SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
_______________
FORM 10-Q
_______________
X Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarterly period ended December 31, 1995
OR
_____ Transition Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the transition period from ..........to..........
Commission File Number 1-7936
NATIONAL CONVENIENCE STORES INCORPORATED
(Exact name of registrant as specified in its charter)
Delaware 74-1361734
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
100 Waugh Drive, Houston, Texas 77007
(Address of principal executive offices) (Zip Code)
(713) 863-2200
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No___
APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
Yes X No___
At February 14, 1996, the number of shares of Common Stock outstanding was 100,
all of which are owned by Diamond Shamrock Refining and Marketing Company, a
wholly-owned subsidiary of Diamond Shamrock, Inc., a reporting company under
the Securities Exchange Act of 1934, as amended.
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
NATIONAL CONVENIENCE STORES INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Amounts in thousands, except per share amounts)
Three Months Ended
December 31,
1995 1994(1)
Sales $217,638 $220,504
Costs and Expenses:
Cost of sales 165,880 162,714
Operating expenses 38,415 43,149
General and administrative expenses 10,893 10,255
Gain on sale of assets - (161)
215,188 215,957
Operating Income 2,450 4,547
Other Income (Expense):
Interest expense (1,953) (2,400)
Interest income 260 380
Non-recurring expenses arising from the acquisition
of the Company and revaluation of assets and
liabilities pursuant to accounting for the
transaction as a purchase. (70,860) -
Income (Loss) Before Income Tax Expense (70,103) 2,527
Income Tax Expense (Benefit) (25,816) 909
Net Income (Loss) $(44,287) $ 1,618
Earnings (Loss) Per Share $ (6.91) $ 0.27
Weighted Average Number of Shares Outstanding 6,408 6,050
(1) Restated to conform to presentation used for three months ended
December 31,1995.
See Notes to Condensed Consolidated Financial Statements.
<PAGE>
NATIONAL CONVENIENCE STORES INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Amounts in thousands, except per share amounts)
Six Months Ended
December 31,
1995 1994(1)
Sales $ 454,430 $ 455,785
Costs and Expenses:
Cost of sales 341,301 338,218
Operating expenses 79,481 87,208
General and administrative 21,083 21,703
Gain on sale of assets - (161)
441,865 446,968
Operating Income 12,565 8,817
Other Income (Expense):
Interest expense (4,089) (4,780)
Interest income 579 722
Non-recurring expenses arising from the acquisition
of the Company and revaluation of assets and
liabilities pursuant to accounting for the
transaction as a purchase (70,860) -
Income (Loss) Before Income Tax Expense (61,805) 4,759
Income Tax Expense (Benefit) (22,348) 1,998
Net Income (Loss) $ (39,457) $ 2,761
Earnings (Loss) Per Share $ (6.32) $ 0.46
Weighted Average Number of Shares Outstanding 6,242 6,050
(1) Restated to conform to presentation used for six months ended
December 31,1995.
See Notes to Condensed Consolidated Financial Statements.
<PAGE>
NATIONAL CONVENIENCE STORES INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except per share amounts)
December 31, June 30,
1995 1995(1)
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents, $685 and $9,093
reserved $ 18,301 $ 31,375
Accounts receivable, net 5,369 5,418
Inventories 35,176 36,555
Prepaid expenses 3,530 2,518
Deferred tax asset 4,733 5,610
Total Current Assets 67,109 81,476
Property and Equipment, net of Accumulated
Depreciation 141,395 156,751
Other Assets:
Reorganization value in excess of amounts
allocable to identifiable assets, net - 23,939
Excess of cost over acquired net assets 160,092
Deferred tax asset, net 26,629 5,620
Other assets, net 11,327 16,538
Total Other Assets 198,048 46,097
$ 406,552 $ 284,324
LIABILITIES AND STOCKHOLDERS EQUITY
Current Liabilities:
Accounts payable and accrued expenses $ 81,235 $ 61,625
Current portion of long-term debt 2,979 12,061
Total Current Liabilities 84,214 73,686
Long-Term Debt 166,335 90,256
Other Long-Term Liabilities 40,557 40,342
Stockholders Equity:
Common Stock, par value $.01 per share;
50,000,000 shares authorized; 0 and
6,050,075 shares issued and outstanding - 61
Common Stock, par value $.01 per share;
8,215,000 and 0 shares issued and outstanding 82 -
Additional paid-in capital 115,763 63,463
Retained earnings (399) 16,516
Total Stockholders Equity 115,446 80,040
$406,552 $284,324
(1) Restated to conform to presentation for December 31, 1995.
See Notes to Condensed Consolidated Financial Statements.
<PAGE>
NATIONAL CONVENIENCE STORES INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
Six Months Ended
December 31,
1995 1994
Cash Flows From Operating Activities:
Net income (Loss) $ (39,457) $ 2,761
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 8,505 7,124
Deferred income taxes (20,038) 1,669
Non-recurring expenses arising from the acquisition
of the Company and revaluation of assets and
liabilities pursuant to accounting for the
transaction as a purchase 70,860 -
Other, net 1,322 366
Changes in operating assets and liabilities:
Increase in accounts and notes
receivable and prepaid expenses (3,564) 3,721
Decrease in inventories (519) 3,006
Increase (decrease) in accounts payable and
accrued expenses (6,660) (3,882)
Increase in income taxes (2,393) 138
Net cash provided by (used in) operating activities 8,056 14,903
Cash Flows From Investing Activities:
Capital expenditures (8,950) (13,576)
Other, net (10,778) 2,619
Net cash used in investing activities (19,728) (10,957)
Cash Flows From Financing Activities:
Principal payments on long-term debt (40,308) (7,052)
Increase in long-term debt 34,900 -
Proceeds from issuance of common stock 4,006 -
Net cash used in financing activities (1,402) (7,052)
Net Increase (Decrease) in Cash and Cash Equivalents (13,074) 630
Cash and Cash Equivalents - Beginning of period 31,375 41,142
Cash and Cash Equivalents - End of period $ 18,301 $ 41,772
Supplemental Cash flow Information:
Interest paid $ 4,096 $ 4,944
Income taxes paid, net $ 40 $ 193
(1) Restated to conform to presentation used for six months ended
December 31, 1995
See Notes to Condensed Consolidated Financial Statements.
NATIONAL CONVENIENCE STORES INCORPORATED AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
The consolidated financial statements as of December 31, 1995 and for the three
months and six months ended December 31, 1995 and 1994 are unaudited, but in
the opinion of National Convenience Stores Incorporated (the "Company"), all
adjustments (consisting only of normal accruals) necessary for a fair
presentation of consolidated results of operations, consolidated financial
position, and consolidated cash flows at the date and for the periods indicated
have been included.
The consolidated financial statements have been prepared in accordance with the
instructions to Form 10-Q. Accordingly, certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted.
Certain prior year amounts have been reclassified to conform to the current
year presentation. These unaudited condensed consolidated financial statements
should be read in conjunction with the audited consolidated financial
statements and notes thereto included in the Company's Annual Report on Form
10-K for the year ended June 30, 1995 (the "1995 Form 10-K").
1. Acquisition Transaction
On November 8, 1995, the Company entered into an Agreement and Plan of Merger
(the "Merger Agreement") with Diamond Shamrock, Inc. ("Diamond Shamrock") and
Shamrock Acquisition Corp., a wholly owned indirect subsidiary of Diamond
Shamrock ("SAC"). Pursuant to the Merger Agreement, SAC was merged with and
into NCS on December 18, 1995 (the "Merger"). For a full discussion of the
events leading up to the Merger and Merger Agreement, reference is made to the
1995 Form 10-K and to the Current Report on Form 8-K filed by the Company on
December 29, 1995.
Merger Agreement - As a result of the acquisition of the Company by Diamond
Shamrock, the Company recorded certain non-recurring expenses, including
employee severance and relocation costs, payments under employment contracts,
buyout of stock options, investment banker fees, and other costs relating to
the change in control. The Company also revalued its assets and liabilities in
accordance with the accounting rules applicable to a transaction recorded as a
purchase. The net of these adjustments is a $70.9 million reduction in the
value of Company net assets, less income tax benefit of $26.4 million.
The total amount of funds required by SAC to acquire the entire equity interest
in the Company, including the purchase of the outstanding shares of Common
Stock, par value $.01 per share (the "Shares") and of the outstanding warrants
to purchase Shares (the "Warrants") pursuant to the Offer and the payment for
Shares and Warrants converted into the right to receive cash pursuant to the
Merger and related expenses, was approximately $182.2 million. The total
purchase cost exceeded the value of net assets by $160.5 million, which amount
will be amortized over a 20-year period.
2. Long-term Debt
Immediately following the acquisition of a controlling interest in the Company's
common stock by Diamond Shamrock, all amounts owed under the Company's Term Loan
and revolving credit agreements were paid and the agreements were cancelled.
The Company also paid approximately $2.4 million on mortgage loans, including
interest and early payment penalties. The Company issued a $34.9 million note
payable to a subsidiary of Diamond Shamrock payable on December 14, 2000
bearing an interest rate of 5.91% per annum.
Effective December 28, 1995, the Company declared a dividend in the amount of
$66.4 million, which was paid by delivery of a promissory note in that amount
payable December 28, 2000 bearing interest at 5.91%.
3. Income Taxes
The Company will file a federal income tax return for the fiscal year ended
June 30, 1995 no later than March 15, 1996. Because of the acquisition of
control of the Company by Diamond Shamrock on December 14, 1995, the Company
will be required to file a short period tax return for the period from July 1,
1995 to December 13, 1995. For the period December 14, 1995 to December 31,
1995, the Company will participate in the consolidated federal income tax
return of Diamond Shamrock for the calendar year 1995.
Any unused net operating loss and tax credit carry-forwards of the Company as
of December 13, 1995 will be available to be used by Diamond Shamrock, subject
to the limitations of Section 382 of the Internal Revenue Code. The amount of
those carry-forwards available at December 31, 1995 will be reported in the
annual report on Form 10-K to be filed by Diamond Shamrock as of and for the
year ended December 31, 1995 (the "Diamond Shamrock Form 10-K").
4. Commitments and Contingencies
Reference is made to Note 11 of the Notes to Consolidated Financial Statements
contained in the 1995 Form 10-K for a complete discussion of the Company's
commitments and contingencies at June 30, 1995. Disclosure of all material
commitments and contingencies as of December 31, 1995 will be included in the
Diamond Shamrock Form 10-K.
ITEM 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Significant Event - On November 8, 1995, the Company entered into a Merger
Agreement with Diamond Shamrock and SAC. Pursuant to the Merger Agreement, SAC
was merged with and into the Company on December 18, 1995 (the "Merger"). As a
result of the Merger, Diamond Shamrock presently owns all of the outstanding
shares of the common stock of the Company. The Company also has outstanding
approximately 50,000 Warrants. Following the Merger, the Warrants no longer
represent the right to receive common stock of the Company. The Warrants
represent the right to receive $27.00 in cash from Diamond Shamrock upon
payment of the $17.75 exercise price.
Since December 18, 1995, the Company has been a wholly-owned indirect
subsidiary of Diamond Shamrock. The results of the Company's operations on and
after December 14, 1995 (the date on which Diamond Shamrock acquired effective
control) will be reflected in the consolidated financial statements of Diamond
Shamrock, which statements are prepared on the basis of a calendar year period.
Results of Operations - The Company reported a net loss of $44.3 million ($6.91
per share) for the quarter ended December 31, 1995 compared with net income of
$1.6 million ($0.27 per share) for the same period in 1994.
There were no material differences between the two periods with regard to total
net sales or total operating expenses. The only significant difference
affecting the two periods' results arose from recording the acquisition of the
Company by Diamond Shamrock. As a result of the acquisition, the Company
recorded certain non-recurring expenses, including employee severance and
relocation costs, payments under employment contracts, buyout of stock options,
investment banker fees and other costs relating to the change in control. The
Company also revalued its assets and liabilities in accordance with the
accounting rules applicable to a transaction recorded as a purchase. The net
of the expenses and revaluation is a $70.9 million reduction in the Company's
net asset values, less income tax benefit of $26.4 million.
The Company reported a net loss of $39.5 million ($6.32 per share) for the six
months ended December 31, 1995 compared with net income of $2.8 million ($0.46
per share) for the same period in 1994.
There were no material differences between the periods with regard to total net
sales or total operating expenses. The only significant difference affecting
the two periods' results arose from recording the acquisition of the Company by
Diamond Shamrock. As a result of the acquisition, the Company recorded certain
non-recurring expenses, including employee severance and relocation costs,
payments under employment contracts, buyout of stock options, investment
banker fees and other costs relating to the change in control. The Company
also revalued its assets and liabilities in accordance with the accounting
rules applicable to a transaction recorded as a purchase. The net of the
expenses and revaluation is a $70.9 million reduction in the Company's net
assets, less income tax benefit of $26.4 million.
Liquidity and Capital Resources
Key balance sheet figures and ratios are presented in the table below (all
amounts, excluding ratios are in millions):
December 31, 1995 June 30, 1995
Cash and cash equivalents(a) $ 18.3 $ 31.4
Current assets $ 67.1 $ 81.5
Current liabilities $ 84.2 $ 73.7
Current ratio 0.8 1.11
Inventory turn ratios (annualized):
Merchandise 11.2 11.2
Gasoline 56.3 55.1
Total debt $169.3 $102.3
Stockholders' equity $115.4 $ 80.0
Debt/Equity ratio 1.47 1.28
Common shares outstanding 8.2 6.1
_____________________
(a) Includes $0.7 million and $9.1 million that has been reserved at
December 31, 1995 and June 30, 1995, respectively. Included in the
reserved cash balances at December 31, 1995 and June 30, 1995 is cash
from the April 29, 1994 transaction with Circle K that has been held in
escrow pending the final resolution of collateral-related matters. Also
included in the reserved cash balances at June 30, 1995 is cash
accumulated in trust accounts (at the Company's option) for the
payment of payroll, sales and gasoline taxes and state lottery sales
proceeds.
Liquidity - As a wholly owned subsidiary of Diamond Shamrock, the Company will
rely on Diamond Shamrock and its consolidated subsidiaries to provide funds for
current operating expenses, as well as for capital expenditures. It is
anticipated that any new sources of funds for the Company from non-related
lenders or from equity sources will be arranged by Diamond Shamrock.
Capital Resources - The Company incurred $9.0 million of capital expenditures
through December 31, 1995 compared to $13.6 million for the corresponding
period of the prior fiscal year. During the first six months of fiscal 1996,
the capital expenditures consisted of $3.2 million for gasoline dispensing
equipment and installation of underground piping required to comply with
environmental laws, $2.3 million for new store development, $2.3 million in
equipment replacement and store improvements and $1.2 million for miscellaneous
projects.
PART II - OTHER INFORMATION
ITEM 1. Legal Proceedings
Circle K Tender Offer. All proceedings pending in the Delaware Court of
Chancery and in Delaware District Court in connection with the cash tender
offer by The Circle K Corporation to purchase all of the Company's outstanding
common stock, as previously reported, have been dismissed, with the exception
of Thomas J. McKula v. William K. Wilde, et. al., CA 14481, pending in the
Court of Chancery of the State of Delaware, in and for New Castle County. The
only unresolved matter in that case relates to plaintiff's asserted right to
reimbursement for legal expenses incurred in connection with the case.
ITEM 2. Change in Securities
The Company's Restated Certificate of Incorporation, defining and governing
certain rights existing in connection the Company's common stock, par value
$.01 per share, was amended and restated effective January 8, 1996, to reduce
the number of shares of common stock the Company is authorized to issue; to
eliminate the Company's authority to issue preferred stock; to eliminate
super-majority voting requirements with respect to amendment of the Company's
certificate of incorporation, the merger of the Company, the conveyance of
substantially all of the Company's assets, the dissolution of the Company, and
the revocation of the dissolution of the Company; to eliminate certain
requirements that the approval of the Company's Board of Directors be obtained
for purchase of over 5% of the Company's outstanding common stock or that such
purchaser conduct a tender offer under the Securities Exchange Act of 1934 to
purchase at least 2/3 of such stock followed by a back-end merger in which non-
tendering shareholders would receive consideration equal to that received by
tendering shareholders; to eliminate certain rights of "appraisal" with respect
to the Company's common stock; and to eliminate certain provision providing for
the classification of the Company's Board of Directors.
The Company's Restated Bylaws were amended and restated effective January 8,
1996 to eliminate certain provisions governing nominations for election to the
Company's Board of Directors, and to eliminate certain requirements for
shareholder approval of amendments to Bylaw provisions.
Certain rights to purchase preferred stock which were outstanding and
exercisable in connection with the Company's common stock, par value $.01 per
share, were redeemed effective January 3, 1996.
ITEM 6. Exhibits and Reports on Form 8-K
a) Exhibits
2.1 Agreement and Plan of Merger dated November 8, 1995, among Diamond
Shamrock, Inc., Shamrock Acquisition Corp., and National Convenience
Stores, Incorporated (incorporated by reference to Exhibit 1 to the
Company's Schedule 14D-9 Solicitation/Recommendation Statement filed
with the Securities and Exchange Commission on November 14, 1995)
3.1 Amended and Restated Certificate of Incorporation of National
Convenience Stores Incorporated
3.2 Amended and Restated Bylaws of National Convenience Stores
Incorporated
27.1 Financial Data Schedule
b) Reports on Form 8-K
On October 30, 1995, the Company filed a Current Report on Form 8-K describing
a declaratory judgment action filed by the Company, with respect to a contract
relating to automated teller machines, and the answer and counterclaim filed in
response thereto.
On December 29, 1995, the Company filed a Current Report on Form 8-K describing
the merger of a wholly-owned subsidiary of Diamond Shamrock, Inc. with and into
the Company.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
NATIONAL CONVENIENCE STORES INCORPORATED
(Registrant)
Date February 20, 1996 /s/ Gary E. Johnson
Gary E. Johnson - Vice President and Controller
<PAGE>
NATIONAL CONVENIENCE STORES INCORPORATED AND SUBSIDIARIES
INDEX TO EXHIBITS
EXHIBITS:
2.1 Agreement and Plan of Merger dated November 8, 1995, among Diamond
Shamrock, Inc., Shamrock Acquisition Corp., and National Convenience
Stores, Incorporated (incorporated by reference to Exhibit 1 to the
Company's Schedule 14D-9 Solicitation/Recommendation Statement filed
with the Securities and Exchange Commission on November 14, 1995)
3.1 Amended and Restated Certificate of Incorporation of National
Convenience Stores Incorporated
3.2 Amended and Restated Bylaws of National Convenience Stores Incorporated
27.1 Financial Data Schedule
W4003.TW
Exhibit 3.1
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
NATIONAL CONVENIENCE STORES INCORPORATED
National Convenience Stores Incorporated, a Delaware corporation (the
"Corporation"), does hereby certify that this Amended and Restated Certificate
of Incorporation of National Convenience Stores Incorporated was duly adopted in
accordance with Section 245 of the General Corporation Law of the State of
Delaware; the Corporation was originally incorporated under the name of NCS
Merging Corporation; and the Corporation's original Certificate of
Incorporation was filed with the Delaware Secretary of State on June 21, 1979.
The text of the Corporation's Restated Certificate of Incorporation as
heretofore amended or supplemented is hereby restated and further amended to
read in its entirety as follows:
FIRST: The name of the Corporation (the "Corporation") is National
Convenience Stores Incorporated.
SECOND: The address of the Corporation's registered office in the
State of Delaware is 1209 Orange Street, City of Wilmington, County of New
Castle, Delaware 19801. The name of the Corporation's registered agent at
such address is The Corporation Trust Company.
THIRD: The purpose of the Corporation is to engage in any lawful act
or activity for which corporations may be organized under the General
Corporation Law of the State of Delaware.
FOURTH: The total number of shares which the Corporation shall have
authority to issue is 1,000 shares of Common Stock, par value $.01 per share.
FIFTH: Elections of directors need not be by written ballot except
and to the extent provided in the by-laws of the Corporation.
SIXTH: 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; provided, however, that the foregoing clause
shall not apply to any liability of a director (i) for any breach of the
director's duty of loyalty to the Corporation or its stockholders, (ii) for
acts or omissions not in good faith or which involve intentional misconduct or a
knowing violation of the law, (iii) under Section 174 of the General
Corporation Law of the State of Delaware, or (iv) for any transaction from
which the director derived an improper personal benefit. This Article Sixth
shall not eliminate or limit the personal liability of a director for any act
or omission occurring prior to the date this Article Sixth becomes effective.
SEVENTH: In furtherance and not in limitation of the rights, powers,
privileges, and discretionary authority granted or conferred by the General
Corporation Law of the State of Delaware or other statutes or laws of the State
of Delaware, the Board of Directors is expressly authorized to make, alter,
amend or repeal the by-laws of the Corporation, without any action on the part
of the stockholders, but the stockholders may make additional by-laws and may
alter, amend or repeal any by-law whether adopted by them or otherwise. The
Corporation may in its by-laws confer powers upon its Board of Directors in
addition to the foregoing and in addition to the powers and authorities
expressly conferred upon the Board of Directors by applicable law.
EIGHTH: The Corporation reserves the right at any time and from time
to time to amend, alter, change or repeal any provision contained in this
Certificate of Incorporation, and other provisions authorized by the laws of
the State of Delaware at the time in force may be added or inserted, in the
manner now or hereafter prescribed herein or by applicable law; and all rights,
preferences and privileges of whatsoever nature conferred upon stockholders,
directors or any other persons whomsoever by and pursuant to this Certificate
of Incorporation in its present form or as hereafter amended are granted
subject to this reservation.
W3899.TW
Exhibit 3.2
NATIONAL CONVENIENCE STORES INCORPORATED
AMENDED AND RESTATED
BYLAWS
NATIONAL CONVENIENCE STORES INCORPORATED
AMENDED AND RESTATED
BY-LAWS
NATIONAL CONVENIENCE STORES INCORPORATED
AMENDED AND RESTATED
BY-LAWS
Table of Contents
Page
ARTICLE I - MEETINGS OF STOCKHOLDERS
Section 1. Time and Place of Meetings.............................. 1
Section 2. Annual Meeting.......................................... 1
Section 3. Special Meetings........................................ 1
Section 4. Notice of Meetings...................................... 2
Section 5. Quorum.................................................. 2
Section 6. Voting.................................................. 2
Section 7. Written Action.......................................... 3
ARTICLE II - DIRECTORS
Section 1. Powers.................................................. 4
Section 2. Number and Term of Office............................... 4
Section 3. Vacancies and New Directorships......................... 4
Section 4. Regular Meetings........................................ 5
Section 5. Special Meetings........................................ 5
Section 6. Quorum.................................................. 5
Section 7. Written Action.......................................... 5
Section 8. Participation in Meetings by Conference Telephone....... 5
Section 9. Committees.............................................. 6
Section 10. Compensation............................................ 6
Section 11. Rules................................................... 7
ARTICLE III - NOTICES
Section 1. Generally............................................... 7
Section 2. Waivers................................................. 7
Table of Contents
(continued)
ARTICLE IV - INDEMNIFICATION
Section 1. Generally........................................... 8
Section 2. Failure to Pay Claim................................ 9
Section 3. Right not Exclusive................................. 10
Section 4. Insurance........................................... 10
ARTICLE V - OFFICERS
Section 1. Generally........................................... 11
Section 2. Compensation........................................ 11
Section 3. Succession.......................................... 11
Section 4. Authority and Duties................................ 11
Section 5. Chairman............................................ 11
Section 6. President........................................... 12
Section 7. Execution of Documents and Action with Respect to
Securities of Other Corporations................. 12
Section 8. Vice President...................................... 13
Section 9. Secretary and Assistant Secretaries................. 13
Section 10. Treasurer and Assistant Treasurers.................. 13
Section 11. Controller.......................................... 14
Section 12. General Counsel..................................... 14
ARTICLE VI - STOCK
Section 1. Certificates......................................... 15
Section 2. Transfer............................................. 15
Section 3. Lost, Stolen or Destroyed Certificates............... 15
Section 4. Record Date.......................................... 16
ARTICLE VII - GENERAL PROVISIONS
Section 1. Fiscal Year.......................................... 18
Section 2. Corporate Seal....................................... 18
Section 3. Reliance upon Books, Reports and Records............. 18
Section 4. Time Periods......................................... 18
Section 5. Dividends............................................ 18
ARTICLE VII - AMENDMENTS
Section 1. Amendments............................................ 19
<PAGE>
NATIONAL CONVENIENCE STORES INCORPORATED
AMENDED AND RESTATED
BY-LAWS
ARTICLE I
MEETINGS OF STOCKHOLDERS
Section 1. Time and Place of Meetings. All meetings of the stockholders
for the election of directors or for any other purpose shall be held at such
time and place, within or without the State of Delaware, as may be designated
by the Board of Directors, or by the Chairman of the Board, the President or
the Secretary in the absence of a designation 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 Meeting. An annual meeting of the stockholders shall be
held at such date and time as shall be designated from time to time by the Board
of Directors, at which meeting the stockholders shall elect by a plurality vote
the directors to succeed those whose terms expire and shall transact such other
business as may properly be brought before the meeting.
Section 3. Special Meetings. Special meetings of the stockholders, for
any purpose or purposes, unless otherwise prescribed by law or by the
Certificate of Incorporation, may be called by the Board of Directors, the
Chairman of the Board or the President, and shall be called by the President or
the Secretary at the request in writing of stockholders owning a majority in
interest of the entire capital stock of the Corporation issued and outstanding
and entitled to vote. Such request shall be sent to the President and the
Secretary and shall state the purpose or purposes of the proposed meeting.
Section 4. Notice of Meetings. Written notice of every meeting of the
stockholders, stating the place, date and hour of the meeting and, in the case
of a special meeting, the purpose or purposes for which the meeting is called,
shall be given not less than ten nor more than 60 days before the date of the
meeting to each stockholder entitled to vote at such meeting, except as
otherwise provided herein or by law. When a meeting is adjourned to another
place, date or time, written notice need not be given of the adjourned meeting
if the place, date and time thereof are announced at the meeting at which the
adjournment is taken; provided, however, that if the adjournment is for more
than 30 days, or if after the adjournment a new record date is fixed for the
adjourned meeting, written notice of the place, date and time of the adjourned
meeting shall be given in conformity herewith. At any adjourned meeting, any
business may be transacted which might have been transacted at the original
meeting.
Section 5. Quorum. The holders of a majority of the 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 except as otherwise provided by law or by the
Certificate of Incorporation. 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 the 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.
Section 6. Voting. Except as otherwise provided by law or by the
Certificate of Incorporation, each stockholder shall be entitled at every
meeting of the stockholders to one vote for each share of stock having voting
power standing in the name of such stockholder on the books of the Corporation
on the record date for the meeting and such votes may be cast either in person
or by written proxy. Every proxy must be duly executed and filed with the
Secretary of the Corporation. A stockholder may revoke any proxy which is not
irrevocable by attending the meeting and voting in person or by filing an
instrument in writing revoking the proxy or another duly executed proxy bearing
a later date with the Secretary of the Corporation. The vote upon any question
brought before a meeting of the stockholders may be by voice vote, unless the
holders of a majority of the outstanding shares of all classes of stock
entitled to vote thereon present in person or by proxy at such meeting shall so
determine. Every vote taken by written ballot shall be counted by one or more
inspectors of election appointed by the Board of Directors. When a quorum is
present at any meeting, the vote of the holders of a majority of the stock which
has voting power present in person or represented by proxy and which has
actually voted shall decide any question properly brought before such meeting,
unless the question is one upon which by express provision of law, the
Certificate of Incorporation or these By-Laws, a different vote is required, in
which case such express provision shall govern and control the decision of such
question.
Section 7. Written Action. Any action required or permitted to be taken
at any annual or special meeting of the stockholders of the Corporation may be
taken without a meeting, without prior notice and without a vote, if a consent
or consents in writing, setting forth the action so taken, shall be signed by
the holders of outstanding stock having not less than the minimum number of
votes that would be necessary to authorize or take such action at a meeting at
which all shares entitled to vote thereon were present and voted.
ARTICLE II
DIRECTORS
Section 1. Powers. The business and affairs of the Corporation shall be
managed by or under the direction of its Board of Directors, which may exercise
all such powers of the Corporation and do all such lawful acts and things as
are not by law or by the Certificate of Incorporation directed or required to
be exercised or done by the stockholders.
Section 2. Number and Term of Office. The Board of Directors shall
consist of one or more members. The number of directors shall be fixed by
resolution of the Board of Directors or by the stockholders at the annual
meeting or a special meeting. The directors shall be elected at the annual
meeting of the stockholders, except as provided in Section 3 of this Article,
and each director elected shall hold office until his successor is elected and
qualified, except as required by law. Any decrease in the authorized number of
directors shall not be effective until the expiration of the term of the
directors then in office, unless, at the time of such decrease, there shall be
vacancies on the Board which are being eliminated by such decrease.
Section 3. Vacancies and New Directorships. Vacancies and newly created
directorships resulting from any increase in the authorized number of directors
which occur between annual meetings of the stockholders may be filled by a
majority of the directors then in office, though less than a quorum, or by a
sole remaining director, and the directors so elected shall hold office until
the next annual meeting of the stockholders and until their successors are
elected and qualified, except as required by law.
Section 4. Regular Meetings. Regular meetings of the Board of Directors
may be held without notice immediately after the annual meeting of the
stockholders and at such other time and place as shall from time to time be
determined by the Board of Directors.
Section 5. Special Meetings. Special meetings of the Board of Directors
may be called by the Chairman of the Board or the President on one day's written
notice to each director by whom such notice is not waived, given either
personally or by mail or telegram, and shall be called by the President or the
Secretary in like manner and on like notice on the written request of any two
directors.
Section 6. Quorum. At all meetings of the Board of Directors, a majority
of the total number of directors then in office 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 to another place, time or date, without notice other than announcement at
the meeting, until a quorum shall be present.
Section 7. Written Action. 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 members of the Board or committee, as the case
may be, consent thereto in writing, and the writing or writings are filed with
the minutes or proceedings of the Board or Committee.
Section 8. Participation in Meetings by Conference Telephone. Members of
the Board of Directors, or any committee designated by the Board of Directors,
may participate in a meeting of the Board of Directors, or any such committee,
by means of conference telephone or similar communications equipment by means of
which all persons participating in the meeting can hear each other, and such
participation in a meeting shall constitute presence in person at the meeting.
Section 9. Committees. The Board of Directors may, by resolution passed
by a majority of the whole Board, designate one or more committees, each
committee to consist of one or more of the directors of the Corporation and
each to have such lawfully delegable powers and duties as the Board may confer.
Each such committee shall serve at the pleasure of the Board of Directors. The
Board may designate one or more directors as alternate members of any committee,
who may replace any absent or disqualified member at any meeting of the
committee. Except as otherwise provided by law, any such committee, to the
extent provided in the resolution of the Board of Directors, 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, and may authorize
the seal of the Corporation to be affixed to all papers which may require it.
Any committee or committees so designated by the Board shall have such name or
names as may be determined from time to time by resolution adopted by the Board
of Directors. Unless otherwise prescribed by the Board of Directors, a
majority of the members of the committee shall constitute a quorum for the
transaction of business, and the act of a majority of the members present at a
meeting at which there is a quorum shall be the act of such committee. Each
committee shall prescribe its own rules for calling and holding meetings and
its method of procedure, subject to any rules prescribed by the Board of
Directors, and shall keep a written record of all actions taken by it.
Section 10. Compensation. The Board of Directors may establish such
compensation for, and reimbursement of the expenses of, directors for
attendance at meetings of the Board of Directors or committees, or for other
services by directors to the Corporation, as the Board of Directors may
determine.
Section 11. Rules. The Board of Directors may adopt such special rules
and regulations for the conduct of their meetings and the management of the
affairs of the Corporation as they may deem proper, not inconsistent with law
or these By-Laws.
ARTICLE III
NOTICES
Section 1. Generally. Whenever by law or under the provisions of the
Certificate of Incorporation or these By-Laws, notice is required to be given
to any director or stockholder, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
director or stockholder, at his 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. Notice to directors may also be given by telegram or telephone.
Section 2. Waivers. Whenever any notice is required to be given by law
or under the provisions of the Certificate of Incorporation or these By-Laws,
a waiver thereof in writing, signed by the person or persons entitled to such
notice, whether before or after the time of the event for which notice is to be
given, shall be deemed equivalent to such notice. Attendance of a person at a
meeting shall constitute a waiver of notice of such meeting, except when the
person attends a meeting for the express purpose of objecting, at the beginning
of the meeting, to the transaction of any business because the meeting is not
lawfully called or convened.
ARTICLE IV
INDEMNIFICATION
Section 1. Generally. Each person who was or is made a party or is
threatened to be made a party to or is involved in any action, suit or
proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact that he, or a person of
whom he is the legal representative, is or was a director or officer of the
Corporation or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation or of a
partnership, joint venture, trust or other enterprise, including service with
respect to employee benefit plans, whether the basis of such proceeding is
alleged action in an official capacity as a director, officer, employee or
agent or in any other capacity while serving as a director, officer, employee
or agent, shall be indemnified and held harmless by the Corporation to the
fullest extent authorized by the Delaware General Corporation Law, as the same
exists or may hereafter be amended (but, in the case of any such amendment,
only to the extent that such amendment permits the Corporation to provide
broader indemnification rights than said law permitted the Corporation to
provide prior to such amendment), against all expense, liability and loss
(including attorneys' fees, judgments, fines, ERISA excise taxes or penalties
and amounts paid or to be paid in settlement) reasonably incurred or suffered
by such person in connection therewith, and such indemnification shall continue
as to a person who has ceased to be a director, officer, employee or agent and
shall inure to the benefit of his heirs, executors and administrators;
provided, however, that, except as provided in Section 2 of this Article IV,
the Corporation shall indemnify any such person seeking indemnification in
connection with a proceeding (or part thereof) initiated by such person only if
such proceeding (or part thereof) was authorized by the Board of Directors of
the Corporation. The right to indemnification conferred in this Article IV
shall be a contract right and shall include the right to be paid by the
Corporation the expenses incurred in defending any such proceeding in advance
of its final disposition; provided, however, that, if the Delaware General
Corporation Law requires, the payment of such expenses incurred by a director
or officer in his capacity as a director or officer (and not in any other
capacity in which service was or is rendered by such person while a director or
officer, including, without limitation, service to an employee benefit plan) in
advance of the final disposition of the proceeding, shall be made only upon
delivery to the Corporation of an undertaking, by or on behalf of such director
or officer, to repay all amounts so advanced if it shall ultimately be
determined that such director or officer is not entitled to be indemnified under
this Article IV or otherwise. The Corporation may, by action of its Board of
Directors, provide indemnification to employees and agents of the Corporation
with the same scope and effect as the foregoing indemnification of directors and
officers.
Section 2. Failure to Pay Claim. If a claim under Section 1 of this
Article IV is not paid in full by the Corporation within thirty days after a
written claim has been received by the Corporation, the claimant may at any
time thereafter bring suit against the Corporation to recover the unpaid amount
of the claim and, if successful in whole or in part, the claimant shall be
entitled to be paid also the expense of prosecuting such claim. It shall be a
defense to any such action (other than an action brought to enforce a claim for
expenses incurred in defending any proceeding in advance of its final
disposition where the required undertaking, if any is required, has been
tendered to the Corporation) that the claimant has not met the standards of
conduct which make it permissible under the Delaware General Corporation
Law for the Corporation to indemnify the claimant for the amount claimed, but
the burden of proving such defense shall be on the Corporation. Neither the
failure of the Corporation (including its Board of Directors, independent legal
counsel, or its stockholders) to have made a determination prior to the
commencement of such action that indemnification of the claimant is proper in
the circumstances because he has met the applicable standard of conduct
set forth in the Delaware General Corporation Law, nor an actual determination
by the Corporation (including its Board of Directors, independent legal
counsel, or its stockholders) that the claimant has not met such applicable
standard of conduct, shall be a defense to the action or create a presumption
that the claimant has not met the applicable standard of conduct.
Section 3. Right not Exclusive. The right to indemnification and the
payment of expenses incurred in defending a proceeding in advance of its final
disposition conferred in this Article IV shall not be exclusive of any other
right which any person may have or hereafter acquire under any statute,
provision of the Certificate of Incorporation, bylaw, agreement, vote of
stockholders or disinterested directors or otherwise.
Section 4. Insurance. The Corporation may maintain insurance, at its
expense, to protect itself and any director, officer, employee or agent of the
Corporation or another corporation, partnership, joint venture, trust and other
enterprise against any such expense, liability or loss, whether or not the
Corporation would have the power to indemnify such person against such expense,
liability or loss under the Delaware General Corporation Law.
ARTICLE V
OFFICERS
Section 1. Generally. The officers of the Corporation shall be elected
by the Board of Directors and shall consist of a President, a Secretary and a
Treasurer. The Board of Directors may also choose any or all of the following:
a Chairman of the Board of Directors, one or more Vice Presidents, a Controller,
a General Counsel, one or more Assistant Secretaries and Assistant Treasurers
and such other officer or officers as the Board of Directors may be deemed
necessary, desirable or appropriate. Any number of offices may be held by the
same person.
Section 2. Compensation. The compensation of all officers and agents of
the Corporation who are also directors of the Corporation shall be fixed by the
Board of Directors. The Board of Directors may delegate the power to fix the
compensation of other officers and agents of the Corporation to an officer of
the Corporation.
Section 3. Succession. The officers of the Corporation shall hold office
until their successors are elected and qualified. Any officer elected or
appointed by the Board of Directors may be removed at any time by the
affirmative vote of a majority of the directors. Any vacancy occurring in any
office of the Corporation may be filled by the Board of Directors.
Section 4. Authority and Duties. Each of the officers of the Corporation
shall have such authority and shall perform such duties as are stated in these
By-Laws or as may be specified by the Board of Directors in a resolution which
is not inconsistent with these By-Laws.
Section 5. Chairman. The Chairman shall preside at all meetings of the
stockholders and of the Board of Directors and he shall have such other duties
and responsibilities as may be assigned to him by the Board of Directors. The
Chairman may delegate to any qualified person authority to chair any meeting of
the stockholders, either on a temporary or a permanent basis.
Section 6. President. The President shall be responsible for the active
management and direction of the business and affairs of the Corporation. In
case of the inability or failure of the Chairman to perform the duties of that
office, the President shall perform the duties of the Chairman, unless
otherwise determined by the Board of Directors.
Section 7. Execution of Documents and Action with Respect to Securities
of Other Corporations. The President shall have and is hereby given, full
power and authority, except as otherwise required by law or directed by the
Board of Directors, (a) to execute, on behalf of the Corporation, all duly
authorized contracts, agreements, deeds, conveyances or other obligations of the
Corporation, applications, consents, proxies and other powers of attorney, and
other documents and instruments, and (b) to vote and otherwise act on behalf of
the Corporation, in person or by proxy, at any meeting of stockholders (or with
respect to any action of such stockholders) of any other corporation in which
the Corporation may hold securities and otherwise to exercise any and all rights
and powers which the Corporation may possess by reason of its
ownership of securities of such other corporation. In addition, the President
may delegate to other officers, employees and agents of the Corporation the
power and authority to take any action which the President is authorized to take
under this Section 7, with such limitations as the President may specify; such
authority so delegated by the President shall not be re-delegated by the person
to whom such execution authority has been delegated.
Section 8. Vice President. Each Vice President, however titled, shall
perform such duties and services and shall have such authority and
responsibilities as shall be assigned to or required from time to time by the
Board of Directors or the President.
Section 9. Secretary and Assistant Secretaries. (a) The Secretary shall
attend all meetings of the stockholders and all meetings of the Board of
Directors and record all proceedings of the meetings of the stockholders and of
the Board of Directors and shall perform like duties for the standing
committees when requested by the Board of Directors or the President. The
Secretary shall give, or cause to be given, notice of all meetings of the
stockholders and meetings of the Board of Directors. The Secretary shall
perform such duties as may be prescribed by the Board of Directors or the
President. The Secretary shall have charge of the seal of the Corporation and
authority to affix the seal to any instrument. The Secretary or any Assistant
Secretary may attest to the corporate seal by handwritten or facsimile
signature. The Secretary shall keep and account for all books, documents,
papers and records of the Corporation except those for which some other officer
or agent has been designated or is otherwise properly accountable. The
Secretary shall have authority to sign stock certificates.
(b) Assistant Secretaries, in the order of their seniority, shall assist
the Secretary and, if the Secretary is unavailable or fails to act, perform the
duties and exercise the authorities of the Secretary.
Section 10. Treasurer and Assistant Treasurers. (a) The Treasurer shall
have the custody of the funds and securities 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
Treasurer with the prior approval of the Board of Directors or the President.
The Treasurer shall disburse the funds and pledge the credit of the
Corporation as may be directed by the Board of Directors and shall render to
the Board of Directors and the President, as and when required by them, or any
of them, an account of all transactions by the Treasurer.
(b) Assistant Treasurers, in the order of their seniority, shall assist
the Treasurer and, if the Treasurer is unable or fails to act, perform the
duties and exercise the powers of the Treasurer.
Section 11. Controller. The Controller shall be the chief accounting
officer of the Corporation. The Controller shall keep full and accurate
accounts of receipts and disbursements in books belonging to the Corporation in
accordance with accepted accounting methods and procedures. The Controller
shall initiate periodic audits of the accounting records, methods and systems
of the Corporation. The Controller shall render to the Board of Directors and
the President, as and when required by them, or any of them, a statement of the
financial condition of the Corporation.
Section 12. General Counsel. The General Counsel shall be the chief legal
officer of the Corporation. The General Counsel shall provide legal counsel and
advice to the Board of Directors and to the officers with respect to compliance
with applicable laws and regulations. The General Counsel shall also provide or
obtain legal representation of the Corporation in proceedings by or against the
Corporation. The General Counsel shall render to the Board of Directors and the
President, as and when required by them, or any of them, a report on the status
of claims against, and pending litigation of, the Corporation.
ARTICLE VI
STOCK
Section 1. Certificates. Certificates representing shares of stock of
the Corporation shall be in such form as shall be determined by the Board of
Directors, subject to applicable legal requirements. Such certificates shall
be numbered and their issuance recorded in the books of the Corporation, and
such certificate shall exhibit the holder's name and the number of shares and
shall be signed by, or in the name of the Corporation by the President and the
Secretary or an Assistant Secretary or the Treasurer or an Assistant Treasurer
of the Corporation and shall bear the corporate seal. Any or all of the
signatures and the seal of the Corporation, if any, upon such certificates may
be facsimiles, engraved or printed.
Section 2. Transfer. Upon surrender to the Corporation or the transfer
agent of the Corporation of a certificate for shares duly endorsed or
accompanied by proper evidence of succession, assignment or authority to
transfer, it shall be the duty of the Corporation to issue, or to cause its
transfer agent to issue, a new certificate to the person entitled thereto,
cancel the old certificate and record the transaction upon its books.
Section 3. Lost, Stolen or Destroyed Certificates. The Secretary may
direct a new certificate or certificates to be issued in place of any
certificate or certificates theretofore issued by the Corporation alleged to
have been lost, stolen or destroyed upon the making of an affidavit of that
fact, satisfactory to the Secretary, by the person claiming the certificate of
stock to be lost, stolen or destroyed. As a condition precedent to the
issuance of a new certificate or certificates the Secretary may require the
owner of such lost, stolen or destroyed certificate or certificates to give the
Corporation a bond in such sum and with such surety or sureties as the
Secretary may direct as indemnity against any claims that may be made against
the Corporation with respect to the certificate alleged to have been lost,
stolen or destroyed or the issuance of the new certificate.
Section 4. Record Date. (a) 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, 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 shall not be more than 60 nor less than ten days before the
date of such meeting. If no record is fixed by the Board of Directors, 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. 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.
(b) In order that the Corporation may determine the stockholders entitled
to consent to corporate action in writing without a meeting, 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 date shall not be more than ten days after the date upon
which the resolution fixing the record date is adopted by the Board of
Directors. If no record date has been fixed by the Board of Directors, the
record date for determining stockholders entitled to consent to corporate
action in writing without a meeting, when no prior action by the Board of
Directors is required, shall be the first date on which a signed written
consent setting forth the action taken or proposed to be taken is delivered to
the Corporation by delivery to its registered office in Delaware, its
principal place of business, or an officer or agent of the Corporation having
custody of the book in which proceedings of meetings of stockholders are
recorded. Delivery made to a Corporation's registered office shall be by hand
or by certified or registered mail, return receipt requested. If no record
date has been fixed by the Board of Directors and prior action by the Board of
Directors is required by law, the record date for determining stockholders
entitled to consent to corporate action in writing without a meeting shall be
at the close of business on the day on which the Board of Directors adopts the
resolution taking such prior action.
(c) In order that the Corporation may determine the stockholders entitled
to receive payment of any dividend or other distribution or allotment of any
rights or the stockholders 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, and which record date shall be not more than 60 days prior to such
action. If no record date is fixed, the record date for determining
stockholders for any such purpose shall be at the close of business on the day
on which the Board of Directors adopts the resolution relating thereto.
ARTICLE VII
GENERAL PROVISIONS
Section 1. Fiscal Year. The fiscal year of the Corporation shall be fixed
from time to time by the Board of Directors.
Section 2. Corporate Seal. The Board of Directors may adopt a corporate
seal and use the same by causing it or a facsimile thereof to be impressed,
affixed, reproduced or otherwise.
Section 3. Reliance upon Books, Reports and Records. Each director, each
member of a committee designated by the Board of Directors, and each officer of
the Corporation shall, in the performance of his or her duties, be fully
protected in relying in good faith upon the records of the Corporation and upon
such information, opinions, reports or statements presented to the Corporation
by any of the Corporation's officers or employees, or committees of the Board
of Directors, or by any other person as to matters the director, committee
member or officer believes are within such other person's professional or
expert competence and who has been selected with reasonable care by or on
behalf of the Corporation.
Section 4. Time Periods. In applying any provision of these By-Laws
which requires that an act be done or not be done a specified number of days
prior to an event or that an act be done during a period of a specified number
of days prior to an event, calendar days shall be used, the day of the doing of
the act shall be excluded and the day of the event shall be included.
Section 5. Dividends. The Board of Directors may from time to time
declare and the Corporation may pay dividends upon its outstanding shares of
capital stock, in the manner and upon the terms and conditions provided by law
and the Certificate of Incorporation.
ARTICLE VIII
AMENDMENTS
Section 1. Amendments. These By-Laws may be altered, amended or repealed,
or new by-laws may be adopted, by the stockholders or by the Board of
Directors.
W3990.TW
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