Exhibit 3.2
BYLAWS
OF
UGI UTILITIES, INC.
(A PENNSYLVANIA REGISTERED CORPORATION)
ARTICLE I
OFFICES AND FISCAL YEAR
SECTION 1.01. REGISTERED OFFICE. The registered office of the corporation
in the Commonwealth of Pennsylvania shall be at Valley Forge, Pennsylvania,
until otherwise established by an amendment of the articles or by the board of
directors and a record of such change is filed with the Department of State in
the manner provided by law.
SECTION 1.02. OTHER OFFICES. The corporation may also have offices at such
other places within or without Pennsylvania as the board of directors may from
time to time appoint or the business of the corporation may require.
SECTION 1.03. FISCAL YEAR. The fiscal year of the corporation shall begin
on the first day of October in each year.
ARTICLE II
NOTICE - WAIVERS - MEETINGS GENERALLY
SECTION 2.01. MANNER OF GIVING NOTICE.
(a) General Rule. Whenever written notice is required to be given to
any person under the provisions of the Business Corporation Law or by the
articles or these bylaws, it may be given to the person either personally or by
sending a copy thereof by first class or express mail, postage prepaid, or by
telegram (with messenger service specified), telex or TWX (with answerback
received) or courier service, charges prepaid, or by telecopier, to the address
(or to the telex, TWX, telecopier or telephone number) of the person appearing
on the books of the corporation or, in the case of directors, supplied by the
director to the corporation for the purpose of notice. If the notice is sent by
mail, telegraph or courier service, it shall be deemed to have been given to the
person entitled thereto when deposited in the United States mail or with a
telegraph office or courier service for delivery to that person or, in the case
of telex or TWX, when dispatched or, in the case of telecopier, when received. A
notice of meeting shall specify the place, day and hour of the meeting and any
other information required by any other provision of the Business Corporation
Law, the articles or these bylaws.
(b) Adjourned Shareholder Meetings. When a meeting of shareholders
is adjourned, it shall not be necessary to give any notice of the adjourned
meeting or of the business to be transacted at an adjourned meeting, other than
by announcement at the meeting at which the adjournment is taken, unless the
board fixes a new record date for the adjourned meeting.
SECTION 2.02. NOTICE OF MEETINGS OF BOARD OF DIRECTORS. Notice of a
regular meeting of the board of directors need not be given. Notice of every
special meeting of the board of directors shall be given to each director by
telephone or in writing at least 24 hours (in the case of notice by telephone,
facsimile transmission, e-mail, or other electronic communication) or 48 hours
(in the case of notice by telegraph, courier service or express mail) or five
days (in the case of notice by first class mail) before the time at which the
meeting is to be held. Every such notice shall state the time and place of the
meeting. Neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the board need be specified in a notice of the
meeting.
SECTION 2.03. NOTICE OF MEETINGS OF SHAREHOLDERS. Written notice of every
meeting of the shareholders shall be given by, or at the direction of, the
secretary to each shareholder of record entitled to vote at the meeting at least
(10) ten days prior to the day named for a meeting called to consider amendment
of the articles or adoption of a plan of merger, consolidation, exchange, asset
transfer, division or conversion or adoption of a proposal of dissolution or (2)
five days prior to the day named for the meeting in any other case. If the
secretary neglects or refuses to give notice of a meeting, the person or persons
calling the meeting may do so. In the case of a special meeting of shareholders,
the notice shall specify the general nature of the business to be transacted.
SECTION 2.04. WAIVER OF NOTICE.
(a) Written Waiver. Whenever any written notice is required to be
given under the provisions of the Business Corporation Law, the articles or
these bylaws, a waiver thereof in writing, signed by the person or persons
entitled to the notice, whether before or after the time stated therein, shall
be deemed equivalent to the giving of the notice. Except as otherwise required
by this subsection, neither the business to be transacted at, nor the purpose
of, a meeting need be specified in the waiver of notice of the meeting. In the
case of a special meeting of shareholders, the waiver of notice shall specify
the general nature of the business to be transacted.
(b) Waiver by Attendance. Attendance of a person at any meeting
shall constitute a waiver of notice of the meeting except where a person attends
a meeting for the express purpose of objecting, at the beginning of the meeting,
to the transaction of any business because the meeting was not lawfully called
or convened.
SECTION 2.05. MODIFICATION OF PROPOSAL CONTAINED IN NOTICE. Whenever the
language of a proposed resolution is included in a written notice of a meeting
required to be given under the provisions of the Business Corporation Law or the
articles or these bylaws, the meeting considering the resolution may without
further notice adopt it with such clarifying or other amendments as do not
enlarge its original purpose.
-2-
SECTION 2.06. EXCEPTION TO REQUIREMENT OF NOTICE.
(a) General Rule. Whenever any notice or communication is required
to be given to any person under the provisions of the Business Corporation Law
or by the articles or these bylaws or by the terms of any agreement or other
instrument or as a condition precedent to taking any corporate action and
communication with that person is then unlawful, the giving of the notice or
communication to that person shall not be required.
(b) Shareholders Without Forwarding Addresses. Notice or other
communications shall not be sent to any shareholder with whom the corporation
has been unable to communicate for more than 24 consecutive months because
communications to the shareholder are returned unclaimed or the shareholder has
otherwise failed to provide the corporation with a current address. Whenever the
shareholder provides the corporation with a current address, the corporation
shall commence sending notices and other communications to the shareholder in
the same manner as to other shareholders.
SECTION 2.07. USE OF CONFERENCE TELEPHONE AND SIMILAR EQUIPMENT. Any
director may participate in any meeting of the board of directors, and the board
of directors may provide by resolution with respect to a specific meeting or
with respect to a class of meetings that one or more persons may participate in
a meeting of the shareholders of the corporation, by means of conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other. Participation in a meeting
pursuant to this section shall constitute presence in person at the meeting.
ARTICLE III
SHAREHOLDERS
SECTION 3.01. PLACE OF MEETING. All meetings of the shareholders of the
corporation shall be held at the registered office of the corporation unless
another place is designated by the board of directors in the notice of a
meeting.
SECTION 3.02. ANNUAL MEETING. The board of directors may fix and designate
the date and time of the annual meeting of the shareholders, but if no such date
and time is fixed and designated by the board, the meeting for any calendar year
shall be held on the first Tuesday in March in such year, if not a legal holiday
under the laws of Pennsylvania, and, if a legal holiday, then on the next
succeeding business day, not a Saturday, at 10:00 o'clock A.M., and at said
meeting the shareholders then entitled to vote shall elect directors and shall
transact such other business as may properly be brought before the meeting. If
the annual meeting shall not have been called and held within six months after
the designated time, any shareholder may call the meeting at any time
thereafter.
-3-
SECTION 3.03. SPECIAL MEETINGS. Special meetings of the shareholders may
be called at any time by the chief executive officer or by the board of
directors.
At any time, upon written request of any person or persons who have
duly called a special meeting, which written request shall state the object of
the meeting, it shall be the duty of the secretary to fix the date, time and
place of the meeting. The date fixed by the Secretary shall not be less than
five nor more than 60 days after the receipt of the request.
SECTION 3.04. QUORUM AND ADJOURNMENT.
(a) General Rule. A meeting of shareholders of the corporation duly
called shall not be organized for the transaction of business unless a quorum is
present. The presence of shareholders entitled to cast at least a majority of
the votes that all shareholders are entitled to cast on a particular matter to
be acted upon at the meeting shall constitute a quorum for the purposes of
consideration and action on the matter. Shares of the corporation owned,
directly or indirectly, by it and controlled, directly or indirectly, by the
board of directors of this corporation, as such, shall not be counted in
determining the total number of outstanding shares for quorum purposes at any
given time.
(b) Withdrawal of a Quorum. The shareholders present at a duly
organized meeting can continue to do business until adjournment notwithstanding
the withdrawal of enough shareholders to leave less than a quorum.
(c) Adjournments Generally. Any regular or special meeting of the
shareholders, including one at which directors are to be elected and one which
cannot be organized because a quorum has not attended, may be adjourned for such
period and to such place as the shareholders present and entitled to vote shall
direct.
(d) Electing Directors at Adjourned Meeting. Those shareholders
entitled to vote who attend a meeting called for the election of directors that
has been previously adjourned for lack of a quorum, although less than a quorum
as fixed in this section, shall nevertheless constitute a quorum for the purpose
of electing directors.
(e) Other Action in Absence of Quorum. Those shareholders entitled
to vote who attend a meeting of shareholders that has been previously adjourned
for one or more periods aggregating at least 15 days because of an absence of a
quorum, although less than a quorum as fixed in this section, shall nevertheless
constitute a quorum for the purpose of acting upon any matter set forth in the
notice of the meeting if the notice states that those shareholders who attend
the adjourned meeting shall nevertheless constitute a quorum for the purpose of
acting upon the matter.
-4-
SECTION 3.05. ACTION BY SHAREHOLDERS.
(a) General Rule. Except as otherwise provided in the Business
Corporation Law or the articles or these bylaws, whenever any corporate action
is to be taken by vote of the shareholders of the corporation, it shall be
authorized by a majority of the votes cast at a duly organized meeting of
shareholders by the holders of shares entitled to vote thereon. Except when
acting by unanimous consent to remove a director or directors, the shareholders
of the corporation may act only at a duly organized meeting.
(b) Interested Shareholders. Any merger or other transaction
authorized under 15 Pa.C.S. Subchapter 19C between the corporation or subsidiary
thereof and a shareholder of this corporation, or any voluntary liquidation
authorized under 15 Pa.C.S. Subchapter 19F in which a shareholder is treated
differently from other shareholders of the same class (other than any dissenting
shareholders), shall require the affirmative vote of the shareholders entitled
to cast at least a majority of the votes that all shareholders other than the
interested shareholder are entitled to cast with respect to the transaction,
without counting the vote of the interested shareholder. For the purposes of the
preceding sentence, interested shareholder shall include the shareholder who is
a party to the transaction or who is treated differently from other shareholders
and any person, or group of persons, that is acting jointly or in concert with
the interested shareholder and any person who, directly or indirectly, controls,
is controlled by or is under common control with the interested shareholder. An
interested shareholder shall not include any person who, in good faith and not
for the purpose of circumventing this subsection, is an agent, bank, broker,
nominee or trustee for one or more other persons, to the extent that the other
person or persons are not interested shareholders.
(c) Exceptions. Subsection (b) shall not apply to a transaction:
(1) that has been approved by a majority vote of the board of
directors without counting the vote of directors who:
(i) are directors or officers of, or have a material equity
interest in, the interested shareholder; or
(ii) were nominated for election as a director by the
interested shareholder, and first elected as a director, within 24 months of the
date of the vote on the proposed transaction; or
(2) in which the consideration to be received by the shareholders
for shares of any class of which shares are owned by the interested shareholder
is not less than the highest amount paid by the interested shareholder in
acquiring shares of the same class.
-5-
(d) Additional Approvals. The approvals required by subsection (b)
shall be in addition to, and not in lieu of, any other approval required by the
Business Corporation Law, the articles or these bylaws, or otherwise.
SECTION 3.06. ORGANIZATION. At every meeting of the shareholders, the
chairman of the board, if there be one, or, in the case of vacancy in office or
absence of the chairman of the board, one of the following officers present in
the order stated: the vice chairman of the board, if there be one, the
president, the vice presidents in their order of rank and seniority, or a person
chosen by vote of the shareholders present, shall act as chairman of the
meeting. The secretary, or in the absence of the secretary, an assistant
secretary, or, in the absence of both the secretary and assistant secretaries, a
person appointed by the chairman of the meeting, shall act as secretary of the
meeting.
SECTION 3.07. VOTING RIGHTS OF SHAREHOLDERS. Unless otherwise provided in
the articles, every shareholder of the corporation shall be entitled to one vote
for every share standing in the name of the shareholder on the books of the
corporation.
SECTION 3.08. VOTING AND OTHER ACTION BY PROXY.
(a) General Rule.
(1) Every shareholder entitled to vote at a meeting of
shareholders may authorize another person to act for the shareholder by proxy.
(2) The presence of, or vote or other action at a meeting of
shareholders by a proxy of a shareholder shall constitute the presence of, or
vote or action by the shareholder.
(3) Where two or more proxies of a shareholder are present, the
corporation shall, unless otherwise expressly provided in the proxy, accept as
the vote of all shares represented thereby the vote cast by a majority of them
and, if a majority of the proxies cannot agree whether the shares represented
shall be voted or upon the manner of voting the shares, the voting of the shares
shall be divided equally among those persons.
(b) Minimum Requirements. Every proxy shall be executed in writing
by the shareholder or by the duly authorized attorney-in-fact of the shareholder
and filed with the secretary of the corporation. A proxy, unless coupled with an
interest, shall be revocable at will, notwithstanding any other agreement or any
provision in the proxy to the contrary, but the revocation of a proxy shall not
be effective until written notice thereof has been given to the secretary of the
corporation. An unrevoked proxy shall not be valid after three years from the
date of its execution unless a longer time is expressly provided therein. A
proxy shall not be revoked by the death or incapacity of the maker unless,
before the vote is counted or the authority is exercised, written notice of the
death or incapacity is given to the secretary of the corporation.
-6-
(c) Expenses. The corporation shall pay the reasonable expenses of
solicitation of votes or proxies of shareholders by or on behalf of the board of
directors or its nominees for election to the board including solicitation by
professional proxy solicitors and otherwise.
SECTION 3.09. VOTING BY FIDUCIARIES AND PLEDGEES. Shares of the
corporation standing in the name of a trustee or other fiduciary and shares held
by an assignee for the benefit of creditors or by a receiver may be voted by the
trustee, fiduciary, assignee or receiver. A shareholder whose shares are pledged
shall be entitled to vote the shares until the shares have been transferred into
the name of the pledgee, or a nominee of the pledgee, but nothing in this
section shall affect the validity of a proxy given to a pledgee or nominee.
SECTION 3.10. VOTING BY JOINT HOLDERS OF SHARES.
(a) General Rule. Where shares of the corporation are held jointly
or as tenants in common by two or more persons, as fiduciaries or otherwise:
(1) if only one or more of such persons is present in person or
by proxy, all of the shares standing in the names of such persons shall be
deemed to be represented for the purpose of determining a quorum and the
corporation shall accept as the vote of all the shares the vote cast by a joint
owner or a majority of them; and
(2) if the persons are equally divided upon whether the shares
held by them shall be voted or upon the manner of voting the shares, the voting
of the shares shall be divided equally among the persons without prejudice to
the rights of the joint owners or the beneficial owners thereof among
themselves.
(b) Exception. If there has been filed with the secretary of the
corporation a copy, certified by an attorney at law to be correct, of the
relevant portions of the agreement under which the shares are held or the
instrument by which the trust or estate was created or the order of court
appointing them or of an order of court directing the voting of the shares, the
persons specified as having such voting power in the document latest in date of
operative effect so filed, and only those persons, shall be entitled to vote the
shares but only in accordance therewith.
SECTION 3.11. VOTING BY CORPORATIONS.
(a) Voting by Corporate Shareholders. Any corporation that is a
shareholder of this corporation may vote at meetings of shareholders of this
corporation by any of its officers or agents, or by proxy appointed by any
officer or agent, unless some other person, by resolution of the board of
directors of the other corporation or a provision of its articles or bylaws, a
copy of which resolution or provision certified to be correct by one of its
officers has been filed with the secretary of this corporation, is appointed its
general or special proxy in which case that person shall be entitled to vote the
shares.
-7-
(b) Controlled Shares. Shares of this corporation owned, directly or
indirectly, by it and controlled, directly or indirectly, by the board of
directors of this corporation, as such, shall not be voted at any meeting and
shall not be counted in determining the total number of outstanding shares for
voting purposes at any given time.
SECTION 3.12. DETERMINATION OF SHAREHOLDERS OF RECORD.
(a) Fixing Record Date. The board of directors may fix a time prior
to the date of any meeting of shareholders as a record date for the
determination of the shareholders entitled to notice of, or to vote at, the
meeting, which time, except in the case of an adjourned meeting, shall be not
more than 60 days prior to the date of the meeting of shareholders. Only
shareholders of record on the date fixed shall be so entitled notwithstanding
any transfer of shares on the books of the corporation after any record date
fixed as provided in this subsection. The board of directors may similarly fix a
record date for the determination of shareholders of record for any other
purpose. When a determination of shareholders of record has been made as
provided in this section for purposes of a meeting, the determination shall
apply to any adjournment thereof unless the board fixes a new record date for
the adjourned meeting.
(b) Determination When a Record Date is Not Fixed. If a record date
is not fixed:
(1) The record date for determining shareholders entitled to
notice of or to vote at a meeting of shareholders shall be at the close of
business on the day next preceding the day on which notice is given.
(2) The record date for determining shareholders for any other
purpose shall be at the close of business on the date on which the board of
directors adopts the resolution relating thereto.
(c) Certification by Nominee. The board of directors may adopt a
procedure whereby a shareholder of the corporation may certify in writing to the
corporation that all or a portion of the shares registered in the name of the
shareholder are held for the account of a specified person or persons. Upon
receipt by the corporation of a certification complying with the procedure, the
persons specified in the certification shall be deemed, for the purposes set
forth in the certification, to be the holders of record of the number of shares
specified in place of the shareholder making the certification.
SECTION 3.13. VOTING LISTS.
(a) General Rule. The officer or agent having charge of the transfer
books for shares of the corporation shall make a complete list of the
shareholders entitled to vote at any meeting of shareholders, arranged in
alphabetical order, with the address of and the number of shares held by each.
The list shall be produced and kept open at the time and place of the meeting
and shall be subject to the inspection of any shareholder during the whole time
of the meeting for the purposes
-8-
thereof except that, if the corporation has 5,000 or more shareholders, in lieu
of the making of the list the corporation may make the information therein
available at the meeting by any other means.
(b) Effect of List. Failure to comply with the requirements of this
section shall not affect the validity of any action taken at a meeting prior to
a demand at the meeting by any shareholder entitled to vote thereat to examine
the list. The original share register or transfer book, or a duplicate thereof
kept in the Commonwealth of Pennsylvania, shall be prima facie evidence as to
who are the shareholders entitled to examine the list or share register or
transfer book or to vote at any meeting of shareholders.
SECTION 3.14. JUDGES OF ELECTION.
(a) Appointment. In advance of any meeting of shareholders of the
corporation, the board of directors may appoint judges of election, who need not
be shareholders, to act at the meeting or any adjournment thereof. If judges of
election are not so appointed, the presiding officer of the meeting may, and on
the request of any shareholder shall, appoint judges of election at the meeting.
The number of judges shall be one or three. A person who is a candidate for an
office to be filled at the meeting shall not act as a judge.
(b) Vacancies. In case any person appointed as a judge fails to
appear or fails or refuses to act, the vacancy may be filled by appointment made
by the board of directors in advance of the convening of the meeting or at the
meeting by the presiding officer thereof.
(c) Duties. The judges of election shall determine the number of
shares outstanding and the voting power of each, the shares represented at the
meeting, the existence of a quorum, and the authenticity, validity and effect of
proxies, receive votes or ballots, hear and determine all challenges and
questions in any way arising in connection with nominations by shareholders or
the right to vote, count and tabulate all votes, determine the result and do
such acts as may be proper to conduct the election or vote with fairness to all
shareholders. The judges of election shall perform their duties impartially, in
good faith, to the best of their ability and as expeditiously as is practical.
If there are three judges of election, the decision, act or certificate of a
majority shall be effective in all respects as the decision, act or certificate
of all.
(d) Report. On request of the presiding officer of the meeting or of
any shareholder, the judges shall make a report in writing of any challenge or
question or matter determined by them, and execute a certificate of any fact
found by them. Any report or certificate made by them shall be prima facie
evidence of the facts stated therein.
SECTION 3.15. MINORS AS SECURITY HOLDERS. The corporation may treat a
minor who holds shares or obligations of the corporation as having capacity to
receive and to empower others to receive dividends, interest, principal and
other payments or distributions, to vote or express consent or dissent and to
make elections and exercise rights relating to such shares or obligations
unless, in the case of payments or distributions on shares, the corporate
officer responsible for maintaining the
-9-
list of shareholders or the transfer agent of the corporation or, in the case of
payments or distributions on obligations, the treasurer or paying officer or
agent has received written notice that the holder is a minor.
ARTICLE IV
BOARD OF DIRECTORS
SECTION 4.01. POWERS; PERSONAL LIABILITY.
(a) General Rule. Unless otherwise provided by statute, all powers
vested by law in the corporation shall be exercised by or under the authority
of, and the business and affairs of the corporation shall be managed under the
direction of, the board of directors.
(b) Standard of Care; Justifiable Reliance. A director shall stand
in a fiduciary relation to the corporation and shall perform his or her duties
as a director, including duties as a member of any committee of the board upon
which the director may serve, in good faith, in a manner the director reasonably
believes to be in the best interests of the corporation and with such care,
including reasonably inquiry, skill and diligence, as a person of ordinary
prudence would use under similar circumstances. In performing his or her duties,
a director shall be entitled to rely in good faith on information, opinions,
reports or statements, including financial statements and other financial data,
in each case prepared or presented by any of the following:
(1) One or more officers or employees of the corporation whom the
director reasonably believes to be reliable and competent in the matters
presented.
(2) Counsel, public accountants or other persons as to matters
which the director reasonably believes to be within the professional or expert
competence of such person.
(3) A committee of the board upon which the director does not
serve, duly designated in accordance with law, as to matters within its
designated authority, which committee the director reasonably believes to merit
confidence.
A director shall not be considered to be acting in good faith
if the director has knowledge concerning the matter in question that would cause
his or her reliance to be unwarranted.
(c) Consideration of Factors. In discharging the duties of their
respective positions, the board of directors, committees of the board and
individual directors may, in considering the best interests of the corporation,
consider the effects of any action upon employees, upon suppliers and customers
of the corporation and upon communities in which offices or other establishments
of the
-10-
corporation are located, and all other pertinent factors. The consideration of
those factors shall not constitute a violation of subsection (b).
(d) Presumption. Absent breach of fiduciary duty, lack of good faith
or self-dealing, actions taken as a director or any failure to take any action
shall be presumed to be in the best interests of the corporation.
(e) Personal Liability of Directors. A director of the corporation
shall not be personally liable for monetary damages as such for any action
taken, or any failure to take any action, unless the director has breached or
failed to perform the duties of his or her office under 42 Pa.C.S. Section 8363
and the breach or failure to perform constitutes self-dealing, willful
misconduct or recklessness. The provisions of this subsection shall not apply to
the responsibility or liability of a director pursuant to any criminal statute
or the liability of a director for the payment of taxes pursuant to local, state
or Federal law.
(The provisions of this subsection (e) were first adopted by the shareholders of
the corporation on May 12, 1987.)
(f) Notation of Dissent. A director who is present at a meeting of
the board of directors, or of a committee of the board, at which action on any
corporate matter is taken shall be presumed to have assented to the action taken
unless his or her dissent is entered in the minutes of the meeting or unless the
director files a written dissent to the action with the secretary of the meeting
before the adjournment thereof or transmits the dissent in writing to the
secretary of the corporation immediately after the adjournment of the meeting.
The right to dissent shall not apply to a director who voted in favor of the
action. Nothing in this section shall bar a director from asserting that minutes
of the meeting incorrectly omitted his or her dissent if, promptly upon receipt
of a copy of such minutes, the director notifies the secretary, in writing, of
the asserted omission or inaccuracy.
SECTION 4.02. QUALIFICATIONS AND SELECTION OF DIRECTORS.
(a) Qualifications. Each director of the corporation shall be a
natural person or full age, provided that no person of age seventy (70) years or
more is eligible for election as a director. Directors need not be residents of
the Commonwealth of Pennsylvania or shareholders of the corporation.
(b) Election of Directors. Except as otherwise provided in these
bylaws, directors of the corporation shall be elected by the shareholders. In
elections for directors, voting need not be by ballot, except upon demand made
by a shareholder entitled to vote at the election and before the voting begins.
In all elections for directors every shareholder entitled to vote shall have the
right to multiply the number of votes to which such shareholder may be entitled
by the total number of directors to be elected in the same election by the
holders of the class of shares of which his or her shares are a part, and may
cast the whole number of such votes for one candidate or may distribute
-11-
them among any two or more candidates. The candidates receiving the highest
number of votes from each class or group of classes, if any, entitled to elect
directors separately up to the number of directors to be elected by the class or
group of classes shall be elected. If at any meeting of shareholders, directors
of more than one class are to be elected, each class of directors shall be
elected in a separate election.
SECTION 4.03. NUMBER AND TERM OF OFFICE.
(a) Number. The board of directors shall consist of such number of
directors, not less than five (5) nor more than fifteen (15), as may be
determined from time to time by resolution of the board of directors.
(b) Term of Office. Each director shall hold office until the
expiration of the term for which he or she was elected and until a successor has
been selected and qualified or until his or her earlier death, resignation or
removal. A decrease in the number of directors shall not have the effect of
shortening the term of any incumbent director.
(c) Resignation. Any director may resign at any time upon written
notice to the corporation. The resignation shall be effective upon receipt
thereof by the corporation or at such subsequent time as shall be specified in
the notice of resignation.
SECTION 4.04. VACANCIES.
(a) General Rule. Vacancies in the board of directors, including
vacancies resulting from an increase in the number of directors, may be filled
by a majority vote of the remaining members of the board though less than a
quorum, or by a sole remaining director, and each person so selected shall be a
director to serve until the next selection of the class for which such director
has been chosen, and until a successor has been selected and qualified or until
his or her earlier death, resignation or removal.
(b) Action by Resigned Directors. When one or more directors resign
from the board effective at a future date, the directors then in office,
including those who have so resigned, shall have power by the applicable vote to
fill the vacancies, the vote thereon to take effect when the resignations become
effective.
SECTION 4.05. REMOVAL OF DIRECTORS.
(a) Removal by the Shareholders. The entire board of directors, or
any class of the board, or any individual director may be removed from office by
vote of the shareholders entitled to vote thereon without assigning any cause.
In case the board or a class of the board or any one or more directors are so
removed, new directors may be elected at the same meeting.
-12-
(b) Removal by the Board. The board of directors may declare vacant
the office of a director who has been judicially declared of unsound mind or who
has been convicted of an offense punishable by imprisonment for a term of more
than one year of if, within 60 days after notice of his or her selection, the
director does not accept the office either in writing or by attending a meeting
of the board of directors.
SECTION 4.06. PLACE OF MEETINGS. Meetings of the board of directors may be
held at such place within or without the Commonwealth of Pennsylvania as the
board of directors may from time to time appoint or as may be designated in the
notice of the meeting.
SECTION 4.07. ORGANIZATION OF MEETINGS. At every meeting of the board of
directors, the chairman of the board, if there be one, or, in the case of a
vacancy in the office or absence of the chairman of the board, one of the
following officers present in the order stated: the vice chairman of the board,
if there be one, the president, the vice presidents in their order of rank and
seniority, or a person chosen by a majority of the directors present, shall act
as chairman of the meeting. The secretary or, in the absence of the secretary,
an assistant secretary, or, in the absence of the secretary and the assistant
secretaries, any person appointed by the chairman of the meeting, shall act as
secretary of the meeting.
SECTION 4.08. REGULAR MEETINGS. Regular meetings of the board of directors
shall be held at such time and place as shall be designated from time to time by
resolution of the board of directors.
SECTION 4.09. SPECIAL MEETINGS. Special meetings of the board of directors
shall be held whenever called by the chief executive officer or by two or more
of the directors.
SECTION 4.10. QUORUM OF AND ACTION BY DIRECTORS.
(a) General Rule. A majority of the directors in office of the
corporation shall be necessary to constitute a quorum for the transaction of
business and the acts of a majority of the directors present and voting at a
meeting at which a quorum is present shall be the acts of the board of
directors.
(b) Action by Written Consent. Any action required or permitted to
be taken at a meeting of the directors may be taken without a meeting if, prior
or subsequent to the action, a consent or consents thereto by all of the
directors in office is filed with the secretary of the corporation.
SECTION 4.11. EXECUTIVE AND OTHER COMMITTEES.
(a) Establishment and Powers. The board of directors may, by
resolution adopted by a majority of the directors in office, establish one or
more committees to consist of one or more directors of the corporation. Any
committee, to the extent provided in the resolution of the board of
-13-
directors, shall have and may exercise all of the powers and authority of the
board of directors except that a committee shall not have any power or authority
as to the following:
(1) The submission to shareholders of any action requiring
approval of shareholders under the Business Corporation Law.
(2) The creation or filling of vacancies in the board of
directors.
(3) The adoption, amendment or repeal of these bylaws.
(4) The amendment or repeal of any resolution of the board that
by its terms is amendable or repealable only by the board.
(5) Action on matters committed by a resolution of the board of
directors to another committee of the board.
(b) Alternate Committee Members. The board may designate one or more
directors as alternate members of any committee who may replace any absent or
disqualified member at any meeting of the committee or for the purposes of any
written action by the committee. In the absence or disqualification of a member
and alternate member or members of a committee, the member or members thereof
present at any meeting and not disqualified from voting, whether or not
constituting a quorum, may unanimously appoint another director to act at the
meeting in the place of the absent or disqualified member.
(c) Term. Each committee of the board shall serve at the pleasure of
the board.
(d) Committee Procedures. The term "board of directors" or "board,"
when used in any provision of these bylaws relating to the organization or
procedures of or the manner of taking action by the board of directors, shall be
construed to include and refer to any executive or other committee of the board.
SECTION 4.12. COMPENSATION. The board of directors shall have the
authority to fix the compensation of directors for their services as directors
and a director may be a salaried officer of the corporation.
ARTICLE V
OFFICERS
SECTION 5.01. OFFICERS GENERALLY.
(a) Number, Qualifications and Designation. The officers of the
corporation shall be a president (who may be the chief executive officer), one
or more vice presidents, a secretary, a
-14-
treasurer, and such other officers as may be elected in accordance with the
provisions of Section 5.03. Officers may but need not be directors or
shareholders of the corporation. The president and secretary shall be natural
persons of full age. The treasurer may be a corporation, but if a natural person
shall be of full age. The board of directors may elect from among the members of
the board a chairman of the board (who may be the chief executive officer) and a
vice chairman of the board who may be officers of the corporation. Any number of
offices may be held by the same person.
(b) Bonding. The corporation may secure the fidelity of any or all
of its officers by bond or otherwise.
SECTION 5.02. ELECTION, TERM OF OFFICE AND RESIGNATIONS.
(a) Election and Term of Office. The officers of the corporation
(except those elected by delegated authority pursuant to Section 5.03 or filled
pursuant to Section 5.05) shall be elected annually by the board of directors,
and each such officer shall hold office for a term of one year and until a
successor has been selected and qualified or until his or her earlier death,
resignation or removal.
(b) Resignation. Any officer may resign at any time upon written
notice to the corporation. The resignation shall be effective upon receipt
thereof by the corporation or at such subsequent time as may be specified in the
notice of resignation.
SECTION 5.03. SUBORDINATE OFFICERS, COMMITTEES AND AGENTS. The board of
directors may from time to time elect such other officers and appoint such
committees, employees or other agents as the business of the corporation may
require, including one or more assistant secretaries, and one or more assistant
treasurers, each of whom shall hold office for such period, have such authority,
and perform such duties as are provided in these bylaws, or as the board of
directors may from time to time determine. The board of directors may delegate
to any officer or committee the power to elect subordinate officers and to
retain or appoint employees or other agents, or committees thereof, and to
prescribe the authority and duties of such subordinate officers, committees,
employees or other agents.
SECTION 5.04. REMOVAL OF OFFICERS AND AGENTS. Any officer or agent of the
corporation may be removed by the board of directors with or without cause. The
removal shall be without prejudice to the contract rights, if any, or any person
so removed. Election or appointment of an officer or agent shall not of itself
create contract rights.
SECTION 5.05. VACANCIES. A vacancy in any office because of death,
resignation, removal, disqualification, or any other cause, may be filled by the
board of directors or the board of directors may delegate to any officer or
committee the power to fill a vacancy in such office or to create a new such
office, subject to ratification by the board of directors, and if the office is
one for which these bylaws prescribe a term, shall be filled for the unexpired
portion of the term.
-15-
SECTION 5.06. AUTHORITY. All officers of the corporation, as between
themselves and the corporation, shall have such authority and perform such
duties in the management of the corporation as may be provided by or pursuant to
resolutions or orders of the board of directors or, in the absence of
controlling provisions in the resolutions or orders of the board of directors,
as may be determined by or pursuant to these bylaws.
SECTION 5.07. THE CHAIRMAN AND VICE CHAIRMAN OF THE BOARD. The chairman of
the board or in the absence of the chairman, the vice chairman of the board,
shall preside at all meetings of the shareholders and of the board of directors,
and shall perform such other duties as may from time to time be requested by the
board of directors.
SECTION 5.08. THE CHIEF EXECUTIVE OFFICER. The chief executive officer
shall be the chief executive officer of the corporation and shall be in addition
either the chairman of the board or the president of the corporation. The chief
executive officer shall have general supervision over the business of the
corporation and, in general, shall have the powers and perform the duties which
by law and general usage appertain to the office, subject however, to the
control of the board of directors. The chief executive officer shall sign,
execute, and acknowledge, in the name of the corporation, deeds, mortgages,
bonds, contracts or other instruments, authorized by the board of directors,
except in cases where the signing and execution thereof shall be expressly
delegated by the board of directors, or by these bylaws, to some other officer
or agent of the corporation.
SECTION 5.09. THE PRESIDENT. The president shall perform such duties as
from time to time may be assigned by the board of directors or the chief
executive officer (unless the president shall be the chief executive officer, in
which case the president's duties shall be those specified in Section 5.08).
SECTION 5.10. THE VICE PRESIDENT. The vice presidents shall perform the
duties of the president in the absence of the president and such other duties as
may from time to time be assigned to them by the board of directors or the chief
executive officer.
SECTION 5.11. THE SECRETARY. The secretary or an assistant secretary shall
attend all meetings of the shareholders and of the board of directors and shall
record all the votes of the shareholders and of the directors and the minutes of
the meetings of the shareholders and of the board of directors and of committees
of the board in a book or books to be kept for that purpose; shall see that
notices are given and records and reports properly kept and filed by the
corporation as required by law; shall be the custodian of the seal of the
corporation and see that it is affixed to all documents to be executed on behalf
of the corporation under its seal; and, in general, shall perform all duties
incident to the office of secretary, and such other duties as may from time to
time be assigned by the board of directors or the chief executive officer.
SECTION 5.12. THE TREASURER. The treasurer or an assistant treasurer shall
have or provide for the custody of the funds or other property of the
corporation; shall collect and receive or provide for the collection and receipt
of moneys earned by or in any manner due to or received by the
-16-
corporation; shall deposit all funds in his or her custody as treasurer in such
banks or other places of deposit as shall be designated in accordance with
resolutions adopted by the board of directors; shall, whenever so required by
the board of directors, render an account showing all transactions as treasurer,
and the financial condition of the corporation; and, in general, shall discharge
such other duties as may from time to time be assigned by the board of directors
or the chief executive officer.
SECTION 5.13. SALARIES. The salaries of the officers elected by the board
of directors shall be fixed from time to time by the board of directors or by
such officer as may be designated by resolution of the board. The salaries or
other compensation of any other officers, employees and other agents shall be
fixed from time to time by the officer or committee to which the power to elect
such officers or to retain or appoint such employees or other agents has been
delegated pursuant to Section 5.03. No officer shall be prevented from receiving
such salary or other compensation by reason of the fact that the officer is also
a director of the corporation.
ARTICLE VI
CERTIFICATES OF STOCK, TRANSFER, ETC.
SECTION 6.01. SHARE CERTIFICATES.
(a) Form of Certificates. Certificates for shares of the corporation
shall be in such form as approved by the board of directors, and shall state
that the corporation is incorporated under the laws of the Commonwealth of
Pennsylvania, the name of the person to whom issued, and the number and class of
shares and the designation of the series (if any) that the certificate
represents. If the corporation is authorized to issue shares of more than one
class or series certificates for shares of the corporation shall set forth upon
the face or back of the certificate (or shall state on the face or back of the
certificate that the corporation will furnish to any shareholder upon request
and without charge), a full or summary statement of the designations, voting
rights, preferences, limitations and special rights of the shares of each class
or series authorized to be issued so far as they have been fixed and determined
and the authority of the board of directors to fix and determine the
designations, voting rights, preferences, limitations and special rights of the
classes and series of shares of the corporation.
(b) Share Register. The share register or transfer book and blank
share certificates shall be kept by the secretary or by any transfer agency or
registrar designated by the board of directors for that purpose.
SECTION 6.02. ISSUANCE. The share certificates of the corporation shall be
numbered and registered in the share register or transfer books of the
corporation as they are issued. They shall be executed in such manner as the
board of directors shall determine.
SECTION 6.03. TRANSFER. Transfers of shares shall be made on the share
register or transfer books of the corporation upon surrender of the certificate
therefor, endorsed by the person named in
-17-
the certificate or by an attorney lawfully constituted in writing. No transfer
shall be made inconsistent with the provisions of the Uniform Commercial Code,
13 Pa.C.S.Sections 8101 et seq., and its amendments and supplements.
SECTION 6.04. RECORD HOLDER OF SHARES. The corporation shall be entitled
to treat the person in whose name any share or shares of the corporation stand
on the books of the corporation as the absolute owner thereof, and shall not be
bound to recognize any equitable or other claim to, or interest in, such share
or shares on the part of any other person.
SECTION 6.05. LOST, DESTROYED OR MUTILATED CERTIFICATES. The holder of
any shares of the corporation shall immediately notify the corporation of any
loss, destruction or mutilation of the certificate therefor, and the board of
directors may, in its discretion, cause a new certificate or certificates to be
issued to such holder, in case of mutilation of the certificate, upon the
surrender of the mutilated certificate or, in case of loss or destruction of the
certificate, upon satisfactory proof of such loss or destruction and, if the
board of directors shall so determine, the deposit of a bond in such form and in
such sum, and with such surety or sureties, as it may direct.
ARTICLE VII
INDEMNIFICATION OF DIRECTORS AND OFFICERS
(This Article effective for acts occurring prior to May 12, 1987)
The corporation shall indemnify any director or officer of the corporation
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of the
corporation) by reason of the fact that he is or was an authorized
representative of the corporation (which for the purposes of this Article VII
shall mean a director, officer, employee or agent of the corporation, or a
person who is or was serving at the request of the corporation as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise) against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by him in connection with such action, suit or proceeding if he acted in good
faith and in a manner he reasonably believed to be in, or not opposed to, the
best interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in, or not opposed to, the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was unlawful.
The corporation shall indemnify any director or officer of the corporation
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action or
-18-
suit by or in the right of the corporation to procure a judgment in its favor by
reason of the fact that he is or was an authorized representative of the
corporation against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably believed to be in,
or not opposed to, the best interests of the corporation and except that no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable for negligence or
misconduct in the performance of his duty to the corporation unless and only to
the extent that the court of common pleas of the county in which the registered
office of the corporation is located or the court in which such action or suit
was brought shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses which the court of
common pleas or such other court shall deem proper.
To the extent that an authorized representative of the corporation who
neither was nor is a director or officer of the corporation has been successful
on the merits or otherwise in defense of any action, suit or proceeding referred
to in the two preceding paragraphs of this Article or in defense of any claim,
issue or matter therein, he shall be indemnified by the corporation against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection therewith. Such an authorized representative may, at the discretion
of the corporation, be indemnified by the corporation in any other circumstances
to any extent if the corporation would be required by the two preceding
paragraphs of this Article to indemnify such person in such circumstances and to
such extent as if he were or had been a director or officer of the corporation.
Indemnification under the three preceding paragraphs of this Article shall
be made when ordered by court (in which case the expenses, including attorneys'
fees, of the authorized representative in enforcing such right of
indemnification shall be added to and be included in the final judgment against
the corporation) and may be made in a specific case upon a determination that
indemnification of the authorized representative is required or proper in the
circumstances because he has met the applicable standard of conduct set forth in
the first two paragraphs of this Article. Such determination shall be made:
(1) By the board of directors by a majority vote of a quorum
consisting of directors who were not parties to such action, suit or proceeding,
or
(2) If such a quorum is not obtainable, or, even if obtainable a
majority vote of a quorum of disinterested directors so directs, by independent
legal counsel in a written opinion, or
(3) By the stockholders.
Expenses (including attorneys' fees) incurred in defending a civil or
criminal action, suit or proceeding shall be paid by the corporation in advance
of the final disposition of such action, suit or proceeding, upon receipt of an
undertaking by or on behalf of a director or officer to repay such amount unless
it shall ultimately be determined that he is entitled to be indemnified by the
-19-
corporation as required in this Article or as authorized by law, and may be paid
by the corporation in advance on behalf of any other authorized representative
when authorized by the Board of Directors upon receipt of a similar undertaking.
Each person who shall act as an authorized representative of the
corporation shall be deemed to be doing so in reliance upon such rights of
indemnification as are provided in this Article. The indemnification provided by
this Article shall not be deemed exclusive of any other rights to which those
seeking indemnification may be entitled under any agreement, vote of
stockholders or disinterested directors, statute or otherwise, both as to action
in his official capacity and as to action in another capacity while holding such
office or position, and shall continue as to a person who has ceased to be an
authorized representative of the corporation and shall inure to the benefit of
the heirs, executors and administrators or of such a person.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. CORPORATE SEAL. The corporation shall have a corporate seal
in the form of a circle containing the name of the corporation on the
circumference, and the words "Penna.-1882" in the center.
SECTION 8.02. CHECKS. All checks, notes, bills of exchange or other orders
in writing shall be signed by such person or persons as shall be designated in
accordance with resolutions adopted by the board of directors.
SECTION 8.03. CONTRACTS. Except as otherwise provided in the Business
Corporation Law in the case of transactions that require action by the
shareholders, the board of directors may authorize any officer or agent to enter
into any contract or to execute or deliver any instrument on behalf of the
corporation, and such authority may be general or confined to specific
instances.
SECTION 8.04. INTERESTED DIRECTORS OR OFFICERS; QUORUM.
(a) General Rule. A contract or transaction between the corporation
and one or more of its directors or officers or between the corporation and
another corporation, partnership, joint venture, trust or other enterprise in
which one or more of its directors or officers are directors or officers or have
a financial or other interest, shall not be void or voidable solely for that
reason, or solely because the director or officer is present at or participates
in the meeting of the board of directors that authorizes the contract or
transaction, or solely because his, her or their votes are counted for that
purpose, if:
(1) the material facts as to the relationship or interest and as
to the contract or transaction are disclosed or are known to the board of
directors and the board authorizes the
-20-
contract or transaction by the affirmative votes of a majority of the
disinterested directors even though the disinterested directors are less than a
quorum;
(2) the material facts as to his or her relationship or interest
and as to the contract or transaction are disclosed or are known to the
shareholders entitled to vote thereon and the contract or transaction is
specifically approved in good faith by vote of those shareholders; or
(3) the contract or transaction is fair as to the corporation as
of the time it is authorized, approved or ratified by the board of directors or
the shareholders.
(b) Quorum. Common or interested directors may be counted in
determining the presence of a quorum at a meeting of the board which authorizes
a contract or transaction specified in subsection (a).
SECTION 8.05. DEPOSITS. All funds of the corporation shall be deposited
from time to time to the credit of the corporation in such banks, trust
companies or other depositaries as shall be designated as banks of the
corporation in accordance with resolutions adopted by the board of directors,
and all such funds shall be withdrawn in accordance with resolutions adopted by
the board of directors.
SECTION 8.06. CORPORATE RECORDS.
(a) Required Records. The corporation shall keep complete and
accurate books and records of account, minutes of the proceedings of the
incorporators, shareholders and directors and a share register giving the names
and addresses of all shareholders and the number and class of shares held by
each. The share register shall be kept at either the registered office of the
corporation in the Commonwealth of Pennsylvania or at its principal place of
business wherever situated or at the office of its registrar or transfer agent.
Any books, minutes or other records may be in written form or any other form
capable of being converted into written form within a reasonable time.
(b) Right of Inspection. Every shareholder shall, upon written
verified demand stating the purpose thereof, have a right to examine, in person
or by agent or attorney, during the usual hours of business for any proper
purpose, the share register, books and records of account, and records of the
proceedings of the incorporators, shareholders and directors and to make copies
or extracts therefrom. A proper purpose shall mean a purpose reasonably related
to the interest of the person as a shareholder. In every instance where an
attorney or other agent is the person who seeks the right of inspection, the
demand shall be accompanied by a verified power of attorney or other writing
that authorizes the attorney or other agent to so act on behalf of the
shareholder. The demand shall be directed to the corporation at its registered
office in the Commonwealth of Pennsylvania or at its principal place of business
wherever situated.
[SECTION 8.07 INAPPLICABILITY OF SECTION 910 OF THE PENNSYLVANIA BUSINESS
CORPORATION LAW. Effective December 23, 1983, Section 910 of the Pennsylvania
Business Corporation Law
-21-
(added by Pennsylvania Act No. 1983-92 enacted December 23, 1983) shall not be
applicable to the corporation. This Section 8.07 shall continue in effect until
rescinded by an amendment to the Articles of Incorporation of the corporation.]
[Superseded by Statute.]
SECTION 8.08. AMENDMENT OF BYLAWS. These bylaws may be amended or
repealed, or new bylaws may be adopted, either (i) by vote of the shareholders
at any duly organized annual or special meeting of shareholders, or (ii) with
respect to those matters that are not by statute committed expressly to the
shareholders and regardless of whether the shareholders have previously adopted
or approved the bylaw being amended or repealed, by vote of a majority of the
board of directors of the corporation in office at any regular or special
meeting of directors. Any change in these bylaws shall take effect when adopted
unless otherwise provided in the resolution effecting the change.
SECTION 8.09. PREVENTION OF "GREENMAIL." The corporation shall not
repurchase shares for more than the market value thereof from any shareholder
who beneficially owns more than 5% of the outstanding Common Stock of the
corporation and has beneficially owned such shares for less than two years from
the date of repurchase without (1) first obtaining the affirmative vote of the
shareholders entitled to cast at least a majority of the votes which all
shareholders are entitled to cast thereon, or (2) offering to repurchase shares
from all shareholders upon the same terms. "Beneficially owned" as used herein
shall have the meaning set forth in Rule 13d-3 under the Securities Exchange Act
of 1934, as amended, or any successor provision thereto.
ARTICLE IX
INDEMNIFICATION OF DIRECTORS, OFFICERS AND
OTHER INDEMNIFIED REPRESENTATIVES
(This Article effective for acts occurring on or after May 12, 1987)
SECTION 9.01. SCOPE OF INDEMNIFICATION.
(a) The corporation shall indemnify an indemnified representative
against any liability incurred in connection with any proceeding in which the
indemnified representative may be involved as a party or otherwise, by reason of
the fact that such person is or was serving in an indemnified capacity,
including without limitation any liabilities resulting from any actual or
alleged breach or neglect of duty, error, misstatement or misleading statement,
negligence, gross negligence or act giving rise to strict or products liability,
except where such indemnification is for acts or failures to act constituting
self-dealing, willful misconduct or recklessness.
(b) If an indemnified representative is entitled to indemnification
in respect of a portion, but not all, of any liabilities to which such person
may be subject, the corporation shall
-22-
indemnify such indemnified representative to the maximum extent for such portion
of the liabilities.
(c) The termination of a proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent shall not, of
itself, create a presumption that the indemnified representative is not entitled
to indemnification.
(d) For purposes of this Article:
(1) "indemnified capacity" means any and all past, present and
future service by an indemnified representative in one or more capacities as a
director, officer, employee or agent of the corporation, or, at the request of
the corporation, as a director, officer, employee, agent, fiduciary or trustee
of another corporation, partnership, joint venture, trust, employee benefit plan
or other entity or enterprise;
(2) "indemnified representative" means any and all directors and
officers of the corporation and any other person designated as an indemnified
representative by the board of directors of the corporation (which may, but need
not, include any person serving at the request of the corporation, as a
director, officer, employee, agent, fiduciary or trustee of another corporation,
partnership, joint venture, trust, employee benefit plan or other entity or
enterprise);
(3) "liability" means any damage, judgment, amount paid in
settlement, fine, penalty, punitive damages, excise tax assessed with respect to
an employee benefit plan, or cost or expense of any nature (including, without
limitation, attorneys' fees and disbursements);
(4) "proceeding" means any threatened, pending or completed
action, suit, appeal or other proceeding of any nature, whether civil, criminal,
administrative or investigative, whether formal or informal, and whether brought
by or in the right of the corporation, a class of its security holders or
otherwise; and
(5) "self-dealing" means receipt of a personal benefit from the
corporation to which the recipient is not legally entitled.
SECTION 9.02. PROCEEDINGS INITIATED BY INDEMNIFIED REPRESENTATIVES.
Notwithstanding any other provision of this Article, the corporation shall not
indemnify under this Article an indemnified representative for any liability
incurred in a proceeding initiated (which shall not be deemed to include
counterclaims or affirmative defenses) or participated in as an intervenor or
amicus curiae by the person seeking indemnification unless such initiation of or
participation in the proceeding is authorized, either before or after its
commencement, by the affirmative vote of a majority of the directors in office.
This section does not apply to reimbursement of expenses incurred in
successfully prosecuting or defending an arbitration under Section 9.06(d) of
this Article or otherwise successfully prosecuting or defending the rights of an
indemnified representative granted by or pursuant to this Article.
-23-
SECTION 9.03. ADVANCING EXPENSES. The corporation shall pay the expenses
(including attorneys' fees and disbursements) incurred in good faith by an
indemnified representative in advance of the final disposition of a proceeding
described in Section 9.01 and 9.02 of this Article upon receipt of an
undertaking by or on behalf of the indemnified representative to repay such
amount if it shall ultimately be determined pursuant to Section 9.06(d) that
such person is not entitled to be indemnified by the corporation pursuant to
this Article. The financial ability of an indemnified representative to repay an
advance shall not be a prerequisite to the making of such advance.
SECTION 9.04 SECURING OF INDEMNIFICATION OBLIGATIONS. To further effect,
satisfy or secure the indemnification obligations provided herein or otherwise,
the corporation may maintain insurance, obtain a letter of credit, act as
self-insurer, create a reserve, trust, escrow, cash collateral or other fund or
account, enter into indemnification agreements, pledge or grant a security
interest in any assets or properties of the corporation or use any other
mechanism or arrangement whatsoever in such amounts, at such costs and upon such
other terms and conditions as the board of directors shall deem appropriate.
Absent fraud, the determination of the board of directors with respect to such
amounts, costs, terms and conditions shall be conclusive against all security
holders, officers and directors and shall not be subject to voidability.
SECTION 9.05. PAYMENT OF INDEMNIFICATION. An indemnified representative
shall be entitled to indemnification within 30 days after a written request for
such indemnification has been delivered to the secretary of the corporation.
SECTION 9.06. INDEMNIFICATION PROCEDURE.
(a) An indemnified representative shall use such indemnified
representative's best efforts to notify promptly the secretary of the
corporation of the commencement of any proceeding or the occurrence of any event
which might give rise to a liability under this Article, but the failure so to
notify the corporation shall not relieve the corporation of any liability which
it may have to the indemnified representative under this Article or otherwise.
(b) The corporation shall be entitled, upon notice to any such
indemnified representative, to assume the defense of any proceeding with counsel
reasonably satisfactory to the indemnified representative, or a majority of the
indemnified representatives involved in such proceeding if there be more than
one. If the corporation notifies the indemnified representative of its election
to defend the proceeding, the corporation shall have no liability for the
expenses (including attorneys' fees) of the indemnified representative incurred
in connection with the defense of such proceeding subsequent to such notice,
unless (i) such expenses (including attorneys' fees) have been authorized by the
corporation, (ii) the corporation shall not in fact have employed counsel
reasonably satisfactory to such indemnified representative or indemnified
representatives to assume the defense of such proceeding, or (iii) it shall have
been determined pursuant to Section 9.06(d) that the indemnified representative
was entitled to indemnification for such expenses under
-24-
this Article or otherwise. Notwithstanding the foregoing, the indemnified
representative may elect to retain counsel at the indemnified representative's
own cost and expense to participate in the defense of such proceeding.
(c) The corporation shall not be required to obtain the consent of
the indemnified representative to the settlement of any proceeding which the
corporation has undertaken to defend if the corporation assumes full and sole
responsibility for such settlement and the settlement grants the indemnified
representative an unqualified release in respect of all liabilities at issue in
the proceeding. Whether or not the corporation has elected to assume the defense
of any proceeding, no indemnified representative shall have any right to enter
into any full or partial settlement of the proceeding without the prior written
consent of the corporation (which consent shall not be unreasonably withheld),
nor shall the corporation be liable for any amount paid by an indemnified
representative pursuant to any settlement to which the corporation has not so
consented.
(d) Any dispute related to the right to indemnification,
contribution or advancement of expenses as provided under this Article, except
with respect to indemnification for liabilities under the Securities Act of 1933
which the corporation has undertaken to submit to a court for adjudication,
shall be decided only by arbitration in the metropolitan area in which the
principal executive offices of the corporation are located, in accordance with
the commercial arbitration rules then in effect of the American Arbitration
Association, before a panel of three arbitrators, one of whom shall be selected
by the corporation, the second of whom shall be selected by the indemnified
representative and the third of whom shall be selected by the other two
arbitrators. In the absence of the American Arbitration Association, or if for
any reason arbitration under the arbitration rules of the American Arbitration
Association cannot be initiated, or if one of the parties fails or refuses to
select an arbitrator, or if the arbitrators selected by the corporation and the
indemnified representative cannot agree on the selection of the third arbitrator
within 30 days after such time as the corporation and the indemnified
representative have each been notified of the selection of the other's
arbitrator, the necessary arbitrator or arbitrators shall be selected by the
presiding judge of the court of general jurisdiction in such metropolitan area.
Each arbitrator selected as provided herein is required to be or have been a
director or executive officer of a corporation whose shares of common stock were
listed during at least one year of such service on the New York Stock Exchange
or the American Stock Exchange or quoted on the National Association of
Securities Dealers Automated Quotations System. The party or parties challenging
the right of an indemnified representative to the benefits of this Article shall
have the burden of proof. The corporation shall reimburse an indemnified
representative for the expenses (including attorneys' fees and disbursements)
incurred in successfully prosecuting or defending such arbitration. Any award
entered by the arbitrators shall be final, binding and nonappealable and
judgment may be entered thereon by any party in accordance with applicable law
in any court of competent jurisdiction. This arbitration provision shall be
specifically enforceable.
(e) Upon a payment to any indemnified representative under this
Article, the corporation shall be subrogated to the extent of such payment to
all of the rights of the indemnified representative to recover against any
person for such liability, and the indemnified representative
-25-
shall execute all documents and instruments required and shall take such other
actions as may be necessary to secure such rights, including the execution of
such documents as may be necessary for the corporation to bring suit to enforce
such rights.
SECTION 9.07. CONTRIBUTION. If the indemnification provided for in this
Article or otherwise is unavailable for any reason in respect of any liability
or portion thereof, the corporation shall contribute to the liabilities to which
the indemnified representative may be subject in such proportion as is
appropriate to reflect the intent of this Article or otherwise.
SECTION 9.08. DISCHARGE OF DUTY. An indemnified representative shall be
deemed to have discharged such person's duty to the corporation if he or she has
relied in good faith on information, opinions, reports or statements prepared or
presented by any of the following:
(a) one or more officers or employees of the corporation whom such
indemnified representative reasonably believes to be reliable and competent with
respect to the matter presented;
(b) legal counsel, public accountants or other persons as to matters
that the indemnified representative reasonably believes are within the persons'
professional or expert competence; or
(c) a committee of the board of directors on which he or she does
not serve as to matters within its area of designated authority, which committee
he or she reasonably believes to merit confidence.
SECTION 9.09. CONTRACT, RIGHTS; AMENDMENT OR REPEAL. All rights to
indemnification, contribution and advancement of expenses under this Article
shall be deemed a contract between the corporation and the indemnified
representative pursuant to which the corporation and each indemnified
representative intend to be legally bound. Any repeal, amendment or modification
hereof shall be prospective only and shall not affect any rights or obligations
then existing.
SECTION 9.10. SCOPE OF ARTICLE. The rights granted by this Article shall
not be deemed exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under any statute,
agreement, vote of shareholders or disinterested directors or otherwise, both as
to action in an indemnified capacity and as to action in any other capacity. The
indemnification, and advancement of expenses provided by or granted pursuant to
this Article shall continue as to a person who has ceased to be an indemnified
representative in respect of matters arising prior to such time, and shall inure
to the benefit of the heirs, executors, administrators and personal
representatives of such a person.
SECTION 9.11. RELIANCE ON PROVISIONS. Each person who shall act as an
indemnified representative of the corporation shall be deemed to be doing so in
reliance upon the rights of indemnification, and advancement of expenses
provided by this Article.
-26-
SECTION 9.12. INTERPRETATION. The provisions of this Article have been
adopted by the shareholders of the corporation and are intended to constitute By
laws authorized by Section 410F of the Pennsylvania Business Corporation Law and
42 Pa.C.S.Section 8365.
(The provisions of this Article IX were first adopted by the shareholders of the
corporation on May 12, 1987.)
Amended and Restated 2/27/90.
As amended through September 24, 2002.
-27-