EMCORE: AMENDED BY-LAWS
Published on December 20, 2006
EXHIBIT
3.1
BY-LAWS
OF
EMCORE
CORPORATION
As
Amended Through December 14, 2006
ARTICLE
I
OFFICES
1. Principal
Place of Business.
The
principal place of business of EMCORE Corporation (the “Corporation”) is 145
Belmont Drive, Somerset, New Jersey 08873.
2. Other
Places of Business.
Branch
or subordinate places of business or offices may be established at any time
by
the Board of Directors of the Corporation (the “Board”) at any place or places
where the Corporation is qualified to do business.
ARTICLE
II
SHAREHOLDERS
1. Annual
Meeting.
The
annual meeting of shareholders shall be held at a time fixed by the Board that
shall be within thirteen months of the last annual meeting, upon not less than
ten nor more than sixty days written notice of the time, place, and purpose
of
the meeting at the corporate offices, or at such other time and place as shall
be specified in the notice of meeting, in order to elect directors of the
Corporation (“Directors”) and transact such other business as shall come before
the meeting.
2. Special
Meetings.
A
special meeting of shareholders may be called for any purpose by the president
or the Board. A special meeting shall be held upon not less than ten nor more
than sixty days written notice of the time, place and purpose of the
meeting.
3. Action
Without Meeting.
The
shareholders may act without a meeting if, prior or subsequent to such action,
each shareholder who would have been entitled to vote upon such action shall
consent in writing to such action. Such written consent or consents shall be
filled in the minute book.
4. Quorum.
The
presence at a meeting in person or by proxy of the holders of shares entitled
to
cast a majority of the votes shall constitute a quorum.
5. Organization.
The
president, or in the absence of the president, such vice president as may be
designated by the president, shall preside at all meetings of the shareholders.
If both are absent, any other officer designated by the Board shall preside.
If
no officer so designated is present, the shareholders present in person or
represented by proxy may elect one of their number to preside. The secretary
shall act as secretary at all meetings of the shareholders; but in the absence
of the secretary the presiding officer may appoint any person to act as
secretary of the meeting.
ARTICLE
III
VOTING
AND ELECTIONS
1. Voting.
Each
holder of shares with voting rights shall be entitled to one vote for each
such
share registered in his or her name, except as otherwise provided in the
certificate of incorporation of the Corporation (the “Certificate of
Incorporation”). Whenever any action, other than the election of Directors, is
to be taken by vote of the shareholders, it shall be authorized by a majority
of
the votes cast at a meeting of shareholders by the holders of shares entitled
to
vote thereon, unless a greater percentage is required by statute or by the
Certificate of Incorporation.
2. Voting
Lists.
The
officer or agent having charge of the stock transfer books for shares of the
Corporation shall make a complete list of shareholders entitled to vote at
a
shareholders’ meeting or any adjournment thereof. A list required by this
Section 2 may consist of cards arranged alphabetically or any equipment which
permits the visual display of the information required. Such list shall be
arranged alphabetically within each class, series or group of shareholders
maintained by the Corporation for convenience of reference, with the address
of,
and the number of shares held by, each shareholder; be produced (or available
by
means of a visual display) at the time and place of the meeting; be subject
to
the inspection of any shareholder for reasonable periods during the meeting;
and
be prima facie evidence of the identity of the shareholders entitled to examine
such list or to vote at any meeting. If the requirements of this Section 2
have
not been complied with, the meeting shall, on the demand of any shareholder
in
person or by proxy, be adjourned until the requirements are complied with.
Failure to comply with the requirements of this Section 2 shall not affect
the
validity of any action taken at such meeting prior to the making of such
demand.
3. Fixing
Record Date.
(a)
The
Board may fix, in advance, a date as the record date for determining the
Corporation’s shareholders with regard to any corporate action or event and, in
particular, for determining the shareholders who are entitled to
(i)
notice
of
or to vote at any meeting of shareholders or any adjournment
thereof;
(ii) give
a
written consent to any action without a meeting; or
(iii) receive
payment of any dividend or allotment of any right.
The
record date may in no case be more than sixty days prior to the shareholders’
meeting or other corporate action or event to which it relates. The record
date
for a shareholders’ meeting may not be less than ten days before the date of the
meeting. The record date to determine shareholders to give a written consent
may
not be more than sixty days before the date fixed for tabulation of the consents
or, if no date has been fixed for tabulation, more than sixty days before the
last day on which consents received may be counted.
(b) If
no
record date is fixed,
(i)
|
the
record date for a shareholders’ meeting shall be the close of business on
the day next preceding the day on which notice is given, or, if no
notice
is given, the day next preceding the day on which the meeting is
held;
and
|
(ii)
|
the
record date for determining shareholders for any other purpose shall
be at
the close of business on the day on which the resolution of the Board
relating thereto is adopted.
|
(c) The
record date for determining shareholders entitled to consent to corporate action
in writing without a meeting, when no prior action by the Board is required
by
this act, shall be the first date on which a signed written consent setting
forth the action taken or proposes to be taken is delivered to the Corporation
by delivery to its registered office in New Jersey, its principal place of
business, or an officer or agent of the Corporation having custody of the book
in which proceeding of meetings of shareholders are recorded.
(d) When
a
determination of shareholders of record for a shareholders’ meeting has been
made as provided in this Subsection 3(d), such determination shall apply to
any
adjournment thereof, unless the Board fixes a new record date under this
Subsection 3(d) for the adjourned meeting.
4. Inspectors
of Election.
The
Board may, in advance of any shareholders’ meeting, or of the tabulation of
written consents of shareholders without a meeting, appoint one or more
inspectors to act at the meeting or any adjournment thereof or to tabulate
such
consents and make a written report thereof. If inspectors to act at any meeting
of shareholders are not so appointed or shall fail to qualify, the person
presiding at a shareholders’ meeting may, and on the request of any shareholder
entitled to vote thereat shall, make such appointment.
Each
inspector, before entering upon the discharge of his duties, shall take and
sign
an oath faithfully to execute the duties of inspector with strict impartiality
and according to the best of his or her ability. No person shall be elected
a
Director in an election for which he or she has served as an
inspector.
The
inspectors shall determine the number of shares outstanding and the voting
power
of each, the shares represented at the meeting, the existence of a quorum,
the
validity and effect of proxies, and shall receive votes or consents, hear and
determine all challenges and questions arising in connection with the right
to
vote, count and tabulate all votes or consents, determine the result, and do
such acts as are proper to conduct the election or vote with fairness to all
shareholders. If there are three or more inspectors, the act of a majority
shall
govern. On request of the person presiding at the meeting or any shareholder
entitled to vote thereat, the inspectors shall make a report in writing of
any
challenge, question or matter determined by them. Any report made by them shall
be prima facie evidence of the facts therein stated, and such report shall
be
filed with the minutes of the meeting.
5. Proxies.
(a) Every
shareholder entitled to vote at a shareholder meeting may authorize another
person or persons to act for him or her by proxy. Every proxy shall be executed
by the shareholder or his or her agent, but a proxy may be given by telegram,
cable, telephonic transmission, or any other means of electronic communication
so long as that telegram, cable, telephonic transmission or other means of
electronic communication either sets forth or is submitted with information
from
which it can be determined that the proxy was authorized by shareholder or
his
agent.
(b) No
proxy
shall be valid after eleven months from the date of its execution unless a
longer time is expressly provided therein. A proxy shall be revocable at will
unless it states that it is irrevocable and is coupled with an interest either
in the stock itself or in the Corporation. A proxy shall not be revoked by
the
death or incapacity of the shareholder, but the proxy shall continue in force
until revoked by the personal representative or guardian of the
shareholder.
(c) The
presence at a meeting of any shareholder who has given a proxy shall not revoke
the proxy unless the shareholder (i) files written notice of the revocation
with
the secretary of the meeting prior to the voting of the proxy or (ii) votes
the
shares subject to the proxy by written ballot. A person named as proxy of a
shareholder may, if the proxy so provides, substitute another person to act
in
his or her place, including any other person named as proxy in the same proxy.
The substitution shall not be effective until an instrument effecting it is
filed with the secretary of the Corporation.
(d) Each
person holding a proxy shall either file the proxy with the secretary of the
meeting or the inspectors at the start of the meeting or shall submit the proxy
to the inspectors together with his or her ballot, as determined by the
presiding officer. No proxy shall be counted or acted upon that is submitted
to
the secretary of the meeting or the inspectors any later than the first time
during the meeting a vote is taken by ballot.
ARTICLE
IV
BOARD
OF
DIRECTORS
1. Election;
Term of Office; Removal; Vacancies; Nomination.
(a)
Election; Term of Office. The number of Directors constituting the entire Board
shall be not less than six nor more than twelve, as fixed from time to time
by
the vote of not less than 66 2/3% of the entire Board; provided, however, that
the number of Directors shall not be reduced so as to shorten the term of any
Director at the time in office, and provided further, that the number of
Directors constituting the entire Board shall be nine unless and until otherwise
fixed by the vote of not less than 66 2/3% of the entire Board. The phrase
“66
2/3% of the entire Board” shall be deemed to refer to 66 2/3% of the number of
Directors constituting the Board as provided in or pursuant to this
Subsection 1(a), without regard to any vacancies then
existing.
(b) Classification.
The
Board shall be divided into three classes, as nearly equal in number as the
then
total number of Directors constituting the entire Board permits. The initial
term of office of the first class shall expire at the 2002 Annual Meeting of
Shareholders. The initial term of office of the second class shall expire at
the
2001 Annual Meeting of Shareholders. The initial term of office of the third
class expired at the 2000 Annual Meeting of Shareholders. The Directors elected
at an annual meeting of shareholders to succeed those whose terms then expire
shall be identified as being Directors of the same class as the Directors whom
they succeed, and each of them shall hold office until the third succeeding
annual meeting of shareholders and until such Director's successor shall have
been elected and qualified. Any vacancies in the Board for any reason, and
any
created Directorships resulting from any increase in the number of Directors,
may be filled by the vote of not less than 66 2/3% of the members of the Board
then in office, although less than a quorum, and any Directors so chosen shall
hold office until the next election of the class for which such Directors shall
have been chosen and until their successors shall be elected and qualified.
No
decrease in the number of Directors shall shorten the term of any incumbent
Director. Notwithstanding the foregoing, and except as otherwise required by
law, whenever the holders of any one or more series of preferred stock of the
Corporation (“Preferred Stock”) shall have the right, voting separately as a
class, to elect one or more Director, the then authorized number of Directors
shall be increased by the number of Directors so to be elected, and the terms
of
the Director or Directors elected by such holders shall expire at the next
succeeding annual meeting of shareholders.
(c) Removal.
Notwithstanding any other provisions of these by-laws (the “By-Laws”), any
Director, or the entire Board, may be removed at any time, but only for cause
and only by the affirmative vote of the holders of 80% or more of the
outstanding shares of capital stock of the Corporation (“Capital Stock”)
entitled to vote generally in the election of Directors (considered for this
purpose as one class) cast at a meeting of the shareholders called for that
purpose. Notwithstanding the foregoing, and except as otherwise required by
law,
whenever the holders of any one or more series of Preferred Stock shall have
the
right, voting separately as a class, to elect one or more Directors, the
provisions of this Subsection 1(c) shall not apply with respect to the Director
or Directors elected by such holders of Preferred Stock.
(d) Nomination.
Nominations for the election of Directors may be made by the Board or by any
shareholder entitled to vote for the election of Directors. Nominations for
election at the annual meeting of shareholders which are not made by the Board
shall be made by notice in writing, delivered or mailed by first class mail,
postage prepaid, to the secretary by the date specified in the Corporation’s
proxy statement mailed to shareholders relating to the immediately preceding
annual meeting of shareholders; provided,
that in
the event of an election to be held at a special meeting of shareholders, or
if
no such date was specified in the relevant proxy statement, such notice shall
be
given not more than 10 days after the date of notice of the meeting of the
shareholders called for the election of Directors. Notice of nominations which
are proposed by the Board shall be given by the Board.
Each
notice under this Subsection 1(d) shall set forth (i) the name, age, and
business address of each nominee proposed in such notice, (ii) the principal
occupation or employ-ment of each such nominee, (iii) the number of shares
of
Capital Stock which are beneficially owned by each such nominee; and (iv) such
other information as would be required to be included in a proxy or disclosure
to be filed with the Securities and Exchange Commission.
The
person presiding at the meeting may, if the facts warrant, determine and declare
to the meeting that a nomination was not made in accordance with the foregoing
pro-cedure, and if he should so determine, he shall so declare to the meeting
and the defective nomination shall be disregarded.
2. Regular
Meetings.
A
regular meeting of the Board shall be held without notice immediately following
and at the same place as the annual shareholders’ meeting for the purposes of
electing officers and conducting such other business as may come before the
meeting. The Board, by resolution, may provide for additional regular meetings
which may be held without notice, except advance notice, as described in Section
3 below, shall be provided to Directors not present at the time of the adoption
of the resolution.
3. Special
Meetings.
A
special meeting of the Board may be called at any time by the president or
a
majority of the members of the Board for any purpose. Such meeting shall be
held
upon one days notice if given orally (either by telephone or in person) or
by
telegraph, e-mail or facsimile transmission, or by three days notice if given
by
depositing the notice in the United States mails, postage prepaid. Such notice
shall specify the time and place of the meeting.
4. Action
Without Meeting.
The
Board may act without a meeting if, prior or subsequent to such action, each
member of the Board shall consent in writing to such action. Such written
consent or consents shall be filed in the minute book.
5. Quorum.
One-half of the entire Board shall constitute a quorum for the transaction
of
business.
6. Committees.
The
Board, by resolution adopted by a majority of the entire Board, may appoint
from
among its members an executive committee and one or more other committees,
each
of which shall have at least three members. To the extent provided in such
resolution, each such committee shall have and may exercise all the authority
of
the Board, except that no such committee shall (a) make, alter or repeal any
By-Law; (b) elect any Director, or remove any officer or Director; (c) submit
to
shareholders any action that requires shareholders’ approval; or (d) amend or
repeal any resolution theretofore adopted by the Board which by its terms is
amendable or repealable only by the Board.
The
Board, by resolution adopted by a majority of the entire Board, may (a) fill
any
vacancy in any such committee; (b) appoint one or more Directors to serve as
alternate members of any such committee, to act in the absence or disability
of
members of any such committee with all the powers of such absent or disabled
members; (c) abolish any such committee at its pleasure; (d) remove any Director
from membership on such committee at any time, with or without cause; and (e)
establish as a quorum for any such committee less than a majority of the entire
committee, but in no case less than the greater of two persons or one-third
of
the entire committee.
Actions
taken at a meeting of any such committee shall be reported to the Board at
its
next meeting following such committee meeting; except that, when the meeting
of
the Board is held within two days after the committee meeting, such report
shall, if not made at the first meeting, be made to the Board at its second
meeting following such committee meeting.
7. Compensation
of Directors.
The
Board, by the affirmative vote of a majority of Directors in office and
irrespective of any personal interest of any of them, shall have authority
to
establish reasonable compensation of Directors for services to the Corporation
as Directors, officers or otherwise.
ARTICLE
V
WAIVERS
OF NOTICE
Any
notice required by these By-Laws, by the Certificate of Incorporation, or by
applicable law, including the New Jersey Business Corporation Act may be waived
in writing by any person entitled to notice. The waiver or waivers may be
executed either before or after the event with respect to which notice is
waived. Each Director or shareholder attending a meeting without protesting,
prior to its conclusion, the lack of proper notice shall be deemed conclusively
to have waived notice of the meeting.
ARTICLE
VI
OFFICERS
1. Election.
At its
regular meeting following the annual meeting of shareholders, the Board shall
elect a chairman of the board, chief executive officer, a president, a treasurer
and a secretary, and it may elect such other officers, including one or more
vice presidents, as it shall deem necessary. One person may hold two or more
offices. The chairman shall be a director of the Corporation. Each officer
shall
hold office until the end of the period for which such officer was elected,
and
until his or her successor has been elected and has qualified, unless he or
she
is earlier removed.
2. Duties
and Authority of Chairman of the Board.
Following the annual meeting of shareholders in 2008, the Company shall have
a
corporate officer who shall hold the position of Chairman of the Board. Subject
only to the authority of the Board, the Chairman shall have responsibility
for
the strategy and policy of the Corporation. Unless otherwise directed by the
Board, the chief executive officer, shall be subject to the authority and
supervision of the Chairman. The Chairman shall preside at shareholder meetings
and Board meetings. He shall have the general powers and duties of management
usually vested in the office of Chairman of a corporation.
3. Duties
and Authority of Chief Executive Officer.
Subject
only to the authority of the Board, the chief executive officer shall have
responsibility for the business and affairs of the Corporation. Unless otherwise
directed by the Board, all other executive officers, including the President,
shall be subject to the authority and supervision of the chief executive
officer. The chief executive officer may enter into and execute in the name
of
the Corporation contracts or other instruments in the regular course of business
or contracts or other instrument not in the regular course of business which
are
authorized, either generally or specifically, by the Board. In the absence
of
the Chairman, the chief executive officer shall preside at shareholder meetings
and, if a director, Board meetings. In the absence or disability of the
Chairman, the chief executive officer, if a director, shall perform the duties
and exercise the power of the Chairman. He shall have the general powers and
duties of management usually vested in the office of chief executive officer
of
a corporation.
4. Duties
and Authority of President.
Subject
only to the authority of the chief executive officer and the Board, the
president shall have responsibility for the business and affairs of the
Corporation. Unless otherwise directed by the Board, all other non-executive
officers shall be subject to the authority and supervision of the president.
The
president may enter into and execute in the name of the Corporation contracts
or
other instruments in the regular course of business or contracts or other
instrument not in the regular course of business which are authorized, either
generally or specifically, by the Board. He shall have the general powers and
duties of management usually vested in the office of president of a
corporation.
5. Duties
and Authority of Vice Presidents.
Each
vice president shall perform such duties and have such authority as from time
to
time may be delegated to him by the chief executive officer, the president
or by
the Board. The Board shall have the authority to append such prefixes as
“executive,” “senior” and “assistant” to any vice president’s title as it shall
determine. In the absence of the chief executive officer and the president
or in
the event of the president’s death, inability, or refusal to act, such vice
president as shall have been designated by the Board or, in the absence of
such
designation, by the chief executive officer, shall perform the duties and be
vested with the authority of the president.
6. Duties
and Authority of Treasurer.
The
treasurer shall have the custody of the funds and securities of the Corporation
and shall keep or cause to be kept regular books of account for the Corporation.
The treasurer shall perform such other duties and possess such other powers
as
are incident to that office or as shall be assigned by the president or the
Board.
7. Duties
and Authority of Secretary.
The
secretary shall cause notices of all meetings to be served as prescribed in
these By-Laws and shall keep or cause to be kept the minutes of all meetings
of
the shareholders and the Board. The secretary shall have charge of the seal
of
the Corporation. The secretary shall perform such other duties and possess
such
other powers as are incident to that office or as are assigned by the president
or the Board.
8. Vacancies.
Any
vacancy in any office may be filled by the Board.
9. Removal
and Resignation.
Any
officer may be removed, either with or without cause, by the Board or by any
officer upon whom the power of removal has been conferred by the Board. An
officer elected by the shareholders may be removed, with or without cause,
only
by vote of the shareholders but his or her authority to act as an officer may
be
suspended by the Board for cause. Removal of an officer shall be without
prejudice to the officer’s contract rights, if any. Election or appointment of
an officer shall not of itself create contract rights. Any officer may resign
at
any time by giving written notice to the Board or to the president. A
resignation shall take effect on the date of the receipt of the notice or at
any
later time specified therein and, unless otherwise specified therein, the
acceptance of the resignation shall not be necessary to make it
effective.
ARTICLE
VII
CAPITAL
STOCK AND OTHER SECURITIES
1. Issuance
of Capital Stock and Other Securities.
Certificates of any class of Capital Stock and certificates representing any
other securities of the Corporation shall be signed by the president, or any
vice president and countersigned by the secretary, any assistant secretary,
the
treasurer or any assistant treasurer. The signature of each officer may be
an
engraved or printed facsimile. If an officer or transfer agent or registrar
whose facsimile signature has been placed upon certificates ceases to hold
the
official capacity in which he or she signed, the certificates may continue
to be
used. The certificates may, but need not, be sealed with the seal of the
Corporation, or a facsimile of the seal. The certificates shall be countersigned
and registered in whatever manner the Board may prescribe.
2. Lost,
Stolen and Destroyed Certificates.
In case
of lost, stolen or destroyed certificates, new certificates may be issued to
take their place upon receipt by the Corporation of a bond of indemnity and
under whatever regulations may be prescribed by the Board. The giving of a
bond
of indemnity may be waived.
3. Transfer
of Securities.
The
shares of the Capital Stock or any other registered securities of the
Corporation shall be transferable on the books of the Corporation by the holder
thereof in person or by that person’s authorized agent, or by the transferee,
upon surrender for cancellation to the relevant transfer agent of an outstanding
certificate or certificates for the same number of shares or other security
with
an assignment and authorization to transfer endorsed thereon or attached
thereto, duly executed, together with such proof of the authenticity of the
signature and of the power of the assignor to transfer the securities as the
Corporation or its agents may require.
4. Fractional
Shares.
The
Corporation may, but shall not be required to, issue certificates for fractions
of a share where necessary to effect authorized transactions, or the Corporation
may pay in cash the fair value of fractions of a share as of the time when
those
entitled to receive such fractions are determined, or it may issue scrip in
registered or bearer form over the manual or facsimile signature of an officer
of the Corporation or of its agent, exchangeable as therein provided for full
shares, but such scrip shall not entitle the holder to any rights of a
shareholder except as therein provided.
ARTICLE
VIII
AMENDMENTS
TO AND EFFECT OF
BY-LAWS;
FISCAL YEAR; SEAL;
CHECKS;
CONTRACTS; RECORDS
1. Force
and Effect of By-Laws.
These
By-Laws are subject to the provisions of the applicable law, including the
New
Jersey Business Corporation Act, and the Certificate of Incorporation, as it
may
be amended from time to time. If any provision in these By-Laws is inconsistent
with a provision in that Act or the Certificate of Incorporation, the provision
of that Act or the Certificate of Incorporation shall govern.
2. Amendments
to By-Laws.
These
By-Laws may be altered, amended or repealed by the shareholders or the Board
in
accordance with the terms of the Certificate of Incorporation, these By-laws
and
applicable law. Any By-Law adopted, amended or repealed by the shareholders
may
be amended or repealed by the Board, unless the resolution of the shareholders
adopting such By-Law expressly reserves to shareholders the right to amend
or
repeal it.
3. Fiscal
Year.
The
fiscal year of the Corporation shall begin on the first day of October of each
year.
4. Seal.
The
corporate seal shall have inscribed thereon the name of the Corporation, the
year of its incorporation, and the words “Corporate Seal New Jersey”. The
corporate seal may be used by causing it or a facsimile thereof to be impressed
or reproduced on a document or instrument, or affixed thereto. Except to the
extent required by applicable law or by resolution of the Board, no contract,
instrument or other document executed by or on behalf of the Corporation, or
to
which the Corporation is otherwise a party, shall be required to bear the
corporate seal.
5. Checks,
Drafts, Etc.
All
checks, drafts or other orders for the payment of money, notes or other
evidences of indebtedness, issued in the name of or payable to the Corporation,
shall be signed or endorsed by the person or persons and in such manner,
manually or by facsimile signature, as shall be determined from time to time
by
the Board.
6. Execution
of Contracts.
The
Board may authorize any officer or officers, employee or employees, or agent
or
agents of the Corporation, to enter into any contract or execute any instrument
in the name of and on behalf of the Corporation. The authority may be general
or
confined to specific instances.
7. Records.
The
Corporation shall keep books and records of account and minutes of the
proceedings of the shareholders, Board and such committees as the Board may
determine. Such books, records and minutes may be kept outside the State of
New
Jersey. The Corporation shall keep at its principal office, its registered
office, or at the office of its registrar and transfer agent, a record or
records containing the names and addresses of all shareholders, the number,
class and series of shares held by each and the dates when they respectively
became the owners of record thereof. Any of the foregoing books, minutes or
records may be in written form or in any other form capable of being converted
into readable form within a reasonable time.
Any
person who shall have been a shareholder of record of the Corporation for at
least six months immediately preceding his demand, or any person holding, or
so
authorized in writing by the holders of, at least five percent of the
outstanding shares of any class or series, upon at least five days’ written
demand shall have the right for any proper purpose to examine in person or
by
agent or attorney, during usual business hours, the minutes of the proceedings
of the shareholders and record of shareholders and to make extracts therefrom
at
the places where the same are kept.
ARTICLE
IX
INDEMNIFICATION
1. General.
The
Corporation shall indemnify an Indemnitee (as hereinafter defined) against
Liabilities (as hereinafter defined) and advance Expenses (as hereinafter
defined) to an Indemnitee to the fullest extent permitted by applicable law
and
as provided in this Article IX. An Indemnitee shall be entitled to the
indemnification provided in this Section 1, if, by reason of his being or having
been an Officer/Director (as hereinafter defined), he is, or is threatened
to be
made, a party to any threatened, pending, or completed Proceeding (as
hereinafter defined). Pursuant to this Section 1, an Indemnitee shall be
indemnified against Expenses and Liabilities actually incurred by him or on
his
behalf in connection with such Proceeding or any claim, issue or matter
therein.
2. Advancement
of Expenses.
The
Corporation shall advance all Expenses incurred by or on behalf of an Indemnitee
in connection with any Proceeding upon the receipt by the Corporation of a
statement or statements from the Indemnitee requesting such advance or advances
from time to time, whether prior to or after final disposition of such
Proceeding. Such statement or statements shall reasonably evidence the Expenses
incurred by the Indemnitee or refer to invoices or bills for Expenses furnished
or to be furnished directly to the Corporation, and shall include or be preceded
or accompanied by an undertaking by or on behalf of the Indemnitee to repay
any
Expenses advanced unless it shall ultimately be determined pursuant to Section
5
of this Article IX that the Indemnitee is entitled to be indemnified against
such Expenses.
3. Indemnification
for Expenses of a Witness.
Notwithstanding any other provision of this Article IX, to the extent that
an
Indemnitee is, by reason of his being or having been an Officer/Director, a
witness in any Proceeding in which such Indemnitee is not also a party, the
Corporation shall indemnify such witness against all Expenses actually incurred
by him or on his behalf in connection therewith.
4. Limitation
on Indemnity. No
indemnification shall be made to any Indemnitee pursuant to this Article IX
to
the extent that, in connection with the relevant Proceeding, a judgment or
other
final adjudication adverse to the Indemnitee establishes that his acts or
omissions (a) were in breach of such Indemnitee’s duty of loyalty to the
Corporation or its shareholders, as defined in subsection (3) of N.J.S. 14A:2-7,
(b) were not in good faith or involved a knowing violation of law, or (c)
resulted in the receipt by such Indemnitee of an improper personal benefit.
In
the event of any such finding, the Indemnitee shall promptly disgorge and pay
over to the Corporation any amounts theretofore paid to such Indemnitee pursuant
to this Article IX, including any advance of Expenses pursuant to Section 2
of
this Article IX. The termination of any Proceeding or of any claim, issue or
matter therein by judgment, order, settlement or conviction, or upon a plea
of
nolo contendere
or its
equivalent, shall not of itself adversely affect the right of an Indemnitee
to
indemnification or create a presumption that an Indemnitee did not act in good
faith or that an Indemnitee had reasonable cause to believe that his conduct
was
unlawful.
5. Procedure
for Determination of Entitlement to Indemnification.
(a) To
obtain
indemnification under this Article IX, an Indemnitee shall submit to the
Corporation a written request for indemnification, and provide for the
furnishing to the Corporation of such documentation and information as is
reasonably available to the Indemnitee and is reasonably necessary to determine
whether and to what extent the Indemnitee is entitled to indemnification. The
secretary shall, promptly upon receipt of such a request for indemnification,
advise the Board in writing that the Indemnitee has requested
indemnification.
(b) Upon
written request by an Indemnitee for indemnification pursuant to Section 5(a)
of
this Article IX, a written determination with respect to the Indemnitee’s
entitlement thereto shall be made: (i) if a Change in Control (as hereinafter
defined) shall have occurred, by Independent Counsel (as hereinafter defined);
(ii) if a Change in Control shall not have occurred, (A) by the Board by a
majority vote of a quorum consisting of Disinterested Directors (as hereinafter
defined), or (B) by a majority vote of a quorum of Disinterested Directors
on a
Committee of the Board authorized by the Board to make such determination,
or
(C) by Independent Counsel. If it is so determined that the Indemnitee is
entitled to indemnification, payment to the Indemnitee shall be made in a timely
fashion. An Indemnitee shall cooperate with the person, persons or entity making
such determination with respect to the Indemnitee’s entitlement to
indemnification, including providing to such person, persons or entity upon
reasonable advance request any documentation or information which is not
privileged or otherwise protected from disclosure and which is reasonably
available to the Indemnitee and reasonably necessary to such determination.
Any
costs or expenses (including attorneys’ fees and disbursements) incurred by an
Indemnitee in so cooperating with the person, persons or entity making such
determination shall be borne by the Corporation (irrespective of the
determination as to an Indemnitee’s entitlement to
indemnification).
(c) In
the
event the determination of entitlement is to be made by Independent Counsel
pursuant to Subsection 5(b) of this Article IX, the Independent Counsel shall
be
selected as provided in this Subsection 5(c). If a Change in Control shall
not
have occurred, the Independent Counsel shall be selected by the Board of
Directors or a Committee thereof authorized by the Board to make such selection,
and the Corporation shall give written notice to the Indemnitee advising him
of
the identity of the Independent Counsel so selected. If a Change of Control
shall have occurred, the Independent Counsel shall be selected jointly by the
Indemnitee and the Board or a Committee thereof authorized by the Board to
make
such determination. In the event that the Board or such a Committee thereof
cannot agree with the Indemnitee on the choice of Independent Counsel, such
Independent Counsel shall be selected by the Board or a Committee thereof from
among the New York City law firms having more than 100 attorneys. The
Corporation shall pay any and all reasonable fees and expenses of Independent
Counsel incurred by such Independent Counsel in connection with acting pursuant
to Subsection 5(b) of this Article IX, and the Corporation shall pay all
reasonable fees and expenses incident to the procedures of this Subsection
5(c),
regardless of the manner in which such Independent Counsel was selected or
appointed.
6. Presumptions
and Effect of Certain Proceedings.
(a) If
a
Change in Control shall have occurred, in making a determination with respect
to
entitlement to indemnification hereunder, the person, persons or entity making
such determination shall presume that an Indemnitee is entitled to
indemnification under this Article if the Indemnitee has submitted a request
for
indemnification in accordance with Subsection 5(a) of this Article IX, and
the
Corporation shall have the burden of proof to overcome that presumption in
connection with the making by any person, persons or entity of any determination
contrary to that presumption.
(b) If
the
person, persons or entity empowered or selected under Section 5 of this Article
IX to determine whether an Indemnitee is entitled to indemnification shall
not
have made such determination in a timely fashion after receipt by the
Corporation of the request therefor, the requisite determination of entitlement
to indemnification shall be deemed to have been made and the Indemnitee shall
be
entitled to such indemnification, absent (i) a misstatement by the Indemnitee
of
a material fact, or an omission of a material fact necessary to make the
Indemnitee’s statement not materially misleading, in connection with the request
for indemnification (which shall have been proven by clear and convincing
evidence), or (ii) a prohibition of such indemnification under applicable
law.
(c) Every
Indemnitee shall be presumed to have relied upon this Article IX in serving
or
continuing to serve as an Officer/Director.
7. Indemnification
of Estate; Standards for Determination.
If an
Indemnitee is deceased and would have been entitled to indemnification under
any
provision of this Article IX, the Corporation shall indemnify the Indemnitee’s
estate and his spouse, heirs, administrators and executors. When the Board,
Committee thereof or Independent Counsel acting in accordance with Section
5 of
this Article IX is determining the availability of indemnification under this
Article IX and when an Indemnitee is unable to testify on his own behalf by
reason of his death or mental or physical incapacity, said Board, Committee
or
Independent Counsel shall deem the Indemnitee to have satisfied applicable
standards set forth in the relevant section or sections of this Article IX
unless it is affirmatively demonstrated by clear and convincing evidence that
indemnification is not available thereunder.
8. Limitation
of Actions and Release of Claims.
No
legal action shall be brought and no cause of action shall be asserted by or
on
behalf of the Corporation or its Affiliates against an Indemnitee, his spouse,
heirs, executors or administrators after the expiration of two years from the
date the Indemnitee ceases (for any reason) to serve as an Officer/Director,
and
any claim or cause of action of the Corporation or its Affiliates shall be
extinguished and deemed released unless asserted by filing of a legal action
within such two-year period.
9. Other
Rights and Remedies of Indemnitee.
(a) The
Corporation shall purchase and maintain on behalf of Indemnitees such insurance
covering such Liabilities and Expenses arising from actions or omissions of
an
Indemnitee in his capacity as an Officer/Director as is obtainable and is
reasonable and appropriate in cost and amount.
(b) In
the
event that (i) a determination is made pursuant to Section 5 of this Article
IX
that an Indemnitee is not entitled to indemnification under this Article IX,
(ii) advancement of Expenses is not timely made pursuant to Section 2 of this
Article IX, (iii) the determination of entitlement to indemnification is to
be
made by Independent Counsel pursuant to Subsection 5(b) of this Article IX
and
such determination shall not have been made and delivered in a written opinion
in a timely fashion after receipt by the Corporation of the request for
indemnification, (iv) payment of indemnification is not made pursuant to Section
3 of this Article IX in a timely fashion after receipt by the Corporation of
a
written request therefor, or (v) payment of indemnification is not made in
a
timely fashion after a determination has been made that an Indemnitee is
entitled to indemnification or such determination is deemed to have been made
pursuant to Section 6 of this Article IX, the Indemnitee shall be entitled
to an
adjudication in the Superior Court of the State of New Jersey, or in any other
court of competent jurisdiction, of his entitlement to such indemnification
or
advancement of Expenses. Alternatively, the Indemnitee, at his option, may
seek
an award in arbitration to be conducted by a single arbitrator pursuant to
the
rules of the American Arbitration Association. The Indemnitee shall commence
such proceeding seeking an adjudication or an award in arbitration in a timely
manner following the date on which the Indemnitee first has the right to
commence such Proceeding pursuant to this Subsection 9(b). The Corporation
shall
not oppose the Indemnitee’s right to exercise his rights under this Subsection
9(b).
(c) In
the
event that a determination shall have been made pursuant to Section 5 of this
Article that an Indemnitee is not entitled to indemnification, any judicial
proceeding or arbitration commenced pursuant to this Section 9 shall be
conducted in all respects as a de novo trial or arbitration on the merits,
and
the Indemnitee shall not be prejudiced by reason of that adverse determination.
If a Change of Control shall have occurred, in any judicial proceeding or
arbitration commenced pursuant to this Section 9 the Corporation shall have
the
burden of proving that the Indemnitee is not entitled to indemnification or
advancement of Expenses, as the case may be.
(d) If
a
determination shall have been made or deemed to have been made pursuant to
Section 5 of this Article IX that an Indemnitee is entitled to indemnification,
the Corporation shall be bound by such determination in any judicial proceeding
or arbitration commenced pursuant to this Section 9, absent (i) a misstatement
by the Indemnitee of a material fact, or an omission of a material fact
necessary to make the Indemnitee’s statement not materially misleading, in
connection with the request for indemnification (which shall have been proven
by
clear and convincing evidence), or (ii) a prohibition of such indemnification
under applicable law.
(e) The
Corporation shall be precluded from asserting in any judicial proceeding or
arbitration commenced pursuant to this Section 9 that the procedures and
presumptions of this Article are not valid, binding and enforceable and shall
stipulate in any such court or before any such arbitrator that the Corporation
is bound by all the provisions of this Article IX.
(f) In
the
event that an Indemnitee, pursuant to this Section 9, seeks a judicial
adjudication of or an award in arbitration to enforce his rights under, or
to
recover damages for breach of, this Article, the Indemnitee shall be entitled
to
recover from the Corporation, and shall be indemnified by the Corporation
against, any and all expenses (of the types described in the definition of
Expenses in Section 12 of this Article IX) actually incurred by him in such
judicial adjudication or arbitration, but only if he prevails therein. If it
shall be determined in said judicial adjudication or arbitration that the
Indemnitee is entitled to receive part but not all of the indemnification or
advancement of Expenses sought, the Expenses incurred by the Indemnitee in
connection with such judicial adjudication or arbitration shall be appropriately
prorated.
10. Non-Exclusivity;
Survival of Rights; Subrogation.
(a) The
rights of indemnification and to receive advancement of Expenses as provided
by
this Article shall not be deemed exclusive of any other rights to which an
Indemnitee may at any time be entitled under applicable law, the Certificate
of
Incorporation, the certificate of incorporation or other similar organizational
document of any Affiliate (as hereinafter defined) of the Corporation, the
By-Laws, the by-laws or other similar organizational document of any Affiliate
of the Corporation, any agreement, any insurance policy maintained or issued
directly or indirectly by the Corporation or any Affiliate of the Corporation,
a
vote of stockholders, a resolution of Disinterested Directors, or otherwise.
No
amendment, alteration or repeal of this Article or of any provision hereof
shall
be effective as to any Indemnitee with respect to any action taken or omitted
by
such Indemnitee as an Officer/Director prior to such amendment, alteration
or
repeal. The provisions of this Article IX shall continue as to an Indemnitee
whose status as an Officer/Director has ceased and shall inure to the benefit
of
his heirs, executors and administrators.
(b) In
the
event of any payment under this Article IX, the Corporation shall be subrogated
to the extent of such payment to all of the rights of recovery of the
Indemnitee, who shall execute all papers required and take all action necessary
to secure such rights, including execution of such documents as are necessary
to
enable the Corporation to bring suit to enforce such rights.
(c) The
Corporation shall not be liable under this Article IX to make any payment of
amounts otherwise indemnifiable hereunder if and to the extent that the
Indemnitee has otherwise actually received such payment under any insurance
policy, contract, agreement or otherwise.
11. Severability.
If any
provision or provisions of this Article shall be held to be invalid, illegal
or
unenforceable for any reason whatsoever: (a) the validity, legality and
enforceability of the remaining provisions of this Article (including without
limitation, each portion of any subsection of this Article IX containing any
such provision held to be invalid, illegal or unenforceable that is not itself
invalid, illegal or unenforceable) shall not in any way be affected or impaired
thereby; and (b) to the fullest extent possible, the provisions of this Article
(including, without limitation, each portion of any subsection of this Article
IX containing any such provision held to be invalid, illegal or unenforceable,
that is not itself invalid, illegal or unenforceable) shall be construed so
as
to give effect to the intent manifested by the provision held invalid, illegal
or unenforceable.
12. Definitions.
For purposes of this Article IX:
(a) “Affiliate”
or “Associate” shall have the same meaning as in Rule 405 under the Securities
Act of 1933, as amended.
(b) “Change
in Control” shall mean either:
(i)
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a
change in the membership of the Board such that one-third or more
of its
members were neither recommended nor elected to the Board by a majority
of
those of its members (A) who are not Affiliates or Associates or
representatives of a beneficial owner described in clause (ii) below
or
(B) who were members of the Board prior to the time the beneficial
owner
became such; or
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(ii)
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The
attainment of “beneficial ownership” (as defined in Rule 13d-3 under the
Securities Exchange Act of 1934, as amended, as Rule 13d-3 was in
existence on the date hereof) by any person, corporation or other
entity,
or any group, including, associates or affiliates of such beneficial
owner, of more than 10% of the voting power of all classes of Capital
Stock, other than by any such entity that held more than such percentage
as of the date hereof.
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(c) “Corporate
Agent” means a person who is or was a director, officer, employee, agent or
fiduciary of the Corporation or of any other corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise which such person
is
or was serving at the request of the Corporation, but shall not include any
Officer/Director.
(d) “Disinterested
Director” means a Director who is not and was not a party to the Proceeding in
respect of which indemnification is sought by an Indemnitee.
(e) “Expenses”
means all reasonable costs, disbursements and counsel fees.
(f) “Indemnitee”
means any person who is, or is threatened to be made, a witness in, or a party
to, any Proceeding by reason of his being or having been an
Officer/Director.
(g) “Independent
Counsel” means a law firm, or a member of a law firm, that is experienced in
matters of corporation law and neither presently is, nor in the past five years
has been, retained to represent: (i) the Corporation or the Indemnitee or,
following a Change in Control, any person acquiring control or any beneficial
owner referred to in clause (ii) of Section 12(b) of this Article or any
Affiliate or Associate of any such person or beneficial owner, in any matter
material to any such person, or (ii) any other party to the Proceeding giving
rise to a claim for indemnification hereunder. Notwithstanding the foregoing,
the term “Independent Counsel” shall not include any person who under the
applicable standards of professional conduct then prevailing, would have a
conflict of interest in representing either the Corporation or the Indemnitee
in
an action to determine the Indemnitee’s rights under this Article
IX.
(h) “Liabilities”
shall mean amounts paid or incurred in satisfaction of settlements, judgments,
awards, fines and penalties.
(i) “Officer/Director”
shall mean any officer of the Corporation or any Director.
(j) “Proceeding”
includes any action, suit, arbitration, alternate dispute resolution mechanism,
investigation, administrative hearing or any other proceeding whether civil,
criminal, administrative or investigative, except one initiated by an Indemnitee
pursuant to Section 9 of this Article IX to enforce his rights under this
Article IX.
13. Notices.
Any
notice, request or other communication required or permitted to be given to
the
Corporation under this Article IX shall be in writing and either delivered
in
person or sent by telex, telegram or certified or registered mail, postage
prepaid, return receipt requested, to the secretary of the Corporation and
shall
be effective only upon receipt by the secretary.
14. Amendments.
This
Article IX may be amended or repealed only by action of the Board approved
by
the favorable vote of a majority of the votes cast by stockholders entitled
to
vote thereon at a meeting of stockholders for which proxies are solicited in
accordance with then applicable requirements of the Securities and Exchange
Commission, except that (i) the Board, without stockholder approval, may make
technical amendments that do not substantively affect the rights of an
Indemnitee hereunder and (ii) following a Change of Control, as defined in
clause (ii) of Subsection 12(b) of this Article IX, there shall also be required
for approval of any such amendment or repeal the favorable vote of a majority
of
the votes cast by persons other than the beneficial owners referred to in clause
(ii) of Section 12(b) of this Article IX and their Affiliates and
Associates.
15. Indemnification
of Corporate Agents.
The
Corporation may at the discretion of the Board indemnify any Corporate Agent
to
the fullest extent permitted by applicable law; provided,
that
the Corporation shall in any event indemnify a Corporate Agent to the extent
required by applicable law. The procedures to be followed in the event of such
indemnification shall be such as may be determined by the Board in its
discretion; provided,
that in
the event any procedures are mandated by applicable law, such procedures shall
be followed.