AMENDED AND RESTATED BYLAWS
OF
EVANS & SUTHERLAND COMPUTER CORPORATION
A Utah Corporation
INDEX TO AMENDED AND RESTATED BYLAWS
OF
EVANS & SUTHERLAND COMPUTER CORPORATION
Page
ARTICLE I Offices.............................................................1
Section 1.01 Business Offices.............................................1
Section 1.02 Principal Office.............................................1
Section 1.03 Registered Office............................................1
ARTICLE II Shareholders.......................................................1
Section 2.01 Annual Meeting...............................................1
Section 2.02 Special Meetings.............................................2
Section 2.03 Place of Meetings............................................2
Section 2.04 Notice of Meetings...........................................2
Section 2.05 Fixing of Record Date........................................3
Section 2.06 Shareholder List for Meetings................................4
Section 2.07 Shareholder Quorum and Voting Requirements...................4
Section 2.08 Increasing Quorum or Voting Requirements.....................5
Section 2.09 Proxies......................................................5
Section 2.10 Voting of Shares.............................................5
Section 2.11 Corporation's Acceptance of Votes............................5
Section 2.12 Action Without a Meeting.....................................6
Section 2.13 Meetings by Telecommunication................................7
Section 2.14 Voting Trusts and Agreements.................................7
Section 2.15 Voting for Directors.........................................7
Section 2.16 Maintenance of Records and Shareholder Inspection Rights.....7
Section 2.17 Financial Statements and Share Information...................9
Section 2.18 Dissenters' Rights...........................................9
Section 2.19 Shares Held by Nominees......................................9
ARTICLE III Board of Directors................................................9
Section 3.01 General Powers...............................................9
Section 3.02 Number, Tenure and Qualifications............................9
Section 3.03 Resignation.................................................10
Section 3.04 Removal.....................................................10
Section 3.05 Vacancies...................................................10
Section 3.06 Regular Meetings............................................10
Section 3.07 Special Meetings............................................11
Section 3.08 Place of Meetings -- Meetings by Telephone..................11
Section 3.09 Notice of Meetings..........................................11
Section 3.10 Waiver of Notice............................................11
Section 3.11 Quorum and Manner of Acting.................................11
Section 3.12 Action Without a Meeting....................................12
Section 3.14 Compensation................................................12
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Section 3.14 Committees..................................................12
Section 3.15 Standards of Conduct........................................13
Section 3.16 Liability for Unlawful Distributions........................13
Section 3.17 Conflicting Interest Transactions...........................13
ARTICLE IV Officers..........................................................13
Section 4.01 Number and Qualifications...................................13
Section 4.02 Appointment and Term of Office..............................14
Section 4.03 Removal and Resignation of Officers.........................14
Section 4.04 Authority and Duties........................................14
Section 4.05 Surety Bonds................................................16
Section 4.06 Compensation................................................16
ARTICLE V Standards of Conduct for Officers and Directors....................16
Section 5.01 Standards of Conduct........................................16
Section 5.02 Reliance on Information and Reports.........................16
Section 5.03 Limitation on Liability.....................................17
ARTICLE VI Indemnification..................................................17
Section 6.01 Indemnification of Directors................................17
Section 6.02 Advance Expenses for Directors..............................18
Section 6.03 Indemnification of Officers, Employees,
Fiduciaries, and Agents.....................................19
Section 6.04 Insurance...................................................19
Section 6.05 Scope of Indemnification....................................19
Section 6.06 Other Rights and Remedies...................................20
Section 6.07 Severability................................................20
ARTICLE VII Stock...........................................................20
Section 7.01 Issuance of Shares..........................................20
Section 7.02 Certificates for Shares; Shares Without Certificates........20
Section 7.03 Restrictions on Transfer of Shares Permitted................22
Section 7.04 Acquisition of Shares by the Corporation....................22
ARTICLE VIII Amendments to Bylaws............................................22
Section 8.01 Authority to Amend..........................................22
ARTICLE IX Miscellaneous....................................................23
Section 9.01 Corporate Seal..............................................23
Section 9.02 Fiscal Year.................................................23
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AMENDED AND RESTATED BYLAWS
OF
EVANS & SUTHERLAND COMPUTER CORPORATION
Approved by Resolution of the Board of Directors dated August 30, 2000.
ARTICLE I
Offices
Section 1.01 Business Offices. The corporation may have such offices as the
Board of Directors may from time to time determine or as the business of the
corporation may from time to time require.
Section 1.02 Principal Office. The principal office of the corporation
shall be located at any place either within or outside Utah as may be designated
in the most recent document on file with the Utah Department of Commerce,
Division of Corporations and Commercial Code (the "Division") providing
information regarding the principal office of the corporation. The corporation
shall maintain at its principal office a copy of such corporate records as may
be required by the Utah Revised Business Corporation Act (the "Act") and Section
2.16 of these bylaws.
Section 1.03 Registered Office. The registered office of the corporation
required by the Act to be maintained in Utah shall be the registered office as
designated as the corporation's registered office in the most recent document on
file with the Division providing such information. The corporation shall
maintain a registered agent at the registered office, as required by the Act.
The registered office and registered agent may be changed from time to time as
provided by the Act.
ARTICLE II
Shareholders
Section 2.01 Annual Meeting. The annual meeting of shareholders shall be
held each year on a date and at a time designated by the Board of Directors. In
the absence of such designation, the annual meeting of shareholders shall be
held on the third Wednesday of May in each year at 11:00 a. m. However, if the
day fixed for the annual meeting is a legal holiday in Utah, then the meeting
shall be held at the same time and place on the next succeeding business day. At
the meeting, directors shall be elected and any other proper business may be
transacted. If the election of directors shall not be held on the day designated
herein for any annual meeting of the shareholders, or at any adjournment
thereof, the Board of Directors shall cause the election to be held at a meeting
of the shareholders as soon thereafter as may be convenient. Failure to hold an
annual meeting as required by these bylaws shall not affect the validity of any
corporate action or work a forfeiture or dissolution of the corporation.
Section 2.02 Special Meetings. Special meetings of the shareholders may be
called at any time by the Board of Directors, by such officers or persons as may
be authorized by the bylaws to call a special meeting, or by the holders of
shares representing at least ten percent (10%) of all the votes entitled to be
cast on any issue proposed to be considered at the meeting, all in accordance
with the Act.
Section 2.03 Place of Meetings. Each annual or special meeting of the
shareholders shall be held at such place, either within or outside Utah, as may
be designated by the Board of Directors. In the absence of any such designation,
meetings shall be held at the principal office of the corporation.
Section 2.04 Notice of Meetings.
(a) Required Notice. The corporation shall give notice to shareholders
of the date, time, and place of each annual and special meeting of
shareholders no fewer than ten (10) nor more than sixty (60) days before
the meeting date, in accordance with the requirements of the Act. Unless
otherwise required by law or the articles of incorporation, the corporation
is required to give the notice only to shareholders entitled to vote at the
meeting. The notice requirement will be excused under certain circumstances
with respect to shareholders whose whereabouts are unknown, as provided in
the Act.
If the proposed corporate action creates dissenters' rights, the
notice must be sent to all shareholders of the corporation as of the
applicable record date, whether or not they are entitled to vote at the
meeting.
(b) Contents of Notice. The notice of each special meeting must
include a description of the purpose or purposes for which the meeting is
called. Except as provided in this Section 2.04(b), or as otherwise
required by the Act, other applicable law, or the articles of
incorporation, notice of an annual meeting need not include a description
of the purpose or purposes for which the meeting is called.
If a purpose of any shareholder meeting is to consider: (1) a proposed
amendment to the articles of incorporation; (2) a plan of merger or share
exchange; (3) the sale, lease, exchange or other disposition of all, or
substantially all, of the corporation's property; (4) the dissolution of
the corporation; or (5) the removal of a director, the notice must so state
and be accompanied by a copy or summary of the transaction documents, as
set forth in the above-referenced sections of the Act.
If the proposed corporate action creates dissenters' rights, the
notice must state that shareholders are, or may be, entitled to assert
dissenters' rights, and must be accompanied by a copy of Part 13 of the
Act.
(c) Adjourned Meeting. If any annual or special meeting of
shareholders is adjourned to a different date, time or place, then subject
to the requirements of the following sentence notice need not be given of
the new date, time and place if the new date, time and place are announced
at the meeting before adjournment. If the adjournment is for more than
thirty (30) days, or if after the adjournment a new record date for the
adjourned meeting is or must be fixed under the Act and Section 2.05 of
these bylaws, notice of the adjourned meeting must be given pursuant to the
requirements of paragraph 2.04(a) of these bylaws to shareholders of record
entitled to vote at the meeting, as provided in the Act.
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(d) Waiver of Notice. A shareholder may waive notice of any meeting
(or any other notice required by the Act, the articles of incorporation or
these bylaws) by a writing signed by the shareholder entitled to the
notice, which is delivered to the corporation (either before or after the
date and time stated in the notice as the date and time when any action
will occur), for inclusion in the minutes or filing with the corporation
records. A shareholder's attendance at a meeting: (a) waives objection to
lack of notice or defective notice of the meeting, unless the shareholder
at the beginning of the meeting objects to holding the meeting or
transacting business at the meeting because of lack of notice or defective
notice; and (b) waives objection to consideration of a particular matter at
the meeting that is not within the purpose or purposes described in the
meeting notice, unless the shareholder objects to considering the matter
when it is presented.
Section 2.05 Fixing of Record Date. For the purpose of determining
shareholders of any voting group entitled to: (i) notice of or to vote at any
meeting of shareholders or any adjournment thereof; (ii) take action without a
meeting; (iii) demand a special meeting; (iv) receive payment of any
distribution or share dividend; or (v) take any other action, the board of
directors may fix in advance a date as the record date for one or more voting
groups. As provided in the Act, a record date fixed pursuant to such section may
not be more than 70 days prior to the date on which the particular action
requiring such determination of shareholders is to be taken. If no record date
is otherwise fixed by the board as provided herein, then the record date for the
purposes set forth below shall be the close of business on the dates indicated:
(a) With respect to a determination of shareholders entitled to notice
of and to vote at an annual or special meeting of shareholders, the day
before the first notice is mailed to shareholders;
(b) With respect to a determination of shareholders entitled to demand
a special meeting of shareholders, the later of (i) the earliest date of
any of the demands pursuant to which the meeting is called, and (ii) the
date that is sixty days prior to the date the first of the written demands
pursuant to which the meeting is called is received by the corporation;
(c) With respect to a determination of shareholders entitled to a
share dividend, the date the board authorizes the share dividend;
(d) With respect to a determination of shareholders entitled to take
action without a meeting (pursuant to Section 2.12 of these bylaws and the
Act) or entitled to be given notice of an action so taken, the date the
first shareholder delivers to the corporation a writing upon which the
action is taken; and
(e) With respect to a determination of shareholders entitled to a
distribution (other than one involving a purchase or reacquisition of
shares for which no record date is necessary), the date the board of
directors authorizes the distribution.
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A determination of shareholders entitled to notice of or to vote at
any meeting of shareholders is effective for any adjournment of the meeting
unless the board of directors fixes a new record date, which it must do if
the meeting is adjourned to a date more than 120 days after the date fixed
for the original meeting.
Section 2.06 Shareholder List for Meetings. The officer or agent having
charge of the stock transfer books for shares of the corporation shall prepare a
list of the names of all shareholders entitled to be given notice of, and to
vote at, each meeting of shareholders, in compliance with the requirements of
the Act. The list must be arranged by voting group and within each voting group
by class or series of shares. The list must be in alphabetical order within each
class or series of shares and must show the address of, and the number of shares
held by, each shareholder. The shareholder list must be available for inspection
by any shareholder, beginning on the earlier of (i) ten days before the meeting
for which the list was prepared, or (ii) two business days after notice of the
meeting is given, and continuing through the meeting and any adjournments
thereof. The list must be available at the corporation's principal office or at
a place identified in the meeting notice in the city where the meeting is to be
held. A shareholder or a shareholder's agent or attorney is entitled on written
demand to the corporation, and subject to the provisions of the Act, to inspect
and copy the list during regular business hours, during the period it is
available for inspection. The list is to be available at the meeting for which
it was prepared, and any shareholder or any shareholder's agent or attorney is
entitled to inspect the list at any time during the meeting for any purpose
germane to the meeting. The shareholder list is to be maintained in written form
or in another form capable of conversion into written form within a reasonable
time.
Section 2.07 Shareholder Quorum and Voting Requirements. If the articles of
incorporation or the Act provides for voting by a single voting group on a
matter, action on that matter is taken when voted upon by that voting group.
Shares entitled to vote as a separate voting group may take action on a
matter at a meeting only if a quorum of such shares exists with respect to that
matter. Unless the articles of incorporation or the Act provide otherwise, a
majority of the votes entitled to be cast on the matter by the voting group
constitutes a quorum of that group for action on that matter.
If the articles of incorporation or the Act provides for voting by two or
more voting groups on a matter, action on that matter is taken only when voted
upon by each of those voting groups counted separately. One voting group may
vote on a matter even though another voting group entitled to vote on the matter
has not voted.
Once a share is represented for any purpose at a meeting, including the
purpose of determining that a quorum exists, it is deemed present for quorum
purposes for the remainder of the meeting and for any adjournment of the
meeting, unless a new record date is or must be set for the adjourned meeting.
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If a quorum exists, action on a matter (other than the election of
directors) by a voting group is approved if the votes cast within the voting
group favoring the action exceed the votes cast within the voting group opposing
the action, unless the articles of incorporation or the Act requires a greater
number of affirmative votes. Those matters as to which the Act provides for a
special voting requirement, typically requiring the vote of a majority of all
votes entitled to be cast, or a majority of all voting shares within each voting
group which is entitled to vote separately, include certain amendments to the
articles of incorporation, mergers, sales of substantially all corporate assets,
and dissolution of the corporation.
Section 2.08 Increasing Quorum or Voting Requirements. The articles of
incorporation may provide for a greater quorum or voting requirement for
shareholders, or voting groups of shareholders, than is provided for by the Act.
An amendment to the articles of incorporation that changes or deletes a greater
quorum or voting requirement must meet the same quorum requirement and be
adopted by the same vote and voting groups required to take action under the
quorum and voting requirements then in effect.
Section 2.09 Proxies. At all meetings of shareholders, a shareholder may
vote in person or by proxy. A shareholder may appoint a proxy by signing an
appointment form, either personally or by the shareholder's attorney-in-fact, or
by any of the other means set forth in the Act. A proxy appointment is valid for
eleven months unless a longer period is expressly provided in the appointment
form. The effectiveness and revocability of proxy appointments are governed by
the Act.
Section 2.10 Voting of Shares. Unless otherwise provided in the articles of
incorporation or applicable law, each outstanding share, regardless of class, is
entitled to one vote, and each fractional share is entitled to a corresponding
fractional vote, on each matter voted on at a shareholders' meeting. Only shares
are entitled to vote.
Except as otherwise provided by specific court order, shares of this
corporation are not entitled to be voted or to be counted in determining the
total number of outstanding shares eligible to be voted if they are owned,
directly or indirectly, by a second corporation, domestic or foreign, and this
corporation owns, directly or indirectly, a majority of the shares entitled to
vote for directors of the second corporation. The prior sentence shall not limit
the power of the corporation to vote any shares, including its own shares, held
by it in a fiduciary capacity. Redeemable shares are not entitled to be voted
after notice of redemption is mailed to the holders and a sum sufficient to
redeem the shares has been deposited with a bank, trust company, or other
financial institution under an irrevocable obligation to pay the holders the
redemption price on surrender of the shares.
Section 2.11 Corporation's Acceptance of Votes. If the name signed on a
vote, consent, waiver, proxy appointment, or proxy appointment revocation
corresponds to the name of a shareholder, the corporation, if acting in good
faith, is entitled to accept the vote, consent, waiver, proxy appointment, or
proxy appointment revocation and give it effect as the act of the shareholder.
If the name signed on a vote, consent, waiver, proxy appointment, or proxy
appointment revocation does not correspond to the name of a shareholder, the
corporation, if acting in good faith, is nevertheless entitled to accept the
vote, consent, waiver, proxy appointment, or proxy appointment revocation and
give it effect as the act of the shareholder if:
(a) the shareholder is an entity and the name signed purports to be
that of an officer or agent of the entity;
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(b) the name signed purports to be that of an administrator, executor,
guardian, or conservator representing the shareholder and, if the
corporation requests, evidence of fiduciary status acceptable to the
corporation has been presented with respect to the vote, consent, waiver,
proxy appointment, or proxy appointment revocation;
(c) the name signed purports to be that of a receiver or trustee in
bankruptcy of the shareholder and, if the corporation requests, evidence of
this status acceptable to the corporation has been presented with respect
to the vote, consent, waiver, proxy appointment, or proxy appointment
revocation;
(d) the name signed purports to be that of a pledgee, beneficial
owner, or attorney-in-fact of the shareholder and, if the corporation
requests, evidence acceptable to the corporation of the signatory's
authority to sign for the shareholder has been presented with respect to
the vote, consent, waiver, proxy appointment, or proxy appointment
revocation;
(e) two or more persons are the shareholder as co-tenants or
fiduciaries and the name signed purports to be the name of at least one of
the co-tenants or fiduciaries and the person signing appears to be acting
on behalf of all co-tenants or fiduciaries; or
(f) the acceptance of the vote, consent, waiver, proxy appointment, or
proxy appointment revocation is otherwise proper under rules established by
the corporation that are not inconsistent with the provisions of the Act.
If shares are registered in the names of two or more persons, whether
fiduciaries, members of a partnership, co-tenants, husband and wife as community
property, voting trustees, persons entitled to vote under a shareholder voting
agreement or otherwise, or if two or more persons, including proxyholders, have
the same fiduciary relationship respecting the same shares, then unless the
secretary of the corporation or other officer or agent entitled to tabulate
votes is given written notice to the contrary and is furnished with a copy of
the instrument or order appointing them or creating the relationship wherein it
is so provided, their acts with respect to voting shall have the effects set
forth in Section 724(3) of the Act.
The corporation is entitled to reject a vote, consent, waiver, proxy
appointment, or proxy appointment revocation if the secretary or other officer
or agent authorized to tabulate votes, acting in good faith, has reasonable
basis for doubt about the validity of the signature on it or about the
signatory's authority to sign for the shareholder.
The corporation and its officer or agent who accepts or rejects a vote,
consent, waiver, proxy appointment, or proxy appointment revocation in good
faith and in accordance with the standards of Section 724 of the Act are not
liable in damages to the shareholder for the consequences of the acceptance or
rejection.
Corporate action based on the acceptance or rejection of a vote, consent,
waiver, proxy appointment, or proxy appointment revocation under this section
and Section 724 of the Act is valid unless a court of competent jurisdiction
determines otherwise.
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Section 2.12 Action Without a Meeting. Unless otherwise provided in the
articles of incorporation, and subject to the provisions of the Act, any action
required or permitted to be taken at a meeting of the shareholders may be taken
without a meeting and without prior notice, if one or more consents in writing,
setting forth the action so taken, shall be signed by the holders of outstanding
shares having no less than the minimum number of votes that would be necessary
to authorize or take the action at a meeting at which all shares entitled to
vote thereon were present and voted. Unless the written consents of all
shareholders entitled to vote have been obtained, notice of any shareholder
approval without a meeting shall be given at least ten days before the
consummation of the action authorized by the approval. Such notice shall meet
the requirements of, and be delivered to all shareholders identified in, the
Act.
Any shareholder giving a written consent, or the shareholder's proxyholder,
personal representative or transferee may revoke a consent by a signed writing
describing the action and stating that the shareholder's prior consent is
revoked, if the writing is received by the corporation prior to the
effectiveness of the action.
An action taken by written consent of the shareholders as provided herein
is not effective unless all written consents on which the corporation relies for
the taking of the action are received by the corporation within a sixty day
period. An action so taken is effective as of the date the last written consent
necessary to effect the action is received by the corporation, unless all of the
written consents necessary to effect the action specify a later date as the
effective date of the action, in which case the later date shall be the
effective date of the action.
Written consents may be received by the corporation by electronically
transmitted facsimile or other form of communication providing the corporation
with a complete copy thereof, including a copy of the signature thereto.
Notwithstanding the other provisions of this bylaw, directors may not be
elected by written consent except by unanimous written consent of all shares
entitled to vote for the election of directors.
An action taken by written consent of the shareholders as provided herein
has the same effect as action taken at a meeting of shareholders, and may be so
described in any document.
Section 2.13 Meetings by Telecommunication. Any or all of the shareholders
may participate in an annual or special meeting of shareholders by, or the
meeting may be conducted through the use of, any means of communication by which
all persons participating in the meeting can hear each other during the meeting.
A shareholder participating in a meeting by this means is considered to be
present in person at the meeting.
Section 2.14 Voting Trusts and Agreements. Voting trusts and agreements may
be entered into among the shareholders in compliance with the requirements of
the Act.
Section 2.15 Voting for Directors. Unless otherwise provided in the
articles of incorporation or the Act, directors are elected by a plurality of
the votes cast by the shares entitled to vote in the election at a meeting at
which a quorum is present, in accordance with the requirements and procedures
set forth in the Act.
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Section 2.16 Maintenance of Records and Shareholder Inspection Rights.
(a) Corporate Records. The corporation shall keep as permanent records
minutes of all meetings of its shareholders and board of directors, a
record of all actions taken by the shareholders or board of directors
without a meeting, a record of all actions taken on behalf of the
corporation by a committee of the board of directors in place of the board
of directors, and a record of all waivers of notices of meetings of
shareholders, meetings of the board of directors, or any meetings of
committees of the board of directors. The corporation shall also maintain
appropriate accounting and shareholder records as required by the statute.
The corporation shall keep at its principal office those corporate records
and documents listed in the following paragraph.
(b) Inspection Rights of Records Required at Principal Office. A
shareholder or director of the corporation (or such person's agent or
attorney) who gives the corporation written notice of the demand at least
five business days before the proposed inspection date, has the right to
inspect and copy, during regular business hours, any of the following
records, all of which the corporation is required to keep at its principal
office:
(i) its articles of incorporation as then in effect;
(ii) its bylaws as then in effect;
(iii) the minutes of all shareholders' meetings, and records of
all actions taken by shareholders without a meeting, for the past
three years;
(iv) all written communications within the past three years to
shareholders as a group or to the holders of any class or series of
shares as a group;
(v) a list of the names and addresses of its current officers and
directors;
(vi) its most recent annual report delivered to the Division; and
(vii) all financial statements prepared for periods ending during
the last three years that a shareholder could request under the Act.
(c) Conditional Inspection Rights. In addition to the inspection
rights set forth in paragraph (b) above, a shareholder or director of the
corporation (or such person's agent or attorney) who gives the corporation
a written demand in good faith and for a proper purpose at least five
business days before the requested inspection date, and describes in the
demand with reasonable particularity the records proposed to be inspected
and the purpose of the inspection, is entitled to inspect and copy, during
regular business hours at a reasonable location specified by the
corporation, any of the following records of the corporation:
(i) excerpts from minutes of meetings of, and from actions taken
by, the shareholders, the board of directors, or any committees of the
board of directors, to the extent not subject to inspection under
paragraph (b) of this Section 2.16;
(ii) accounting records of the corporation; and
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(iii) the record of shareholders (compiled no earlier than the
date of the demand for inspection).
For the purposes of paragraph (c), a proper purpose means a purpose
reasonably related to the demanding party's interest as a shareholder or
director. A party may not use any information obtained through the inspection or
copying of records permitted by this paragraph (c) for any purposes other than
those set forth in a proper demand as described above, and the officers of the
corporation are authorized to take appropriate steps to ensure compliance with
this limitation.
Section 2.17 Financial Statements and Share Information. Upon the written
request of any shareholder, the corporation shall mail to the requesting
shareholder:
(i) its most recent annual or quarterly financial statements
showing in reasonable detail its assets and liabilities and the
results of its operations, as required by the Act; and
(ii) the information specified by Section 625(3) of the Act,
regarding the designations, preferences, limitations, and relative
rights applicable to each class and series of shares of the
corporation, and the authority of the board of directors to determine
variations for any existing or future class or series.
Section 2.18 Dissenters' Rights. Each shareholder of the corporation shall
have the right to dissent from, and obtain payment of the fair value of shares
held by such shareholder in the event of, any of the corporate actions
identified in Section 1302 of the Act or otherwise designated in the articles of
incorporation or in a resolution of the board of directors.
Section 2.19 Shares Held by Nominees. The Board of Directors is authorized
to establish for the corporation from time to time such procedures as the
directors may determine to be appropriate, by which the beneficial owner of
shares that are registered in a nominee is recognized by the corporation as a
shareholder.
ARTICLE III
Board of Directors
Section 3.01 General Powers. All corporate powers shall be exercised by or
under the authority of, and the business and affairs of the corporation shall be
managed under the direction of board of directors, subject to any limitation set
forth in the articles of incorporation or in a shareholder agreement permitted
by the Act.
Section 3.02 Number, Tenure and Qualifications. Unless otherwise
specifically provided in the articles of incorporation, and subject to the
provisions of the Act, the number of directors of the corporation shall be not
less than 3 nor more than 11. The exact number of directors shall be 5, until
changed, within the limits specified above, by a bylaw amending this Section 3.2
duly adopted by the board of directors or the shareholders.
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As provided in the articles of incorporation, the board of directors shall
be divided into three classes, designated Class I, Class II and Class III. Each
class of directors shall serve for a staggered three-year term. However, a
director whose term expires shall continue to serve until such director's
successor shall have been elected and qualified or until there is a decrease in
the authorized number of directors. No decrease in the authorized number of
directors shall have the effect of shortening the term of any incumbent
director.
If the articles of incorporation authorize dividing the shares into classes
or series, the articles of incorporation may also authorize the election of all
or a specified number or portion of directors by the holders of one or more
authorized classes or series of shares, as provided in Section 804 of the Act. A
class or series of shares entitled to elect one or more directors is a separate
voting group for purposes of the election of directors.
Section 3.03 Resignation. Any director may resign at any time by giving a
written notice of resignation to the corporation. A director's resignation is
effective when the notice is received by the corporation, or on such later date
as may be specified in the notice of resignation. (Section 807 of the Act).
Section 3.04 Removal. The shareholders may remove one or more directors at
a meeting called for that purpose, as contemplated by Section 808 of the Act, if
the meeting notice states that a purpose of the meeting is such removal. The
removal may be with or without cause unless the articles of incorporation
provide that directors may be removed only for cause. If a director is elected
by a voting group of shareholders, only the shareholders of that voting group
may participate in the vote to remove the director. If the articles of
incorporation provide for cumulative voting for the election of directors, a
director may not be removed if a number of votes sufficient to elect the
director under such cumulative voting is voted against removal. If cumulative
voting is not in effect, a director may be removed only if the number of votes
cast to remove the director exceeds the number of votes cast against removal.
Section 3.05 Vacancies. Unless the articles of incorporation provide
otherwise, if a vacancy occurs on the board of directors, including a vacancy
resulting from an increase in the number of directors, the vacancy may be filled
by the shareholders or the board of directors. If the directors remaining in
office constitute fewer than a quorum of the board, they may fill the vacancy by
the affirmative vote of a majority of all the directors remaining in office.
If the vacant office was held or is to be held by a director elected by a
voting group of shareholders, only the holders of the shares of that voting
group are entitled to vote to fill the vacancy if it is filled by the
shareholders. If such vacancy is to be filled by the directors and one or more
of the other directors elected by the same voting group are serving, only they
are entitled to vote to fill the vacancy.
A vacancy that will occur at a specific later date (by reason of a
resignation effective at a later date or otherwise) may be filled before the
vacancy occurs, but the new director may not take office until the vacancy
occurs.
The terms of directors elected to fill vacancies shall expire at the end of
the term of the director whom they were elected to succeed.
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Section 3.06 Regular Meetings. Regular meetings of the board of directors
may be held without notice of the date, time, place or purposes of the meetings,
if the times of such meetings are fixed by resolution of the board of directors.
Section 3.07 Special Meetings. Special meetings of the board of directors
may be called by or at the request of the president or any one director. The
person or persons authorized to call special meetings of the board of directors
may fix the time and place of the meetings so called.
Section 3.08 Place of Meetings -- Meetings by Telephone. The board of
directors may hold regular or special meetings in or out of the State of Utah.
Unless the articles of incorporation or bylaws provide otherwise, the board of
directors may permit any or all directors to participate in a regular or special
meeting by, or conduct the meeting through the use of, any means of
communication by which all directors participating may hear each other during
the meeting.
Section 3.09 Notice of Meetings. Unless the articles of incorporation or
the Act provide otherwise, regular meetings of the board may be held without
notice of the date, time, place, or purposes of the meeting. Unless the articles
of incorporation provide for a longer or shorter period, special meetings of the
board of directors must be preceded by at least two days' notice of the date,
time, and place of the meeting. The notice need not describe the purpose of the
special meeting unless required by the articles of incorporation or the Act.
The giving of notice of any meeting, shall be governed by the rules set
forth in the Act.
Section 3.10 Waiver of Notice. Any director may waive notice of any meeting
before or after the date of the meeting, as provided in the Act. Except as
provided in the next sentence, the waiver must be in writing, signed by the
director entitled to the notice, and delivered to the corporation for filing
with the corporate records (but delivery and filing are not conditions to its
effectiveness). A director's attendance at or participation in a meeting waives
any required notice to the director of the meeting unless the director at the
beginning of the meeting, or promptly upon the director's arrival, objects to
holding the meeting or transacting business at the meeting because of lack of
notice or defective notice, and does not thereafter vote for or assent to action
taken at the meeting.
Section 3.11 Quorum and Manner of Acting. Unless the articles of
incorporation establish a different quorum requirement, a quorum of the board of
directors consists of a majority of the number of directors fixed or prescribed
in accordance with these bylaws.
The affirmative vote of a majority of directors present at a meeting at
which a quorum is present when the vote is taken shall be the act of the board
of directors, unless the articles of incorporation or the Act require the vote
of a greater vote of directors. Any action to change the percentage of directors
needed to take action is subject to the provisions of the Act.
A director who is present at a meeting of the board of directors when
corporate action is taken is considered to have assented to the action taken at
the meeting unless:
(i) the director objects at the beginning of the meeting (or
promptly upon arrival) to holding the meeting or transacting business
at the meeting and does not thereafter vote for or assent to any
action taken at the meeting;
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(ii) the director contemporaneously requests that such director's
dissent or abstention as to any specific action be entered into the
minutes of the meeting; or
(iii) the director causes written notice of a dissent or
abstention as to any specific action to be received by the presiding
officer of the meeting before adjournment of the meeting or by the
corporation promptly after adjournment of the meeting. The right of
dissent or abstention as to a specific action is not available to a
director who votes in favor of the action taken.
Section 3.12 Action Without a Meeting. Unless the articles of
incorporation, these bylaws or the Act provide otherwise, any action required or
permitted to be taken by the board of directors at a meeting may be taken
without a meeting if all the directors consent in writing to the action as
permitted by the Act. Action is considered to have been taken by such written
consents when the last director signs a writing describing the action taken,
unless prior to that time any director has revoked a consent by a writing signed
by the director and received by an authorized officer of the corporation. An
action so taken is effective at the time it is taken, unless the board of
directors establishes a different effective date. An action taken by written
consent of the directors as described in this section has the same effect as
action taken at a meeting of directors and may be described as such in any
document.
Section 3.13 Compensation. Unless otherwise provided in the articles of
incorporation, the board of directors may fix the compensation of directors as
permitted by the Act. The corporation shall provide for directors to be paid
their expenses, if any, of attendance at each meeting of the board of directors,
and may be paid a stated salary as director or a fixed sum for attendance at
each meeting of the board of directors or both. No such payment shall preclude
any director from serving the corporation in any capacity and receiving
compensation therefor.
Section 3.14 Committees.
(a) Creation of Committees. Unless the articles of incorporation
provide otherwise, a board of directors may create one or more committees
and appoint members of the board of directors to serve on them. Each
committee must have two or more members, who serve at the pleasure of the
board of directors.
(b) Selection of Committee Members. The creation of a committee and
appointment of members to it must be approved by the greater of:
(i) a majority of all the directors in office when the action is
taken; or
(ii) the number of directors required by the articles of
incorporation to take action under the Act and Section 3.11 of these
bylaws.
(c) Required Procedures. Sections 820 and 824 of the Act, and Sections
3.06 through 3.11 of these bylaws, which govern meetings, action without
meeting, notice, waiver of notice, and quorum and voting requirements of
the board of directors, apply to committees and their members as well.
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(d) Authority. Unless limited by the articles of incorporation, each
committee may exercise those aspects of the authority of the board of
directors (as set forth in the Act and Section 3.01 of these bylaws) which
the board of directors confers upon such committee in the resolution
creating the committee.
(e) Impact on Duty of Directors. The creation of, delegation of
authority to, or action by a committee does not alone constitute compliance
by a director with the standards of conduct described in the Act and
referenced in Section 3.15 of these bylaws.
Section 3.15 Standards of Conduct. Each director is to discharge such
director's duties as a director, including duties as a member of a committee, in
compliance with the standards of conduct set forth in the Act and described in
Article V of these bylaws.
Section 3.16 Liability for Unlawful Distributions. A director who votes for
or assents to a distribution made in violation of the requirements of Section
640 of the Act or the articles of incorporation, and who does not discharge such
duties in compliance with the standards of conduct set forth in the Act and
referenced in Sections 3.15 and 5.01 of these bylaws, is personally liable to
the corporation for the amount by which the distribution exceeds the amount that
could have been properly distributed, as provided in the Act.
Section 3.17 Conflicting Interest Transactions. Transactions in which a
director has a conflicting interest will be handled in accordance with Sections
850 to 853 of the Act. In accordance with such sections, each "director's
conflicting interest transaction" as defined therein, which has not otherwise
been established to be fair to the corporation, is to be presented to the
shareholders for approval in accordance with Section 853 of the Act, or approved
by the directors in compliance with the requirements of Section 822 of the Act.
Directors may take action with respect to a director's conflicting interest
transaction by the affirmative vote of a majority of those "qualified directors"
(defined in Section 850 of the Act as essentially those directors without
conflicting interests with respect to the transaction) on the board of directors
or on a duly empowered and constituted committee of the board who voted on the
transaction after receipt of the "required disclosure" (as defined in Sections
850 and 852(2) of the Act). For purposes of such action, a majority of the
qualified directors on the board or on the committee, as the case may be,
constitutes a quorum. Such action is not affected by the presence or vote of a
director who is not a qualified director.
ARTICLE IV
Officers
Section 4.01 Number and Qualifications. The officers of the corporation
shall be such officers as may be appointed by the board of directors, and may
include one or more of: a president, chief executive officer, chief operating
officer, chief technical officer, chief financial officer, treasurer,
controller, and secretary. The corporation may also have such other officers and
assistant officers as the board of directors in its discretion may determine, by
resolution, to be appropriate, including a chairman of the board, one or more
vice-presidents, assistant secretaries and assistant treasurers. All such
officers shall be appointed by the board of directors, except that if
specifically authorized by the board of directors, an officer may appoint one or
more officers or assistant officers, pursuant to Section 830(2) of the Act. The
same individual may simultaneously hold more than one office in the corporation.
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Section 4.02 Appointment and Term of Office. The officers of the
corporation shall be appointed by the board of directors (or, to the extent
permitted by Section 4.01 above, by an officer specifically authorized by the
board to make such appointments), for such terms as may be determined by the
board of directors. Neither the appointment of an officer nor the designation of
a specified term creates or grants to the officer any contract rights, and the
board can remove the officer at any time prior to the termination of any term
for which the officer may have been appointed, with or without cause, except to
the extent an express, written agreement between the officer and the corporation
provides otherwise. If no other term is specified, officers shall hold office
until they resign, die, or until they are removed or replaced in the manner
provided in Section 4.03 below.
Section 4.03 Removal and Resignation of Officers. Any officer or agent of
the corporation may be removed or replaced by the board of directors at any time
with or without cause, as permitted by Section 832 of the Act. The election of a
replacement officer shall constitute the removal of the person previously
holding such office. An officer may resign at any time by giving written notice
of the resignation to the corporation. Resignations shall become effective as
provided in Section 832 of the Act. An officer's resignation or removal does not
affect the contract rights of the parties, if any.
Section 4.04 Authority and Duties. Except as otherwise established by the
board of directors, the officers of the corporation shall have the authority and
perform the duties specified below and as may be additionally specified by the
president or chief executive officer, the board of directors, or these bylaws
(and in all cases where the duties of any officer are not prescribed by the
bylaws or by the board of directors, such officer shall follow the orders and
instructions of the president or chief executive officer), except that in any
event each officer shall exercise such powers and perform such duties as may be
required by law:
(a) President; Chief Executive Officer. The chief executive officer and/or
president shall, subject to the direction and supervision of the board of
directors: (i) have general and active control of its affairs and business and
general supervision of its officers, agents and employees; (ii) unless there is
a chairman of the board, preside at all meetings of the shareholders and the
board of directors; (iii) see that all orders and resolutions of the board of
directors are carried into effect; and (iv) perform all other duties incident to
such office and as from time to time may be assigned to such officer by the
board of directors. The president and/or chief executive officer may sign, with
the secretary or any other proper officer of the corporation authorized to take
such action, certificates for shares of the corporation, the issuance of which
have been authorized by resolution of the board of directors. The president
and/or chief executive officer may also sign (or appoint other officers of the
corporation to sign), subject to such restrictions and limitations as may be
imposed from time to time by the board of directors, deeds, mortgages, bonds,
contracts or other instruments which have been duly approved for execution. If
both a president and chief executive officer are elected and serving, then as
between the two of such officers, their relative authority shall be as
determined by the board of directors or as otherwise agreed upon between such
officers.
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(b) Chief Financial Officer. The chief financial officer, while one is
serving, shall: (i) be the principal financial officer of the corporation and
have responsibility for the care and custody of all its funds, securities,
evidences of indebtedness and other personal property and deposit and handle the
same in accordance with instructions of the board of directors; (ii) receive and
give receipts and acquittances for moneys paid in on account of the corporation,
and pay out of funds on hand all bills, payrolls and other just debts of the
corporation of whatever nature upon maturity; (iii) be the principal accounting
officer of the corporation and as such prescribe and maintain the methods and
systems of accounting to be followed, keep complete books and records of
account, prepare and file all local, state and federal tax returns, prescribe
and maintain an adequate system of internal audit and prepare and furnish to the
president and the board of directors statements of account showing the financial
position of the corporation and the results of its operations; (iv) upon request
of the board, make such reports to it as may be required at any time; and (v)
perform all other duties incident to the office of the chief financial officer
and such other duties as from time to time may be assigned by the board of
directors. president or chief executive officer.
(c) Vice-Presidents. The vice-president, if any (or if there is more than
one then each vice-president), shall assist the president and/or chief executive
officer and shall perform such duties as may be assigned by the president, chief
executive officer or board of directors. The vice-president, if there is one (or
if there is more than one then the vice-president designated by the board of
directors, or if there be no such designation then the vice-presidents in order
of their election), shall, at the request of the president or chief executive
officer, or in the event of the absence or inability or refusal to act of
president and/or chief executive officer, perform the duties of such offices and
when so acting shall have all the powers of and be subject to all the
restrictions upon such offices. Any vice-president may sign, with the secretary
or an assistant secretary, certificates for shares of the corporation the
issuance of which have been authorized by resolution of the board of directors.
Vice-presidents shall perform such other duties as from time to time may be
assigned to them by the president or chief executive officer or by the board of
directors. Assistant vice-presidents, if any, shall have such powers and perform
such duties as may be assigned to them by the president, chief executive officer
or board of directors.
(d) Treasurer. A treasurer, if one is appointed, shall assist the chief
financial officer and perform such financial, accounting and money management
functions and other duties as the board of directors or chief financial officer
may from time to time direct, subject to the supervision of the chief financial
officer. In the absence of a chief financial officer, the treasurer shall
perform the duties of the chief financial officer and when so acting shall have
the powers of, and be subject to the restrictions applicable to, the chief
financial officer. The treasurer will perform all other duties incident to the
office of treasurer and such other duties as from time to time may be assigned
by the board of directors, president or chief executive officer.
(e) Corporate Secretary. The corporate secretary shall: (i) have
responsibility for the preparation and maintenance of minutes of the proceedings
of the shareholders and of the board of directors; (ii) have responsibility for
the preparation and maintenance of the other records and information required to
be kept by the corporation under Section 1601 of the Act; (iii) see that all
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notices are duly given in accordance with the provisions of these bylaws or as
required by the Act or other applicable law; (iv) be custodian of the corporate
records and of any seal of the corporation; (v) when requested or required,
authenticate any records of the corporation; (vi) keep a register of the post
office address of each shareholder which shall be furnished to the secretary by
such shareholder; (vii) sign with the president, chief executive officer or a
vice-president, certificates for shares of the corporation, the issuance of
which shall have been authorized by resolution of the board of directors; (viii)
have general charge of the stock transfer books of the corporation, unless the
corporation has a transfer agent; and (ix) in general perform all duties
incident to the office of secretary, including those identified in the Act, and
such other duties as from time to time may be assigned to the corporate
secretary by the president, chief executive officer or board of directors.
Assistant secretaries, if any, shall have the same duties and powers, subject to
supervision by the corporate secretary.
Section 4.05 Surety Bonds. The board of directors may require any officer
or agent of the corporation to provide to the corporation a bond, in such sums
and with such sureties as may be satisfactory to the board, conditioned upon the
faithful performance of such individual's duties and for the restoration to the
corporation of all books, papers, vouchers, money, securities and other property
of whatever kind in such officer's possession or under such officer's control
belonging to the corporation.
Section 4.06 Compensation. Officers shall receive such compensation for
their services as may be authorized or ratified by the board of directors and no
officer shall be prevented from receiving compensation by reason of the fact
that such officer is also a director of the corporation. Appointment as an
officer shall not of itself create a contract or other right to compensation for
services performed as such officer.
ARTICLE V
Standards of Conduct for Officers and Directors
Section 5.01 Standards of Conduct. As provided in Section 840 of the Act,
each director is required to discharge his or her duties as a director,
including duties as a member of a committee, and each officer with discretionary
authority is required to discharge his or her duties under that authority, in a
manner consistent with the following standards of conduct:
(i) in good faith;
(ii) with the care an ordinarily prudent person in a like
position would exercise under similar circumstances; and
(iii) in a manner the director or officer reasonably believes is
in the best interests of the corporation.
Section 5.02 Reliance on Information and Reports. In discharging his or her
duties, a director or officer is entitled to rely on information, opinions,
reports, or statements, including financial statements and other financial data,
if prepared or presented by:
(i) one or more officers or employees of the corporation whom the
director or officer reasonably believes to be reliable and competent
in the matters presented;
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(ii) legal counsel, public accountants, or other persons as to
matters the director or officer reasonably believes are within the
person's professional or expert competence; or
(iii) in the case of a director, a committee of the board of
directors of which such director is not a member, if the director
reasonably believes the committee merits confidence.
A director or officer is not acting in good faith in relying on any such
information, opinions, reports or statements if such director or officer has
knowledge concerning the matter in question that makes reliance otherwise
permitted as set forth above unwarranted.
Section 5.03 Limitation on Liability. A director or officer is not liable
to the corporation, its shareholders, or any conservator or receiver, or any
assignee or successor-in-interest thereof, for any action taken, or any failure
to take any action as an officer or director, as the case may be, unless (i) the
director or officer has breached or failed to perform the duties of the office
in compliance with the provisions of this Article 5, and Section 840 of the Act,
and (ii) the performance constitutes gross negligence, willful misconduct, or
intentional infliction of harm on the corporation or the shareholders.
ARTICLE VI
Indemnification
Section 6.01 Indemnification of Directors.
(a) Permitted Indemnification. Pursuant to Section 902 of the Act,
unless otherwise provided in the articles of incorporation as permitted by
Section 909 of the Act, the corporation may indemnify any individual made a
party to a proceeding because such individual is or was a director of the
corporation, against liability incurred in the proceeding if the
corporation has authorized the payment in accordance with Section 906 of
the Act and a determination has been made in accordance with the procedures
set forth in Section 906(2) of the Act that the director has met the
applicable standards of conduct as set forth below and in Section 902 of
the Act:
(i) the individual's conduct was in good faith; and
(ii) the individual reasonably believed that his or her conduct
was in, or not opposed to, the corporation's best interests; and
(iii) in the case of any criminal proceeding, the individual had
no reasonable cause to believe his or her conduct was unlawful.
(b) Limitation on Permitted Indemnification. As provided in Section
902(4) of the Act, the corporation shall not indemnify a director under
Section 6.01(a) above:
(i) in connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation; or
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(ii) in connection with any other proceeding charging that the
director derived an improper personal benefit, whether or not
involving action in the director's official capacity, in which
proceeding the director was adjudged liable on the basis that the
director derived an improper personal benefit.
(c) Indemnification in Derivative Actions Limited. Indemnification
permitted under Section 6.01(a) and Section 902 of the Act in connection
with a proceeding by or in the right of the corporation is limited to
reasonable expenses incurred in connection with the proceeding.
(d) Mandatory Indemnification. As set forth in Section 903 of the Act,
unless limited by its articles of incorporation, the corporation shall
indemnify a director who was successful, on the merits or otherwise, in the
defense of any proceeding, or in the defense of any claim, issue, or matter
in the proceeding, to which the director was a party because the director
is or was a director of the corporation, against reasonable expenses
incurred by the director in connection with the proceeding or claim with
respect to which the director has been successful.
(e) Authorized/Required Indemnification of Directors. The corporation
is authorized to, and shall, indemnify its directors to the fullest extent
permitted by applicable law, including without limitation the provisions of
Part 9 of the Act. Without limiting the foregoing, the corporation shall
indemnify its directors in all cases in which a corporation may indemnify a
director under Section 902 of the Act. This provision constitutes
authorization of indemnification as contemplated in Section 906 of the Act,
so that the corporation can indemnify directors once a determination has
been made in the specific case that indemnification is permissible in the
circumstances because the director has met the applicable standard of
conduct set forth in Section 902 of the Act, as referenced above. The
corporation shall consider and act as expeditiously as possible on any and
all requests by a director for indemnification.
Section 6.02 Advance Expenses for Directors.
(a) Requirements for Reimbursements. Pursuant to the provisions of
Section 904 of the Act, if a determination is made, following the
procedures of Section 906(b) of the Act, that a director has met the
following requirements; and if an authorization of payment is made,
following the procedures and standards set forth in Section 906 of the Act,
then unless otherwise provided in the articles of incorporation, the
corporation may pay for or reimburse the reasonable expenses incurred by a
director who is a party to a proceeding in advance of final disposition of
the proceeding, if:
(i) the director furnishes the corporation a written affirmation
of the director's good faith belief that the director has met the
applicable standard of conduct described in Section 5.01 of these
bylaws and Section 902 of the Act;
(ii) the director furnishes to the corporation a written
undertaking, executed personally or on such director's behalf, to
repay the advance if it is ultimately determined that the director did
not meet the standard of conduct; and
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(iii) a determination is made that the facts then known to those
making the determination would not preclude indemnification under
Sections 901 through 909 of the Act.
(b) Authorization for Reimbursement. The corporation is to authorize
the advancement of expenses to directors, and to advance such expenses,
once the written affirmation and undertaking required by Subsections
904(1)(a) and (b) of the Act (as referenced in Subsections 6.02(a)(i) and
(ii) of these bylaws) are received and the determination required by
Subsection 904(1)(c) of the Act (as referenced in Subsection 6.02(a)(iii)
of these bylaws) has been made. The corporation is to consider and act as
expeditiously as possible upon any and all requests for advancements of
expenses, promptly make the requisite determination in each instance as to
eligibility for advancement of expenses and, in the event of a
determination that the advancement of expenses is permissible, promptly
authorize such advancement.
Section 6.03 Indemnification of Officers, Employees, Fiduciaries, and
Agents. Unless otherwise provided in the articles of incorporation, and pursuant
to Section 907 of the Act:
(i) an officer of the corporation is entitled to mandatory
indemnification under Section 903 of the Act, and is entitled to apply
for court-ordered indemnification under Section 905 of the Act, in
each case to the same extent as a director;
(ii) the corporation shall indemnify and advance expenses to an
officer, employee, fiduciary, or agent of the corporation to the same
extent as to a director; and
(iii) the corporation shall also indemnify and advance expenses
to an officer, employee, fiduciary, or agent who is not a director to
a greater extent, if not inconsistent with public policy, and if
provided for by its articles of incorporation, action of the board of
directors, or contract.
Section 6.04 Insurance. As provided in Section 908 of the Act, the
corporation may purchase and maintain liability insurance on behalf of a person
who is or was a director, officer, employee, fiduciary, or agent of the
corporation, or who, while serving as a director, officer, employee, fiduciary,
or agent of the corporation, is or was serving at the request of the corporation
as a director, officer, partner, trustee, employee, fiduciary, or agent of
another foreign or domestic corporation or other person, or of an employee
benefit plan, against liability asserted against or incurred by such person in
that capacity or arising from such person's status as a director, officer,
employee, fiduciary, or agent, whether or not the corporation would have power
to indemnify such person against the same liability under Article VI of these
bylaws or Sections 902, 903 or 907 of the Act. Insurance may be procured from
any insurance company designated by the board of directors, president, or chief
executive officer, whether the insurance company is formed under the laws of
this state or any other jurisdiction, including any insurance company in which
the corporation has an equity or any other interest through stock ownership or
otherwise.
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Section 6.05 Scope of Indemnification. The indemnification and advancement
of expenses authorized by this Article VI is intended to permit the corporation
to indemnify to the fullest extent permitted by the laws of the State of Utah
(and to require such indemnification under specified circumstances as described
above) any and all persons whom it shall have power to indemnify under such laws
from and against any and all of the expenses, disabilities, or other matters
referred to in or covered by such laws. Any indemnification or advancement of
expenses hereunder, unless otherwise provided when the indemnification or
advancement of expenses is authorized or ratified, is intended to be applicable
to acts or omissions that occurred prior to the adoption of this Article, shall
continue as to any party during the period such party serves in any one or more
of the capacities covered by this Article, shall continue thereafter so long as
the party may be subject to any possible proceeding by reason of the fact that
such party served in any one or more of the capacities covered by this Article,
and shall inure to the benefit of the estate and personal representatives of
such person. Any repeal or modification of this Article or of any Section or
provision hereof shall not affect any right or obligations then existing. All
rights to indemnification under this Article shall be deemed to be provided by a
contract between the corporation and each party covered hereby.
Section 6.06 Other Rights and Remedies. The rights to indemnification and
advancement of expenses provided in this Article VI shall be in addition to any
other rights which a party may have or hereafter acquire under any applicable
law, contract, order, or otherwise.
Section 6.07 Severability. If any provision of this Article shall be held
to be invalid, illegal or unenforceable for any reason, the remaining provisions
of this Article shall not be affected or impaired thereby, but shall, to the
fullest extent possible, be construed so as to give effect to the intent of this
Article that each party covered hereby is entitled to the fullest protection
permitted by law.
ARTICLE VII
Stock
Section 7.01 Issuance of Shares. Except to the extent any such powers may
be reserved to the shareholders by the articles of incorporation, the board of
directors may authorize the issuance of shares for consideration consisting of
any tangible or intangible property or benefit to the corporation, including
cash, promissory notes, services performed, contracts or arrangements for
services to be performed, or other securities of the corporation. The terms and
conditions of any tangible or intangible property or benefit to be provided in
the future to the corporation, including contracts or arrangements for services
to be performed, are to be set forth in writing.
Before the corporation issues shares, the board of directors must determine
that the consideration received or to be received for the shares to be issued is
adequate.
The board of directors may authorize a committee of the board of directors,
or an officer of the corporation, to authorize or approve the issuance or sale,
or contract for sale of shares, within limits specifically prescribed by the
board of directors.
Section 7.02 Certificates for Shares; Shares Without Certificates.
(a) Use of Certificates. Shares of the corporation may, but need not
be, represented by certificates. Unless the Act or another applicable
statute expressly provides otherwise, the rights and obligations of
shareholders are not affected by whether or not their shares are
represented by certificates.
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(b) Content of Certificates. Certificates representing shares of the
corporation must, at a minimum, state on their face:
(i) the name of the corporation, and that it is organized under
the laws of Utah;
(ii) the name of the person to whom the certificate is issued;
and
(iii) the number and class of shares and the designation of the
series, if any, the certificate represents.
If the corporation is authorized to issue different classes of shares or
different series within a class, the designations, preferences, limitations, and
relative rights applicable to each class, the variations in preferences,
limitations, and relative rights determined for each series, and the authority
of the board of directors to determine variations for any existing or future
class or series, must be summarized on the front or back of each certificate.
Alternatively, each certificate may state conspicuously on its front or back
that the corporation will furnish the shareholder such information on request in
writing and without charge.
Each share certificate must be signed (either manually or by facsimile) by
the president or chief executive officer or a vice-president and by the
secretary or an assistant secretary, or by any two other officers as may be
designated in these bylaws or by the board of directors. Each certificate for
shares is to be consecutively numbered or otherwise identified.
(c) Shares Without Certificates. As provided in Section 626 of the
Act, unless the articles of incorporation provide otherwise, the board of
directors may authorize the issuance of some or all of the shares of any or
all of its classes or series without certificates. Such an authorization
will not affect shares already represented by certificates until they are
surrendered to the corporation.
Within a reasonable time after the issuance or transfer of shares without
certificates, the corporation shall send the shareholder a written statement of
the information required on certificates by Subsections 625(2) and (3) of the
Act, as summarized in Section 7.02(b) above.
(d) Shareholder List. The corporation shall maintain a record of the
names and addresses of the persons to whom shares are issued, in a form
meeting the requirements of Section 1601(3) of the Act.
(e) Transferring Certificated Shares. All certificates surrendered to
the corporation for transfer shall be canceled and no new certificate shall
be issued until the former certificate for a like number of shares shall
have been surrendered and cancelled, except that in case of a lost,
destroyed, or mutilated certificate a new one may be issued therefor upon
such terms and indemnity to the corporation as the board of directors may
prescribe.
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(f) Registration of the Transfer of Shares. Registration of the
transfer of shares of the corporation shall be made only on the stock
transfer books of the corporation or by transfer agents designated to
transfer shares of the corporation. In order to register a transfer, the
record owner shall surrender the shares to the corporation for
cancellation, properly endorsed by the appropriate person or persons with
reasonable assurances that the endorsements are genuine and effective.
Unless the corporation has established a procedure by which a beneficial
owner of shares held by a nominee is to be recognized by the corporation as
the owner, the person in whose name shares stand on the books of the
corporation shall be deemed by the corporation to be the owner thereof for
all purposes.
(g) Transfer Agents and Registrars. The president or chief executive
officer may appoint one or more transfer agents and one or more registrars
with respect to the certificates representing shares of stock of the
corporation, and may require all such certificates to bear the signature of
either or both. The president or chief executive officer may from time to
time define the respective duties of such transfer agents and registrars.
Section 7.03 Restrictions on Transfer of Shares Permitted. As contemplated
by Section 627 of the Act, the articles of incorporation, an agreement among
shareholders, or an agreement between one or more shareholders and the
corporation may impose restrictions on the transfer or registration of transfer
of shares of the corporation. A restriction does not affect shares issued before
the restriction was adopted unless the holders of the shares are parties to the
restriction agreement or voted in favor of the restriction or otherwise
consented to the restriction.
A restriction on the transfer or registration of transfer of shares may be
authorized for any of the purposes set forth in Section 627(3) of the Act. A
restriction on the transfer or registration of transfer of shares is valid and
enforceable against the holder or a transferee of the holder if the restriction
is authorized by this section and its existence is noted conspicuously on the
front or back of the certificate, or is contained in the information statement
required by Section 7.02(c) of these bylaws with regard to shares issued without
certificates. Unless so noted, a restriction is not enforceable against a person
without knowledge of the restriction.
Section 7.04 Acquisition of Shares by the Corporation. Subject to the
limitations on distributions set forth in Section 640 of the Act and any other
restrictions imposed by applicable law, the corporation may acquire its own
shares, as authorized by Section 631 of the Act, and shares so acquired
constitute authorized but unissued shares.
ARTICLE VIII
Amendments to Bylaws
Section 8.01 Authority to Amend. The corporation's board of directors may
amend these bylaws at any time, except to the extent that the articles of
incorporation, these bylaws, or the Act reserve such power exclusively to the
shareholders, in whole or part. The corporation's shareholders may amend these
bylaws at any time.
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ARTICLE IX
Miscellaneous
Section 9.01 Corporate Seal. The board of directors may provide for a
corporate seal, to be in such a form as the directors may determine to be
appropriate, and any officer of the corporation may, when and as required or as
determined to be appropriate, affix or impress the seal, or a facsimile thereof,
to or on any instrument or document of the corporation.
Section 9.02 Fiscal Year. The fiscal year of the corporation shall be as
established by the board of directors.
(END)
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