SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
FORM 8-A/A
AMENDMENT NO. 1
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(B) OR 12(G) OF THE
SECURITIES EXCHANGE ACT OF 1934
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PRISM FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 36-4279417
(State of incorporation (I.R.S. employer
or organization) identification no.)
440 N. Orleans
Chicago, Illinois 60610
(Address of principal executive offices)
60610
(zip code)
----------------
Securities to be registered pursuant to Section 12(b) of the Act: None.
Name of each exchange
Title of each class on which each class is
to be registered to be registered
------------------- ----------------------
Securities to be registered pursuant to Section 12(g) of the Act:
Preferred Stock
Purchase Rights
(Title of class)
ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED.
Reference is hereby made to the Registration Statement filed
with the Securities Exchange Commission (the "Commission") on Form 8-A,
dated February 8, 2000 (the "Original Form 8-A"), by Prism Financial
Corporation (the "Registrant") relating to the rights distributed to the
stockholders of the Registrant (the "Rights") in connection with the Rights
Agreement, dated as of January 27, 2000 (the "Rights Agreement"), between
the Registrant and LaSalle Bank National Association, as rights agent (the
"Rights Agent"). The Original Form 8-A is incorporated herein by reference.
On March 10, 2000, the Board of Directors of the Registrant
authorized the First Amendment to Rights Agreement, dated as of March 10,
2000 (the "Amendment"), between the Registrant and the Rights Agent.
The Amendment amends paragraph (d) of Section 1 of the
Rights Agreement to provide that none of Royal Bank of Canada, a Canadian
corporation ("Parent"), Rainbow Acquisition Subsidiary, Inc., a Delaware
corporation and a wholly-owned indirect subsidiary of Parent ("Purchaser"),
and their Affiliates or Associates shall be deemed to be the "Beneficial
Owner" of, or "beneficially own," any shares of Common Stock solely by
virtue of (i) the execution of the Merger Agreement, dated as of March 10,
2000 (the "Merger Agreement," which term shall include any amendments
thereto) by and among the Registrant, Parent and Purchaser, or (ii) the
execution of the Stockholders' Agreement, dated as of March 10, 2000 (the
"Stockholders' Agreement," which term shall include any amendments thereto)
by and among Parent, Purchaser and certain holders of the common stock, par
value $.01 per share, of the Registrant or (iii) the consummation of any of
the transactions contemplated by either the Merger Agreement or the
Stockholders' Agreement, including, without limitation, the public or other
announcement of the tender offer provided for by the Merger Agreement (the
"Offer"), the consummation of the Offer, the public or other announcement
of the merger provided for by the Merger Agreement (the "Merger"), the
consummation of the Merger, the public or other announcement of the
acquisition by Parent, Purchaser or any of their Affiliates of beneficial
ownership of any securities of the Registrant pursuant to the Stockholders'
Agreement, and the acquisition by Parent, Purchaser or any of their
Affiliates of beneficial ownership of any securities of the Registrant
pursuant to the Offer, the Merger Agreement or the Stockholders' Agreement.
The Rights Agreement is filed as Exhibit 4.3 to the
Registrant's Current Report on Form 8-K, dated February 7, 2000, filed with
the Commission February 8, 2000 and incorporated herein by reference as
Exhibit 1 to this Form 8- A/A. The Amendment is attached as Exhibit 2 to
this Form 8-A/A. The foregoing summary description of the Amendment does
not purport to be complete and is qualified in its entirety by reference to
such exhibits which are incorporated herein by reference.
ITEM 2. EXHIBITS.
1. Rights Agreement, dated as of January 27, 2000, between
Prism Financial Corporation and LaSalle Bank National
Association, as Rights Agent (incorporated herein by
reference to the Registrant's Registration Statement on Form
8-A filed with the Commission on February 8, 2000).
2. First Amendment to Rights Agreement, dated as of March 10, 2000,
between Prism Financial Corporation and LaSalle Bank National
Association, as Rights Agent.
3. Share Exchange Agreement, effective as of March 19, 1999, by
and among the shareholders of Prism Mortgage Company set
forth on the signature pages thereto and Prism Financial
Corporation.
4. Amended and Restated Certificate of Incorporation of the
Registrant.
5. Second Amended and Restated Bylaws of the Registrant.
6. Specimen Common Stock Certificate.
7. Registration Rights Agreement, dated May 28, 1999.
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this registration
statement to be signed on its behalf by the undersigned, thereto duly
authorized.
PRISM FINANCIAL CORPORATION
By: /s/ David A. Fisher
--------------------
Name: David A. Fisher
Title: Senior Vice President,
Chief Financial Officer and
Secretary
Date: March 24, 2000
EXHIBIT INDEX
Exhibit Description
- ------- -----------
1 Rights Agreement, dated as of January 27, 2000,
between Prism Financial Corporation and LaSalle Bank
National Association (incorporated herein by
reference to the Registrant's Registration Statement
on Form 8-A filed with the Securities and Exchange
Commission on February 8, 2000).
2 First Amendment to Rights Agreement, dated as of
March 10, 2000, between Prism Financial
Corporation and LaSalle Bank National Association.
3 Share Exchange Agreement, effective as of March 19,
1999, by and among the shareholders of Prism Mortgage
Company set forth on the signature pages thereto and
Prism Financial Corporation.
4 Amended and Restated Certificate of Incorporation
of the Registrant.
5 Second Amended and Restated Bylaws of the
Registrant.
6 Specimen Common Stock Certificate.
7 Registration Rights Agreement, dated May 28,
1999.
EXHIBIT 2
FIRST AMENDMENT TO RIGHTS AGREEMENT
This First Amendment (the "Amendment"), dated as of March 10,
2000, is entered into by and between Prism Financial Corporation, a
Delaware corporation, (the "Company"), and LaSalle Bank National
Association, a national banking association, as Rights Agent (the "Rights
Agent").
WHEREAS, the Company and the Rights Agent have entered into a
Rights Agreement, dated as of January 27, 2000 (the "Agreement");
WHEREAS, the Company wishes to amend the Agreement; and
WHEREAS, Section 27 of the Agreement provides, among other
things, that prior to the Distribution Date (as such term is defined in the
Agreement) the Company may and the Rights Agent shall, if the Company so
directs, supplement or amend any provision of the Agreement without the
approval of any holders of certificates representing shares of the
Company's common stock, par value $.01 per share.
NOW, THEREFORE, the Company and the Rights Agent hereby amend
the Agreement as follows:
1. Paragraph (d) of Section 1 of the Agreement is hereby amended
by adding to the end of such paragraph (d) the following:
Notwithstanding the foregoing, for purposes of this Agreement,
none of Royal Bank of Canada, a Canadian corporation ("Parent"),
Rainbow Acquisition Subsidiary, Inc., a Delaware corporation and a
wholly-owned indirect subsidiary of Parent ("Purchaser"), and their
Affiliates or Associates shall be deemed to be the "Beneficial Owner"
of, or "beneficially own," any shares of Common Stock solely by
virtue of (i) the execution of the Merger Agreement, dated as of
March 10, 2000 (the "Merger Agreement," which term shall include any
amendments thereto) by and among the Company, Parent and Purchaser,
or (ii) the execution of the Stockholders' Agreement, dated as of
March 10, 2000 (the "Stockholders' Agreement," which term shall
include any amendments thereto) by and among Parent, Purchaser and
certain holders of the Common Stock, or (iii) the consummation of any
of the transactions contemplated by either the Merger Agreement or
the Stockholders' Agreement, including, without limitation, the
public or other announcement of the tender offer provided for by the
Merger Agreement (the "Offer"), the consummation of the Offer, the
public or other announcement of the merger provided for by the Merger
Agreement (the "Merger"), the consummation of the Merger, the public or
other announcement of the acquisition by Parent, Purchaser or any of
their Affiliates of beneficial ownership of any securities of the Company
pursuant to the Stockholders' Agreement, and the acquisition by
Parent, Purchaser or any of their Affiliates of beneficial ownership
of any securities of the Company pursuant to the Offer, the Merger
Agreement or the Stockholders' Agreement.
2. This Amendment shall be deemed to be a contract made under
the laws of the State of Delaware and for all purposes shall be governed by
and construed in accordance with the laws of such state applicable to
contracts to be made and performed entirely within such state.
3. This Amendment may be executed in any number of
counterparts, each of which shall for all purposes be deemed an original,
and all of which together shall constitute but one and the same instrument.
4. Except as expressly set forth herein, this Amendment shall
not by implication or otherwise alter, modify, amend or in any way affect
any of the terms, conditions, obligations, covenants or agreements
contained in the Agreement, all of which are ratified and affirmed in all
respects and shall continue in full force and affect.
SIGNATURE PAGE FOLLOWS
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed as of the day and year first above written.
Attest: PRISM FINANCIAL CORPORATION
By: /s/ Brad Simon By: /s/ David A. Fisher
------------------------------ --------------------------------
Name: Brad Simon Name: David A. Fisher
Title: Assistant Secretary Title: Chief Financial Officer
Attest: LASALLE BANK NATIONAL
ASSOCIATION
By: /s/ Mark F. Rimkus By: /s/ Gregory Malatia
------------------------------ --------------------------------
Name: Mark F. Rimkus Name: Gregory Malatia
Title: Assistant Vice President Title: First Vice President
Exhibit 3
SHARE EXCHANGE AGREEMENT
THIS SHARE EXCHANGE AGREEMENT (the "Agreement"), effective as of
March 19, 1999, by and among the shareholders (the "Shareholders") of Prism
Mortgage Company, an Illinois corporation ("Prism Mortgage"), set forth on
signature pages hereto, and Prism Financial Corporation, a Delaware
corporation ("Prism Financial"). Prism Mortgage and Prism Financial are
hereinafter referred to collectively as the "Corporations."
WITNESSETH:
WHEREAS, the authorized capital of Prism Mortgage consists of
A. 1,000,000 shares of common stock, par value $.01 per share ("Prism
Mortgage Common Stock"), of which 111,942 are issued and outstanding on the
date hereof;
B. no shares of preferred stock; and
C. the Shareholders collectively hold all of the issued and
outstanding Prism Mortgage Common Stock.
WHEREAS, Prism Financial is a wholly-owned subsidiary of Prism
Mortgage, and its authorized capital stock currently consists of
A. 1,000 shares of common stock, par value $.01 per share, of which
100 shares are issued and outstanding and owned by Prism Mortgage; and
B. no shares of preferred stock.
WHEREAS, upon filing its amended and restated certificate of
incorporation (the "Amended Certificate") with the Secretary of State of
the State of Delaware, Prism Financial's capital stock will consist of
A. 100,000,000 shares of common stock ("Prism Financial Common
Stock"); and
B. 10,000,000 shares of preferred stock.
WHEREAS, immediately prior to the consummation of the transactions
contemplated by this Agreement, pursuant to the Put Agreement or Call
Agreement, each of which was made and entered into as of the 31st day of
December, 1998, by and between Bruce Abrams and GEM Value/Prism, LLC, the
Put Agreement or Call Agreement, each of which was made and entered into as
of the 31st day of December, 1998, by and between Mark Filler and GEM
Value/Prism, LLC and the Put Agreement or Call Agreement, each of which was
made and entered into as of the 31st day of December, 1998, by and between
Terry Markus and GEM Value/Prism, LLC (collectively the "Sale Agreements"),
three of the Shareholders will sell a portion of their shares of Prism
Mortgage Common Stock to GEM Value/Prism, LLC (the "Shareholder Sale") such
that GEM Value/Prism, LLC shall be a shareholder of Prism Mortgage and
shall be included in the definition of Shareholder for all purposes of this
Agreement;
WHEREAS, each of the Shareholders desires to exchange all of its
respective shares of Prism Mortgage Common Stock, upon the terms and
conditions set forth in this Agreement, for shares of Prism Financial
Common Stock (the "Exchange"); and
WHEREAS, immediately following the Exchange and pursuant to an
integrated plan that includes the Exchange, Prism Financial will sell up to
2,875,000 shares of Prism Financial Common Stock (the "IPO") to the public
pursuant to a "firm commitment" underwriting agreement (the "Underwriting
Agreement") such that, immediately after the Exchange and IPO, the
Shareholders and persons who acquired shares of Prism Financial Common
Stock pursuant to the IPO will own all of the issued and outstanding shares
of Prism Financial Common Stock; and
WHEREAS, the Shareholders intend that the Exchange constitute a
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code of 1986, as amended (the "Code"), and the Exchange and IPO constitute
a transaction described in Section 351 of the Code;
NOW, THEREFORE, each of the Shareholders and Prism Financial hereby
agree as follows:
ARTICLE II
Prism Financial hereby agrees to issue to each Shareholder that
number of shares of Prism Financial Common Stock set forth opposite such
Shareholder's name in column 3 of Attachment 2 hereto in exchange for the
transfer by such Shareholder to Prism Financial of all of such
Shareholder's Prism Mortgage Common Stock, which number is set forth
opposite such Shareholder's name in column 2 of Attachment 2 hereto.
Subject to the terms and conditions of this Agreement, the foregoing
exchange shall become effective upon the satisfaction or waiver of the
conditions contained in Article IV hereof (the "Effective Time").
ARTICLE III
The closing (the "Closing") of the transactions contemplated by this
Agreement shall be held immediately prior to the closing of the IPO. The
date of the Closing is herein referred to as the "Closing Date."
ARTICLE IV
A. Each Shareholder, severally and not jointly, represents and
warrants to Prism Financial that:
1. Each Shareholder owns its Prism Mortgage Common Stock in the
amount set forth opposite such Shareholder's name in column 2 of Attachment
2 hereto free and clear of any encumbrances, liens, pledges, security
interests, pre- emptive rights, voting or other trusts or any other
restriction of any kind whatsoever ("Encumbrances") except for Encumbrances
arising from the Sale Agreements or transactions with Cole Taylor Bank
pursuant to those certain agreements listed on Attachment 3 hereto which
such Encumbrances shall be removed prior to the Effective Time, and, upon
consummation of the transactions contemplated by this Agreement, Prism
Financial shall have good title to the Prism Mortgage Common Stock
exchanged by such Shareholder free and clear of all Encumbrances.
2. Each Shareholder that is not an individual is duly organized
and validly existing under the laws of the state of its formation and has
all requisite powers and authority to own its assets and properties and to
conduct its business.
3. No approval, proceeding or action, corporate, trust,
partnership, membership or other, on the part of any of the Shareholders or
any of their respective shareholders, beneficiaries, partners or members is
necessary to authorize the execution and delivery by such Shareholder of
this Agreement and the consummation by it of the transactions contemplated
hereby.
4. Each Shareholder has full legal right, power and authority
to enter into and deliver this Agreement and to perform the terms,
conditions and obligations hereof. The execution, delivery and performance
of this Agreement do not, and the Exchange will not, (i) violate or
conflict with (a) any law, rule or regulation applicable to such
Shareholders, (b) the certificate of incorporation, bylaws, trust
agreements, partnership, operating agreements or similar formation
documents, if any, of any Shareholder or (c) any agreement, instrument or
license to which such Shareholder is a party, or by which any such
Shareholder or any of its assets or properties may be bound or subject,
(ii) result in the creation of any encumbrance or charge upon Prism
Mortgage Common Stock or (iii) or violate any order, judgment, injunction,
award or decree applicable to such Shareholder of any court, arbitrator,
governmental or regulatory body. This Agreement constitutes the valid and
legally binding obligation of each Shareholder enforceable against each
Shareholder in accordance with its terms except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting enforcement of creditors' rights generally or
general principles of equity.
5. Such Shareholder, as of the date hereof, has, and as of the
Closing Date, will have:
(a) acknowledged that neither such Shareholder nor anyone
acting on such Shareholder's behalf has directly or indirectly offered the
Prism Financial Common Stock or any part thereof for sale to, or solicited
any offer to buy the same from, any other person;
(b) acknowledged that the Prism Financial Common Stock
will not be registered as of the Closing Date under the Securities Act of
1933, as amended (the "Securities Act"), by reason that the sale
contemplated hereby is exempt from registration pursuant to Section 4 of
the Securities Act, and that reliance of Prism Financial on such exemption
is predicted in part on the representations set forth in this Section 5 of
Article III;
(c) represented and warranted that the Prism Financial
Common Stock is being acquired by such Shareholder for its own account and
not with a view to, or for sale in connection with, any distribution
thereof in violation of the Securities Act;
(d) represented and warranted that such Shareholder has
such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of such Shareholder's investment,
and has the ability to suffer the total loss of such Shareholder's investment;
(e) represented and warranted that, in making the
decision to acquire the Prism Financial Common Stock, such Shareholder has
relied upon independent investigations made by such Shareholder and, to the
extent believed appropriate by such Shareholder, by such Shareholder's own
professional, financial, tax and other advisors;
(f) represented and warranted that such Shareholder has
had access prior to its acquisition of the Prism Financial Common Stock to
such information relating to Prism Financial as it desired and that it has
had the opportunity to ask questions of and receive answers from the
Corporations concerning the terms and conditions of the offering of the
Prism Financial Common Stock and the IPO and to obtain additional
information (to the extent the Corporations possessed such information or
could acquire it without unreasonable effort or expense) necessary to
verify that accuracy of any information furnished to it or to which it had
access;
(g) represented and warranted that the offering to such
Shareholder was made only through direct personal communication between
such Shareholder and a representative of the Corporations and not through
public solicitation or advertising; and
(h) acknowledged that such Shareholder understands that
the Prism Financial Common Stock may not be sold, transferred or otherwise
disposed of without registration under the Securities Act or an exemption
therefrom and that, in the absence of an effective registration statement
covering the Prism Financial Common Stock or an available exemption from
registration under the Securities Act, the Prism Financial Common Stock
must be held indefinitely.
6. Such Shareholder will, at the time of the Exchange and
immediately after the Exchange and IPO, (i) have beneficial ownership of
all shares of Prism Financial Common Stock received by such Shareholder
pursuant to the Exchange, (ii) except with respect to certain pledges
described in Attachment 3, not have entered into any agreement or
arrangement of any kind to sell, exchange or otherwise dispose of any of
such shares and (iii) have no plan or intention to sell, exchange or
otherwise dispose of such shares.
B. Prism Financial represents and warrants to each Shareholder that:
1. Prism Financial is duly organized and validly existing under
the laws of the State of Delaware.
2. Prism Financial has full legal right, power and authority to
enter into and deliver this Agreement and to perform the terms, conditions
and obligations hereof. The execution, delivery and performance of this
Agreement do not, and the Exchange will not, (i) violate or conflict with
(a) any law, rule or regulation applicable to Prism Financial, (b) Prism
Financial's charter or bylaws or (c) any agreement, instrument or license
to which Prism Financial is a party, or by which Prism Financial or any of
its assets or properties may be bound or subject, (ii) result in the
creation of any encumbrance or charge upon Prism Financial Common Stock or
(iii) violate any order, judgment, injunction, award or decree applicable
to Prism Financial of any court, arbitrator, governmental or regulatory
body. This Agreement constitutes the valid and legally binding obligation
of Prism Financial enforceable against Prism Financial in accordance with
its terms except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
enforcement of creditor's rights generally or general principles of equity.
3. Prism Financial Common Stock, when issued and delivered
pursuant to this Agreement, will be validly issued, fully paid and
nonassessable.
4. The authorized capital stock of Prism Financial consists
solely of (a) 100,000,000 shares of common stock, of which approximately
15,000,000 shares will be issued and outstanding upon consummation of the
IPO, and (b) 10,000,000 shares of preferred stock, none of which will be
issued and outstanding upon consummation of the IPO.
ARTICLE V
At the Closing:
A. Each Shareholder will deliver to Prism Financial such
Shareholder's Prism Mortgage Common Stock representing the number of shares
of Prism Mortgage Common Stock set forth opposite such Shareholder's name
in column 2 of Attachment 2 hereto, with a stock power duly endorsed.
B. Prism Financial will deliver to each Shareholder certificates (in
such denominations and registered in such names as each Shareholder may
request) representing the number of shares of Prism Financial Common Stock
set forth opposite such Shareholder's name in column 3 of Attachment 2
hereto.
C. Each share of Prism Financial Common Stock held by Prism
Mortgage shall be cancelled.
ARTICLE VI
A. The obligation of Prism Financial to consummate the transactions
contemplated hereby on the Closing Date is subject, at its option, to:
1. the representations and warranties of the Shareholders being
true and correct on the Closing Date with the same effect as if such
representations and warranties had been made at and as of that time;
2. Prism Financial Common Stock to be issued in connection
with the exchange shall have been listed, subject to official notice of
issuance, by the Nasdaq National Market;
3. the closing of the transactions contemplated by the
Shareholder Sale;
4. the concurrent closing of the IPO; and
5. the delivery by each of the Shareholders of its Prism
MortgageCommon Stock in an amount set forth opposite such Shareholder's name
in column 3 of Attachment 2 hereto.
B. The obligation of the Shareholders to consummate the transactions
contemplated hereby on the Closing Date is subject, at their option, to:
1. the representations and warranties of Prism Financial being
true and correct on the Closing Date with the same effect as if such
representations and warranties had been made at and as of such time;
2. Prism Financial Common Stock to be issued in connection
with the Exchange shall have been listed, subject to official notice of
issuance, by the Nasdaq National Market;
3. the concurrent closing of the IPO; and
4. the delivery of a true, correct and complete copy of an
executed underwriting agreement entered into in connection with the IPO.
ARTICLE VII
A. Each Shareholder agrees and acknowledges that it will not,
directly or indirectly, offer, transfer, sell, assign, pledge, hypothecate
or otherwise dispose of any Prism Financial Common Stock (each a
"transfer") unless: (i) the transfer is exempt from the registration
requirements of the Securities Act and any applicable state securities
laws, (ii) if Prism Financial so requests, Prism Financial receives from
the transferor an unqualified opinion of counsel that such transfer may be
effected without registration under the Securities Act and any applicable
state securities laws, and (iii) the transferee shall agree in writing, in
form and substance satisfactory to Prism Financial to become, and becomes,
bound by the restrictions on transfer applicable to a Shareholder contained
in this Section A of Article VI; provided that such restrictions shall not
apply to the sale of shares of Prism Mortgage Common Stock pursuant to the
Underwriting Agreement. Each subsequent holder of the Prism Financial
Common Stock by taking and holding the same shall be deemed to represent
and warrant to the parties hereto the representations and warranties set
forth in Sections 5(a), (f), (h) and (i) of Article III hereof.
1. Any purported transfer in violation of this Section A of
Article VI shall be null and void and of no force or effect.
2. The restrictions on transfer contained in this Section A of
Article VI shall not apply to any transfer pursuant to an effective
registration statement under the Securities Act or Rule 144 under the
Securities Act as such rule may be amended from time to time, in compliance
with all applicable state securities laws; provided, however, that a
Shareholder transferring Prism Financial Common Stock pursuant to Rule 144
shall have its counsel provide the Company with an opinion of the type
customarily given in connection with any sale pursuant to Rule 144.
B. Each certificate representing shares of Prism Financial Common
Stock issued hereunder shall bear substantially the following legend
(unless and until Prism Financial determines, based on the advice of
counsel, that such legend is no longer required to appear thereon):
"THE SHARES REPRESENTED BY THIS CERTIFICATE (THE 'SHARES') HAVE NOT
BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE 'ACT'), OR WITH ANY SECURITIES REGULATORY AUTHORITY OF
ANY STATE OF THE UNITED STATES OR OTHER JURISDICTION. NEITHER THE
SHARES NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION, EXCEPT PURSUANT TO
AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, SUCH
REGISTRATION REQUIREMENTS. BY THE ACQUISITION HEREOF, THE HOLDER
AGREES THAT SUCH HOLDER WILL GIVE EACH PERSON TO WHOM THE SHARES ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN
THE CASE OF ANY TRANSFER OR OTHER DISPOSITION MADE OTHERWISE THAN
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, THE
HOLDER HEREOF SHALL BE REQUIRED TO PROVIDE TO THE COMPANY, PRIOR TO
SUCH TRANSFER, AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT
SUCH TRANSFER IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION UNDER
THE ACT AND IN COMPLIANCE WITH ALL APPLICABLE STATE SECURITIES LAWS.
"IN ADDITION, THE SHARES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO
THE TERMS AND PROVISIONS OF A SHARE EXCHANGE AGREEMENT EFFECTIVE AS
OF MARCH 19, 1999, BY AND AMONG PRISM FINANCIAL AND EACH OF THE
SHAREHOLDERS LISTED ON THE SIGNATURE PAGES THERETO, TO WHICH
REFERENCE IS MADE FOR THE TERMS AND PROVISIONS THEREOF. A COPY OF THE
SHARE EXCHANGE AGREEMENT MAY BE OBTAINED UPON REQUEST FROM THE
SECRETARY OF PRISM FINANCIAL AND MAY BE INSPECTED AT THE PRINCIPAL
OFFICE OF THE CORPORATION."
C. At any time prior to the Closing Date, Prism Financial and the
Shareholders may (a) amend this Agreement, (b) extend the time for the
performance of any of the obligations or other acts of the parties hereto,
(c) waive any inaccuracies in the representations and warranties contained
herein or in any document delivered pursuant hereto and (d) waive
compliance with any of the agreements or conditions contained herein. This
Agreement may not be amended except by an instrument in writing signed on
behalf of each of the parties hereto. Any agreement on the part of a party
hereto to any extension or waiver under this Section C of Article VI shall
be valid only if set forth in an instrument in writing signed on behalf of
such party. Except with respect to the Registration Rights Agreement, this
Agreement constitutes the entire agreement between the parties and
supersedes and cancels any and all prior agreements between the parties
relating to the subject matter hereof.
D. Each of the Shareholders and Prism Financial agrees that it will
(i) report the Exchange and IPO as a transaction described in Section 351
of the Code (and any similar provision of applicable state and local law)
(a "Section 351 Transaction") in all tax returns and filings and (ii) take
no position that is inconsistent with the characterization of the Exchange
and IPO as a Section 351 Transaction in any audit, litigation or other
proceeding.
E. This Agreement may be terminated at any time prior to the Closing:
1. by mutual consent of the parties hereto; and
2. by Prism Financial or any of the Shareholders if the Closing
does not occur on or before August 31, 1999; provided that neither Prism
Financial nor any Shareholder shall be entitled to terminate this Agreement
pursuant to this Section E of Article VI if such party's knowing or willful
breach of this Agreement has prevented the consummation of the transactions
contemplated hereby.
F. All communications hereunder will be in writing and, if sent to
Prism Financial, will be marked, delivered, telecopied or telegraphed and
confirmed to Prism Financial Corporation, 440 N. Orleans, Chicago, IL
60610, Attn: David A. Fisher, Fax No. (312) 494-0184, and, if sent to any
of the Shareholders, to the applicable Shareholder at the address listed on
Attachment 2 hereto, or another address if supplementally supplied by such
Shareholder to the other parties hereto.
G. This Agreement shall be governed by and construed in accordance
with the laws of the State of Illinois.
H. This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original and all of which together shall be
considered one and the same agreement.
I. If any article, paragraph or provision of this Agreement is for
any reason determined to be invalid or unenforceable, such determination
shall not affect the validity or enforceability of any other article,
paragraph or provision hereof.
J. This Agreement shall be binding upon and shall inure to the benefit
of the parties and their respective successors and legal representatives.
K. All representations and warranties contained in this Agreement shall
survive the execution and delivery of this Agreement.
L. Any legal action, suit or proceeding arising out of or relating to
this Agreement or the Exchange may be instituted only in the Federal or
state courts within the State of Illinois, and each party irrevocably
submits to the jurisdiction of such courts in any action, suit or
proceeding, and each party hereto agrees not to assert by way of motion as
a defense or otherwise, in any such action, suit or proceeding, any claim
that it is not subject personally to the jurisdiction of such courts, that
the action, suit or proceeding is brought in an inconvenient forum, that
the venue of the action, suit or proceeding is improper or that this
Agreement or the subject matter hereof or thereof may not be enforced in or
by such courts.
IN WITNESS WHEREOF, each of the Shareholders listed below and Prism
Financial, pursuant to authorization and approval given by its Board of
Directors, has caused this Agreement to be executed as of the date first
above written.
/s/ Bruce C. Abrams
---------------------------------
Bruce C. Abrams, solely in his capacity
as a shareholder of Prism Mortgage
Company
/s/ Terry A. Markus
---------------------------------
Terry A. Markus, solely in his capacity
as a shareholder of Prism Mortgage
Company
/s/ Mark A. Filler
---------------------------------
Mark A. Filler, solely in his capacity as a
shareholder of Prism Mortgage Company
/s/ Abby Polin Reisler
---------------------------------
Abby Polin Reisler, solely in her capacity
as a shareholder of Prism Mortgage Company
/s/ William D. Osenton
---------------------------------
William D. Osenton, solely in his
capacity as a shareholder of Prism
Mortgage Company
/s/ Bruce P. Barbera
---------------------------------
Bruce P. Barbera, solely in his capacity
as a shareholder of Prism Mortgage
Company
CTC TRUST
By: /s/ Thomas J. Pritzker
-----------------------------------
Thomas J. Pritzker, Co-Trustee
By: /s/ Marshall E. Eisenberg
----------------------------------
Name: Marshall E. Eisenberg
Title: Co-Trustee
DONROSE TRUST
By: /s/ Nicholas J. Pritzker
-----------------------------------
Name: Nicholas J. Pritzker
Title: Trustee
JBR TRUST #4
By: /s/ Marshall E. Eisenberg
-----------------------------
Name: Marshall E. Eisenberg
Title: Trustee
T&M CHILDREN'S TRUST
By: /s/ Simon Zunamon
-----------------------------
Name: Simon Zunamon
Title: Trustee
GEM VALUE/PRISM, LLC
By: GEM Value Fund, L.P.
By: GEM Value Partners, LLC
By: /s/ Barry Malkin
-----------------------------
Name: Barry Malkin
Title: President
ABRAMS CAPITAL TRUST
By: /s/ Andrew S. Hochberg
-----------------------------
Name: Andrew S. Hochberg
Title: Solely in his capacity as Trustee
PRISM FINANCIAL CORPORATION
By: /s/ Bruce C. Abrams
----------------------------
Name: Bruce C. Abrams
Title: Chairman & CEO
EXHIBIT 4
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
of
PRISM FINANCIAL CORPORATION
(Adopted in Accordance with the Provisions of
Sections 242 and 245 of the
General Corporation Law of the State of Delaware)
PRISM FINANCIAL CORPORATION, a corporation organized and existing under the
laws of the State of Delaware (the "Corporation"), does hereby certify as
follows:
A. The Corporation's present name is Prism Financial Corporation.
It was originally incorporated under the name Prism Financial Corporation
by the filing of its original Certificate of Incorporation in the office of
the Secretary of State of Delaware on February 23, 1999.
B. This Amended and Restated Certificate of Incorporation (the
"Amended and Restated Certificate of Incorporation") was duly adopted by
the Board of Directors of the Corporation (the "Board of Directors") and by
the stockholders of the Corporation, all in accordance with and in the
manner and by the vote prescribed by Sections 242 and 245 of the General
Corporation Law of the State of Delaware (the "DGCL").
C. This Amended and Restated Certificate of Incorporation
restates and integrates and further amends the Certificate of Incorporation
of the Corporation, as heretofore amended and supplemented.
D. The text of the Certificate of Incorporation is amended and
restated in its entirety as follows:
FIRST: Name. The name of the corporation is Prism Financial
Corporation (the "Corporation").
SECOND: Address; Registered Office and Agent. The address of the
registered office of the Corporation in the State of Delaware is 1013
Centre Road in the City of Wilmington, County of New Castle. The name of
its registered agent at such address is Corporation Service Company.
THIRD: Purpose. The purpose of the Corporation is to engage in,
carry on and conduct any lawful act or activity for which a corporation may
be organized under the DGCL.
FOURTH: Number and Designation of Shares of Capital Stock.
(a) Authorized Capital Stock. The total number of shares of stock
that the Corporation shall have authority to issue is 110,000,000 shares
of capital stock, consisting of 100,000,000 shares of common stock, par
value $.01 per share (the Common Stock), and 10,000,000 shares of
preferred stock, par value $.01 per share (the "Preferred Stock"). The
designations, powers, preferences and relative participating, optional
or other special rights and the qualifications, limitations and
restrictions thereof in respect of the capital stock of the Corporation
are as follows:
(b) Common Stock. The powers, preferences and rights, and the
qualifications, limitations and restrictions, of the Common Stock are as
follows:
(1) Voting. Except as otherwise expressly
required by law or provided in this Amended and Restated Certificate
of Incorporation, and subject to any voting rights provided to holders
of Preferred Stock at any time outstanding, the holders of any
outstanding shares of Common Stock shall vote together as a single
class on all matters with respect to which stockholders are entitled
to vote under applicable law, this Amended and Restated Certificate of
Incorporation or the Bylaws of the Corporation, or upon which a vote
of stockholders is otherwise duly called for by the Corporation. At
each annual or special meeting of stockholders, each holder of record
of shares of Common Stock on the relevant record date shall be
entitled to cast one vote in person or by proxy for each share of the
Common Stock standing in such holder's name on the stock transfer
records of the Corporation.
(2) No Cumulative Voting. The holders of
shares of Common Stock shall not have cumulative voting rights.
(3) Dividends. Subject to the rights
provided to holders of Preferred Stock at any time outstanding, and
subject to any other provisions of this Amended and Restated
Certificate of Incorporation, as it may be amended from time to time,
holders of shares of Common Stock shall be entitled to receive such
dividends and other distributions in cash, stock or property of the
Corporation when, as and if declared thereon by the Board of Directors
from time to time out of assets or funds of the Corporation legally
available therefor.
(4) Liquidation, Dissolution, etc. In the
event of any liquidation, dissolution or winding up (either voluntary
or involuntary) of the Corporation, the holders of shares of Common
Stock shall be entitled to receive the assets and funds of the
Corporation available for distribution after payments to creditors and
to the holders of any Preferred Stock of the Corporation that may at
the time be outstanding, in proportion to the number of shares held by
them.
(5) No Preemptive or Subscription Rights.
No holder of shares of Common Stock shall be entitled to preemptive or
subscription rights.
(6) Power to Sell and Purchase Shares.
Subject to the requirements of applicable law, the Corporation shall
have the power to issue and sell all or any part of any shares of any
class of stock herein or hereafter authorized to such persons, and for
such consideration, as the Board of Directors shall from time to time,
in its discretion, determine, whether or not greater consideration
could be received upon the issue or sale of the same number of shares
of another class, and as otherwise permitted by law. Subject to the
requirements of applicable law, the Corporation shall have the power
to purchase any shares of any class of stock herein or hereafter
authorized from such persons, and for such consideration, as the Board
of Directors shall from time to time, in its discretion, determine,
whether or not less consideration could be paid upon the purchase of
the same number of shares of another class, and as otherwise permitted
by law.
(c) Preferred Stock. The Board of Directors is hereby expressly
authorized to provide for the issuance of all or any shares of the
Preferred Stock in one or more classes or series, and to fix for each
such class or series such voting powers, full or limited, or no voting
powers, and such designations, preferences and relative, participating,
optional or other special rights and such qualifications, limitations
or restrictions thereof, as shall be stated and expressed in the
resolution or resolutions adopted by the Board of Directors providing
for the issuance of such class or series, including, without
limitation, the authority to provide that any such class or series may
be (i) subject to redemption at such time or times and at such price or
prices; (ii) entitled to receive dividends (which may be cumulative or
non-cumulative) at such rates, on such conditions, and at such times,
and payable in preference to, or in such relation to, the dividends
payable on any other class or classes or any other series; (iii)
entitled to such rights upon the dissolution of, or upon any
distribution of the assets of, the Corporation; or (iv) convertible
into, or exchangeable for, shares of any other class or classes of
stock, or of any other series of the same or any other class or classes
of stock, of the Corporation at such price or prices or at such rates
of exchange and with such adjustments; all as may be stated in such
resolution or resolutions.
FIFTH: Directors. The following provisions are inserted for the
management of the business and the conduct of the affairs of the
Corporation, and for further definition, limitation and regulation of the
powers of the Corporation and of its directors and stockholders:
(a) The business and affairs of the Corporation shall be managed
by or under the direction of the Board of Directors.
(b) The number of directors that shall constitute the whole
Board of Directors shall from time to time be fixed exclusively by the
Board of Directors by a resolution adopted by a majority of the whole
Board of Directors serving at the time of that vote. In no event
shall the number of directors that constitute the whole board of
directors be less than five or more than nine. No decrease in the
number of directors shall have the effect of shortening the term of
any incumbent director. Election of directors need not be by written
ballot unless the Bylaws so provide.
(c) The directors shall be divided into three classes,
designated Class I, Class II and Class III. Each class shall consist,
as nearly as may be possible, of one-third of the total number of
directors constituting the entire Board of Directors. The initial
division of the Board of Directors into classes shall be made by the
decision of the affirmative vote of a majority of the entire Board of
Directors. The term of the initial Class I directors shall expire on
the date of the 2000 annual meeting; the term of the initial Class II
directors shall expire on the date of the 2001 annual meeting; and the
term of the initial Class III directors shall expire on the date of
the 2002 annual meeting. At each succeeding annual meeting of
stockholders beginning in 2000, successors to the class of directors
whose term expires at that annual meeting shall be elected for a
three-year term. If the number of directors is changed, any increase
or decrease shall be apportioned among the classes so as to maintain
the number of directors in each class as nearly equal as possible, and
any additional director of any class elected to fill a vacancy
resulting from an increase in such class shall hold office for a term
that shall coincide with the remaining term of that class, but in no
case will a decrease in the number of directors shorten the term of
any incumbent director.
(d) A director shall hold office until the annual meeting for
the year in which his or her term expires and until his or her
successor shall be elected and shall qualify, subject, however, to
prior death, resignation, retirement, disqualification or removal from
office.
(e) Subject to the terms of any one or more classes or series of
Preferred Stock, any vacancy on the Board of Directors that results
from an increase in the number of directors may be filled by a
majority of the Board of Directors then in office, provided that a
quorum is present, and any other vacancy occurring on the Board of
Directors may be filled by a majority of the Board of Directors then
in office, even if less than a quorum, or by a sole remaining
director. Any director of any class elected to fill a vacancy
resulting from an increase in the number of directors of such class
shall hold office for a term that shall coincide with the remaining
term of that class. Any director elected to fill a vacancy not
resulting from an increase in the number of directors shall have the
same remaining term as that of his predecessor. Subject to the rights,
if any, of the holders of shares of Preferred Stock then outstanding,
any or all of the directors of the Corporation may be removed from
office at any time, but only for cause and only by the affirmative
vote of the holders of at least two-thirds of the voting power of the
Corporation's then outstanding capital stock entitled to vote
generally in the election of directors. Notwithstanding the foregoing,
whenever the holders of any one or more classes or series of Preferred
Stock issued by the Corporation shall have the right, voting
separately by class or series, to elect directors at an annual or
special meeting of stockholders, the election, term of office, filling
of vacancies and other features of such directorships shall be
governed by the terms of this Amended and Restated Certificate of
Incorporation applicable thereto, and such directors so elected shall
not be divided into classes pursuant to this Article FIFTH unless
expressly provided by such terms.
(f) In addition to the powers and authority hereinbefore or by
statute expressly conferred upon them, the directors are hereby
empowered to exercise all such powers and do all such acts and things
as may be exercised or done by the Corporation, subject, nevertheless,
to the provisions of the DGCL, this Amended and Restated Certificate
of Incorporation, and any Bylaws adopted by the stockholders;
provided, however, that no Bylaws hereafter adopted by the
stockholders shall invalidate any prior act of the directors which
would have been valid if such Bylaws had not been adopted.
SIXTH: Limitation of Liability. No director of the Corporation
shall be personally liable to the Corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director, except to the
extent such exemption from liability or limitation thereof is not permitted
under the DGCL as the same exists or may hereinafter be amended. If the
DGCL is amended hereafter to authorize the further elimination or
limitation of the liability of directors, then the liability of a director
of the Corporation shall be eliminated or limited to the fullest extent
authorized by the DGCL, as so amended. Any repeal or modification of this
Article SIXTH by the stockholders of the Corporation shall not adversely
affect any right or protection of a director of the Corporation existing at
the time of such repeal or modification with respect to acts or omissions
occurring prior to such repeal or modification.
SEVENTH: Indemnification. (a) The Corporation shall indemnify
its directors and officers to the fullest extent authorized or permitted by
law, as now or hereafter in effect, and such right to indemnification shall
continue as to a person who has ceased to be a director or officer of the
Corporation and shall inure to the benefit of his or her heirs, executors
and personal and legal representatives; provided, however, that, except for
proceedings to enforce rights to indemnification, the Corporation shall not
be obligated to indemnify any director or officer (or his or her heirs,
executors or personal or legal representatives) in connection with a
proceeding (or part thereof) initiated by such person unless such
proceeding (or part thereof) was authorized or consented to by the Board of
Directors. The right to indemnification conferred by this Article SEVENTH
shall include the right to be paid by the Corporation the expenses incurred
in defending or otherwise participating in any proceeding in advance of its
final disposition.
(b) The Corporation may, to the extent authorized from time to
time by the Board of Directors, provide rights to indemnification and
to the advancement of expenses to employees and agents of the
Corporation similar to those conferred in this Article SEVENTH to
directors and officers of the Corporation.
(c) The rights to indemnification and to the advance of expenses
conferred in this Article SEVENTH shall not be exclusive of any other
right which any person may have or hereafter acquire under this
Amended and Restated Certificate of Incorporation, the Bylaws of the
Corporation, any statute, agreement, vote of stockholders or
disinterested directors or otherwise.
(d) Any repeal or modification of this Article SEVENTH by the
stockholders of the Corporation shall not adversely affect any rights
to indemnification and to the advancement of expenses of a director or
officer of the Corporation existing at the time of such repeal or
modification with respect to any acts or omissions occurring prior to
such repeal or modification.
EIGHTH: Action by Stockholders. Any action required or
permitted to be taken by the stockholders of the Corporation must be
effected at a duly called annual or special meeting of stockholders of the
Corporation, and the ability of the stockholders to consent in writing to
the taking of any action is hereby specifically denied.
NINTH: Meetings of Stockholders. Meetings of stockholders may
be held within or without the State of Delaware, as the Bylaws may provide.
The books of the Corporation may be kept (subject to any provision
contained in the DGCL) outside the State of Delaware at such place or
places as may be designated from time to time by the Board of Directors or
in the Bylaws of the Corporation.
TENTH: Special Meetings of Stockholders. Unless otherwise
required by law, special meetings of stockholders, for any purpose or
purposes, may be called by either (i) the Chairman of the Board of
Directors, (ii) the Chief Executive Officer or (iii) the Board of
Directors, and shall be at the request in writing of a majority of the
Board of Directors. The ability of the stockholders to call a special
meeting of stockholders is hereby specifically denied.
ELEVENTH: Amendment of Bylaws. In furtherance and not in
limitation of the powers conferred upon it by the laws of the State of
Delaware, the Board of Directors shall have the power to adopt, amend,
alter or repeal the Corporation's Bylaws. The affirmative vote of at least
a majority of the entire Board of Directors shall be required to adopt,
amend, alter or repeal the Corporation's Bylaws. The Corporation's Bylaws
also may be adopted, amended, altered or repealed by the affirmative vote
of the holders of at least two-thirds of the voting power of the shares,
voting as a single class, entitled to vote at an election of directors.
TWELFTH: Amendment of Certificate of Incorporation. The
Corporation reserves the right to amend, alter, change or repeal any
provision contained in this Amended and Restated Certificate of
Incorporation in the manner now or hereafter prescribed in this Amended and
Restated Certificate of Incorporation, the Corporation's Bylaws or the
DGCL, and all rights herein conferred upon stockholders are granted subject
to such reservation; provided, however, that, notwithstanding any other
provision of this Amended and Restated Certificate of Incorporation (and in
addition to any other vote that may be required by law), the affirmative
vote of the holders of at least two-thirds of the voting power of the
shares entitled to vote at an election of directors, voting as a single
class, shall be required to amend, alter, change or repeal, or to adopt any
provision as part of this Amended and Restated Certificate of Incorporation
inconsistent with the purpose and intent of Articles FIFTH, EIGHTH, TENTH
and ELEVENTH of this Amended and Restated Certificate of Incorporation or
this Article TWELFTH.
IN WITNESS WHEREOF, the Corporation has caused this Amended and
Restated Certificate of Incorporation to be executed and attested to on its
behalf this 28th day of May, 1999.
PRISM FINANCIAL CORPORATION
By: /s/ David A. Fisher
----------------------------
Name: David A. Fisher
Title: Senior Vice President,
Chief Financial Officer &
Secretary
EXHIBIT 5
SECOND
AMENDED AND RESTATED
BY-LAWS
of
PRISM FINANCIAL CORPORATION
A Delaware Corporation
Effective December 12, 1999
TABLE OF CONTENTS
PAGE
ARTICLE I
OFFICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1. Registered Office . . . . . . . . . . . . . . 1
Section 2. Other Offices . . . . . . . . . . . . . . . . 1
ARTICLE II
MEETINGS OF STOCKHOLDERS . . . . . . . . . . . . . . . . . . . . . . 1
Section 1. Place of Meetings . . . . . . . . . . . . . . 1
Section 2. Annual Meetings . . . . . . . . . . . . . . . 1
Section 3. Special Meetings . . . . . . . . . . . . . . . 2
Section 4. Quorum . . . . . . . . . . . . . . . . . . . . 2
Section 5. Proxies . . . . . . . . . . . . . . . . . . . 2
Section 6. Voting . . . . . . . . . . . . . . . . . . . . 3
Section 7. Nature of Business at Meetings
of Stockholders . . . . . . . . . . . . . . . 4
Section 8. List of Stockholders Entitled to Vote . . . . 5
Section 9. Stock Ledger . . . . . . . . . . . . . . . . . 6
Section 10. Record Date. . . . . . . . . . . . . . . . 6
Section 11. Inspectors of Election . . . . . . . . . . . 6
Section 12. Conduct of Meetings. . . . . . . . . . . . . 7
ARTICLE III
DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 1. Number and Election of Directors . . . . . . . 7
Section 2. Chairman of the Board . . . . . . . . . . . . 7
Section 3. Nomination of Directors . . . . . . . . . . . 8
Section 4. Vacancies . . . . . . . . . . . . . . . . . . 9
Section 5. Duties and Powers . . . . . . . . . . . . . 10
Section 6. Organization . . . . . . . . . . . . . . . . 10
Section 7. Resignations and Removals of Directors . . . 10
Section 8. Meetings . . . . . . . . . . . . . . . . . . 10
Section 9. Quorum . . . . . . . . . . . . . . . . . . . 11
Section 10. Actions of Board . . . . . . . . . . . . . 11
Section 11. Meetings by Means of Conference Telephone . 11
Section 12. Committees . . . . . . . . . . . . . . . . 11
Section 13. Compensation . . . . . . . . . . . . . . . 12
Section 14. Interested Directors . . . . . . . . . . . 12
ARTICLE IV
OFFICERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 1. General . . . . . . . . . . . . . . . . . . 13
Section 2. Removal . . . . . . . . . . . . . . . . . . 13
Section 3. Compensation . . . . . . . . . . . . . . . . 13
Section 4. Voting Securities Owned by the Corporation . 13
Section 5. Chief Executive Officer . . . . . . . . . . 14
Section 6. President . . . . . . . . . . . . . . . . . 14
Section 7. Executive Vice Presidents, Senior
Vice Presidents, Vice Presidents
and other Officers. . . . . . . . . . . . . 15
Section 8. Secretary . . . . . . . . . . . . . . . . . 15
Section 9. Treasurer . . . . . . . . . . . . . . . . . 15
Section 10. Assistant Secretaries . . . . . . . . . . . 16
Section 11. Assistant Treasurers . . . . . . . . . . . 16
ARTICLE V
STOCK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 1. Form of Certificates . . . . . . . . . . . . 16
Section 2. Signatures . . . . . . . . . . . . . . . . . 17
Section 3. Lost, Destroyed, Stolen or
Mutilated Certificates . . . . . . . . . . . 17
Section 4. Transfers . . . . . . . . . . . . . . . . . 17
Section 5. Transfer and Registry Agents. . . . . . . . 18
Section 6. Beneficial Owners . . . . . . . . . . . . . 18
ARTICLE VI
NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 1. Notices . . . . . . . . . . . . . . . . . . 18
Section 2. Waivers of Notice . . . . . . . . . . . . . 18
ARTICLE VII
GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 1. Dividends . . . . . . . . . . . . . . . . . 19
Section 2. Disbursements . . . . . . . . . . . . . . . 19
Section 3. Fiscal Year . . . . . . . . . . . . . . . . 19
Section 4. Corporate Seal . . . . . . . . . . . . . . . 19
ARTICLE VIII
INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 1. Power to Indemnify in Actions,
Suits or Proceedings Other than
Those by or in the Right of
the Corporation . . . . . . . . . . . . . . 20
Section 2. Power to Indemnify in Actions, Suits
or Proceedings by or in the Right
of the Corporation . . . . . . . . . . . . . 20
Section 3. Authorization of Indemnification . . . . . . 21
Section 4. Good Faith Defined . . . . . . . . . . . . . 21
Section 5. Indemnification by a Court . . . . . . . . . 22
Section 6. Expenses Payable in Advance . . . . . . . . 22
Section 7. Nonexclusivity of Indemnification
and Advancement of Expenses . . . . . . . . 22
Section 8. Insurance . . . . . . . . . . . . . . . . . 23
Section 9. Certain Definitions . . . . . . . . . . . . 23
Section 10. Survival of Indemnification and
Advancement of Expenses . . . . . . . . . . 23
Section 11. Limitation on Indemnification . . . . . . . 24
Section 12. Indemnification of Employees and Agents . . 24
ARTICLE IX
AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 1. Amendments . . . . . . . . . . . . . . . . . 24
Section 2. Entire Board of Directors . . . . . . . . . 24
SECOND
AMENDED AND RESTATED
BY-LAWS
OF
PRISM FINANCIAL CORPORATION
(hereinafter called the "Corporation")
ARTICLE I
OFFICES
Section 1. Registered Office. The registered office of the
Corporation shall be in the City of Wilmington, County of New Castle, State
of Delaware.
Section 2. Other Offices. The Corporation may also have offices at
such other places, both within and without the State of Delaware, as the
Board of Directors may from time to time determine.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. Place of Meetings. Meetings of the stockholders for the
election of directors or for any other purpose shall be held at such time
and place, either within or without the State of Delaware, as shall be
designated from time to time by the Board of Directors and stated in the
notice of the meeting or in a duly executed waiver of notice thereof.
Section 2. Annual Meetings. The annual meetings of stockholders
shall be held on such date and at such time as shall be designated from
time to time by the Board of Directors and stated in the notice of the
meeting, at which meetings the stockholders shall elect directors, and
transact such other business as may properly be brought before the
meeting. Written notice of the annual meeting stating the place, date and
hour of the meeting shall be given to each stockholder entitled to vote at
such meeting not less than ten nor more than sixty days before the date of
the meeting.
Section 3. Special Meetings. Unless otherwise prescribed by law or
by the certificate of incorporation of the Corporation, as amended and
restated from time to time (the "Certificate of Incorporation"), special
meetings of stockholders, for any purpose or purposes, may be called by
either (i) the Chief Executive Officer or (ii) the Board of Directors.
Such request shall state the purpose or purposes of the proposed meeting.
At a special meeting of the stockholders, only such business shall be
conducted as shall be specified in the notice of meeting (or any
supplement thereto) given by or at the direction of the Board of
Directors. Written notice of a special meeting stating the place, date and
hour of the meeting and the purpose or purposes for which the meeting is
called shall be given not less than ten nor more than sixty days before
the date of the meeting to each stockholder entitled to vote at such
meeting.
Section 4. Quorum. Except as otherwise required by law or by the
Certificate of Incorporation, the holders of a majority of the capital
stock issued and outstanding and entitled to vote thereat, present in
person or represented by proxy, shall constitute a quorum at all meetings
of the stockholders for the transaction of business. A quorum, once
established, shall not be broken by the withdrawal of enough votes to
leave less than a quorum. If, however, such quorum shall not be present or
represented at any meeting of the stockholders, the stockholders entitled
to vote thereat, present in person or represented by proxy, shall have
power to adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present or
represented. At such adjourned meeting at which a quorum shall be present
or represented, any business may be transacted which might have been
transacted at the meeting as originally noticed. If the adjournment is for
more than thirty days, or if after the adjournment a new record date is
fixed for the adjourned meeting, a notice of the adjourned meeting shall
be given to each stockholder entitled to vote at the meeting not less than
ten nor more than sixty days before the date of the meeting.
Section 5. Proxies. Any stockholder entitled to vote may do so in
person or by his or her proxy appointed by an instrument in writing
subscribed by such stockholder or by his or her attorney thereunto
authorized, delivered to the Secretary of the meeting; provided, however,
that no proxy shall be voted or acted upon after three years from its
date, unless said proxy provides for a longer period. Without limiting the
manner in which a stockholder may authorize another person or persons to
act for him or her as proxy, either of the following shall constitute a
valid means by which a stockholder may grant such authority:
(i) A stockholder may execute a writing authorizing
another person or persons to act for him or her as proxy. Execution may
be accomplished by the stockholder or his or her authorized officer,
director, employee or agent signing such writing or causing his or her
signature to be affixed to such writing by any reasonable means,
including, but not limited to, by facsimile signature.
(ii) A stockholder may authorize another person or
persons to act for him or her as proxy by transmitting or authorizing
the transmission of a telegram or other means of electronic transmission
to the person who will be the holder of the proxy or to a proxy
solicitation firm, proxy support service organization or like agent duly
authorized by the person who will be the holder of the proxy to receive
such transmission, provided that any such telegram or other means of
electronic transmission must either set forth or be submitted with
information from which it can be determined that the telegram or other
electronic transmission was authorized by the stockholder.
Any copy, facsimile telecommunication or other reliable reproduction of
the writing or transmission authorizing another person or persons to act
as proxy for a stockholder may be substituted or used in lieu of the
original writing or transmission for any and all purposes for which the
original writing or transmission could be used; provided that such copy,
facsimile telecommunication or other reproduction shall be a complete
reproduction of the entire original writing or transmission.
Section 6. Voting. At all meetings of the stockholders at which a
quorum is present, except as otherwise required by law, the Certificate of
Incorporation or these By-Laws, any question brought before any meeting of
stockholders shall be decided by the affirmative vote of the holders of a
majority of the total number of votes of the capital stock present in
person or represented by proxy and entitled to vote on such question,
voting as a single class. The Board of Directors, in its discretion, or
the officer of the Corporation presiding at a meeting of stockholders, in
his or her discretion, may require that any votes cast at such meeting
shall be cast by written ballot.
Section 7. Nature of Business at Meetings of Stockholders. No
business may be transacted at an annual meeting of stockholders, other
than business that is either (a) specified in the notice of meeting (or
any supplement thereto) given by or at the direction of the Board of
Directors (or any duly authorized committee thereof), (b) otherwise
properly brought before the annual meeting by or at the direction of the
Board of Directors (or any duly authorized committee thereof) or (c)
otherwise properly brought before the annual meeting by any stockholder of
the Company (i) who is a stockholder of record on the date of the giving
of the notice provided for in this Section 7 and on the record date for
the determination of stockholders entitled to vote at such annual meeting
and (ii) who complies with the notice procedures set forth in this Section
7.
In addition to any other applicable requirements, for business to
be properly brought before an annual meeting by a stockholder, such
stockholder must have given timely notice thereof in proper written form
to the Secretary of the Corporation.
To be timely, a stockholder's notice to the Secretary must be
delivered to or mailed and received at the principal executive offices of
the Corporation not less than sixty (60) days nor more than ninety (90)
days prior to the anniversary date of the immediately preceding annual
meeting of stockholders; provided, however, that in the event that the
annual meeting is called for a date that is not within thirty (30) days
before or after such anniversary date, notice by the stockholder in order
to be timely must be so received not later than the close of business on
the tenth (10th) day following the day on which such notice of the date of
the annual meeting was mailed or such public disclosure of the date of the
annual meeting was made, whichever first occurs. In no event shall the
public announcement of an adjournment of an annual meeting commence a new
time period for the giving of a stockholder's notice as described above.
To be in proper written form, a stockholder's notice to the
Secretary must set forth as to each matter such stockholder proposes to
bring before the annual meeting (i) a brief description of the business
desired to be brought before the annual meeting and the reasons for
conducting such business at the annual meeting, (ii) the name and record
address of such stockholder, (iii) the class or series and number of
shares of capital stock of the Corporation which are owned beneficially or
of record by such stockholder, (iv) a description of all arrangements or
understandings between such stockholder and any other person or persons
(including their names) in connection with the proposal of such business
by such stockholder and any material interest of such stockholder in such
business and (v) a representation that such stockholder intends to appear
in person or by proxy at the annual meeting to bring such business before
the meeting.
No business shall be conducted at the annual meeting of
stockholders except business brought before the annual meeting in
accordance with the procedures set forth in this Section 7, provided,
however, that, once business has been properly brought before the annual
meeting in accordance with such procedures, nothing in this Section 7
shall be deemed to preclude discussion by any stockholder of any such
business. If the Chairman of an annual meeting determines that business
was not properly brought before the annual meeting in accordance with the
foregoing procedures, the Chairman shall declare to the meeting that the
business was not properly brought before the meeting and such business
shall not be transacted.
For purposes of this Section 7 "public announcement" shall mean an
announcement in a press release reported by the Dow Jones News Service,
Associated Press or comparable national news service or in a document
publicly filed by the Corporation with the Securities and Exchange
Commission pursuant to Section 13, 14 or 15(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act").
Section 8. List of Stockholders Entitled to Vote. The officer of
the Corporation who has charge of the stock ledger of the Corporation
shall prepare and make, at least ten days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each
stockholder. Such list shall be open to the examination of any
stockholder, for any purpose germane to the meeting, during ordinary
business hours, for a period of at least ten days prior to the meeting,
either at a place within the city where the meeting is to be held, which
place shall be specified in the notice of the meeting, or, if not so
specified, at the place where the meeting is to be held. The list shall
also be produced and kept at the time and place of the meeting during the
whole time thereof, and may be inspected by any stockholder of the
Corporation who is present.
Section 9. Stock Ledger. The stock ledger of the Corporation shall
be the only evidence as to who are the stockholders entitled to examine
the stock ledger, the list required by Section 8 of this Article II or the
books of the Corporation, or to vote in person or by proxy at any meeting
of stockholders.
Section 10. Record Date. In order that the Corporation may
determine the stockholders entitled to notice of or to vote at any meeting
of stockholders or any adjournment thereof, or entitled to receive payment
of any dividend or other distribution or allotment of any rights, or
entitled to exercise any rights in respect of any change, conversion or
exchange of stock, or for the purpose of any other lawful action, the
Board of Directors may fix a record date, which record date shall not
precede the date upon which the resolution fixing the record date is
adopted by the Board of Directors and which record date: (1) in the case
of determination of stockholders entitled to vote at any meeting of
stockholders or adjournment thereof, shall not be more than sixty nor less
than ten days before the date of such meeting; and (2) in the case of any
other action, shall not be more than sixty days prior to such other
action. If no record date is fixed: (1) the record date for determining
stockholders entitled to notice of or to vote at a meeting of stockholders
shall be at the close of business on the day next preceding the day on
which notice is given, or, if notice is waived, at the close of business
on the day next preceding the day on which the meeting is held; and (2)
the record date for determining stockholders for any other purpose shall
be at the close of business on the day on which the Board of Directors
adopts the resolution relating thereto. A determination of stockholders of
record entitled to notice of or to vote at a meeting of stockholders shall
apply to any adjournment of the meeting; provided, however, that the Board
of Directors may fix a new record date for the adjourned meeting.
Section 11. Inspectors of Election. In advance of any meeting of
stockholders, the Board by resolution or the Chairman of the meeting shall
appoint one or more inspectors of election to act at the meeting and make
a written report thereof. One or more other persons may be designated as
alternate inspectors to replace any inspector who fails to act. If no
inspector or alternate is present, ready and willing to act at a meeting
of stockholders, the Chairman of the meeting shall appoint one or more
inspectors to act at the meeting. Unless otherwise required by law,
inspectors may be officers, employees or agents of the Corporation. Each
inspector, before entering upon the discharge of his or her 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. The
inspector shall have the duties prescribed by law and shall take charge of
the polls and, when the vote is completed, shall make a certificate of the
result of the vote taken and of such other facts as may be required by
law.
Section 12. Conduct of Meetings. The Board of Directors may adopt
by resolution such rules and regulations for the conduct of the meeting of
the stockholders as it shall deem appropriate. Except to the extent
inconsistent with such rules and regulations as adopted by the Board of
Directors, the Chairman of any meeting of the stockholders shall have the
right and authority to prescribe such rules, regulations and procedures
and to do all such acts as, in the judgment of such Chairman, are
appropriate for the proper conduct of the meeting. Such rules, regulations
or procedures, whether adopted by the board of directors or prescribed by
the Chairman of the meeting, may include, without limitation, the
following: (1) the establishment of an agenda or order of business for the
meeting; (2) the determination of when the polls shall open and close for
any given matter to be voted on at the meeting; (3) rules and procedures
for maintaining order at the meeting and the safety of those present; (4)
limitations on attendance at or participation in the meeting to
stockholders of record of the Corporation, their duly authorized and
constituted proxies or such other persons as the Chairman of the meeting
shall determine; (5) restrictions on entry to the meeting after the time
fixed for the commencement thereof; and (6) limitations on the time
allotted to questions or comments by participants.
ARTICLE III
DIRECTORS
Section 1. Number and Election of Directors. The Board of Directors
shall consist of not less than five nor more than nine members, the exact
number of which shall be determined from time to time by resolution
adopted by the Board of Directors. Except as provided in Section 4 of this
Article III, directors shall be elected by the stockholders at the annual
meetings of stockholders, and each director so elected shall hold office
until such director's successor is duly elected and qualified, or until
such director's death, or until such director's earlier resignation or
removal. Directors need not be stockholders.
Section 2. Chairman of the Board. The Board of Directors shall
annually, or at such other times as the Board of Directors may determine
(which may be more or less frequently than annually), elect a Chairman of
the Board from among its members. The Chairman of the Board shall preside
at all meetings of the stockholders and of the Board of Directors. The
Chairman of the Board shall also perform such other duties and may
exercise such other powers as from time to time may be assigned to him or
her by these By-Laws or by the Board of Directors.
Section 3. Nomination of Directors. Only persons who are nominated
in accordance with the following procedures shall be eligible for election
as directors of the Corporation, except as may be otherwise provided in
the Certificate of Incorporation with respect to the right of holders of
preferred stock of the Corporation to nominate and elect a specified
number of directors in certain circumstances. Nominations of persons for
election to the Board of Directors may be made at any annual meeting of
stockholders, or at any special meeting of stockholders called for the
purpose of electing directors, (a) by or at the direction of the Board of
Directors (or any duly authorized committee thereof) or (b) by any
stockholder of the Company (i) who is a stockholder of record on the date
of the giving of the notice provided for in this Section 3 and on the
record date for the determination of stockholders entitled to vote at such
meeting and (ii) who complies with the notice procedures set forth in this
Section 3.
In addition to any other applicable requirements, for a nomination
to be made by a stockholder, such stockholder must have given timely
notice thereof in proper written form to the Secretary of the Company.
To be timely, a stockholder's notice to the Secretary must be
delivered to or mailed and received at the principal executive offices of
the Company (a) in the case of an annual meeting, not less than sixty (60)
days nor more than ninety (90) days prior to the anniversary date of the
immediately preceding annual meeting of stockholders; provided, however,
that in the event that the annual meeting is called for a date that is not
within thirty (30) days before or after such anniversary date, notice by
the stockholder in order to be timely must be so received not later than
the close of business on the tenth (10th) day following the day on which
such notice of the date of the annual meeting was mailed or such public
disclosure of the date of the annual meeting was made, whichever first
occurs; and (b) in the case of a special meeting of stockholders called
for the purpose of electing directors, not later than the close of
business on the tenth (10th) day following the day on which notice of the
date of the special meeting was mailed or public disclosure of the date of
the special meeting was made, whichever first occurs.
To be in proper written form, a stockholder's notice to the
Secretary must set forth (a) as to each person whom the stockholder
proposes to nominate for election as a director (i) the name, age,
business address and residence address of the person, (ii) the principal
occupation or employment of the person, (iii) the class or series and
number of shares of capital stock of the Corporation which are owned
beneficially or of record by the person and (iv) any other information
relating to the person that would be required to be disclosed in a proxy
statement or other filings required to be made in connection with
solicitations of proxies for election of directors pursuant to Section 14
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and the rules and regulations promulgated thereunder; and (b) as to the
stockholder giving the notice (i) the name and record address of such
stockholder, (ii) the class or series and number of shares of capital
stock of the Corporation which are owned beneficially or of record by such
stockholder, (iii) a description of all arrangements or understandings
between such stockholder and each proposed nominee and any other person or
persons (including their names) pursuant to which the nomination(s) are to
be made by such stockholder, (iv) a representation that such stockholder
intends to appear in person or by proxy at the meeting to nominate the
persons named in its notice and (v) any other information relating to such
stockholder that would be required to be disclosed in a proxy statement or
other filings required to be made in connection with solicitations of
proxies for election of directors pursuant to Section 14 of the Exchange
Act and the rules and regulations promulgated thereunder. Such notice must
be accompanied by a written consent of each proposed nominee to being
named as a nominee and to serve as a director if elected.
No person shall be eligible for election as a director of the
Corporation unless nominated in accordance with the procedures set forth
in this Section 3. If the Chairman of the meeting determines that a
nomination was not made in accordance with the foregoing procedures, the
Chairman shall declare to the meeting that the nomination was defective
and such defective nomination shall be disregarded.
For purposes of this Section 3 "public announcement" shall mean an
announcement in a press release reported by the Dow Jones News Service,
Associated Press or comparable national news service or in a document
publicly filed by the Corporation with the Securities and Exchange
Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.
Section 4. Vacancies. Subject to the terms of any one or more
classes or series of preferred stock, any vacancy on the Board of
Directors that results from an increase in the number of directors may be
filled by a majority of the directors then in office, provided that a
quorum is present, and any other vacancy occurring on the Board of
Directors may be filled by a majority of the Board of Directors then in
office, even if less than a quorum, or by a sole remaining director.
Notwithstanding the foregoing, whenever the holders of any one or more
class or classes or series of preferred stock of the Corporation shall
have the right, voting separately as a class, to elect directors at an
annual or special meeting of stockholders, the election, term of office,
filling of vacancies and other features of such directorships shall be
governed by the Certificate of Incorporation.
Section 5. Duties and Powers. The business of the Corporation shall
be managed by or under the direction of the Board of Directors which may
exercise all such powers of the Corporation and do all such lawful acts
and things as are not by statute or by the Certificate of Incorporation or
by these By-Laws required to be exercised or done by the stockholders.
Section 6. Organization. At each meeting of the Board of Directors,
the Chairman of the Board, or, in his or her absence, a director chosen by
a majority of the directors present, shall act as Chairman. The Secretary
of the Corporation shall act as Secretary at each meeting of the Board of
Directors. In case the Secretary shall be absent from any meeting of the
Board of Directors, an Assistant Secretary shall perform the duties of
Secretary at such meeting; and in the absence from any such meeting of the
Secretary and all the Assistant Secretaries, the Chairman of the meeting
may appoint any person to act as Secretary of the meeting.
Section 7. Resignations and Removals of Directors. Any director of
the Corporation may resign at any time, by giving written notice to the
Chief Executive Officer, the President or the Secretary of the
Corporation. Such resignation shall take effect at the time therein
specified or, if no time is specified, immediately; and, unless otherwise
specified in such notice, the acceptance of such resignation shall not be
necessary to make it effective. Any director or the entire Board of
Directors may be removed only in accordance with the provisions of the
Certificate of Incorporation.
Section 8. Meetings. The Board of Directors of the Corporation may
hold meetings, both regular and special, either within or without the
State of Delaware. Regular meetings of the Board of Directors may be held
at such time and at such place as may from time to time be determined by
the Board of Directors and, unless required by resolution of the Board of
Directors, without notice. Special meetings of the Board of Directors may
be called by the Chairman of the Board or a majority of the directors then
in office. Notice thereof stating the place, date and hour of the meeting
shall be given to each director either by mail not less than forty-eight
(48) hours before the date of the meeting, by telephone, facsimile or
telegram on twenty-four (24) hours' notice, or on such shorter notice as
the person or persons calling such meeting may deem necessary or
appropriate in the circumstances.
Section 9. Quorum. Except as may be otherwise required by law, the
Certificate of Incorporation or these By-Laws, at all meetings of the
Board of Directors, a majority of the entire Board of Directors shall
constitute a quorum for the transaction of business and the act of a
majority of the directors present at any meeting at which there is a
quorum shall be the act of the Board of Directors. If a quorum shall not
be present at any meeting of the Board of Directors, the directors present
thereat may adjourn the meeting from time to time, without notice other
than announcement at the meeting of the time and place of the adjourned
meeting, until a quorum shall be present.
Section 10. Actions of Board. Unless otherwise provided by the
Certificate of Incorporation or these By-Laws, any action required or
permitted to be taken at any meeting of the Board of Directors or of any
committee thereof may be taken without a meeting, if all the members of
the Board of Directors or committee, as the case may be, consent thereto
in writing, and the writing or writings are filed with the minutes of
proceedings of the Board of Directors or committee.
Section 11. Meetings by Means of Conference Telephone. Unless
otherwise provided by the Certificate of Incorporation or these By-Laws,
members of the Board of Directors of the Corporation, or any committee
designated by the Board of Directors, may participate in a meeting of the
Board of Directors or such committee by means of a conference telephone or
similar communications equipment by means of which all persons
participating in the meeting can hear each other, and participation in a
meeting pursuant to this Section 11 shall constitute presence in person at
such meeting.
Section 12. Committees. The Board of Directors may, by resolution
passed by a majority of the entire Board of Directors, designate one or
more committees, each committee to consist of one or more of the directors
of the Corporation. The Board of Directors may designate one or more
directors as alternate members of any committee, who may replace any
absent or disqualified member at any meeting of any such committee. In the
absence or disqualification of a member of a committee, and in the absence
of a designation by the Board of Directors of an alternate member to
replace the absent or disqualified member, the member or members thereof
present at any meeting and not disqualified from voting, whether or not he
or they constitute a quorum, may unanimously appoint another member of the
Board of Directors to act at the meeting in the place of any absent or
disqualified member. Any committee, to the extent permitted by law and
provided in the resolution establishing such committee, shall have and may
exercise all the powers and authority of the Board of Directors in the
management of the business and affairs of the Corporation. Each committee
shall keep regular minutes and report to the Board of Directors when
required.
Section 13. Compensation. The directors may be paid their expenses,
if any, of attendance at each meeting of the Board of Directors and may be
paid such emoluments as the Board of Directors shall from time to time
determine. No such payment shall preclude any director from serving the
Corporation in any other capacity and receiving compensation therefor.
Members of special or standing committees may be allowed like compensation
for attending committee meetings.
Section 14. Interested Directors. No contract or transaction
between the Corporation and one or more of its directors or officers, or
between the Corporation and any other corporation, partnership,
association, or other organization in which one or more of its directors
or officers are directors or officers, or have a financial interest, shall
be void or voidable solely for this reason, or solely because the director
or officer is present at or participates in the meeting of the Board of
Directors or committee thereof which authorizes the contract or
transaction, or solely because such person's or their votes are counted
for such purpose if (i) the material facts as to such person's or their
relationship or interest and as to the contract or transaction are
disclosed or are known to the Board of Directors or the committee, and the
Board of Directors or committee in good faith authorizes the contract or
transaction by the affirmative votes of a majority of the disinterested
directors, even though the disinterested directors be less than a quorum;
or (ii) the material facts as to such person's or their relationship or
interest and as to the contract or transaction are disclosed or are known
to the stockholders entitled to vote thereon, and the contract or
transaction is specifically approved in good faith by vote of the
stockholders; or (iii) 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, a committee thereof or the stockholders. Common or
interested directors may be counted in determining the presence of a
quorum at a meeting of the Board of Directors or of a committee which
authorizes the contract or transaction.
ARTICLE IV
OFFICERS
Section 1. General. The officers of the Corporation shall be chosen
by the Board of Directors and shall be a Chief Executive Officer, a
President, a Secretary and a Treasurer, each of whom shall be elected by
the Board of Directors and shall hold office for such term and shall
exercise such powers and perform such duties as set forth in these By-Laws
and as shall be determined from time to time by the Board of Directors.
The Board of Directors or the Chief Executive Officer may also elect or
appoint one or more Vice Presidents, Assistant Secretaries, Assistant
Treasurers and other officers, each of whom shall hold office for such
term and shall exercise such powers and perform such duties as set forth
in these By-Laws and as shall be determined from time to time by the Board
of Directors if such officer was elected by the Board of Directors or by
the Chief Executive Officer if such officer was appointed by the Chief
Executive Officer. Any number of offices may be held by the same person,
unless otherwise prohibited by law, the Certificate of Incorporation or
these By-Laws. The officers of the Corporation need not be stockholders or
directors of the Corporation.
Section 2. Removal. All officers of the Corporation shall hold
office until their successors are chosen and qualified, or until their
earlier resignation or removal. Any officer may be removed at any time by
the affirmative vote of a majority of the entire Board of Directors or by
the Chief Executive Officer, if such officer was appointed by the Chief
Executive Officer. Any vacancy occurring in the offices of Chief Executive
Officer, President, Secretary or Treasurer shall be filled by the Board of
Directors. Any vacancy occurring in any other office of the Corporation
shall be filled by the Board of Directors or the Chief Executive Officer.
The salaries of all officers of the Corporation shall be fixed by the
Board of Directors.
Section 3. Compensation. The Board of Directors from time to time
shall fix the compensation of the officers of the Corporation. The
compensation of other agents and employees of the Corporation may be fixed
by the Board of Directors, or by any committee designated by the board or
by an officer to whom that function has been delegated by the Board of
Directors.
Section 4. Voting Securities Owned by the Corporation. Powers of
attorney, proxies, waivers of notice of meeting, consents and other
instruments relating to securities owned by the Corporation may be
executed in the name of and on behalf of the Corporation by the Chief
Executive Officer, President or any Vice President and any such officer
may, in the name of and on behalf of the Corporation, take all such action
as any such officer may deem advisable to vote in person or by proxy at
any meeting of security holders of any corporation in which the Corporation
may own securities and at any such meeting shall possess and may exercise any
and all rights and power incident to the ownership of such securities and
which, as the owner thereof, the Corporation might have exercised and
possessed if present. The Board of Directors may, by resolution, from time
to time confer like powers upon any other person or persons.
Section 5. Chief Executive Officer. The Chief Executive Officer
shall be the chief executive officer of the Corporation and shall in
general supervise and control all of the business and affairs of the
Corporation, subject, however, to the direction and control of the Board
of Directors and of any duly authorized committee of the Board of
Directors. In the absence of the Chairman of the Board, the Chief
Executive Officer shall preside at all meetings of the stockholders. The
Chief Executive Officer shall possess the power to execute all deeds,
mortgages, bonds, contracts, certificates and other instruments of the
Corporation, except in cases where the execution thereof shall be
expressly delegated by the Board of Directors or by these By-Laws to some
other officer or agent of the Corporation or shall be required by law to
be otherwise executed or signed. The Chief Executive Officer shall make
reports to the Board of Directors and the stockholders and shall see that
all orders and resolutions of the Board of Directors and of any committee
thereof are carried into effect. The Chief Executive Officer shall also
perform such other duties as from time to time may be assigned to him by
these By-Laws or by the Board of Directors.
Section 6. President. The President shall be the second most senior
executive of the Corporation and, subject to the direction of the Chief
Executive Officer and the control of the Board of Directors, shall assist
the Chief Executive Officer in the administration and operation of the
Corporation's business and general supervision of its policies and
affairs. In the absence of the Chairman of the Board and the Chief
Executive Officer, the President shall preside at all meetings of the
stockholders of the Corporation. The President shall possess the power to
execute all deeds, mortgages, bonds, contracts, certificates and other
instruments of the Corporation requiring a seal, under the seal of the
Corporation, except in cases where the execution thereof shall be
expressly delegated by the Board of Directors or by these By-Laws to some
other officer or agent of the Corporation or shall be required by law to
be otherwise executed or signed. The President shall also perform such
other duties and may exercise such other powers as from time to time may
be assigned to him or her by these By-Laws, the Board of Directors or the
Chief Executive Officer.
Section 7. Executive Vice Presidents, Senior Vice Presidents, Vice
Presidents and other Officers. Each Executive Vice President, Senior Vice
President, other Vice President or other officer of the Corporation shall
perform such duties and have such powers as from time to time may be
assigned to him or her by the Board of Directors or the Chief Executive
Officer.
Section 8. Secretary. The Secretary shall attend all meetings of
the Board of Directors and all meetings of stockholders and record all the
proceedings thereat in a book or books to be kept for that purpose; the
Secretary shall also perform like duties for the standing committees when
required. The Secretary shall give, or cause to be given, notice of all
meetings of the stockholders and special meetings of the Board of
Directors, and shall perform such other duties as may be prescribed by the
Board of Directors or the Chairman of the Board, under whose supervision
the Secretary shall be. If the Secretary shall be unable or shall refuse
to cause to be given notice of all meetings of the stockholders and
special meetings of the Board of Directors, and if there be no Assistant
Secretary, then either the Board of Directors or the Chief Executive Officer
may choose another officer to cause such notice to be given. The Secretary
shall have custody of the seal of the Corporation and the Secretary or any
Assistant Secretary, if there be one, shall have authority to affix the
same to any instrument requiring it and when so affixed, it may be
attested by the signature of the Secretary or by the signature of any such
Assistant Secretary. The Board of Directors may give general authority to
any other officer to affix the seal of the Corporation and to attest the
affixing by his or her signature. The Secretary shall see that all books,
reports, statements, certificates and other documents and records required
by law to be kept or filed are properly kept or filed, as the case may be.
Section 9. Treasurer. The Treasurer shall have the custody of the
corporate funds and securities and shall keep full and accurate accounts
of receipts and disbursements in books belonging to the Corporation and
shall deposit all moneys and other valuable effects in the name and to the
credit of the Corporation in such depositories as may be designated by the
Board of Directors. The Treasurer shall disburse the funds of the
Corporation as may be ordered by the Board of Directors, taking proper
vouchers for such disbursements, and shall render to the Chief Executive
Officer, when he or she so requires, and to the Board of Directors, at its
regular meetings, or when the Board of Directors so requires, an account
of all transactions as Treasurer and of the financial condition of the
Corporation. If required by the Board of Directors, the Treasurer shall
give the Corporation a bond in such sum and with such surety or sureties
as shall be satisfactory to the Board of Directors for the faithful
performance of the duties of the office of Treasurer and for the
restoration to the Corporation, in case of the Treasurer's death,
resignation, retirement or removal from office, of all books, papers,
vouchers, money and other property of whatever kind in the Treasurer's
possession or under control of the Treasurer belonging to the Corporation.
Section 10. Assistant Secretaries. Except as may be otherwise
provided in these By-Laws, Assistant Secretaries, if there be any, shall
perform such duties and have such powers as from time to time may be
assigned to them by the Board of Directors, the Chief Executive Officer,
the President, any Vice President, if there be one, or the Secretary, and
in the absence of the Secretary or in the event of his or her disability
or refusal to act, shall perform the duties of the Secretary, and when so
acting, shall have all the powers of and be subject to all the
restrictions upon the Secretary.
Section 11. Assistant Treasurers. Assistant Treasurers, if there be
any, shall perform such duties and have such powers as from time to time
may be assigned to them by the Board of Directors, the Chief Executive
Officer, the President, any Vice President, if there be one, or the
Treasurer, and in the absence of the Treasurer or in the event of the
Treasurer's disability or refusal to act, shall perform the duties of the
Treasurer, and when so acting, shall have all the powers of and be subject
to all the restrictions upon the Treasurer. If required by the Board of
Directors, an Assistant Treasurer shall give the Corporation a bond in
such sum and with such surety or sureties as shall be satisfactory to the
Board of Directors for the faithful performance of the duties of the
office of Assistant Treasurer and for the restoration to the Corporation,
in case of the Assistant Treasurer's death, resignation, retirement or
removal from office, of all books, papers, vouchers, money and other
property of whatever kind in the Assistant Treasurer's possession or under
control of the Assistant Treasurer belonging to the Corporation.
ARTICLE V
STOCK
Section 1. Form of Certificates. Every holder of stock in the
Corporation shall be entitled to have a certificate signed, in the name of
the Corporation, (i) by the Chairman of the Board, the President or a Vice
President and (ii) by the Treasurer or an Assistant Treasurer, or the
Secretary or an Assistant Secretary of the Corporation, certifying the
number of shares owned by such holder of stock in the Corporation.
Section 2. Signatures. Any or all of the signatures on a
certificate may be a facsimile. In case any officer, transfer agent or
registrar who has signed or whose facsimile signature has been placed upon
a certificate shall have ceased to be such officer, transfer agent or
registrar before such certificate is issued, it may be issued by the
Corporation with the same effect as if such person were such officer,
transfer agent or registrar at the date of issue.
Section 3. Lost, Destroyed, Stolen or Mutilated Certificates. The
Board of Directors may direct a new certificate to be issued in place of
any certificate theretofore issued by the Corporation alleged to have been
lost, stolen or destroyed, upon the making of an affidavit of that fact by
the person claiming the certificate of stock to be lost, stolen or
destroyed. When authorizing such issue of a new certificate, the Board of
Directors may, in its discretion and as a condition precedent to the
issuance thereof, require the owner of such lost, stolen or destroyed
certificate, or such person's legal representative, to advertise the same
in such manner as the Board of Directors shall require and/or to give the
Corporation a bond in such sum as it may direct as indemnity against any
claim that may be made against the Corporation with respect to the
certificate alleged to have been lost, stolen or destroyed.
Section 4. Transfers. Stock of the Corporation shall be
transferable in the manner prescribed by law and in these By-Laws.
Transfers of stock shall be made on the books of the Corporation only by
the person named in the certificate or by such person's attorney lawfully
constituted in writing and upon the surrender of the certificate therefor,
properly endorsed for transfer and payment of all necessary transfer
taxes; provided, however, that such surrender and endorsement or payment
of taxes shall not be required in any case in which the officers of the
Corporation shall determine to waive such requirement. Every certificate
exchanged, returned or surrendered to the Corporation shall be marked
"Cancelled," with the date of cancellation, by the Secretary or Assistant
Secretary of the Corporation or the transfer agent thereof. No transfer of
stock shall be valid as against the Corporation for any purpose until it
shall have been entered in the stock records of the Corporation by an
entry showing from and to whom transferred.
Section 5. Transfer and Registry Agents. The Corporation may from
time to time maintain one or more transfer offices or agencies and
registry offices or agencies at such place or places as may be determined
from time to time by the Board of Directors.
Section 6. Beneficial Owners. The Corporation shall be entitled to
recognize the exclusive right of a person registered on its books as the
owner of shares to receive dividends, and to vote as such owner, and to
hold liable for calls and assessments a person registered on its books as
the owner of shares, and shall not be bound to recognize any equitable or
other claim to or interest in such share or shares on the part of any
other person, whether or not it shall have express or other notice
thereof, except as otherwise provided by law.
ARTICLE VI
NOTICES
Section 1. Notices. Whenever written notice is required by law, the
Certificate of Incorporation or these By-Laws, to be given to any
director, member of a committee or stockholder, such notice may be given
by mail, addressed to such director, member of a committee or stockholder,
at such person's address as it appears on the records of the Corporation,
with postage thereon prepaid, and such notice shall be deemed to be given
at the time when the same shall be deposited in the United States mail.
Written notice may also be given personally or by telegram, facsimile,
telex or cable.
Section 2. Waivers of Notice.
(a) Whenever any notice is required by law, the Certificate of
Incorporation or these By-Laws, to be given to any director, member of a
committee or stockholder, a waiver thereof in writing, signed, by the
person or persons entitled to said notice, whether before or after the
time stated therein, shall be deemed equivalent to notice. Attendance of a
person at a meeting, present by person or represented by proxy, shall
constitute a waiver of notice of such meeting, except where the person
attends the meeting for the express purpose of objecting at the beginning
of the meeting to the transaction of any business because the meeting is
not lawfully called or convened.
(b) Neither the business to be transacted at, nor the purpose
of, any regular or special meeting of the stockholders, directors or
members of a committee of directors need be specified in any written
waiver of notice unless so required by law, the Certificate of
Incorporation or these By-Laws.
ARTICLE VII
GENERAL PROVISIONS
Section 1. Dividends. Subject to the requirements of the General
Corporation Law of the State of Delaware as set forth in Title 8 of the
Delaware Code (the "GCL") and the provisions of the Certificate of
Incorporation, dividends upon the capital stock of the Corporation may be
declared by the Board of Directors at any regular or special meeting of
the Board of Directors, and may be paid in cash, in property, or in shares
of the Corporation's capital stock. Before payment of any dividend, there
may be set aside out of any funds of the Corporation available for
dividends such sum or sums as the Board of Directors from time to time, in
its absolute discretion, deems proper as a reserve or reserves to meet
contingencies, or for purchasing any of the shares of capital stock,
warrants, rights, options, bonds, debentures, notes, scrip or other
securities or evidences of indebtedness of the Corporation, or for
equalizing dividends, or for repairing or maintaining any property of the
Corporation, or for any other proper purpose, and the Board of Directors
may modify or abolish any such reserve.
Section 2. Disbursements. All checks or demands for money and notes
of the Corporation shall be signed by such officer or officers or such
other person or persons as the Board of Directors may from time to time
designate.
Section 3. Fiscal Year. The fiscal year of the Corporation shall
be fixed by resolution of the Board of Directors.
Section 4. Corporate Seal. The corporate seal shall have inscribed
thereon the name of the Corporation, the year of its organization and the
words "Corporate Seal, Delaware". The seal may be used by causing it or a
facsimile thereof to be impressed or affixed or reproduced or otherwise.
ARTICLE VIII
INDEMNIFICATION
Section 1. Power to Indemnify in Actions, Suits or Proceedings
Other than Those by or in the Right of the Corporation. Subject to Section
3 of this Article VIII, the Corporation shall indemnify any person 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 such person is or was a
director or officer of the Corporation, or is or was a director or officer
of the Corporation serving at the request of the Corporation as a director
or officer, employee or agent of another corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise, against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by such person in connection
with such action, suit or proceeding if such person acted in good faith
and in a manner such person reasonably believed to be in or not opposed to
the best interests of the Corporation, and, with respect to any criminal
action or proceeding, such person had no reasonable cause to believe his
or her 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 such person did not act in good faith and in a manner
which such person 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 or her conduct was
unlawful.
Section 2. Power to Indemnify in Actions, Suits or Proceedings by
or in the Right of the Corporation. Subject to Section 3 of this Article
VIII, the Corporation shall indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the Corporation to procure a judgment
in its favor by reason of the fact that such person is or was a director
or officer of the Corporation, or is or was a director or officer of the
Corporation serving at the request of the Corporation as a director,
officer, employee or agent of another corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise, against
expenses (including attorneys' fees) actually and reasonably incurred by
such person in connection with the defense or settlement of such action or
suit if such person acted in good faith and in a manner such person
reasonably believed to be in or not opposed to the best interests of the
Corporation; 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 to the Corporation unless and only to the extent
that the Court of Chancery 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 Chancery or such other court shall deem proper.
Section 3. Authorization of Indemnification. Any indemnification
under this Article VIII (unless ordered by a court) shall be made by the
Corporation only as authorized in the specific case upon a determination
that indemnification of the director or officer is proper in the
circumstances because such person has met the applicable standard of
conduct set forth in Section 1 or Section 2 of this Article VIII, as the
case may be. Such determination shall be made (i) by a majority vote of
the directors who are not parties to such action, suit or proceeding, even
though less than a quorum, or (ii) if there are no such directors, or if
such directors so direct, by independent legal counsel in a written
opinion, or (iii) by the stockholders. To the extent, however, that a
director or officer of the Corporation has been successful on the merits
or otherwise in defense of any action, suit or proceeding described above,
or in defense of any claim, issue or matter therein, such person shall be
indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection therewith, without the
necessity of authorization in the specific case.
Section 4. Good Faith Defined. For purposes of any determination
under Section 3 of this Article VIII, a person shall be deemed to have
acted in good faith and in a manner such person reasonably believed to be
in or not opposed to the best interests of the Corporation, or, with
respect to any criminal action or proceeding, to have had no reasonable
cause to believe his or her conduct was unlawful, if such person's action
is based on the records or books of account of the Corporation or another
enterprise, or on information supplied to such person by the officers of
the Corporation or another enterprise in the course of their duties, or on
the advice of legal counsel for the Corporation or another enterprise or
on information or records given or reports made to the Corporation or
another enterprise by an independent certified public accountant or by an
appraiser or other expert selected with reasonable care by the Corporation
or another enterprise. The term "another enterprise" as used in this
Section 4 shall mean any other corporation or any partnership, joint
venture, trust, employee benefit plan or other enterprise of which such
person is or was serving at the request of the Corporation as a director,
officer, employee or agent. The provisions of this Section 4 shall not be
deemed to be exclusive or to limit in any way the circumstances in which a
person may be deemed to have met the applicable standard of conduct set
forth in Section 1 or 2 of this Article VIII, as the case may be.
Section 5. Indemnification by a Court. Notwithstanding any contrary
determination in the specific case under Section 3 of this Article VIII,
and notwithstanding the absence of any determination thereunder, any
director or officer may apply to the Court of Chancery of the State of
Delaware or any other court of competent jurisdiction in the State of
Delaware for indemnification to the extent otherwise permissible under
Sections 1 and 2 of this Article VIII. The basis of such indemnification
by a court shall be a determination by such court that indemnification of
the director or officer is proper in the circumstances because such person
has met the applicable standards of conduct set forth in Section 1 or 2 of
this Article VIII, as the case may be. Neither a contrary determination in
the specific case under Section 3 of this Article VIII nor the absence of
any determination thereunder shall be a defense to such application or
create a presumption that the director or officer seeking indemnification
has not met any applicable standard of conduct. Notice of any application
for indemnification pursuant to this Section 5 shall be given to the
Corporation promptly upon the filing of such application. If successful,
in whole or in part, the director or officer seeking indemnification shall
also be entitled to be paid the expense of prosecuting such application.
Section 6. Expenses Payable in Advance. Expenses incurred by a
director or officer in defending or investigating a threatened or pending
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 such director or officer to repay such
amount if it shall ultimately be determined that such person is not
entitled to be indemnified by the Corporation as authorized in this
Article VIII.
Section 7. Nonexclusivity of Indemnification and Advancement of
Expenses. The indemnification and advancement of expenses provided by or
granted pursuant to this Article VIII shall not be deemed exclusive of any
other rights to which those seeking indemnification or advancement of
expenses may be entitled under the Certificate of Incorporation or any By-
Law, agreement, contract, vote of stockholders or disinterested directors
or pursuant to the direction (howsoever embodied) of any court of
competent jurisdiction or otherwise, both as to action in such person's
official capacity and as to action in another capacity while holding such
office, it being the policy of the Corporation that indemnification of the
persons specified in Section 1 and 2 of this Article VIII shall be made to
the fullest extent permitted by law. The provisions of this Article VIII
shall not be deemed to preclude the indemnification of any person who is
not specified in Section 1 or 2 of this Article VIII but whom the
Corporation has the power or obligation to indemnify under the provisions
of the GCL, or otherwise.
Section 8. Insurance. The Corporation may purchase and maintain
insurance on behalf of any person who is or was a director or officer of
the Corporation, or is or was a director or officer of the Corporation
serving at the request of the Corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise against any liability asserted
against such person and incurred by such person in any such capacity, or
arising out of such person's status as such, whether or not the
Corporation would have the power or the obligation to indemnify such
person against such liability under the provisions of this Article VIII.
Section 9. Certain Definitions. For purposes of this Article VIII,
references to "the Corporation" shall include, in addition to the
resulting corporation, any constituent corporation (including any
constituent of a constituent) absorbed in a consolidation or merger which,
if its separate existence had continued, would have had power and
authority to indemnify its directors or officers, so that any person who
is or was a director or officer of such constituent corporation, or is or
was a director or officer of such constituent corporation serving at the
request of such constituent corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, shall stand in the same
position under the provisions of this Article VIII with respect to the
resulting or surviving corporation as such person would have with respect
to such constituent corporation if its separate existence had continued.
For purposes of this Article VIII, references to "fines" shall include any
excise taxes assessed on a person with respect to an employee benefit
plan; and references to "serving at the request of the Corporation" shall
include any service as a director, officer, employee or agent of the
Corporation which imposes duties on, or involves services by, such
director or officer with respect to an employee benefit plan, its
participants or beneficiaries; and a person who acted in good faith and in
a manner such person reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan shall be deemed
to have acted in a manner "not opposed to the best interests of the
Corporation" as referred to in this Article VIII.
Section 10. Survival of Indemnification and Advancement of
Expenses. The indemnification and advancement of expenses provided by, or
granted pursuant to, this Article VIII shall, unless otherwise provided
when authorized or ratified, continue as to a person who has ceased to be
a director or officer and shall inure to the benefit of the heirs, executors
and administrators of such a person.
Section 11. Limitation on Indemnification. Notwithstanding anything
contained in this Article VIII to the contrary, except for proceedings to
enforce rights to indemnification (which shall be governed by Section 5
hereof), the Corporation shall not be obligated to indemnify any director
or officer (or his or her heirs, executors or personal or legal
representatives) or advance expenses in connection with a proceeding (or
part thereof) initiated by such person unless such proceeding (or part
thereof) was authorized or consented to by the Board of Directors of the
Corporation.
Section 12. Indemnification of Employees and Agents. The
Corporation may, to the extent authorized from time to time by the Board
of Directors, provide rights to indemnification and to the advancement of
expenses to employees and agents of the Corporation similar to those
conferred in this Article VIII to directors and officers of the
Corporation.
ARTICLE IX
AMENDMENTS
Section 1. Amendments. These By-Laws may be altered, amended or
repealed, in whole or in part, or new By-Laws may be adopted by the Board
of Directors or by the stockholders as provided in the Certificate of
Incorporation.
Section 2. Entire Board of Directors. As used in this Article IX
and in these By-Laws generally, the term "entire Board of Directors" means
the total number of directors which the Corporation would have if
there were no vacancies.
Exhibit 6
- ---------------------------------------------------------------------------
COMMON STOCK PAR VALUE $.01
[LOGO]
INCORPORATED UNDER THE LAWS CUSIP 74264Q 10 8
OF THE STATE OF DELAWARE PRISM FINANCIAL CORPORATION SEE REVERSE FOR
CERTAIN DEFINITIONS
--------------------------------------------------------------------------
THIS CERTIFIES THAT
is the owner of
---------------------------------------------------------------------------
FULLY PAID AND NON-ASSESSABLE SHARES OF COMMON STOCK, PAR VALUE $.01
PER SHARE, OF
PRISM FINANCIAL CORPORATION
(hereinafter called the "Corporation") transferable on the
books of the Corporation by the holder hereof in person or by
duly authorized attorney upon surrender of this Certificate
properly endorsed. This Certificate and the shares
represented hereby are issued and shall be subject to all the
provisions of the Certificate of Incorporation and Bylaws of
the Corporation and the amendments from time to time made
thereto, copies of which are on file at the principal office
of the Corporation, to all of which the holder of this
Certificate by acceptance hereof assents. This Certificate is
not valid until countersigned and registered by the Transfer
Agent and Registrar.
WITNESS, the facsimile seal of the Corporation and the
facsimile signature of its duly authorized officers.
PRESIDENT AND DATED:
CHIEF EXECUTIVE OFFICER COUNTERSIGNED AND REGISTERED:
[SEAL] LASALLE NATIONAL BANK
TRANSFER AGENT
AND REGISTRAR
SECRETARY
BY:
AUTHORIZED SIGNATURE
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The Corporation will furnish without charge to each stockholder who
so requests a statement of the powers, designations, preferences and
relative, participating, optional or other rights of each class of stock
or series thereof of the Corporation, and the qualifications, limitations
or restrictions of such preferences and/or rights. Any such request may
be made to the Corporation or the Transfer Agent.
KEEP THIS STOCK CERTIFICATE IN A SAFE PLACE. If this stock
certificate is lost, stolen, or destroyed, the Board of Directors of the
Corporation may require the owner, or his legal representative, to give
the Corporation a bond to indemnify the Corporation against any claim
that may be made against them on account of the alleged loss, theft, or
destruction of any such certificate as a condition to the issuance of a
replacement certificate.
The following abbreviations, when used in the inscription on the face
of this certificate, shall be construed as though they were written out
in full according to applicable laws or regulations:
<TABLE>
<S> <C>
TEN COM - as tenants in common UNIF GIFT MIN ACT --_________ Custodian ________
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with right
of under Uniform Gifts to Minors
survivorship and not as tenants Act_____________________________
in common (State)
UNIF TRF MIN ACT -- _______ Custodian (until age _____)
(Cust)
____________ under Uniform Transfers
(Minor)
to Minor Act ____________________
(State)
</TABLE>
Additional abbreviations may also be used though not in
the above list.
For value received, ______________________ hereby sell(s),
assign(s), and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- ---------------------------------------
- ---------------------------------------
- ------------------------------------------------------------------------------
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)
- ------------------------------------------------------------------------------
___________________________________________________________________________
Shares of the capital stock represented by the within Certificate, and do
hereby irrevocably constitute and appoint
_______________________________________________________________________
Attorney to transfer the said stock on the books of the within-named
Corporation with full power of substitution in the premises.
Dated __________________________
X______________________________________
X______________________________________
THE SIGNATURE(S) TO THIS ASSIGNMENT
MUST CORRESPOND WITH THE NAME(S) AS
WRITTEN UPON NOTICE: THE FACE OF THE
CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR
ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED
By______________________________________________________________
THE SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKHOLDERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS
WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM,)
PURSUANT TO S.E.C. RULE 17Ad-15.
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in the Rights Agreement between Prism Financial
Corporation (the "Company") and LaSalle Bank National Association, dated as
of January 27, 2000, as from time to time amended (the "Rights Agreement"),
the terms of which are hereby incorporated herein by reference and a copy
of which is on file at the principal offices of the Company. Under certain
circumstances, as set forth in the Rights Agreement, such Rights will be
evidenced by separate certificate and will no longer be evidenced by the
certificate. The Company will mail to the holder of this certificate a copy
of the Rights Agreement, as in effect on the date of mailing, without
charge promptly after receipt of a written request therefor. Under certain
circumstances set forth in the Rights Agreement, Rights issued to, or held
by, any Person who is, was or becomes an Acquiring Person or an Adverse
Person or any Affiliate or Associate thereof (as such terms are defined in
the Rights Agreement), whether currently held by or on behalf of such
Person or by any subsequent holder, may become null and void.
Exhibit 7
REGISTRATION RIGHTS AGREEMENT
May 28, 1999
To the several persons named at the foot hereof:
Ladies and Gentlemen:
WHEREAS, Prism Financial Corporation, a Delaware corporation (the
"Company"), is undertaking an initial public offering of its Common Stock
(as defined herein) pursuant to an underwriting agreement, dated as of the
date hereof, by and among the Company, the Initial Shareholders (as defined
herein) and the underwriters named therein (the "Underwriting Agreement");
WHEREAS, in connection with the Company's initial public offering,
the Company and each Initial Shareholder have entered into a Share Exchange
Agreement or received shares of the Company pursuant to acquisition
agreements, such that upon consummation of the Company's initial public
offering, each Initial Shareholder shall own the number of shares of Common
Stock set forth opposite such Initial Shareholder's name on Annex I hereto;
and
WHEREAS, the Company desires to provide to each of you, rights to
register the Common Stock of the Company owned by you.
NOW, THEREFORE, as an inducement to each of you to consummate the
transactions contemplated by the Underwriting Agreement, the Company hereby
covenants and agrees with each of you, and with each subsequent holder of
Restricted Stock (as defined herein) as follows:
1. Certain Definitions. As used herein, the following terms
shall have the following respective meanings:
"Common Stock" shall mean the Common Stock, par value $0.01 per
share, of the Company.
"Commission" shall mean the Securities and Exchange Commission,
or any other federal agency at the time administering the Securities Act.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, or any similar federal statute, and the rules and regulations
of the Commission thereunder, all as the same shall be in effect at the
time.
"Initial Shareholders" shall mean those persons who are
signatories to this Agreement, and their successors and assigns, and other
persons who may become holders of Restricted Stock.
"Initial Shareholder Shares" means all shares of Common Stock
owned by the Initial Shareholders on the date hereof as set forth in Annex
I hereto, as such shares may be adjusted from time to time in accordance
with Section 8 hereof.
"IPO" shall mean the initial public offering of the Company's
Common Stock under the Securities Act.
"person" means any individual, firm, corporation, partnership,
limited liability company, trust, incorporated or unincorporated
association, joint venture, joint stock company, limited liability company,
government (or an agency or political subdivision thereof) or other entity
of any kind, and shall include any successor (by merger or otherwise) of
such entity.
"Public Sale" shall mean any sale of shares of Common Stock to
the public pursuant to an offering registered under the Securities Act or
to the public pursuant to the provisions of Rule 144 (or any successor or
similar rule) adopted under the Securities Act.
"Registration Expenses" shall mean the expenses so described in
Section 6 hereof.
"Restricted Stock" shall mean the shares of Common Stock issued
to the Initial Shareholders or other persons which are required to bear a
restrictive legend, excluding Initial Shareholder Shares which have been
(i) registered under the Securities Act pursuant to an effective
registration statement filed thereunder and disposed of in accordance with
the registration statement covering them or (ii) publicly sold pursuant to
Rule 144 under the Securities Act.
"Securities Act" shall mean the Securities Act of 1933, as
amended, or any similar federal statute, and the rules and regulations of
the Commission thereunder, all as the same shall be in effect at the time.
"Selling Expenses" shall mean the expenses so described in
Section 6 hereof.
2. Required Registration.
(a) At any time on or after the 180 day anniversary of
the consummation of the IPO, the holders of at least 50% of the Restricted
Stock outstanding at such time may request the Company to register all or
any portion of the Restricted Stock held by such requesting holder or
holders for sale in the manner specified in such notice; provided, however,
that the Company shall not be obligated to effect any such registration
unless the proceeds to be realized in connection with such registration
shall not reasonably be expected to be less than $1,000,000.
(b) Promptly following receipt of any notice under this
Section 2, the Company shall immediately notify any holders of Restricted
Stock from whom notice has not been received and shall use its best efforts
to register under the Securities Act, for Public Sale in accordance with
the method of disposition specified in such notice from requesting holders,
the number of shares of Restricted Stock specified in such notice (and in
any notices received from other holders of Restricted Stock within thirty
(30) days after their receipt of notice from the Company); provided,
however, that the number of shares of Restricted Stock to be included in
such an underwriting may be reduced pro rata among the requesting holders
of Restricted Stock if and to the extent that the managing underwriter, if
the proposed method of disposition specified by the requesting holders
shall be an underwritten public offering, shall be of the opinion that such
inclusion would materially adversely affect the marketing of the Restricted
Stock. If such method of disposition shall be an underwritten public
offering, the Company shall designate the managing underwriter of such
offering, subject to the approval of the selling holders of a majority of
the Restricted Stock covered by the offering, which approval shall not be
unreasonably withheld. Subject to paragraph (c) below, the Company shall be
obligated to use its reasonable best efforts to cause the registration
statement filed pursuant to this Section 2 to become effective not later
than 90 (ninety) days after receipt of notice pursuant to Section 2. The
Company shall be obligated to register Restricted Stock pursuant to this
Section 2 on two (2) occasions only; provided that such obligation shall be
deemed satisfied only when a registration statement covering all shares of
Restricted Stock specified in notices received as aforesaid, for sale in
accordance with the method of disposition specified by the requesting
holders, shall have become effective and, if such method of disposition is
a firm commitment underwritten public offering, all such shares shall have
been sold pursuant thereto; provided, however, that a registration
statement shall not constitute a registration request pursuant to this
Section 2 if (x) after such registration statement has become effective,
such registration or the related offer, sale or distribution of Restricted
Stock thereunder is interfered with by any stop order, injunction or other
order or requirement of the Commission or other governmental agency or
court for any reason not attributable to the holders of such Restricted
Stock and such interference is not thereafter eliminated or (y) the
conditions specified in the underwriting agreement, if any, entered into in
connection with such registration statement are not satisfied or waived,
other than by reason of a failure by any holder of such Restricted Stock.
(c) Notwithstanding anything to the contrary in this
Agreement, the Company may delay for up to ninety (90) days the filing or
effectiveness of a registration statement pursuant to a request under this
Section 2 if the Board of Directors of the Company shall determine that
such a registration would not be in the best interests of the Company at
such time, during which period the requesting holders may withdraw their
request (provided that, if not so withdrawn, the Company will not have
breached its obligations under this Section 2 during such delay period), in
which case the requesting holders will not be deemed to have made a request
for registration under this Section 2.
(d) The Company shall be entitled to include in any
registration statement referred to in this Section 2, for sale in
accordance with the method of disposition specified by the requesting
holders, shares of Common Stock to be sold by the Company for its own
account, except as and to the extent that, in the opinion of the managing
underwriter (if such method of disposition shall be an underwritten public
offering), such inclusion would adversely affect the marketing of the
Restricted Stock (if any) to be sold.
3. Form S-3 Registration.
If at any time (i) the Company shall receive from the holders
of at least 50% of the Restricted Stock a written request or requests that
the Company effect a registration of all or any portion of the shares of
Restricted Stock on Form S- 3 or any successor thereto, and (ii) the
Company is a registrant entitled to use Form S-3 or any successor thereto
to register such shares, the Company will:
(i) promptly give written notice of the proposed
registration, and any related qualification or compliance, to all
other holders of any shares of Restricted Stock; and
(ii) as soon as practicable, effect such registration
(including, without limitation, the execution of an undertaking to
file post- effective amendments, appropriate qualifications under
applicable blue sky or other state securities laws and appropriate
compliance with applicable regulations issued under the Securities
Act and any other government requirements or regulations) as may be
so requested and as would permit or facilitate the sale and
distribution of all or such portion of such holder's or holders'
Restricted Stock as are specified in such request, together with all
or such portion of the Restricted Stock of any holder or holders of
Restricted Stock joining in such request as are specified in a
written request given within thirty (30) days after receipt of such
written notice from the Company; provided that the Company shall not
be obligated to effect any such registration, qualification or
compliance pursuant to this Section 3 more than once in any 180-day
period and provided further that the Company shall not be obligated
to effect any such registration unless the proceeds to be realized in
connection with such registration shall not reasonably be expected to
be less than $1,000,000. Subject to the foregoing, the Company shall
file a registration statement covering the Restricted Stock so
requested to be registered as soon as practicable after receipt of
the request or requests of the holder or holders of Restricted Stock
to do so.
Notwithstanding anything to the contrary in this Agreement, (i) the Company
may delay for up to ninety (90) days the effectiveness of, and (ii) the
Company may suspend for up to thirty (30) days, not more than once during
the term of this Agreement, the effectiveness of, a registration statement
pursuant to a request under this Section 3 if the Board of Directors of the
Company shall determine such registration (or, in the case of a suspension
of a registration, sales under such registration statement) would not be in
the best interests of the Company at such time, during which period the
requesting holders may withdraw their request, in which case the requesting
holders will not be deemed to have made a request for registration under
this Section 3.
(a) Commencing one year after the Company becomes subject
to the requirements of Section 12 or 15(d) of the Securities Exchange Act
of 1934, as amended, the Company shall use its reasonable best efforts to
satisfy the registrant requirements applicable for use of registration
statements on Form S-3 (or any successor form thereto) for the resale of
securities by selling stockholders.
(b) Registrations effected pursuant to this Section 3
shall not be counted as requests for registration effected pursuant to
Section 2.
4. Incidental Registration. If the Company at any time (other
than pursuant to Section 2 or 3 hereof) proposes to register any of its
Common Stock under the Securities Act for sale for cash only to the public,
whether for its own account or for the account of other security holders or
both (except with respect to registration statements on Forms S-4 or S-8 or
another form not available for registering the Restricted Stock for sale to
the public, a registration statement on Form S-3 to be filed by the Company
to register shares of Common Stock issued in consideration for an
acquisition, or a registration statement on Form S-1 covering solely an
employee benefit plan), it will give written notice at such time to all
holders of outstanding Restricted Stock of its intention to do so. Upon the
written request of any such holder, given within thirty (30) days after
receipt of any such notice by the Company, to register any of its
Restricted Stock (which request shall state the intended method of
disposition thereof), the Company will use its reasonable best efforts to
cause the Restricted Stock as to which registration shall have been so
requested, to be included in the securities to be covered by the
registration statement proposed to be filed by the Company, all to the
extent requisite to permit the sale or other disposition by the holder (in
accordance with its written request) of such Restricted Stock so
registered; provided that nothing herein shall prevent the Company from
abandoning or delaying any such registration at any time. In the event that
any registration pursuant to this Section 4 shall be, in whole or in part,
an underwritten public offering of Common Stock, the Company shall not be
required to include any Restricted Stock in such underwritten offering
unless the holder shall agree to the terms and conditions of the
underwritten offering as agreed by the Company and the underwriters. The
number of shares of Restricted Stock to be included in such an underwriting
may be reduced pro rata among the requesting holders of Restricted Stock,
if and to the extent that the managing underwriter shall be of the opinion
that such inclusion would adversely affect the marketing of the securities
to be sold by the Company therein. In such event, the Company shall be
required to include in such registration, to the extent of the amount that
the managing underwriter believes may be sold without causing such adverse
effect, first, all of the securities to be offered for the account of the
Company; second, the Restricted Stock to be offered for the account of the
holders pursuant to this Section 4, pro rata based on the number of shares
of Restricted Stock owned by each such holder; and third, any other
securities requested to be included in such underwritten offering.
5. Registration Procedures. If and whenever the Company is
required by the provisions of Section 2, 3 or 4 hereof to use its
reasonable best efforts or best efforts, as the case may be, to effect the
registration of any of the Restricted Stock under the Securities Act, the
Company will, as expeditiously as possible:
(a) prepare (and afford counsel for the selling holders up to
10 business days' opportunity to review and comment thereon) and file with
the Commission a registration statement (which, in the case of an
underwritten public offering pursuant to Section 2 hereof, shall be on Form
S-1 or other form of general applicability satisfactory to the managing
underwriter selected as therein provided) with respect to such securities
and use its reasonable best efforts or best efforts, as the case may be, to
cause such registration statement to become and remain effective for the
period of the distribution contemplated thereby (determined as hereinafter
provided);
(b) prepare (and afford counsel for the selling holders
up to 10 business days' opportunity to review and comment thereon) and file
with the Commission such amendments and supplements to such registration
statement and the prospectus used in connection therewith as may be
necessary to keep such registration statement effective for the period
specified in paragraph (a) above and to comply with the provisions of the
Securities Act with respect to the disposition of all Restricted Stock
covered by such registration statement in accordance with the sellers'
intended method of disposition set forth in such registration statement for
such period;
(c) furnish to each seller and to each underwriter such
number of copies of the registration statement and the prospectus included
therein (including each preliminary prospectus) as such persons may
reasonably request in order to facilitate the Public Sale or other
disposition of the Restricted Stock covered by such registration statement;
(d) use its reasonable best efforts or best efforts, as
the case may be, to register or qualify the Restricted Stock covered by
such registration statement under the securities or blue sky laws of such
jurisdictions as the sellers of Restricted Stock or, in the case of an
underwritten public offering, the managing underwriter, shall reasonably
request and do any and all other acts and things which may be reasonably
necessary or advisable to enable any such seller to consummate the
disposition in such jurisdictions of the Restricted Stock owned by such
seller (provided that the Company will not be required to (i) qualify
generally to do business in any jurisdiction where it would not otherwise
be required to qualify but for this paragraph (d), (ii) subject itself to
taxation in any such jurisdiction or (iii) consent to general service of
process in any jurisdiction);
(e) use its reasonable best efforts to list the
Restricted Stock covered by such registration statement with any securities
exchange on which any Common Stock of the Company is then listed;
(f) immediately notify each seller under such
registration statement and each underwriter, at any time when a prospectus
relating thereto is required to be delivered under the Securities Act, of
the happening of any event as a result of which the prospectus contained in
such registration statement, as then in effect, includes an untrue
statement of a material fact or omits to state any material fact required
to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing;
(g) use its reasonable best efforts or best efforts, as
the case may be (if the offering is underwritten and at the request of any
seller of Restricted Stock), to furnish, at the request of any seller, on
the date that Restricted Stock is delivered to the underwriters for sale
pursuant to such registration: (i) an opinion dated such date of counsel
representing the Company, for the purposes of such registration, addressed
to the underwriters and either addressed to such seller or specifically
entitling such seller to rely thereupon, stating that such registration
statement has become effective under the Securities Act and that (A) to the
best knowledge of such counsel, no stop order suspending the effectiveness
thereof has been issued and no proceedings for that purpose have been
instituted or are pending or contemplated under the Securities Act, (B) the
registration statement, the related prospectus, and each amendment or
supplement thereof, comply as to form in all material respects with the
requirements of the Securities Act and the applicable rules and regulations
of the Commission thereunder (except that such counsel need express no
opinion as to financial statements, the notes thereto, and the financial
schedules and other financial and statistical data contained therein) and
(C) to such other effects as may reasonably be requested by counsel for the
underwriters or by such seller or its counsel; and (ii) a letter dated such
date from the independent public accountants retained by the Company,
addressed to the underwriters and to such seller, stating that they are
independent public accountants within the meaning of the Securities Act and
that, in the opinion of such accountants, the financial statements of the
Company included in the registration statement or the prospectus, or any
amendment or supplement thereof, comply as to form in all material respects
with the applicable accounting requirements of the Securities Act, and such
letter shall additionally cover such other financial matters (including
information as to the period ending no more than five (5) business days
prior to the date of such letter) with respect to the registration in
respect of which such letter is being given as such underwriters or seller
may reasonably request; and
(h) make available for inspection by each seller, any
underwriter participating in any distribution pursuant to such registration
statement, and any attorney, accountant or other agent retained by such
seller or underwriter, all financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company's officers,
directors and employees to supply all information reasonably requested by
any such seller, underwriter, attorney, accountant or agent in connection
with such registration statement.
(i) cooperate with each seller of Restricted Stock and
each underwriter participating in the disposition of such Restricted Stock
and their respective counsel in connection with any filings required to be
made with the National Association of Securities Dealers, Inc. (the
"NASD"); and
(j) immediately notify each seller of Restricted Stock of
any stop order issued or threatened by the Commission.
For purposes of paragraphs (a) and (b) above and of Section 2(d) hereof,
the period of distribution of Restricted Stock in a firm commitment
underwritten public offering shall be deemed to extend until each
underwriter has completed the distribution of all securities purchased by
it, and the period of distribution of Restricted Stock in any other
registration shall be deemed to extend until the earlier of the sale of all
Restricted Stock covered thereby or six (6) months after the effective date
thereof.
In connection with each registration hereunder, as a condition
to the right to sell under any registration statement (a) the selling
holders of Restricted Stock will furnish to the Company in writing such
information with respect to themselves and the proposed distribution by
them as shall be reasonably necessary in order to assure compliance with
federal and applicable state securities laws; (b) any such selling holder
of Restricted Stock will enter into a written agreement with the
underwriters and the Company in such form and containing such provisions as
are customary in the securities business for such an arrangement between
major underwriters and companies of the Company's size and investment
stature, and such selling holder of Restricted Stock will use its
reasonable best efforts to cause its counsel to give any opinion
customarily given, in connection with secondary distributions under similar
circumstances; (c) during such time as any such selling holder of
Restricted Stock may be engaged in a distribution of such stock, such
selling holder of Restricted Stock will comply with all applicable laws
and, to the extent required by such laws, will, among other things (i) not
engage in any stabilization activity in connection with the securities of
the Company in contravention of such rules, (ii) distribute the Restricted
Stock owned by such selling holder of Restricted Stock solely in the manner
described in applicable registration statement or as otherwise permitted by
law, (iii) cause to be furnished to each agent or broker-dealer to or
through whom the Restricted Stock owned by such selling holder of
Restricted Stock may be offered, or to the offeree if an offer is made
directly by such holder, such copies of the applicable prospectus (as
amended and supplemented to such date) and the documents incorporated by
reference therein as may be required by such agent, broker-dealer or
offeree, provided that the Company shall have provided such selling holder
of Restricted Stock with an adequate number of copies thereof and (iv) not
bid for or purchase any securities of the Company or attempt to induce any
person to purchase any securities of the Company; and (d) on notice from
the Company of the happening of any event specified in paragraph (f) of
Section 5 hereof or the suspension of effectiveness of the registration
statement under Section 3, then such selling holder will cease offering or
distributing the Restricted Stock until the Company notifies such selling
holder that the offering and distribution of the Restricted Stock may
recommence.
In connection with each registration pursuant to Sections 2, 3
and 4 hereof covering an underwritten public offering, the Company agrees
to enter into a written agreement with the managing underwriter selected in
the manner herein provided in such form and containing such provisions as
are customary in the securities business for such an arrangement between
major underwriters and companies of the Company's size and investment
stature; provided, however, that such agreement shall not contain any such
provision applicable to the Company which is inconsistent with the
provisions hereof; and provided, further, that the time and place of the
closing under said agreement shall be as mutually agreed upon between the
Company and such managing underwriter.
6. Expenses. All expenses incurred by the Company in complying
with Sections 2, 3 or 4 hereof, including without limitation all
registration and filing fees, printing expenses, fees and disbursements of
counsel and independent public accountants for the Company, fees of the
NASD, transfer taxes, fees of transfer agents and registrars, costs of
insurance and reasonable fees and expenses of not more than one counsel for
the Initial Shareholders (not more than $50,000 in fees for such counsel),
but excluding any Selling Expenses, are herein called "Registration
Expenses." All underwriting discounts and selling commissions applicable to
the sale of Restricted Stock are herein called "Selling Expenses."
The Company will pay all Registration Expenses in connection
with each registration statement filed pursuant to Sections 2, 3 and 4
hereof. All Selling Expenses in connection with any registration statement
filed pursuant to Section 2, 3 or 4 hereof shall be borne by the
participating sellers in proportion to the number of shares sold by each,
or by such persons other than the Company (except to the extent the Company
shall be a seller) as they may agree.
7. Indemnification.
(a) In the event of a registration of any of the Restricted
Stock under the Securities Act pursuant to Section 2, 3 or 4 hereof, the
Company will indemnify and hold harmless each seller of such Restricted
Stock thereunder and each underwriter of Restricted Stock thereunder and
each officer, director and each other person, if any, who controls such
seller or underwriter within the meaning of the Securities Act, against any
losses, claims, damages or liabilities, joint or several, to which such
seller or underwriter or controlling person may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained in any registration statement under which such Restricted Stock
was registered under the Securities Act pursuant to Section 2, 3 or 4, any
preliminary prospectus or final prospectus contained therein, or any
amendment or supplement thereof, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading, and will reimburse each such seller, each such underwriter and
each such controlling person for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such
loss, claim, damage, liability or action; provided, however, that (i) the
indemnity in this Section 7 shall not apply to any amounts paid in
settlement of any such loss, claim, damage or liability if settlement is
affected without the consent of the Company, and (ii) the Company will not
be liable in any such case if and to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission so made in
conformity with information furnished by such seller, such underwriter or
such controlling person in writing specifically for use in such
registration statement or prospectus.
(b) In the event of a registration of any of the Restricted
Stock under the Securities Act pursuant to Section 2, 3 or 4 hereof, to the
extent permitted by law each seller of such Restricted Stock thereunder,
severally and not jointly, will indemnify and hold harmless the Company and
each officer, director and each other person, if any, who controls the
Company within the meaning of the Securities Act, each officer of the
Company who signs the registration statement, each director of the Company,
each underwriter and each person who controls any underwriter within the
meaning of the Securities Act, against all losses, claims, damages or
liabilities, joint or several, to which the Company or such officer or
director or underwriter or controlling person may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained in the registration statement under which such Restricted Stock
was registered under the Securities Act pursuant to Section 2, 3 or 4, any
preliminary prospectus or final prospectus contained therein, or any
amendment or supplement thereof, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading, and will reimburse the Company and each such officer, director,
underwriter and controlling person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending
any such loss, claim, damage, liability or action; provided, however, that
such seller will be liable hereunder in any such case if and only to the
extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in reliance upon and in conformity with information
pertaining to such seller, as such, furnished in writing to the Company by
such seller specifically for use in such registration statement or
prospectus; and provided, further, that the liability of each seller
hereunder shall be limited to the proportion of any such loss, claim,
damage, liability or expense which is equal to the proportion that the
public offering price of shares sold by such seller under such registration
statement bears to the total public offering price of all securities sold
thereunder, but not to exceed the proceeds (net of underwriting discounts
and commissions) received by such seller from the sale of Restricted Stock
covered by such registration statement.
(c) Promptly after receipt by an indemnified party
hereunder of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party hereunder, notify the indemnifying party in writing
thereof, but the omission so to notify the indemnifying party shall not
relieve it from any liability which it may have to any indemnified party
other than under this Section 7. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of
the commencement thereof, the indemnifying party shall be entitled to
participate in and, to the extent it shall wish, to assume and undertake
the defense thereof with counsel reasonably satisfactory to such
indemnified party, and, after notice from the indemnifying party to such
indemnified party of its election so to assume and undertake the defense
thereof, the indemnifying party shall not be liable to such indemnified
party under this Section 7 for any legal expenses subsequently incurred by
such indemnified party in connection with the defense thereof other than
reasonable costs of investigation and of liaison with counsel so selected;
provided, however, that, if the defendants in any such action include both
the indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there are reasonable defenses
available to it which are different from or additional to those available
to the indemnifying party, or if the interests of the indemnified party
reasonably are in conflict with the interests of the indemnifying party,
the indemnified party shall have the right to select a separate counsel and
to assume such legal defenses and otherwise to participate in the defense
of such action, with the reasonable expenses and fees of such separate
counsel and other expenses related to such participation to be reimbursed
by the indemnifying party as incurred. No settlement of any such claim,
loss, damage, liability or action shall be made by the indemnified party
without the prior written consent (not to be unreasonably withheld or
delayed) of the indemnifying party.
Notwithstanding the foregoing, any indemnified party shall have
the right to retain its own counsel in any such action, but the fees and
disbursements of such counsel shall be at the expense of such indemnified
party unless (i) the indemnifying party shall have failed to retain counsel
for the indemnified person as aforesaid or (ii) the indemnifying party and
such indemnified party shall have mutually agreed to the retention of such
counsel. It is understood that the indemnifying party shall not, in
connection with any action or related actions in the same jurisdiction, be
liable for the fees and disbursements of more than one separate firm
qualified in such jurisdiction to act as counsel for the indemnified party.
The indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against any loss
or liability by reason of such settlement or judgment.
(d) If the indemnification provided for in paragraphs (a) and
(b) of this Section 7 is unavailable or insufficient to hold harmless an
indemnified party under such paragraphs in respect of any losses, claims,
damages or liabilities or actions in respect thereof referred to therein,
then each indemnifying party shall in lieu of indemnifying such indemnified
party contribute to the amount paid or payable by such indemnified party as
a result of such losses, claims, damages, liabilities or actions in such
proportion as appropriate to reflect the relative fault of the Company, on
the one hand, and the sellers of such Restricted Stock, on the other, in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or actions as well as any other relevant
equitable considerations, including the failure to give any notice under
paragraph (c) of this Section 7. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact relates to information supplied by the
Company, on the one hand, or the sellers of such Restricted Stock, on the
other hand, and to the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The Company and the sellers of Restricted Stock agree that it
would not be just and equitable if contributions pursuant to this paragraph
were determined by pro rata allocation (even if all of the sellers of such
Restricted Stock were treated as one entity for such purpose) or by any
other method of allocation which did not take account of the equitable
considerations referred to above in this paragraph. The amount paid or
payable by an indemnified party as a result of the losses, claims, damages,
liabilities or action in respect thereof, referred to above in this
paragraph, shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this paragraph, the sellers of such Restricted Stock shall
not be required to contribute any amount in excess of the amount, if any,
by which the total price at which the Common Stock sold by each of them was
offered to the public exceeds the amount of any damages which they would
have otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission. No person guilty of fraudulent
misrepresentations (within the meaning of Section 11(f) of the Securities
Act), shall be entitled to contribution from any person who is not guilty
of such fraudulent misrepresentation.
The indemnification of underwriters provided for in this
Section 7 shall be on such other terms and conditions as are at the time
customary and reasonably required by such underwriters. In that event the
indemnification of the sellers of Restricted Stock in such underwriting
shall at the sellers' request be modified to conform to such terms and
conditions.
8. Changes in Restricted Stock. If, and as often as, there are
any changes in the Common Stock by way of stock split, stock dividend,
combination or reclassification, or through merger, consolidation,
reorganization or recapitalization, or by any other means, appropriate
adjustment shall be made in the provisions hereof, as may be required, so
that the rights and privileges granted hereby shall continue with respect
to the Common Stock as so changed and shall apply to any securities
received in any such transaction.
9. Rule 144 Reporting. The Company agrees with you as
follows:
(a) From and after such time as the Company becomes
subject to the reporting requirements of the Exchange Act, the Company
shall make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act, at all times
from and after the date it is first required to do so.
(b) The Company shall file with the Commission in a
timely manner all reports and other documents as the Commission may
prescribe under Section 13(a) or 15(d) of the Exchange Act at any time
after the Company has become subject to such reporting requirements of the
Exchange Act.
(c) The Company shall furnish to such holder of
Restricted Stock forthwith upon request (i) a written statement by the
Company as to its compliance with the reporting requirements of Rule 144
(at any time from and after the date it first becomes subject to such
reporting requirements), and of the Securities Act and the Exchange Act (at
any time after it has become subject to such reporting requirements), (ii)
a copy of the most recent annual or quarterly report of the Company, and
(iii) such other reports and documents so filed as a holder may reasonably
request to avail itself of any rule or regulation of the Commission
allowing a holder of Restricted Stock to sell any such securities without
registration.
10. Holdback Agreement. If and to the extent requested by the
Company, the Initial Shareholders agree (i) not to effect any public sale
or distribution of any Restricted Stock or of any securities convertible
into or exchangeable or exercisable for such Restricted Stock, including a
sale pursuant to Rule 144, and (ii) not to make any request for a
registration under Sections 2 or 3 of this Agreement, during the 120-day
period or such shorter period agreed upon by such holder beginning thirty
days prior to the anticipated effective date of a registration statement
filed by the Company (except as part of such registration filed by the
Company).
11. Effectiveness. This agreement shall become effective upon
consummation of the IPO; provided, however, that if the IPO has not
occurred on or prior to July 31, 1999, this agreement shall not become
effective and shall be void.
12. Miscellaneous.
(a) All covenants and agreements contained in this
Agreement by or on behalf of any of the parties hereto, including, without
limitation, the rights to indemnification under Section 7 hereof, shall
bind and inure to the benefit of the respective successors and permitted
assigns of the parties hereto whether so expressed or not. Without limiting
the generality of the foregoing, the registration rights conferred herein
on the holders of Restricted Stock shall inure to the benefit of any and
all subsequent holders from time to time of the Restricted Stock.
(b) All notices, requests, consents and other
communications hereunder shall be in writing and shall be mailed by first
class registered mail, postage prepaid, addressed as follows:
if to the Company, to it at 440 N. Orleans Street, Chicago,
Illinois 60610, attention: Chief Financial Officer, facsimile number (312)
494-0273, with a copy to Skadden, Arps, Slate, Meagher & Flom (Illinois),
333 W. Wacker Drive, Chicago, Illinois 60606, attention: Rodd Schreiber,
Esq., facsimile number (312) 407-0411;
if to any holder of Restricted Stock, to him, her or it, as the
case may be, at its address as set forth on Annex I hereto or any
subsequent address provided by such holder to the Company and the other
Initial Shareholders;
or, in any case, at such other address or addresses as shall
have been furnished in writing to the Company (in the case of a holder of
Restricted Stock), or to the holders of Restricted Stock (in the case of
the Company).
(c) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.
(d) This Agreement constitutes the entire agreement of
the parties with respect to the subject matter hereof. This Agreement may
not be waived, modified or amended, nor may the Company grant any third
party any registration rights more favorable than or inconsistent with any
of those contained herein as long as any of the registration rights under
this Agreement remains in effect, except in writing executed by the
Company, the holders of a majority of the Initial Shareholders' Shares;
provided, however, that any such amendment, modification or waiver shall
affect all of the holders of Initial Shareholders' Shares in the same
manner and that no such amendment, modification or waiver that would
adversely affect the rights or alter the obligations of any holder of
Initial Shareholders' Shares hereunder or confer on any holder of Initial
Shareholders' Shares any benefit not shared ratably by all of the other
holders of Initial Shareholders' Shares will be effective without the prior
written approval of any such adversely affected holder of Initial
Shareholders' Shares.
(e) This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
(f) If any provision of this Agreement shall be held to
be illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any
manner affect or render illegal, invalid or unenforceable any other
provision of this Agreement, and this Agreement shall be carried out as if
any such illegal, invalid or unenforceable provision were not contained
herein.
Please indicate your acceptance of the foregoing by signing and
returning the enclosed counterpart of this letter, whereupon this letter
(herein sometimes called "this Agreement") shall be a binding agreement
between the Company and you.
Very truly yours,
PRISM FINANCIAL CORPORATION
By: /s/ Bruce C. Abrams
-----------------------------------------
Name:
Title:
/s/ Bruce C. Abrams
--------------------------------------------
Bruce C. Abrams
/s/ Terry A. Markus
--------------------------------------------
Terry A. Markus
/s/ Mark A. Filler
--------------------------------------------
Mark A. Filler
/s/ Abby Polin Reisler
--------------------------------------------
Abby Polin Reisler
/s/ William D. Osenton
--------------------------------------------
William D. Osenton
/s/ Bruce P. Barbera
--------------------------------------------
Bruce P. Barbera
/s/ Robert Siefert
--------------------------------------------
Robert Siefert
CTC TRUST
By: /s/ Thomas J. Pritzker
-----------------------------------------
Thomas J. Pritzker, Co-Trustee
By: /s/ Marshall E. Eisenberg
-----------------------------------------
Name: Marshall E. Eisenberg
Title: Co-Trustee
DONROSE TRUST
By: /s/ Nicholas J. Pritzker
----------------------------------------
Name: Nicholas J. Pritzker
Title: Trustee
JBR TRUST #4
By: /s/ Marshall E. Eisenberg
---------------------------------------
Name: Marshall E. Eisenberg
Title: Trustee
T&M CHILDREN'S TRUST
By: /s/ Simon Zunamon
--------------------------------------
Name: Simon Zunamon
Title: Trustee
GEM VALUE/PRISM, LLC
By: GEM Value Fund, L.P.
By: GEM Value Partners, LLC
By: /s/ Barry Malkin
--------------------------------------
Name: Barry Malkin
Title: President
ABRAMS CAPITAL TRUST
By: /s/ Andrew S. Hochberg
-------------------------------------
Name: Andrew S. Hochberg
Title: Solely in his capacity as Trustee
