prior to becoming a Related Person or as a result of a pro rata share dividend, share split or division of shares or in a transaction that satisfied all applicable requirements of this Article X); (iii) such Related Person shall not have acquired any additional Voting Shares of the Corporation or securities convertible into or exchangeable for Voting Shares except as a part of the transaction which resulted in such Related Person's becoming a Related Person; and (iv) such Related Person shall not have received the benefit, directly or indirectly (except proportionately as a shareholder), of any loans, advances, guarantees, pledges or other financial assistance or tax credits provided by the Corporation or any Subsidiary, or made any major change in the Corporation's business or equity capital structure or entered into any contract, arrangement or understanding with the Corporation except any such change, contract, arrangement or understanding as may have been approved by the favorable vote of not less than a majority of the continuing Directors of the Corporation; and
(d)
A proxy statement complying with the requirements of the Securities Exchange Act of 1934 and the rules and regulations of the Securities and Exchange Commission thereunder, as then in force for corporations subject to the requirements of Section 14 of such Act (even if the Corporation is not otherwise subject to Section 14 of such Act), shall have been mailed to all holders of Voting Shares for the purpose of soliciting shareholder approval of such Business Combination. Such proxy statement shall contain on the face page thereof, in a prominent place, any recommendations as to the advisability (or inadvisability) of the Business Combination which the Continuing Directors, or any of them, may have furnished in writing and, if deemed advisable by a majority of the Continuing Directors, a fair summary of an opinion of a reputable investment banking firm addressed to the Corporation as to the fairness (or lack of fairness of the terms of such Business Combination from the point of view of the holders of Voting Shares other than any Related Person (such investment banking firm to be selected by a majority of the Continuing Directors, to be furnished with all information it reasonably requests, and to be paid a reasonable fee for its services upon receipt by the Corporation of such opinion).
Section 10.3.
Director Approval Exception. The provisions of Sections 10.01 and 10.02 of this Article X shall not apply to, and such votes shall not be required, if:
(a)
The Continuing Directors of the Corporation by a two-thirds vote (i) have expressly approved a memorandum of understanding with the Related Person with respect to the Business Combination prior to the time the Related Person became a Related Person, or (ii) have otherwise approved the Business Combination (this provision is incapable of satisfaction unless there is at least one Continuing Director); or
(b)
The Business Combination is solely between the Corporation and another corporation, 100 percent of the Voting Shares of which are owned directly or indirectly by the Corporation.
Section 10.4.
Definitions. For the purpose of this Article X: (a) A "Business Combination" means:
(i)
the sale, exchange, lease, transfer or other disposition to or with a Related Person or any Affiliate or Associate of such Related Person by the Corporation or any of its Subsidiaries (in a single transaction or a series of Related Transactions) of all or substantially all, or any substantial Part, of its or their assets or businesses (including, without limitation, any securities issued by a Subsidiary);
(ii)
The purchase, exchange, lease or other acquisition by the Corporation or any of its Subsidiaries (in a single transaction or a series of Related Transactions) of all or substantially all, or any Substantial Part, of the assets or business of a Related Person or any Affiliate or Associate of such Related Person;
(iii)
Any merger or consolidation of the Corporation or any Subsidiary thereof into or with a Related Person or any Affiliate or Associate of such Related Person or into or with another Person which, after such merger or consolidation, would be an Affiliate or an Associate of a Related Person, in each case irrespective of which Person is the surviving entity in such merger or consolidation;
(iv)
Any reclassification of securities, recapitalization or other transaction (other than a redemption in accordance with the terms of the security redeemed) which has the effect, directly or indirectly, of increasing the proportionate amount of Voting Shares of the Corporation or any Subsidiary thereof which are Beneficially Owned by a Related Person, or any partial or complete liquidation, spin-off, split-off or split-up of the Corporation or any Subsidiary thereof; provided, however, that this Section 10.04(a)(iv) shall not relate to any transaction of the types specified in this Article X that has been approved by a majority of the Continuing Directors; or
(v)
The acquisition upon the issuance thereof of Beneficial Ownership by a Related Person of Voting Shares or securities convertible into Voting Shares or any voting securities or securities convertible into voting securities of any Subsidiary of the Corporation, or the acquisition upon the issuance thereof of Beneficial Ownership by a Related Person of any rights, warrants or options to acquire any of the foregoing or any combination of the foregoing Voting Shares or voting securities of the Subsidiary.
(b)
A "Series of Related Transactions" shall be deemed to include not only a series of transactions with the same Related Person but also a series of separate transactions with a Related Person or any Affiliate or Associate of such Related Person.
(c)
A "Person" shall mean any individual, firm, corporation or other entity and any partnership, syndicate or other group.
(d)
"Related Person" shall mean any Person (other than the Corporation or any of the Corporation's Subsidiaries) who or that:
(i)
is the Beneficial Owner, directly or indirectly, of more than ten percent of the voting power of the outstanding Voting Shares;
(ii)
is an Affiliate of the Corporation and at any time within the two-year period immediately prior to the date in question was the Beneficial Owner, directly or indirectly, of ten percent or more of the voting power of the then outstanding shares of Voting Shares; or
(iii)
is an assignee of or has otherwise succeeded to any Voting Shares which were at any time within the two-year period immediately prior to the date in question beneficially owned by any Related Person, if such assignment or succession shall have occurred in the course of a transaction or series of transactions not involving a public offering within the meaning of the Securities Act of 1933.
A Related Person shall be deemed to have acquired a share of the Corporation at the time when such Related Person became the Beneficial Owner thereof. For the purposes of determining whether a Person is the Beneficial Owner of ten percent or more of the voting power of the then outstanding Voting Shares, the outstanding Voting Shares shall be deemed to include any Voting Shares that may be issuable to such Person pursuant to a right to acquire such Voting Shares and that is therefore deemed to be Beneficially Owned by such Person pursuant to Section 10.04(e)(ii)(a). A Person who is a Related Person at (i) the time any definitive agreement relating to a Business Combination is entered into, (ii) the record date for the determination of shareholders entitled to notice of and to vote on a Business Combination, or (iii) the time immediately prior to the consummation of a Business Combination, shall be deemed a Related Person.
(e)
A Person shall be a "Beneficial Owner" of any Voting Shares:
(i)
which such Person or any of its Affiliates or Associates beneficially owns, directly or indirectly; or
(ii)
which such Person or any of its Affiliates or Associates has (a) the right to acquire (whether such right is exercisable immediately or only after the passage of time), pursuant to any agreement, arrangement or understanding or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise, or (b) the right to vote pursuant to any agreement, arrangement or understanding; or
(iii)
which are beneficially owned, directly or indirectly, by any other Person with which such Person or any of its Affiliates or Associates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any Voting Shares.
(f)
An "Affiliate" of, or a person Affiliated with, a specific Person, means a Person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, the Person specified.
(g)
The term "Associate" used to indicate a relationship with any Person, means (i) any corporation or organization (other than this Corporation or a majority-owned Subsidiary of this Corporation) of which such Person is an officer or partner or is, directly or indirectly, the Beneficial Owner of five percent or more of any class of equity securities, (ii) any trust or other estate in which such Person has a substantial beneficial interest or as to which such Person serves as trustee or in a similar fiduciary capacity, (iii) any relative or spouse of such Person, or any relative of such spouse, who has the same home as such Person, or (iv) any investment company registered under the Investment Company Act of 1940, for which such Person or any Affiliate of such Person serves as investment advisor.
(h)
"Subsidiary" means any corporation of which a majority of any class of equity security is owned, directly or indirectly, by the Corporation; provided, however, that for the purposes of the definition of Related Person set forth in paragraph (d) of this Section 10.04, the term "Subsidiary" shall mean only a corporation of which a majority of each class of equity security is owned, directly or indirectly, by the Corporation.
(i)
"Continuing Director" means any member of the Board of Directors of the Corporation (the Board"), other than the Related Person who proposes the Business Combination in question and his Affiliates and Associates, who (i) is a member of the Board at the time this Article X first became effective or (ii) was a member of the Board prior to the time that the Related Person who proposes the Business Combination in question became a Related Person or (iii) is a successor of a Continuing Director who was recommended to succeed the Continuing Director by a majority of Continuing Directors then on the Board.
(j)
"Independent Majority of Shareholders" shall mean the holders of a majority of the outstanding Voting Shares that are not Beneficially Owned or controlled, directly or indirectly, by the Related Person who proposes the Business Combination in question.
(k)
"Voting Shares" shall mean all outstanding capital shares of the Corporation or another corporation entitled to vote generally in the election of Directors, and each reference to a proportion of shares of Voting Shares shall refer to such proportion of the votes entitled to be cast by such shares.
(l)
"Substantial Part" means properties and assets involved in any single transaction or a series of Related Transactions having an aggregate fair market value of more than ten percent of the total consolidated assets of the Person in question as determined immediately prior to such transaction or series of Related Transactions.
Section 10.5.
Director Determinations. A majority of the Continuing Directors shall have the power to determine for the purposes of this Article X, on the bases of information known to them: (i) the number of Voting Shares of which any Person is the Beneficial Owner, (ii) whether a Person is an Affiliate or Associate of another, (iii) whether a Person has an agreement, arrangement or understanding with another as to the matters referred to in the definition of "Beneficial Owner," (iv) whether the assets subject to any Business Combination constitute a Substantial Part, (v) whether two or more transactions constitute a series of Related Transactions, and (vi) such other matters with respect to which a determination is required under this Article X.
In connection with the exercise of its judgment in determining what is in the best interests of the Corporation and its shareholders when evaluating a business combination or a proposal by another Person or Persons to make a business combination or a tender or exchange offer (regardless of whether such proposal is otherwise subject to this Article X), the Board of Directors of the Corporation shall, in addition to considering the adequacy of the consideration to be paid in connection with any such transaction, consider all of the following factors and any other factors that it deems relevant: (i) the social and economic effects of the transaction on the Corporation and its Subsidiaries, employees, depositors, loan and other customers, creditors and other elements of the communities in which the Corporation and its Subsidiaries operate or are located; (ii) the business and financial condition and earnings prospects of the acquiring Person or Persons, including, but not limited to, debt service and other existing or likely financial obligations of the acquiring Person or Persons and their Affiliates and Associates, and the possible effect of such conditions upon the Corporation and its Subsidiaries and the other elements of the communities in which the Corporation and its Subsidiaries operate or are located; and (iii) the competence, experience, and integrity of the acquiring Person or Persons and its or their management and Affiliates and Associates.
Section 10.6.
Fiduciary Obligations Unaffected. Nothing in this Article X shall be construed to relieve any Related Person from any fiduciary duty imposed by law.
GERMAN AMERICAN BANCORP, INC.
Corporate Governance Guidelines
(as adopted June 27, 2011)
The following guidelines are adopted by the Board of Directors of German American Bancorp, Inc. and replace the 2004 Governance Policy. The Board of Directors is referred to as the “Board” and members of the Board are referred to as the “Directors” by these guidelines. The term “Corporation” when used in these guidelines will refer to German American Bancorp, Inc., and may (if the context so suggests) also refer to the Corporation’s banking and other subsidiaries.
Board Composition
Independence. A majority of the members of the Board must qualify as independent in accordance with the applicable provisions of the Securities Exchange Act of 1934, as amended by the Sarbanes-Oxley Act of 2002 and other laws, and the rules promulgated thereunder by the Securities and Exchange Commission (SEC), and by the applicable NASDAQ listing standards pertaining to corporate governance.
The Board will determine annually in conjunction with the annual slating of nominees for election at each annual shareholders meeting whether each Director (including Directors not standing for election) is considered independent for purposes of this requirement. A Director will be considered independent if (A) he or she is not disqualified from being determined to be “independent” under the then-applicable legal, regulatory, and NASDAQ standards of independence described above, and (B) the Board affirmatively determines, after considering the total mix of information available to it at that time, that the Director has no relationships that would interfere with the exercise of his or her independent judgment in carrying out his or her responsibilities as a director of the Corporation. For this purpose, a material relationship includes relationships that arise either directly or as a partner, shareholder, equity owner or officer of an organization that has a relationship with the Corporation, and can encompass commercial, industrial, banking, consulting, legal, accounting, charitable and familial relationships. In assessing the materiality of a Director’s relationship and the potential for such relationship to interfere with that Director’s independence, the Board shall consider the issue of materiality not only from the standpoint of the Director but also from that of the persons or organizations with which the Director has an affiliation. The basis for the Board’s determination that a relationship does not interfere with independence shall be disclosed in the Corporation’s annual proxy statement.
Notwithstanding the above, however, a Director shall not fail to be deemed independent solely as a result of loan transactions (including principal advances and repayments and interest and fee charges and payments) made by our banking subsidiary in the ordinary course of its banking business with that Director or his or her associates and immediate family members (as immediate family membership is defined for purposes of the related person transaction disclosure requirements of the Corporation’s annual proxy statement under SEC rules and NASDAQ independence guidelines), if (X) those loans have been made on substantially the same terms, including interest rates, collateral and repayment terms on extensions of credit, as those prevailing at the same time for comparable loans with persons not related to the lender and did not involve more than the normal risk of collectability or present other unfavorable features, and (Y) none of them are disclosable by the Corporation or its banking subsidiary as nonaccrual, past due, restructured or potential problems (as those terms are defined by the SEC industry guide applicable to disclosures by bank holding companies).
Number of Directors. The Board shall determine from time to time the appropriate size of the Board, with the objective of obtaining the necessary experience, expertise and geographic representation without becoming too large to function efficiently.
Chairman of the Board. The positions of the Chairman of the Board and the Chief Executive Officer may be filled by the same individual or by different individuals, at the discretion of the Board.
Lead Independent Director. At any time when the Chairman of the Board is not an “independent” Director, the Board shall designate from among the independent Directors a “lead independent Director.” The lead independent Director shall assist the Board in assuring effective corporate governance under these guidelines and shall serve as chairperson of meetings of the independent Directors that are held without the presence of any Directors who may at that time be deemed not to be independent. The lead independent Director shall also chair meetings of the Board or shareholders during any meetings or portions of meetings if the Chairman of the Board is absent. In addition, the lead independent Director shall serve as the principal liaison between the independent Directors on the one hand and the full Board and senior management on the other, and work with the Chairman of the Board to finalize the information flow to the Board, the content of meeting agendas and proposed meeting schedules.
Criteria for Director Effectiveness and Suitability for Service
Nominees. Effectiveness of the individual Directors who serve from time to time on the Board is enhanced by careful consideration of those who may be nominated for election to the Board. To discharge their duties in identifying and evaluating nominees for Directors (including nominees who may be appointed to fill vacancies from whatever cause arising on the Board without a shareholder vote), the Governance/Nominating Committee and the Board shall consider the factors identified in the Charter of the Governance/Nominating Committee, as amended from time to time.
Existing Directors. The effectiveness or suitability for Board service of a Director can be affected adversely by events or circumstances that arise after nomination or election to the Board of such Director, such as events or circumstances that (had they arisen at the time of the most recent election or re-election to the Board of such Director and been known to the Board) would have adversely affected (in a material way) the Board’s assessment of (A) the Director’s qualifications, suitability, loyalty or effectiveness, or (B) his or her status as an “independent” Director. Therefore, each Director is expected to promptly report to the lead independent Director any such events or circumstances, including without limitation any (X) change in his or her employment or other affiliations of the Director or his or her immediate family members that could result in a related person transaction disclosure in the Corporation’s annual proxy statement, or otherwise affect the Director’s independence, (Y) substantial change in his or her principal occupation or business association from the position he or she held when last elected to the Board, or (Z) legal, regulatory or financial problems experienced or likely to be experienced by the Director that could become disclosable in the Corporation’s annual proxy statement, including without limitation any inability (or likely inability) of the Director or related persons to perform as scheduled all obligations as debtor under any loan or other extension of credit extended by the Corporation’s banking subsidiary to the Director or his or her related persons.
Age and Tenure Limits. The age qualification requirement of Section 2.3 of the Restated Bylaws of the Corporation applies to elections of certain Directors. Otherwise, there are no tenure or retirement limits or requirements.
Director Responsibilities
Directors should regularly attend meetings of the Board and of all Board committees upon which they serve. To prepare for the meetings, Directors should carefully review the meeting materials that are distributed in advance of each meeting. Each Director is expected to serve on and participate diligently in the work of at least one committee. Further, each Director is expected to attend the entirety of at least 75% of all Board and committee meetings each year. Attendance in person (as distinguished from participation by telephone) is strongly encouraged whenever possible.
Directors are expected to comply with all laws, regulations and internal corporate policies and codes of conduct applicable to them as Directors.
A Director must inform the Audit Committee of the Board as soon as reasonably possible of all types of proposed transactions or series of transactions between (A) him or her (directly or indirectly) and/or his or her related persons as determined under SEC related person transaction disclosure rules, on the only hand, and (B) the Corporation, on the other hand, if such proposed transactions or series of transactions are of the type, amount and nature that could become reportable as related person transactions in the Corporation’s annual meeting proxy statement. Certain types of transactions are not reportable in the Corporation’s proxy statement under the SEC related person transaction disclosure rules, however, and therefore do not require Audit Committee review, including (X) loan transactions of the Corporation’s bank subsidiary in which Directors or members of their immediate families may have a direct or indirect material interest, if such loans satisfy the SEC standards (generally described by the special rule for such loans described under the discussion of independence standards above) for non-disclosure; (Y) payments of dividends or interest made by the Corporation to Directors or members of their immediate families solely as a result of their ownership of publicly-held securities issued by the Corporation (presently including its common shares and debentures) and indebtedness owed by the Corporation to such persons that is evidenced by the Corporation’s publicly-held debentures; and (Z) compensation paid by the Corporation to Directors that is disclosable as compensation in the annual meeting proxy statement and is in fact disclosed as such.
Further, Directors are expected to avoid service on the board of a competing institution or corporation and to resign their position on the Board if such a competing service relationship is established and is not discontinued at the request of the Board. Any questions as to what defines a competing institution or corporation should be directed to the lead independent Director or Chairman of the Board of the Corporation.
Executive Sessions
NASDAQ rules require that the independent Board members regularly meet in executive session without the presence of Directors who are at such time not “independent” as determined in these guidelines. The Board's policy is to hold these executive sessions without the presence of management, including the chief executive officer and any other non-independent Directors in connection with each regularly scheduled Board meeting, and at other times as necessary.
Board Committees
The Board currently has the following standing committees (including committees of the board of directors of the Corporation’s banking subsidiary, the membership of which board is the same as the membership from time to time of the Board of the Corporation):
·
Audit Committee
·
Governance/Nominating Committee
·
Compensation/Human Resources Committee
·
Credit Risk Management Committee
·
Investment Committee
·
Finance (ALCO) Committee
From time to time the Board may form a new committee or disband a current committee depending on the circumstances.
When appointing Directors to the Audit Committee, the Governance/Nominating Committee, or the Compensation/Human Resources Committee, the Board shall determine that each such appointee is then not only an “independent” Director as determined for general Board independence requirements, but also (A) is not potentially classifiable as an “affiliated outside director” by Institutional Shareholder Services, and (B) meets any enhanced or special independence or other requirements established for members of such types of committees by applicable law and regulations, including those of the SEC and the Internal Revenue Service, or by the governance rules or interpretations of NASDAQ.
Members of all standing committees are appointed by the Board but subject to the recommendation of the Governance/Nominating Committee. The Board determines the exact number of members and can at any time remove or replace a Committee member.
The Chair of each committee of the Board will, in consultation with appropriate committee members and members of management, and in accordance with the committee's charter, determine the frequency and length of committee meetings and develop the committee's agenda.
Board, Committee and Director Evaluation and Self-Assessment
The Board and its committees and its individual members are subject to evaluation and self-assessment from time to time. The Governance/Nominating Committee shall develop procedures for this process and oversee such evaluations and self-assessments and report to the Board at least annually concerning such matters.
Director Access to Management
Although Directors may contact any member of management without prior or subsequent notice or permission from the Chief Executive Officer or other executive officer, the Board expects that Directors will exercise reasonable judgment to assure that contact of this sort is not distracting to the business operations of the Corporation. Further, any such contact, if in writing, will be copied to the Chief Executive Officer or the lead independent Director, as appropriate.
CEO Performance Evaluation and Succession Planning
The Board (not including any members of management) will conduct an annual review of the performance and compensation of the Chief Executive Officer, taking into account the views and recommendations of the Compensation/Human Resources Committee. The Board will establish and annually review plans regarding succession to the Chief Executive Officer in the event of emergency or retirement. The Chief Executive Officer shall discuss with the Board at least annually succession planning for key senior management positions, along with related development recommendations.
Director Compensation
The Governance/Nominating Committee shall assess, from time to time, the adequacy and suitability of the compensation package for members of the Board in relation to competitive market and sound corporate governance practices. The Chief Executive Officer or other members of the senior management team or other persons appointed by the Governance/Nominating Committee shall report to the Committee from time to time regarding the adequacy and suitability of the Board compensation package in relation to other comparable companies. Changes in Board compensation, if any, should be suggested by the Governance/Nominating Committee for approval by the Board.
Stock Ownership Guidelines
In order to align the interests of Directors with shareholders, non-employee Directors are expected to have an investment position in shares of the Corporation’s common stock equal to a multiple of three times the current annual cash retainer paid to non-employee Directors. Further, the Chief Executive Officer is expected to have an investment position in shares of the Corporation’s common stock equal to three times his or her base salary. Exceptions to these ownership guidelines may be approved by the lead independent Director for good reason.
Investment positions for purposes of these guidelines shall mean the shares deemed to be beneficially owned according to the SEC’s beneficial ownership rules that are followed in the table of beneficial ownership that is included in the Corporation’s annual meeting proxy statement. Once a person is in compliance with the ownership guidelines, he or she does not need to re-qualify solely because the shares that are beneficially owned at time of attaining compliance experience a stock price decline.
Directors and executive officers must notify the Corporation of any pledge or grant of security interest in any shares of Corporation common stock that they beneficially own or any change in similar previously-reported arrangements.
External Advisors
While the information needed for the Board's decision making generally will be found within the Corporation, from time to time the Board may seek professional or expert advice from sources independent of management. Accordingly, the Board shall have the sole authority to engage, compensate, oversee and terminate external advisors as it determines necessary to carry out its responsibilities. The Corporation shall provide appropriate funding (as determined by the Board) for payment of compensation to advisors engaged by the Board.
Likewise, each committee of the Board shall have the sole authority to engage, compensate, oversee and terminate external advisors as it determines necessary to carry out its duties. The Corporation shall provide appropriate funding (as determined by each committee) for payment of compensation to advisors engaged by the committees.
Shareholder Communications with the Board
Any holder (of record or beneficially) of any shares of common stock of the Corporation may direct written communications to the Board (or to specified individual members of the Board in their official capacities as members of the Board) by (a) addressing such communications to the attention of the Board (or such individual(s), as applicable), (b) including in such communication a statement that the person sending the record is a holder (of record or beneficially) of the Corporation's common shares and a statement that the shareholder wishes that the communication be delivered to the Board (or the specified individuals), and (c) mailing such communications (by registered or certified mail, return receipt requested) to the indicated addressee(s) in care of the Secretary of the Corporation, at the address of the Corporation's principal executive offices. The Board has directed that the Secretary of the Corporation, upon his or her receipt of any such communication, shall distribute copies of such communication (even if such communication may have been addressed solely to the attention of one or more individual Directors and not to all Directors) to all of the members of the Board not later than the date of the next regular meeting of the Board. The above procedure is of general applicability for those communications for which a communication channel is not otherwise established. If the shareholder communication relates to the recommendation of a candidate for nomination by the Board for election as a Director at an annual meeting, the shareholder should send that communication to the attention of the Chairman of the Governance/Nominating Committee in accordance with Section 4 of the Charter of the Governance/Nominating Committee. If an employee desires to communicate (on a confidential anonymous basis) any concern relating to accounting or auditing matters, the employee should communicate such concerns to the Audit Committee in accordance with the Corporation’s Section 301 reporting policies and procedures that are posted on the Corporation’s website.
Board Interaction with Investors, Media and Customers
The Board believes that, except in extraordinary circumstances, management should speak for the Corporation. Each Director is therefore expected to refer inquiries from investors, the press or other media sources, or customers to the Chief Executive Officer without substantive comment.
Annual Review of these Guidelines
These guidelines have been developed and approved by the Board. The Board will review at least annually the practices incorporated into these guidelines in order to determine whether these they should be updated. These guidelines shall be published on the Corporation's website.