<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[X] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
First National of Nebraska, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(4) Date Filed:
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Notes:
1
<PAGE>
FIRST NATIONAL OF NEBRASKA, INC.
One First National Center
Omaha, Nebraska 68102
Date of Mailing: May 16, 1997
PROXY STATEMENT
The annual meeting of the shareholders of First National of Nebraska,
Inc. (the "Company") will be held on Wednesday, June 18, 1997 at 3:00 p.m. at
the First National Bank of Omaha, Fourth Floor, One First National Center,
Omaha, Nebraska. At the annual meeting, shareholders will (i) elect directors
(ii) vote on the adoption of Amended and Restated Articles of Incorporation for
the Company (the "Amended Articles") and (iii) vote on the adoption of the
Amended and Restated Bylaws of the Company (the "Amended Bylaws").
This proxy statement is furnished in connection with the solicitation
by the Company of proxies in the accompanying form. You are requested to
complete, sign, date and return the enclosed proxy card in order to ensure that
your shares are voted. A shareholder giving a proxy may revoke it at any time
before it is exercised at the annual meeting. Each proxy signed, dated and
returned will be voted "FOR" each of the nominees for the Board of Directors and
"FOR" the adoption of the Amended Articles and the Amended Bylaws, unless
contrary instructions are given. If instructions are given, the proxy will be
voted in accordance with those instructions. Only shareholders of record at the
close of business on May 12, 1997 will be entitled to notice of the annual
meeting and to vote thereat or any adjournment thereof.
ELECTION OF DIRECTORS
On April 14, 1997, the Board of Directors adopted and approved the
Amended Articles and Amended Bylaws. Among other things, the Amended Articles
and Amended Bylaws increase the number of directors from three to eight and
create three classes of directors having terms ending in different years. The
adoption of the Amended Articles and Amended Bylaws is subject to the approval
of the shareholders of the Company. See "AMENDMENT OF ARTICLES OF INCORPORATION
AND BYLAWS". Accordingly, the increase in the number of directors and the
nominations of the persons to fill the additional positions on the Board of
Directors are conditioned on the approval of the Amended Articles and Amended
Bylaws by the shareholders. The following persons have been nominated to serve
as directors of the Company for the terms ending on the dates of the annual
meeting of shareholders to be held in the years set forth opposite their
respective names and until their respective successors are duly elected and
qualified. However, if the shareholders do not approve the Amended Articles and
Amended Bylaws, then only Bruce R. Lauritzen, J. William Henry and Dennis A.
O'Neal are nominated to serve as directors for a term ending at the 1998 annual
meeting of shareholders and until their respective successors are duly elected
and qualified.
<PAGE>
Unless contrary instructions are given, it is intended that shares
represented by the proxies will be voted in favor of the election of each
nominee. Each nominee has held the position listed under principal
occupation for at least the past five years unless otherwise indicated.
<TABLE>
<CAPTION>
NOMINEE AGE PRINCIPAL OCCUPATION TERM ENDING
------- --- -------------------- -----------
<S> <C> <C> <C>
F. Phillips Giltner 72 Chairman of the Board of 1999
Directors, Secretary,
Member of the Executive
Committee and Director
of the Company; Chairman of the
Board of Directors, Member of the
Executive Committee and Director of
First National Bank of Omaha
(the "Bank")
Bruce R. Lauritzen* 53 President, Treasurer, Member of 1998
the Executive Committee and
Director of the Company;
President, Member of Executive
Committee and Director of the
Bank
Elias J. Eliopoulos 52 Executive Vice President and 2000
Director of the Bank-1993 to
present, Senior Vice President of the
Bank-1983 to 1993
J. William Henry 54 Executive Vice President and 1999
Director of the Bank
Dennis A. O'Neal 56 Executive Vice President and 2000
Director of the Bank
Charles R. Walker 48 Executive Vice President and 1998
Director of the Bank
Margaret M. Lauritzen 29 Senior Commercial Credit 2000
Analyst of the Bank-present,
Commercial Credit Analyst of
the Bank-1996, Management
Trainee of the Bank-1995,
Employee of Aspen Skiing
Corporation - 1990 to 1994
Daniel K. O'Neill 43 Executive Vice President of 1999
Lauritzen Corporation
President of Financial
Service Company
</TABLE>
_____________
*Mr. Lauritzen is an owner of more than 5% of the common stock of the Company.
See "SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT". Bruce R.
Lauritzen is the father of Margaret M. Lauritzen.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE ELECTION OF
EACH OF THE NOMINEES FOR DIRECTOR.
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AMENDMENT OF ARTICLES OF INCORPORATION AND BYLAWS
On April 14, 1997, the Board of Directors adopted and approved Amended and
Restated Articles of Incorporation for the Company (the "Amended Articles") and
Amended and Restated Bylaws for the Company (the "Amended Bylaws"). The full
texts of the Amended Articles and the Amended Bylaws, both of which have been
marked to show the changes from the existing Articles of Incorporation and
existing Bylaws are attached as Exhibits A and B to this Proxy Statement. The
principal changes effected by the Amended Articles and Amended Bylaws are:
(i) to increase the number of directors on the Board of Directors
from three to eight and to allow the number of directors to be set from
three to nine by resolution of the Board of Directors;
(ii) to create three classes of directors having terms ending in
different years;
(iii) to provide that procedures to be followed with respect to
contracts or transactions between the Company and a director or officer
comply with the provisions of the recent amendments to the Nebraska
Business Corporation Act (the "Nebraska Act");
(iv) to limit the liability of directors and to cause the Company to
indemnify directors and officers to the full extent provided for under the
Nebraska Act;
(v) to clarify that nominations for directors may be made by the
Executive Committee and by the shareholders;
(vi) to streamline the manners in which the Board of Directors and
Executive Committee may take action;
(vii) to allow the Board of Directors to determine members
of the Executive Committee; and
(viii) to allow the Board of Directors to amend the Bylaws of
the Company without the need for shareholder consent.
Increase the Number of Directors. Article II of the existing Bylaws
provides that there shall be three, and only three, directors of the
Corporation and that shareholders may change the number of directors at an
annual or special meeting. The Amended Articles and Amended Bylaws provide
that the Board of Directors may consist of from three to nine members and
establishes the initial number of directors at eight. Thereafter, the Board
may establish the number of directors making up the full Board of Directors
without further amendment to the Articles of Incorporation or Bylaws or
action by the shareholders. The purpose of these provisions of the Amended
Articles and Amended Bylaws is to increase the number of directors so that
the Company may retain additional directors whose skills and experience
will benefit the Company and the conduct and operation of the Board of
Directors. In addition, by giving the Board of Directors the ability to set
the number of directors making up the Board, the Amended Articles and
Amended Bylaws avoid subjecting the Company to the expense and effort
required to call and conduct a meeting of the shareholders each time the
Company wishes to change the size of the Board of Directors.
The increase in the number of directors will effect the voting power of
shareholders exercising their right of cumulative voting under Nebraska law
at the annual meeting. By increasing the number of directors from three to
eight, a fewer number of votes are required to be cumulated in order to
place a particular nominee on the Board. With eight directors, a
shareholder owning only 38,530 shares would be capable of electing one
person as a director of the Company, assuming that all outstanding shares
of the Company's common stock were cumulated and voted. By contrast, with
only three directors, a shareholder would need to own 86,692 shares in
order to elect one person as a director of the Company, assuming that all
outstanding shares of the Company's common stock were cumulated and voted.
However, because of the proposed classification of the Board of Directors
(discussed below), the effect of the larger Board on the voting power of
shareholders exercising cumulative voting rights will be negated for all
years after 1997. See "Classified Board."
Classified Board. The Amended Articles and Amended Bylaws provide that the
Board of Directors shall be divided into three classes, designated Classes
I, II and III, which shall be as nearly equal in number as possible.
Directors of Class I shall be elected to hold office for a term expiring at
the annual meeting of shareholders to be held in 1998, directors of Class
II shall be elected to hold office for a term expiring at the annual
meeting of
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shareholders to be held in 1999 and directors of Class III shall be elected
to hold office for a term expiring at the annual meeting of shareholders to
be held in 2000. At each succeeding annual meeting of shareholders
following such initial classification and election, the respective
successors of each class shall be elected for three-year terms.
The creation of a classified board is designed to promote continuity and
stability in the leadership and policies of the Company and thereby
facilitate long-range planning for the Company's business and to have a
positive effect on employee loyalty and customer confidence, which are
important factors to the success of the Company's business. These changes
are also expected to discourage certain types of tactics which could
involve actual or threatened changes in control that are not in the best
interest of all shareholders.
The Board of Directors is not proposing these amendments to the Articles of
Incorporation and Bylaws in response to any specific effort to accumulate
shares of the Company's common stock or to otherwise change control of the
Company. These amendments will not, and are not intended to, prevent a
purchase of all or a majority of the Company's common stock, nor are they
intended to deter bids for such stock. However, the Board of Directors
believes that these changes will discourage disruptive tactics and
encourage persons who may seek to acquire control of the Company to
initiate such an acquisition through negotiations with the Board of
Directors. The Board of Directors believes that it will, therefore, be in
a better position to protect the interest of all shareholders and
shareholders will have a better opportunity to evaluate any such action.
Shareholders should note that the Amended Articles and Amended Bylaws may
make it more difficult or time-consuming to change the composition of the
Board of Directors and, therefore, may have the effect of preserving the
incumbent management. Takeovers or changes in the board of directors of a
company that are accomplished without the prior consent of the board of
directors are not necessarily detrimental to the best interests of
shareholders. If the Amended Articles and Amended Bylaws are adopted, then
two annual shareholders' meetings, rather than one, will be required to
effect a change in the majority of the Board of Directors. This may have
the effect of discouraging tender offers for all or a portion of the
Company's common stock, proxy contests or other take-over related actions,
even though some or a majority of the shareholders may believe such actions
to be beneficial. To the extent a potential acquirer of the Company is so
deterred by these provisions of the Amended Articles and Amended Bylaws,
shareholders could be deprived of opportunities to sell their shares at a
premium above the existing market price.
Because no more than three directors will be elected in any given year
after 1997, the classification of the Board will effect the voting power of
shareholders exercising their right of cumulative voting under Nebraska law
at the annual meeting. The effect of a classified board is to increase the
number of votes required to be cumulated in order to place a particular
nominee on the Board. However, because of the increase in the size of the
Board from three to eight (see "Increase in Number of Directors," above),
the number of shares of common stock that would currently be required to be
cumulated in order to place a nominee on the Board (86,692) would not
change as a result of the adoption of a classified board except in those
years in which only two persons are nominated for the Board. If the number
of directors is increased to eight, then in 1998 and every third year
thereafter only two persons will be nominated to the Board of Directors. In
those years a shareholder will need to own 115,590 shares of common stock
in order to elect one person as a director of the Company, assuming that
all outstanding shares of the Company's common stock were cumulated and
voted.
Transactions with Directors and Officers. The existing Articles of
Incorporation of the Company provide that contracts or transactions between
the Company and any of its directors, officers or entities in which such
directors or officers have an interest would be valid as long as such
contract or transaction had been disclosed to or known by the Board. The
Nebraska Act, as amended in 1995, now requires that such a transaction will
be valid if it is (i) approved by a majority of disinterested members of
the board of directors, (ii) approved by shareholders holding two-thirds of
the outstanding shares which are not beneficially owned by the director who
has entered into the transaction with the Company or (iii) is judicially
determined to be fair to the corporation. The Board has proposed this
amendment in order to conform the provisions of the Company's Articles of
Incorporation with the current provision of the Nebraska Act. Accordingly,
the Amended Articles require that contracts or transactions between the
Company and directors or officers (i) meet the requirements of Section 21-
20,114 of the Nebraska Act dealing with approval by disinterested
directors, (ii) meet the requirements of Section 21-20,115 of the Nebraska
Act dealing with approval by shareholders or (iii) be established to be
fair to the Company.
Limitation on the Liability of Directors/Indemnification. The Amended
Articles provide that a director of the Company will not be liable to the
Company or its shareholders other than for (i) the amount of any wrongfully
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<PAGE>
received financial benefit, (ii) intentional infliction of harm on the
Company or its shareholders, (iii) an unlawful dividend or other
distribution or (iv) intentional violation of criminal law. In addition,
under the Amended Articles and Amended Bylaws, the Company will also
indemnify the directors and officers against liability to the fullest
extent allowed under law. The Nebraska Act provides that a corporation may
indemnify a director against liabilities arising in connection therewith as
long as the director (i) conducted himself in good faith, (ii) reasonably
believed that his conduct was in the best interest of the corporation or
not opposed thereto and (iii) had no reasonable grounds to believe that his
conduct was unlawful.
The proposals to amend the Articles of Incorporation and Bylaws to limit
directors' liability and provide for indemnification of directors and
officers are being made to allow the officers and directors of the Company
the full protections afforded under the Nebraska Act. It is not in
response to any pending or threatened shareholder derivative action
involving the Company or other attempt to impose personal liability on the
directors or officers of the Company. The directors recognize that they
have a personal interest in having these provisions included in the Amended
Articles and Amended Bylaws, but believe that the adoption of these
proposals will enhance the Company's ability to attract and retain
qualified directors and officers and allow them to make the business
decisions which are in the best long-term interests of the Company.
Method of Nominating Directors. Neither the current Articles of
Incorporation or the current Bylaws specify the manner in which persons are
to be nominated to serve on the Board of Directors. The Amended Bylaws
provide that both the Executive Committee and shareholders may make
nominations to the Board of Directors and requires that shareholders
receive notice of all such nominations.
Manner in which the Board and Executive Committee May Act. The Amended
Bylaws make several changes to the manner in which the Board of Directors
and the Executive Committee are allowed to operate. Under the current
Bylaws, a majority of the Board constitutes a quorum for a meeting.
However, if a meeting is held at which all members of the Board are not
present (even though a quorum is established), any action taken at such
meeting must be ratified in writing by each member that was unable to
attend the meeting. The effect of this provision is to give a veto power
to any board member who is unable or unwilling to attend an otherwise duly
called and constituted meeting of the Board. In the opinion of the Board,
it is not in the best interest of the Company or its shareholders to allow
a single director to have such an ability, especially in light of the
proposed increase in the number of directors. In effect, this provision,
when combined with the right to place a director on the Board of Directors
through cumulative voting, could give a shareholder holding a relatively
small number of shares the ability to veto any corporate action or use the
threat of such veto to gain concessions from the Company which may not be
in the best interest of all shareholders. Accordingly, the Amended Bylaws
eliminate the requirement that a director ratify any actions taken at a
meeting of the Board of Directors which he or she did not attend.
The existing Bylaws provide that the Executive Committee may only act by
the unanimous consent of its members. The Amended Bylaws will establish
that a majority of the members of the Executive Committee will constitute a
quorum for a meeting of the Executive Committee and that a majority of the
members of the Executive Committee who are present at a meeting may take
action. Again, the Board of Directors believes that the provisions of the
existing Bylaws are not in the best interests of the Company or its
shareholders in that they may be used to retard the ability of the
Executive Committee to act.
Membership of Executive Committee. The existing Bylaws provide that the
Board of Directors will appoint from among those of its members recommended
by the shareholders an Executive Committee consisting of from two to five
persons. The Amended Bylaws allow the Board of Directors to appoint the
members of an Executive Committee without soliciting the recommendation of
shareholders. The practice of soliciting shareholder recommendations for
the Executive Committee is not required by law and is inconsistent with the
practice of most other public corporations. In addition, by giving the
Board of Directors the ability to determine the make-up of the Executive
Committee, the Amended Bylaws avoid subjecting the Company to the expense
and effort required to call and conduct a meeting of the shareholders each
time the Board wishes to change the make-up of the Executive Committee.
The current Bylaws do not allow the Board of Directors to change the make
up of the Executive Committee and provide that in the event of a vacancy on
the Executive Committee, the remaining members of the Executive Committee
will fill the vacancy rather than the Board of Directors. The Board of
Directors is of the view that the make up of the Executive Committee should
be controlled by the Board of Directors. Accordingly, the Amended Bylaws
provide the Board of Directors with the ability to remove members of the
Executive Committee and fill any vacancies on the Executive Committee.
5
<PAGE>
Procedures for Amending Bylaws. The existing Bylaws of the Company allow
the directors to amend the Bylaws except for Sections 1 and 2 of Article II
and Sections 1, 2, 3 and 4 of Article III. In general these excluded
provisions deal with the composition and powers of the Board of Directors
and the Executive Committee. See Exhibit B. The Board of Directors
believes that it would be in the best interest of the Company and its
shareholders for the Board of Directors to adopt amendments to the
Company's Bylaws from time to time that it determines to be necessary
without having to incur the expense and effort to conduct a meeting of the
shareholders. Therefore, the Amended Bylaws allow the Board to amend any
provisions thereof. However, under the Amended Bylaws, the right of the
shareholders to amend the Amended Bylaws is retained.
ADOPTION OF AMENDED ARTICLES AND AMENDED BYLAWS. Under Nebraska law, the
adoption of the Amended Articles requires the affirmative vote of the holders of
two-thirds of all of the issued and outstanding shares of the Company's common
stock entitled to vote at the annual meeting, whether or not such shares are
represented at the annual meeting. Certain of the proposed amendments to the
existing Bylaws may only be adopted with the approval of a majority of the
issued and outstanding shares of common stock. In addition, the adoption of
those provisions of the Amended Bylaws relating to (i) the number of directors
making up the entire Board of Directors and (ii) the classification of the Board
of Directors will be conditioned on the Amended Articles becoming effective as
provided in the Nebraska Act. If the Amended Articles are approved by the
shareholders, they will become effective upon filing with the Secretary of State
of the State of Nebraska, which is expected to be accomplished as soon as
practicable after shareholder approval is obtained.
THE BOARD OF DIRECTORS BELIEVES THAT IT IS IN THE BEST INTEREST OF THE COMPANY
AND ITS SHAREHOLDERS TO ADOPT THE AMENDED ARTICLES AND THE AMENDED BYLAWS AND IS
RECOMMENDING THAT THE AMENDED ARTICLES AND THE AMENDED BYLAWS BE APPROVED BY THE
SHAREHOLDERS.
VOTING AT MEETING
As of May 12, 1997, the Company has outstanding 346,767 shares of $5 par
value common stock. No other class of stock has been issued by the Company.
In voting for directors, each share of common stock is entitled to one vote
for each director to be elected. However, shareholders have the right to
cumulate their votes for the election of directors. In cumulating votes, the
number of votes which each shareholder may cast is determined by multiplying the
number of shares held by the number of directors to be elected. All of such
votes may be cast for any one nominee or such votes may be distributed among the
nominees. Any shareholder desiring to exercise his or her right of cumulative
voting shall give written notice of intent to do so to the Secretary of the
Company at least 30 days before the meeting or within five days after notice of
the meeting is mailed, whichever is later (but in no event less than ten days
before the meeting). Upon receipt of such notice, the Secretary shall
immediately give notice to the other shareholders and such other shareholders
shall each have the right to cumulate their votes and cast them as they see fit
without giving further notice to the Secretary.
All shares represented by properly executed and unrevoked proxies will be
voted at the meeting in accordance with the instructions given therein. Where no
instructions are indicated, such proxies will be voted "FOR" each of the
proposals set forth in this Proxy Statement for consideration at the annual
meeting. Shares of common stock entitled to vote and represented by properly
executed, returned and unrevoked proxies will be considered present for
determining a quorum at the annual meeting, including shares with respect to
which votes are withheld, abstentions are cast and there are broker nonvotes. A
vote of the majority of shares represented, either in person or by proxy, at the
annual meeting is required for the election of directors. A vote of a majority
of the issued and outstanding shares of common stock is required to approve the
Amended Bylaws and a vote of two-thirds or more of the issued and outstanding
shares of common stock is required to approve the Amended Articles.
OTHER MATTERS TO COME BEFORE THE MEETING
If any matters not referred to in this proxy statement come before the
meeting, the persons named in the proxies will vote the shares represented
thereby in accordance with their judgment. The directors are not aware that any
matters other than those set forth in this proxy statement will be presented for
action at the meeting.
6
<PAGE>
SHAREHOLDER PROPOSALS
If any shareholder desires to submit a proposal to be included in the proxy
statement for the Company's 1998 annual meeting, such proposal must be received
at the offices of the Company on or before January 17, 1998. The inclusion of
any such proposal in such proxy statement will be subject to the requirement of
the proxy rules adopted by the Securities and Exchange Commission.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
Notwithstanding anything to the contrary set forth in any of the Company's
previous filings under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, that might incorporate future filings,
including this proxy statement, in whole or in part, the following report and
the Performance Graph shall not be incorporated by reference into any such
filings.
A. Report of the Executive Committee on Executive Compensation
COMPENSATION PHILOSOPHY
The Executive Committee for the Company, the members of which are also the
members of the Executive Committee for the Bank, sets the compensation of the
officers of the Company and the Bank. Information presented herein is presented
on a consolidated basis. The Company compensates its executive officers in
amounts which are competitive, consistent with its business objectives, and
commensurate with the experience level of its executive officers. The goal of
the Company's compensation policy is to attract, retain and reward executive
officers who contribute to the long-term success of the Company. The Executive
Committee considers midwest regional financial institutions and selected local
employers in determining competitive base salaries.
Executive officers are rewarded based upon corporate performance, business
unit performance and individual performance. Corporate performance and business
unit performance are evaluated by reviewing the extent to which strategic and
business goals are met, including such factors as operating profit and asset
growth. Individual performance is evaluated by reviewing contributions to
corporate goals. In all cases, the condition of the economy relative to the
Company's lines of business and the performance of competitors is also taken
into consideration in order to determine the relative performance of each
individual and the Company.
PRIMARY ELEMENTS OF COMPENSATION
The Company has had a history of using a simple total compensation package
that consists of cash and benefits. Having a compensation program that allows
the Company to successfully attract and retain key employees permits it to
provide useful products and services to customers, enhance shareholder value,
motivate innovation, foster teamwork, and adequately reward employees.
Currently, the primary elements of the executives' total compensation program
are base salary, annual cash incentives, and long-term cash incentives.
With respect to the base salary and cash incentive bonuses granted to the
executive officers in 1996, the Executive Committee took into account the
Company's success in meeting a variety of financial and nonfinancial performance
goals. These goals include: growth in earnings; the rate of return on assets;
the rate of return on shareholder's equity; the growth in assets and fee income;
degree of market share; quality of assets; various measures of productivity and
efficiency; development and execution of business strategies; the identification
and implementation of acquisition plans; and the introduction of new
technologies, products and services.
BASE SALARY
The Executive Committee sets base salary for executive officers by
reviewing individual performance, professional experience, position with the
Company, and base salary levels paid by similarly situated companies. The
Executive Committee believes that the Company's base salaries are generally
commensurate with the base salaries of similar financial institutions and local
employers.
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Base salary is included in the amount reported in column (c) of the Summary
Compensation Table of this proxy statement and consists of amounts paid by the
Bank and the Company. This base salary is determined by the Executive Committee
in December of the year prior to the period it is earned. For example, the base
salary earned as indicated in column (c) of the Summary Compensation Table for
1996 was determined by the Executive Committee in December, 1995.
ANNUAL CASH INCENTIVES
The Executive Committee awards cash incentive bonuses in January of each
year to executive officers based on their performance with respect to individual
goals and to the Company's financial goals and the Company's performance
relative to its competitors. Specifically, in 1996, Company goals were to earn a
15% rate of return on shareholders' equity; increase assets by 15%; and increase
earnings by 15%. Depending upon the performance relative to these guidelines,
executive officers are given raises in line with those received by other
officers and bonuses as appropriate for the Company's performance. In 1996, the
Company earned a 15.4% rate of return on shareholders' equity and managed assets
increased by 12.7% . However, earnings decreased by 14.6% between 1995 and 1996.
Current cash bonuses for 1996 were adjusted to account for performance in each
area and were paid in January 1997.
LONG-TERM CASH INCENTIVES
The Executive Committee awards long-term cash incentive compensation under
two separate plans, which are subject to vesting schedules, to establish long-
term incentives for the executive officers.
Cash incentives awarded under the first plan, which are included in column
(d) of the Summary Compensation Table, are subject to a 7-year vesting schedule
and are payable upon retirement, death, or total disability. This cash
incentive plan is to provide additional incentive to senior management to
increase earnings of the Company on a long term basis. Participation in the
plan is limited to key executives as determined by the Executive Committee. The
Executive Committee determines at the beginning of each Plan Year the
participants, if any, and the share each participant shall receive for the Plan
Year in the total incentive pool. The incentive pool is determined by the
Executive Committee and is based upon the level of achievement by the Company of
the financial goals as set forth above for the related Plan Year.
In 1996, each of the Company's executive officers received deferred cash
compensation based on the prior year's performance. For example, in January
1996, each executive officer listed on the Summary Compensation Table received a
deferred cash payment based on the Company performance and their individual
performance in 1995. This annual incentive compensation, included as a portion
of the amounts in column (d) of the Summary Compensation Table, is
discretionarily determined by the Executive Committee based upon the Company
meeting its financial goals as set forth above and upon individual contribution
to the Company's performance.
Cash incentives awarded under the second plan, which are also included in
column (d) of the Summary Compensation Table, are subject to a 5-year vesting
schedule and are payable upon retirement, termination, disability, or death.
Cash incentives under this plan are awarded to plan participants which
historically have included the executive officers of the Company. The Executive
Committee discretionarily determines which employees and officers shall be
entitled to participate in the Plan. Historically, this amount has been based
upon the current salary, for the Plan Year, of each participant and has not been
determined based upon Company performance or individual performance. No amounts
were awarded under this plan in 1995 and 1996.
F. Phillips Giltner
Bruce R. Lauritzen
8
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B. SUMMARY COMPENSATION TABLE
The following table sets forth total compensation paid by the Company and the
Bank to certain of their executive officers for the years 1996, 1995 and 1994.
Mssrs. Eliopoulos, Henry, O'Neal, and Walker are executive officers of the Bank
only.
<TABLE>
<CAPTION>
Annual Compensation
-----------------------------------------------------
Other
Annual All Other
Compen- Compen-
Salary Bonus sation sation
Name and Principal Position Year ($) ($) ($) ($)
- -----------------------------------------------------------------------------------------------------------------
------------(a)------------ (b) (c) (d) (e) (i)
<S> <C> <C> <C> <C> <C>
F. Phillips Giltner
Chairman of the Board, the Company and
the Bank; Secretary, the Company 1996 419,729 399,074 (1) 61,286 (4) 4,604 (5)
Chairman of the Board, the Company and
the Bank; Secretary, the Company 1995 403,727 417,464 (2) 34,239 4,403
Chairman of the Board, the Company and
the Bank; Secretary, the Company 1994 407,546 435,406 (3) 26,319 8,402
Bruce R. Lauritzen
President/Treasurer, the Company and
President, the Bank 1996 379,853 385,632 (1) 65,185 (4)
President/Treasurer, the Company and
President, the Bank 1995 355,386 402,426 (2) 23,291
President/Treasurer, the Company and
President, the Bank 1994 348,160 415,467 (3) 19,883
Elias J. Eliopoulos
Executive Vice President, the Bank 1996 211,613 291,775 (1) 5,899 (4)
Executive Vice President, the Bank 1995 203,280 282,555 (2) 6,025
Executive Vice President, the Bank 1994 147,087 287,793 (3) 3,206
J. William Henry
Executive Vice President, the Bank 1996 211,613 285,112 (1) 7,200 (4)
Executive Vice President, the Bank 1995 203,280 292,065 (2) 7,375
Executive Vice President, the Bank 1994 193,500 292,988 (3) 7,643
Dennis A. O'Neal
Executive Vice President, the Bank 1996 211,613 285,115 (1) 13,097 (4)
Executive Vice President, the Bank 1995 203,280 294,669 (2) 15,235
Executive Vice President, the Bank 1994 193,500 292,994 (3) 20,019
Charles R. Walker
Executive Vice President, the Bank 1996 211,613 279,699 (1) 3,853 (4)
Executive Vice President, the Bank 1995 203,280 291,965 (2) 6,716
Executive Vice President, the Bank 1994 193,500 292,788 (3) 4,282
</TABLE>
_______________
(1) Includes deferred compensation allocated to a participant account
pursuant to an incentive plan based on the previous year's performance in the
following amounts: F. Phillips Giltner, $104,208; Bruce R. Lauritzen, $94,926;
Elias J. Eliopoulos, $109,128; J. William Henry, $101,156; Dennis A. O'Neal,
$101,156; Charles R. Walker, $95,843. All such amounts are subject to a 7-year
vesting schedule and are payable in cash only upon retirement, upon death, or
upon total disability.
(2) Includes compensation allocated to a participant account pursuant to an
incentive plan in the following amounts: F. Phillips Giltner, $122,598; Bruce
R. Lauritzen, $111,720; Elias J. Eliopoulos, $102,908; J. William Henry,
$108,109; Dennis A. O'Neal, $110,710; Charles R. Walker, $108,109. All such
amounts are subject to a 7-year vesting schedule and are payable in cash only
upon retirement, upon death, or upon total disability.
(3) Includes compensation allocated to a participant account pursuant to an
incentive plan in the following amounts: F. Phillips Giltner, $120,540; Bruce
R. Lauritzen, $109,760; Elias J. Eliopoulos, $106,500; J. William Henry,
$109,075; Dennis A. O'Neal, $109,075; Charles R. Walker, $109,075. All such
amounts are subject to a 7-year vesting schedule and are payable in cash only
upon retirement, upon death, or upon total disability. Includes compensation
allocated to a participant account pursuant to another incentive plan in the
following amounts: F. Phillips Giltner, $19,866; Bruce R. Lauritzen, $16,707;
Elias J. Eliopoulos, $6,293; J. William Henry, $8,913; Dennis A. O'Neal, $8,919;
Charles R. Walker, $8,713. All such amounts are subject to a 5-year vesting
schedule and are payable in cash upon retirement, termination, disability, or
death.
(4) Includes the following amounts: F. Phillips Giltner, $34,003 for legal
fees paid; Bruce R. Lauritzen, $57,889 for travel expenses paid; Elias J.
Eliopoulos, $4,458 for travel expenses paid; J. William Henry, $4,500 auto
stipend paid and $2,400 for social club memberships paid; Dennis A. O'Neal,
$4,800 for social club memberships paid, $4,875 for auto stipend paid; Charles
R. Walker, $2,895 for social club memberships paid.
(5) A premium of $4,604 paid on a life insurance policy which, pursuant to a
split dollar agreement, currently has no cash surrender value to F. Phillips
Giltner.
9
<PAGE>
C. DEFINED BENEFIT PENSION PLAN
The Bank's pension plan is a noncontributory defined benefit pension plan
(the "Pension Plan"). Contribution amounts cannot be readily determined with
respect to individual Pension Plan participants. In 1996, no contributions to
the Pension Plan were required, and, therefore, none were made because the
Pension Plan was fully funded.
Benefits payable at "normal retirement" (age 65) are determined by a
formula which is: 1.25% of final average monthly salary (the highest average
using 60 consecutive months out of the last 120 months of employment) plus .42%
of the excess of final average salary over the social security wage base, times
years of credited service. The amount payable is subject to limits established
by federal law. This amount is paid in full at normal retirement. Early
retirement benefits are available, at actuarially reduced amounts, at any age
between 55 and 65; provided, however, there is no reduction if a person has 40
or more years credited service. If credited service exceeds 40 years, an
actuarial increase of up to 4.25% will be substituted for each credited year of
service over 40. If a Pension Plan participant terminates before eligibility
for retirement benefits, the participant may be vested in some or all of his or
her accrued benefit, deferred to normal retirement (or an actuarially reduced
amount if payments start early). Vesting in the Pension Plan is determined by a
method termed "Five Year Cliff" vesting (no vesting until five years of service
have been completed, excluding years of service before the participant's 18th
birthday, then 100% vested after the five year period).
Benefits determined by the formula above are straight-life annuity amounts.
Joint and survivor annuities, on an actuarially equivalent basis, are provided
for by the Pension Plan.
The table below (the "Pension Table") shows estimated annual benefits
payable on a straight-life annuity basis under the Pension Plan to a Bank
employee upon retirement on December 31, 1996 at age 65 with indicated coverage,
final compensation and periods of service. Estimated benefits for salaries over
$150,000 are the same as for a $150,000 salary, because of limitations imposed
by federal law. The current $120,000 limit, as set by federal law for defined
benefit plans, has been reflected in the Pension Table.
<TABLE>
<CAPTION>
Annual
Average Years of Service
--------------------------------------------------
Covered
Remuneration 15 Years 20 Years 25 Years 30 Years 35 Years
------------ -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$125,000 $27,362 $36,483 $45,604 $54,725 $63,846
150,000 33,625 44,833 56,042 67,250 78,458
175,000 33,625 44,833 56,042 67,250 78,458
200,000 33,625 44,833 56,042 67,250 78,458
225,000 33,625 44,833 56,042 67,250 78,458
250,000 33,625 44,833 56,042 67,250 78,458
300,000 33,625 44,833 56,042 67,250 78,458
400,000 33,625 44,833 56,042 67,250 78,458
450,000 33,625 44,833 56,042 67,250 78,458
500,000 33,625 44,833 56,042 67,250 78,458
</TABLE>
Remuneration covered by the Pension Plan and included in the Pension Table
above is basic salary only. Thus, remuneration covered by the Pension Plan is
part of the cash compensation reported in column (c) of the Summary Compensation
Table for the executive officers named above. The amounts in the Pension Table
are not subject to any deductions for Social Security benefits or other offsets.
The amounts of covered remuneration paid in 1996 and the number of years of
credited service (total years of service, if different, are noted) for the
executive officers named above as of December 31, 1996 were: F. Phillips
Giltner -- $392,529 - 32.75; Bruce R. Lauritzen -- $357,653 - 29.25; Elias J.
Eliopoulos -- $204,413 - 27.75; J. William Henry -- $204,413 - 32.25; Dennis A.
O'Neal -- $204,413 - 15; Charles R. Walker -- $204,413 - 13. See the Pension
Table above.
10
<PAGE>
D. Committee Interlocks and Insider Participation
The Executive Committee, which currently consists of F. Phillips Giltner
and Bruce R. Lauritzen, fixes the compensation of the officers of the Company
and the Bank. In addition to their positions with the Company and the Bank, F.
Phillips Giltner and Bruce R. Lauritzen also hold the following positions with
the Company's subsidiaries:
F. Phillips Giltner
-------------------
Credit Card Finance Corporation, Chairman and Director
First National Credit Corporation, Chairman and Director
First National of Colorado, Inc., Chairman and Director
Bruce R. Lauritzen
------------------
First National of Colorado, Inc., President and Director
First National Bank (Ft. Collins, CO), Director
Union Colony Bank (Greeley, CO), Director
The Bank of Boulder (Boulder, CO), Director
E. Compensation of Directors
Although the Company does not compensate its directors, the Bank paid each
director a fee of $600 per month in 1996 for their service as a director.
Directors fees are included in column (c) of the Summary Compensation Table.
F. Employment Contracts and Termination of Employment Arrangements
Employment agreements exist between the Company and F. Phillips Giltner and
Bruce R. Lauritzen with respect to their employment in the positions indicated
in the Election of Directors section. The agreements generally provide for an
annual base salary which is adjusted in such amounts and at such times as may be
determined by the Executive Committee and, in the event of the employee's
termination of employment by reason of death, certain benefits to be paid to a
designated beneficiary of the employee. Such benefits will include one year of
the employee's current compensation which will be equal to the sum of (i)
employee's direct annual compensation being received from the Company upon such
termination, (ii) the employee's base compensation being received from the Bank
upon such termination, and (iii) the bonus received from the Bank for the year
immediately prior to his death, payable in not more than sixty (60) equal
monthly installments. In the event the employee's employment is terminated by
reason of disability, the employee will be paid an amount approximately equal to
two-thirds of the sum of the three items listed above adjusted annually by a
percentage equal to the average increase in direct compensation paid to officers
of the Company and the Bank, which payments will continue until the employee is
entitled to receive retirement benefits from the pension plan of the Bank or the
Company. During 1996, $20,000 and $15,000 were the annual base salaries paid by
the Company pursuant to the employment agreement to F. Phillips Giltner and
Bruce R. Lauritzen, respectively. No formal employment agreements exist between
the Bank and Bruce R. Lauritzen and F. Phillips Giltner.
The Bank has a deferred compensation plan for Mr. F. Phillips Giltner. He
will begin to receive payments on December 15, 1999.
11
<PAGE>
G. Performance Graph
The following graph illustrates the cumulative total return to shareholders
for the five-year period ended December 31, 1996, for First National of
Nebraska's common stock, the Standard and Poor's 500 Stock Index (S&P 500
Index), and an original and revised group of peer bank holding companies that
First National of Nebraska considers its primary local and regional competitors.
The original competitive peer group consists of: Commerce Bancshares, Inc. and
United Missouri Bancshares, Inc. both of Kansas City, Missouri; and Norwest
Corporation and First Bank Systems, Inc., both of Minneapolis, Minnesota; and
Firstier Financial, Inc. of Omaha, Nebraska through 1995. During 1996, Firstier
Financial, Inc. was acquired by First Bank Systems, which is also included in
the competitive peer group. The revised competitive peer group consists of:
Commerce Bancshares, Inc. and United Missouri Bancshares, Inc. both of Kansas
City, Missouri; and Norwest Corporation and First Bank Systems, Inc., both of
Minneapolis, Minnesota; Firstar Corporation of Milwaukee, Wisconsin; First
Commerce Bancshares of Lincoln, Nebraska; Commercial Federal Corporation of
Omaha, Nebraska; and BancOne Corporation of Columbus, Ohio. The competitive
peer group index was revised to broaden the composition of competitors included
in the peer group index. The cumulative total return to shareholders for the
competitive peer group is weighted according to the respective issuer's market
capitalization. This graph assumes an initial investment of $100.00 in the
indices presented and in the Company's common stock on December 31, 1991 and
reinvestment of dividends.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
LINE GRAPH DEPICTING:
<TABLE>
<CAPTION>
1992 1993 1994 1995 1996
<S> <C> <C> <C> <C> <C>
REVISED COMPETITIVE PEER GROUP $ 124 $ 138 $ 134 $ 184 $ 221
FIRST NATIONAL OF NEBR $ 159 $ 230 $ 271 $ 327 $ 322
ORIGINAL COMPETITIVE PEER GROUP $ 124 $ 137 $ 140 $ 187 $ 223
S&P 500 INDEX $ 108 $ 118 $ 120 $ 165 $ 203
</TABLE>
12
<PAGE>
INFORMATION CONCERNING CERTAIN INTERESTS OF DIRECTORS
AND TRANSACTIONS WITH MANAGEMENT
In addition to his role and ownership position with the Company and its
subsidiaries during 1996, Bruce R. Lauritzen served as an officer and director
of, and owned more than 10% equity interest in, numerous other banks and
corporations.
Such banks and other affiliates have had normal business relationships with
the Bank. In the course of such normal business relationships, such banks paid
fees to the Bank for data processing services. Charges for these data
processing services were at normal rates and approximated $683,000 in 1996.
During 1996, banking subsidiaries of the Company had loan transactions in
the ordinary course of business with some of the Company's directors and
officers, and some of the subsidiaries' directors and officers. Such loans did
not involve more than the normal risk of collectibility, present other
unfavorable features or bear lower interest rates than those prevailing at the
time for comparable transactions with unaffiliated persons.
COMMITTEES OF THE BOARD OF DIRECTORS
The Company does not have standing nominating, audit or compensation
committees of the Board of Directors. The Executive Committee fixes the
compensation of the officers of the Company, and the Board of Directors
otherwise performs the functions that such committees would normally perform.
The Board of Directors held eight meetings and executed twelve unanimous
consents in lieu of meetings during 1996. The Executive Committee executed one
unanimous consent and held several ad hoc Executive Committee meetings during
1996.
13
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the beneficial ownership of the common
stock of the Company by all officers, directors, and nominees for directors
individually, by officers and directors of the Company and the Bank as a group
and by all persons known to management of the Company to be the beneficial
owners of more than 5% of the Company's common stock. Unless otherwise noted,
the named shareholders have sole investment and voting power with respect to all
shares listed.
<TABLE>
<CAPTION>
Name and Address Amount and Nature of Percent
Of Beneficial Owner Beneficial Ownership of Class
- ------------------- -------------------- --------
<S> <C> <C>
John R. Lauritzen 160,736 1 46.4% 5
First National Bank
First National Center
Omaha, NE 68102
Bruce R. Lauritzen 27,652 2 8.0% 5
First National Bank
First National Center
Omaha, NE 68102
Thomas L. Davis 42,036 3 12.1%
c/o Trust Department
First National Bank
First National Center
Omaha, NE 68102
F. Phillips Giltner 9,366 2.7%
First National Bank
First National Center
Omaha, NE 68102
Elias J. Eliopoulos 302 *
First National Bank
First National Center
Omaha, NE 68102
J. William Henry 30 *
First National Bank
First National Center
Omaha, NE 68102
Dennis A. O'Neal 40 *
First National Bank
First National Center
Omaha, NE 68102
Charles R. Walker 105 *
First National Bank
First National Center
Omaha, NE 68102
Margaret M. Lauritzen 540 *
First National Bank
First National Center
Omaha, NE 68102
Daniel K. O'Neill 0 *
Lauritzen Corporation
First National Center
Omaha, NE 68102
Mutual of Omaha Insurance Company 17,000 4.9%
United of Omaha Life Insurance Company 12,420 3.6%
Dodge at 33rd
Omaha, NE 68131
All Officers and Directors of 182,488 4 52.6%
the Company and the Bank
as a group (29 persons)
</TABLE>
________________
1. 4,922 sole investment and voting power: 73,596 voting and
investment power through control of the Lauritzen Corporation; 52,286 Elizabeth
D. Lauritzen, spouse, has sole investment and voting power; 29,932 spouse shares
investment and voting power with the Bank.
2. Sole investment and voting power 9,022; investment and voting
power shared with spouse and minor child 640; right to receive dividends and
proceeds 16,516; voting power of shares owned by Lauritzen companies pension
plan 1,474.
3. Sole investment and voting power; 29,600; voting power no other
interest 12,436.
4. In addition, benefit plans of the Bank own 11,747 shares of the
Company's stock which totals 3.4%.
5. Some of the shares reported for John R. Lauritzen and Bruce R.
Lauritzen are included twice. The total number without duplication is 170,398 or
49%.
* Represents less than 1% of the Company's stock.
14
<PAGE>
INDEPENDENT PUBLIC ACCOUNTANTS
Deloitte & Touche are the principal accountants for the Company and are
expected to continue in that capacity during 1997. It is not anticipated that a
representative of that firm will attend the annual meeting of shareholders of
the Company.
COST OF SOLICITATION
The cost of soliciting proxies, which includes printing, postage,
mailing and legal fees, will be paid by the Company.
THE ANNUAL REPORT ON FORM 10-K TO THE SECURITIES AND EXCHANGE
COMMISSION FOR THE YEAR ENDED DECEMBER 31, 1996 MAY BE OBTAINED WITHOUT CHARGE
BY EACH PERSON WHOSE PROXY IS SOLICITED BY WRITTEN REQUEST TO THE COMPANY. SUCH
REQUEST SHOULD BE DIRECTED TO F. PHILLIPS GILTNER, ONE FIRST NATIONAL CENTER,
OMAHA, NE 68102.
15
<PAGE>
First National of Nebraska, Inc. PROXY
One First National Center
16th and Dodge Streets
Omaha, NE 68102
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints F. Phillips Giltner or Bruce
R. Lauritzen, or either of them, as Proxies with full power of
substitution to represent the undersigned and to vote, as
designated below, all of the shares of common stock of First
National of Nebraska, Inc. held of record by the undersigned
at the annual meeting of that Corporation to be held on June
18, 1997 and any adjournment thereof.
<TABLE>
<CAPTION>
1. ELECTION OF DIRECTORS FOR all persons listed below [_] AGAINST all persons listed below [_]
(except as marked to the contrary below)
INSTRUCTION To vote against any individual person, cross out the person's name in the list below.
<S> <C> <C> <C> <C>
F. Phillips Giltner, Bruce R. Lauritzen, Elias J. Eliopoulos, Margaret M. Lauritzen
J. William Henry, Dennis A. O'Neal, Charles R. Walker, Daniel K. O'Neill
</TABLE>
2. AMENDMENT OF ARTICLES OF INCORPORATION
FOR amendment and restatement of Articles of Incorporation [_]
AGAINST amendment and restatement of Articles of Incorporation [_]
ABSTAIN [_]
3. AMENDMENT OF BY-LAWS
FOR amendment and restatement of By-Laws [_]
AGAINST amendment and restatement of By-Laws [_]
ABSTAIN [_]
4. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.
<PAGE>
THIS PROXY, IF EXECUTED AND RETURNED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN. IF NO DIRECTION IS MADE, THE PROXY WILL BE VOTED FOR PROPOSALS 1, 2 AND
3.
Please sign this proxy as your name appears above. Joint owners must
each sign personally. Trustees and others signing in a representative capacity
must indicate the capacity in which they sign.
_______________________________
(Signature)
Date: ______________________________ _______________________________
<PAGE>
May 12, 1997
RE: NOTICE OF ANNUAL MEETING
The annual meeting of shareholders of First National of Nebraska, Inc. will
be held on the fourth floor of the First National Bank of Omaha Building, One
First National Center, 16th and Dodge Streets, Omaha, Nebraska, on June 18, 1997
at 3:00 o'clock P.M. for the following purposes:
1. To elect directors for the ensuing year; and
2. To consider proposals to amend and restate the Articles of
Incorporation and the By-Laws.
F. PHILLIPS GILTNER
Chairman and Secretary
<PAGE>
EXHIBIT A
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
FIRST NATIONAL OF NEBRASKA, INC.
These are the Amended and Restated Articles of Incorporation of First
National of Nebraska, Inc. [which correctly set forth without change the
corresponding provisions of the Articles of Incorporation as heretofore amended.
These Restated Articles of Incorporation supersede the] adopted pursuant to the
Business Corporation Act of the State of Nebraska in effect on the date hereof
and supersede the corporation's original Articles of Incorporation and all
amendments thereto:
FIRST: The name of the corporation is First National of Nebraska, Inc.
SECOND: The period of its duration is perpetual.
THIRD: The purposes for which the corporation is organized are: to
acquire, purchase, own, hold, operate, develop, lease, mortgage, pledge,
exchange, sell, invest, transfer, trade, or otherwise deal in real or personal
property, stocks, bonds, securities, choses in action or any interest therein.
The corporation shall have authority to undertake and carry on any lawful
business of any kind whatsoever, and shall have all powers and authorities
granted to a Nebraska business corporation by the laws of the State of Nebraska.
The purposes herein set forth shall each be regarded as independent powers of
the corporation.
FOURTH: The aggregate number of shares which the corporation shall
have authority to issue is 346,767 shares of voting common stock [having a]
par value [of] $5.00 per share.
FIFTH: No shareholders of the corporation of any class or series shall
have any preemptive rights to acquire additional or treasury shares of the
corporation or be entitled as a matter of right to subscribe for or to purchase
any shares of any class or series whether now or hereafter authorized.
SIXTH: Provisions [which the incorporators elect to include in the]
included in these Amended and Restated Articles of Incorporation for the
regulation of the internal affairs of the corporation are as follows:
(a) General - All shares of common stock shall be of one and the same
class and when issued shall have equal rights of participation in dividends and
assets of the corporation and shall be non-assessable. The holders of common
stock shall be entitled to one vote for each of the shares of such stock held by
them of record at any meeting of shareholders except when there shall be
cumulative voting in the election of directors as provided below. The
shareholders shall not be liable for the debts of the corporation.
<PAGE>
(b) Cumulative Voting - In any election of directors of the
corporation, each shareholder entitled to vote in such election shall be
entitled to cumulate his votes either (i) by giving to one candidate as many
votes as shall equal the number of directors who are to be elected and for whose
election he has a right to vote multiplied by the number of shares owned by such
shareholder, or (ii) by distributing the total number of his votes, computed as
set out above, among any number of candidates. Any shareholder desiring to
exercise his right of cumulative voting shall give notice thereof to the
Secretary [and each member of the Executive Committee] of the corporation in
writing delivered at least thirty (30) days before the meeting at which the vote
is to be taken or within five (5) days after notice of the meeting is mailed,
whichever is later, but in no event less than ten (10) days before the meeting
is to be held. Upon receipt of such notice, the Secretary shall immediately give
written notice to the other shareholders and such other shareholders shall each
have the right to cumulate their votes without giving further notice to the
Secretary. All notices required to be given under this paragraph (b) shall be
sent, [if to an address in the same state, by certified mail return receipt
requested or, if to an address in a different state, by Federal Express, UPS,
Western Union or other similar expedited delivery service.] by mail, postage
prepaid, to each shareholder's address as shown in the corporation's current
record of shareholders.
(c) Board of Directors - The number of directors constituting the
Board of Directors shall be eight (8) on the date of the adoption of these
Amended and Restated Articles of Incorporation and thereafter the number shall
be as set forth in or pursuant to the bylaws of the corporation, but shall not
be less than three (3) nor more than nine (9). The Board of Directors shall be
divided by the directors into three classes, designated Classes I, II and III,
which shall be as nearly equal in number as possible. Directors of Class I shall
be elected to hold office for a term expiring at the annual meeting of
shareholders to be held in 1998, directors of Class II shall be elected to hold
office for a term expiring at the annual meeting of shareholders to be held in
1999 and directors of Class III shall be elected to hold office for a term
expiring at the annual meeting of shareholders to be held in 2000. At each
succeeding annual meeting of shareholders following such initial classification
and election, the respective successors of each class shall be elected for
three-year terms. The shareholders of the corporation may remove any director or
the entire Board of Directors.
(d) Director Nominations - Advance notice of nominations for
elections for the election of directors shall be given in the manner and to the
extent provided in the bylaws of the corporation.
(e) Director Vacancies - Vacancies in the Board of Directors
resulting from death, resignation, retirement, disqualification, removal from
office or other cause and newly created directorships resulting from any
increase in the authorized number of directors shall be filled in the manner
provided in the bylaws of the corporation.
[(c)](f) Directors and Officers Interest in Contracts - No contract or
transaction between this corporation and any of its directors and officers, or
between this corporation and any other corporation, firm, association, or other
legal entity in which a director or officer of this corporation has
2
<PAGE>
any direct or indirect interest, pecuniary, or otherwise, shall be invalidated
by reason of such fact, or because the interested director or officer was
present at the meeting of the Board of Directors which acted upon or in
reference to such contract or transaction, or because an interested director
participated in such action, nor shall an interested director or officer be
liable to account to the corporation because or by reason of such interest for
any amount realized from or through any such transaction or contract with the
corporation, provided that [the interest of each such director or officer shall
have been disclosed to or known by the Board.] such transaction or contract
either (i) meets the requirements of Neb. Rev. Stat. (S)(S) 21-20,114 or 20,115
or (ii) is established to have been fair to the corporation, judged according to
the circumstances at the time of commitment.
[SEVENTH: The address of the current registered office](g) A director of
the corporation [is One First National Center, Omaha, Nebraska 68102 and the
name of its current registered agent at such address is Eric S. Turille] shall
not be liable to the corporation or its shareholders for money damages for any
action taken, or any failure to take any action, as a director, except liability
for (i) the amount of a financial benefit received by a director to which he or
she is not entitled; (ii) an intentional infliction of harm on the corporation
or its shareholders; (iii) a violation of Neb. Rev. Stat. (S) 21-2096; or (iv)
an intentional violation of criminal law. If the Business Corporation Act is
amended after the effective date of these Amended and Restated Articles of
Incorporation so as to authorize any further elimination or limitation of the
liability of directors, then the liability of directors of the corporation shall
be so further eliminated or limited. The corporation shall indemnify every
director of the corporation for liability to any person for any action taken, or
any failure to take any action, as a director to the fullest extent permitted by
law.
(h) No amendment to or repeal of any part of this Article shall
apply to or have any effect on the liability or alleged liability of any
director, or on the indemnification available to any director or officer, for or
with respect to any acts or omissions occurring prior to such amendment or
repeal.
SEVENTH: The corporation shall maintain a registered office and
registered agent as required by the Business Corporation Act.
DATED as of the [27th] 18th day of [May, 1992] June, 1997.
FIRST NATIONAL OF NEBRASKA, INC.,
a Nebraska Corporation
By______________________________
[F. Phillips Giltner] Bruce
R. Lauritzen, President
ATTEST:
________________________________
F. Phillips Giltner
Chairman and [Bruce R. Lauritzen]
Secretary
3
<PAGE>
EXHIBIT B
AMENDED AND RESTATED BYLAWS
OF
FIRST NATIONAL OF NEBRASKA, INC.
[OMAHA, NEBRASKA]
ARTICLE I - SHAREHOLDERS
Section 1. Annual Meetings. The annual meeting of the shareholders of the
corporation shall be held on such day during the first 180 days of the calendar
year as the Board of Directors may determine.
Section 2. Special Meetings. Special meetings of the shareholders may be
called at any time by the Board of Directors, the Chairman of the Board, or the
Chairman of the Executive Committee, and shall be called upon the request of
shareholders holding at least one-tenth of the outstanding stock.
Section 3. Place of Meetings. Each annual and special meeting of the
shareholders shall be held at the principal office of the corporation, or at
such other place as shall be designated by the Board of Directors or the
Executive Committee.
Section 4. Notice of Meetings. Written or printed notice stating the place,
day and hour of meeting and, in case of [a] special meeting, the purpose or
purposes for which the meeting is called, shall be mailed by the Secretary or an
Assistant Secretary not less than thirty nor more than [fifty] sixty days before
the date of the meeting, to each shareholder of record, addressed to him at his
address as it appears on the stock records of the corporation. Such notice shall
be sent, [and, if to an address outside the state of Nebraska, by Federal
Express, Western Union, UPS, or other similar expedited delivery service.] by
mail, postage prepaid, to each shareholder's address as shown in the
corporation's current records.
Section 5. Proxies. At all meetings of shareholders, a shareholder may vote
by proxy executed in writing by the shareholder and filed with the Secretary of
the corporation, bearing date within eleven months prior to the meeting unless a
longer period is provided therein and is permitted by law. A proxy shall be
revocable, if [so] not provided [therein] otherwise, by written notice of the
revocation delivered by the shareholder to the Secretary of the corporation.
Section 6. Quorum. A majority of the outstanding shares of the corporation,
appearing in person or represented by proxy, shall constitute a quorum at a
meeting of shareholders.
Section 7. Voting. [Subject to the provisions of Section 3 Article V
hereof] Except as otherwise provided in the Articles of Incorporation, in all
voting by shareholders each shareholder shall be entitled
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[to] one vote for each share of stock standing in the name of such shareholder
on the stock records of the corporation; however, only those whose names appear
as shareholders on the stock records of the corporation, or their proxies or
legal representatives, shall be entitled to vote or to participate in any
meeting of shareholders. [A] Except as otherwise provided in the Articles of
Incorporation, these By-Laws or by law, a majority of the votes cast shall
decide any question that may come before the meeting, [except as otherwise
provided by law or by these By Laws.]
ARTICLE II - DIRECTORS
Section 1. Membership. Subject to the rights of the shareholders to revise
the number of directors, beginning on the date hereof there shall be eight and
only eight members of the Board of Directors, and thereafter the number of
members of the Board of Directors shall be fixed by Board of Directors
resolution. The Board of Directors shall be divided by the directors into three
classes, designated Classes I, II and III, which shall be as nearly equal in
number as possible. Directors of Class I shall be elected to hold office for a
term expiring at the annual meeting of shareholders to be held in 1998,
directors of Class II shall be elected to hold office for a term expiring at the
annual meeting of shareholders to be held in 1999 and directors of Class III
shall be elected to hold office for a term expiring at the annual meeting of
shareholders to be held in 2000. At each succeeding annual meeting of
shareholders following such initial classification and election, the respective
successors of each class shall be elected for three-year terms. The shareholders
of the corporation may remove any director or the entire Board of Directors.
The Executive Committee shall nominate persons for election to the Board of
Directors. Shareholders may also nominate persons for election to the Board of
Directors. All Shareholders must be sent notice, pursuant to Section 4 Article I
of these By-Laws, of all nominations for election to the Board of
Directors.
[Members of the Board of Directors shall be elected annually by vote of the
shareholders at the annual meeting, and shall hold office until the next annual
meeting and until their successors are elected and qualified. Any vacancy in the
Board of Directors, however caused, may be filled for the unexpired term by the
remaining directors at any lawful meeting.]
[There shall be three and only three members of the Board of Directors, but the
shareholders, at the annual meeting or at any special meeting called for that
purpose, may change the number of directors by amendment of the By-Laws;
provided, however, that each shareholder shall have received notice pursuant to
Section 4 Article I of these By-Laws of the intent to change the number of
Directors.]
Section 2. General Powers. The business and property of the corporation
shall be managed by the Board of Directors and they shall and may exercise all
powers of the corporation except as limited by law and elsewhere by these By-
Laws. They shall have power to make all necessary rules and regulations for
their government and for the regulation of the business of the corporation which
are not
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inconsistent with the Articles of Incorporation and these By-Laws, and shall
have general management and control of the corporation.
The Board of Directors shall appoint [any] an Executive Committee as provided in
Article III of these By-Laws, which shall be a standing committee, and which
shall have the powers and authority set forth in Article III and IV of these By-
Laws.
Section 3. Regular Meetings. A regular meeting of the Board of Directors
shall be held, [upon notice as provided below in Section 5 of this Article II]
without other notice than this By-Law, immediately after and at the same place
as the annual meeting of the shareholders. The Board of Directors may provide,
by resolution, the date and place of the holding of additional regular meetings.
The Secretary shall give each director written notice of such [regularly
scheduled] regular meetings at least ten (10) days prior to each such meeting in
the manner specified below in Section 5 of this Article II.
Section 4. Special Meetings. Special meetings of the Board of Directors may
be called by the Executive Committee, the Chairman of the Board of Directors,
the Chairman of the Executive Committee, or upon request of a majority of the
Board, and may be held at such time and place as may be specified in the notice
thereof.
Section 5. Notice of Special Meetings. Notice of each special meeting of
the Board of Directors, stating the time and place where the meeting is to be
held, shall be given by the Secretary or an Assistant Secretary by mailing the
same to each director at his residence or business address not less than [thirty
(30) days nor more than fifty (50)] two (2) days before such meeting.
Any and all requirements for call and notice of special meetings may be
dispensed with if all directors are present at the meeting or if those not
present at the meeting shall at any time waive or have waived notice thereof.
Any director may waive notice of any special meeting, and the attendance of a
director at a meeting shall constitute a waiver of notice of such meeting except
where a director attends a meeting for the express purpose of objecting to the
transaction of any business because the meeting is not lawfully called or
convened.
Such notice shall be [sent, if to an address within the State of Nebraska, by
certified mail, return receipt requested, and, if to an address outside the
State of Nebraska, by Federal Express, Western Union, UPS, or other similar
expedited delivery service.] in writing and shall be delivered in person, by
mail or private carrier, or by telegraph, teletype or other form of wire or
wireless communication.
Section 6. Quorum and Manner of Acting. A majority of the number of
directors in office shall constitute a quorum for the transaction of business at
any meeting of the Board of Directors. Except as otherwise required by law, the
act of a majority of the directors present at a meeting at which a quorum is
present shall be the act of the Board of Directors. [At any meeting which fewer
than all of the Directors are present, the Secretary shall send to any absent
director, in the manner specified for]
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[notices pursuant to Section 5 of this Article II, a copy of the minutes of such
meeting. No action (other than the declaration of dividends which are in an
amount customary and ordinary for the corporation approximately 15% of earnings)
which is adopted at a meeting at which fewer than all the directors are present
shall be implemented until such action is ratified by the absent director.] Any
action permitted or required to be taken at a meeting of the Board of Directors
may be taken without a meeting if a consent in writing setting forth the action
so taken shall be signed by all of the directors. Such consent shall have the
same effect as a unanimous vote. The consent may be executed by the directors in
counterparts. Further, members of the Board of Directors may participate in a
meeting of the Board by means of a conference telephone or similar
communications equipment by which all persons participating in the meeting can
hear each other at the same time. Participation by such means shall constitute
presence in person at a meeting.
Section 7. Compensation. The directors shall receive such fees and
expenses for attendance at meetings of the Board as may be determined by the
Board of Directors.
ARTICLE III - COMMITTEES
Section 1. Executive Committee - Composition. The Board of Directors shall
appoint from those of its members [recommended by the shareholders] an Executive
Committee consisting of not less than two nor more than five members, which
shall constitute a standing committee to serve until the next annual meeting of
the Board of Directors and until their successors are designated. The Executive
Committee shall designate one of its members as the Chairman of that Committee.
The Board of Directors may remove any member of the Executive Committee. Any
vacancy on the Executive Committee, however caused, may be filled for the
unexpired term by the [remaining members of the Committee] Board of Directors at
any lawful meeting.
Section 2. Executive Committee - Meetings. A regular meeting of the
Executive Committee shall be held, without other notice than this By-Law,
immediately after and at the same place as the annual meeting of the Board of
Directors. Other meetings of the Executive Committee shall be held at such times
and places as may be determined by its Chairman or as may be agreed upon by
members of the Executive Committee. A quorum at any meeting of the Executive
Committee shall consist of [all] a majority of the committee, and any action
taken by the committee shall require the [assent] vote of [all] a majority of
the members who are present. Notice of meetings shall be given, may be dispensed
with, and may be waived, in the same manner as provided in Section 5 of Article
[III] II for special meetings of the Board of Directors. Any action required to
be taken at a meeting of the Executive Committee may be taken without a meeting
if a consent in writing setting forth the action so taken shall be signed by all
of the members of the committee. Such consent shall have the same effect as a
unanimous vote. The consent may be executed by the members in counterparts.
Further, [Members] members of the Board of Directors may participate in a
meeting of the committee by means of a conference telephone or similar
communications equipment by which all persons participating in the meeting can
hear each other at the same time. Participation by such means shall constitute
presence in person at a meeting.
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Section 3. Executive Committee - Powers and Authority. At all times when
the Board of Directors is not in session, and to the full extent permitted by
law, the Executive Committee shall have and may exercise all the authority of
the Board of Directors in the management of the business and affairs of the
corporation and may do all things, including actions specified by these By-Laws
to be performed by the Board of Directors, in the same manner and with the same
authority and effect as if such acts had been performed by the whole Board of
Directors.
Any action taken by the Executive Committee, to the full extent permitted by
law, shall be deemed to be action taken by the Board of Directors and shall be
binding on the corporation.
Section 4. Executive [Committee - Powers] Committee--Powers and Authority
Continued. The powers and authority of the Executive Committee shall include
general supervision of all the business affairs of the corporation. The powers
and authority of the Executive Committee shall also include full power and
authority to designate the person or persons to attend, act and vote on behalf
of the corporation at any meeting of security holders of any other corporation
in which this corporation may hold securities. At such meeting, the person or
persons so designated shall possess and may exercise any and all rights and
powers incident to the ownership of such securities which the corporation might
have possessed and exercised if it had been present.
Section 5. Other Committees. There shall be such other committees,
consisting of directors, officers and employees of the corporation, as the Board
of Directors [or the Executive Committee] may designate from time to time.
Section 6. Compensation. Members of committees shall receive such fees and
expenses for attendance at committee meetings as may be determined by the Board
of Directors or Executive Committee.
ARTICLE IV - OFFICERS
Section 1. Number. The officers of the corporation shall be a Chairman of
the [Executive Committee, a Chairman of the] Board of Directors, a President,
[and determine, a Secretary/Treasurer] one or more Vice Presidents, if and as
determined by the Board of Directors, a Secretary and a Treasurer. Any two or
more of said offices may be held by one person at the same time, [except that
the President may not also be the Secretary].
Section 2. Election and Tenure. The officers of the corporation shall be
appointed by the Board of Directors at its first regular meeting held after each
annual meeting of the shareholders, or if for any reason officers are not
appointed at such meeting, at a special meeting called for that purpose, and
shall hold office until their successors are appointed and qualified.
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Section 3. Duties of Officers. The Executive Committee shall, from time to
time, in its discretion, designate and prescribe the scope of authority and the
duties incident to each office.
Section 4. Salaries. The salaries of the officers shall be fixed from time
to time by the Executive Committee. No officer shall be prevented from receiving
such salary by reason of the fact that he is also a director of the corporation
or a member of the Executive Committee.
Section 5. Assistant Officers. The Executive Committee may appoint such
assistant officers, from time to time, as it deems appropriate, and may fix
their compensation and the scope of their authority.
ARTICLE V - CAPITAL STOCK
Section 1. Form of Certificates. All certificates of stock shall be in such
form as may be prescribed by the Board of Directors, shall be signed [by the
Chairman of the Executive Committee or the President and by the Secretary] on
behalf of the corporation as required by law and shall be sealed with the
corporation's seal; provided, however, that if the certificate is countersigned
by a transfer agent or any assistant transfer agent, or is registered by a
registrar other than the corporation itself or an employee of the corporation,
such certificates may be signed with the facsimile signatures of the officers
authorized to execute such certificates and may be sealed with a facsimile of
the seal of the corporation. All certificates shall be consecutively numbered or
otherwise identified.
Section 2. Stock Record. The name and address of the person to whom
certificates representing shares of the capital stock are issued, with the
certificate number, number of shares and date of issue, shall be entered on the
stock transfer records of the corporation. All certificates surrendered to the
corporation for transfer shall be canceled, and no new certificate shall be
issued until the former certificate for a like number of shares shall have been
surrendered or canceled, except that in case of a lost, destroyed or mutilated
certificate, a new certificate may be issued in lieu thereof upon such terms and
indemnity to the corporation as the Board of Directors may prescribe.
Section 3. Transfer of Stock. Transfer of shares of the corporation shall
be made only on the stock transfer records of the corporation by the holder of
record thereof or by his legal representative, who shall furnish proper evidence
of authority to transfer, or by his attorney thereunto authorized by power of
attorney duly executed and filed with the corporation, and on surrender for
cancellation of the certificate for such shares. The person in whose name shares
stand on the stock records of the corporation shall be deemed by the corporation
to be the owner thereof for all purposes, unless the corporation establishes a
procedure by which the beneficial owner of shares that are registered in the
name of a nominee is recognized by the corporation as the owner.
For the purpose of determining shareholders entitled to notice of or to vote at
any meeting of shareholders or any adjournment thereof, or entitled to receive
payment of any dividend, or in order to
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make a determination of shareholders for any other proper purpose, [the Board of
Directors may provide that the stock transfer records shall be closed for a
stated period but not to exceed, in any case, fifty days. If the stock transfer
records shall be closed for the purpose of determining shareholders entitled to
notice of or to vote at a meeting of shareholders, such books shall be closed
for at least ten days immediately preceding such meeting. In lieu of closing the
stock transfer records,] the Board of Directors may fix in advance a date as the
record date for any such determination of shareholders, such date in any case to
be not more than [fifty] seventy days and, in case of a meeting of shareholders,
not less than ten days prior to the date on which the particular action,
requiring such determination of shareholders, is to be taken.
If [the stock transfer books are not closed and] no record date is fixed for the
determination of shareholders entitled to notice of or to vote at a meeting of
the shareholders, or shareholders entitled to receive payment of a dividend, the
date on which notice of the meeting is mailed or the date on which the
resolution of the Board of Directors declaring such dividend as adopted, as the
case may be, shall be the record date for such determination of shareholders.
When a determination of shareholders entitled to vote at any meeting of
shareholders has been made as provided in this section such determination shall
apply to any adjournment thereof.
ARTICLE VI - AMENDMENTS
Section 1. Amendment by Stockholders. These By-Laws may be added to,
amended or repealed, by the majority vote of the entire outstanding stock of the
corporation at any regular meeting of the shareholders, or at any special
meeting if such proposed action has been announced in the call and notice of
such special meeting.
Section 2. Amendment by Board of Directors. Subject to the right of the
shareholders to adopt, amend or repeal the By-Laws, the Board of Directors shall
have the power to adopt new or additional By-Laws, including emergency By-Laws,
and to amend or repeal any existing By-Laws [other than Sections 1 or 2 of
Article II, Sections 1, 2, 3 or 4 of Article III, or Article IV,] by an
affirmative vote of a majority of all directors then holding office, provided
that notice of the proposal to adopt, amend or repeal the By-Laws is given to
the Board of Directors not less than [thirty (30) nor more that fifty (50)]
ten (10) days prior to the meeting, or, at any time, [a waiver of such notice is
signed by all directors then holding office; and provided, further, that if
fewer than all directors are present at such meeting, the action shall be
ratified by the absent director in the manner specified in Section 6 of Article
II] by written consent.
ARTICLE VII - INDEMNIFICATION
Section 1. 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
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reason of the fact that he or she is or was a director or officer of the
corporation or is or was serving at the request of the corporation as a director
or officer of another corporation, partnership, joint venture, trust, or other
enterprise against expenses, including attorneys' fees, judgments, fines and
amounts paid in settlement actually and reasonably incurred by him or her in
connection with such action, suit, or proceeding if he or she acted in good
faith and in a manner he or she reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his or her conduct was
unlawful; provided, however, in no event shall the corporation indemnify such
person against expenses, penalties, or other payments incurred in an
administrative proceeding or action instituted by an appropriate regulatory
agency having jurisdiction over national bank holding companies which proceeding
or action results in a final order assessing civil money penalties or requiring
affirmative action by such person in the form of payments to the corporation.
The termination of any action, suit, or proceeding by judgment, order,
settlement, conviction or upon a plea of nolo contendere or its equivalent shall
not, of itself, create a presumption that the person did not act in good faith
and in a manner which he or she 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. 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 he or she is or was a director or officer
of the corporation or is or was serving at the request of the corporation as a
director or officer of another corporation, partnership, joint venture, trust,
or other enterprise against expenses, including attorneys' fees, actually and
reasonably incurred by him or her in connection with the defense or settlement
of such action or suit if he or she acted in good faith and in a manner he or
she 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 for any negligence or misconduct in the performance of his or her duty to
the corporation unless and only to the extent that 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 circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses which
such court shall deem proper.
Section 3. Any indemnification under Section 1 and 2 of this Article, 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 he or she has met the applicable
standard of conduct set forth in Section 1 and 2 of this Article. Such
determination shall be made by the Board of Directors by a majority vote of a
quorum consisting of directors who were not parties to such action, suit, or
proceeding, or if such a quorum is not obtainable, or, even if obtainable a
quorum of disinterested directors so directs, by independent legal counsel in a
written opinion, or by the shareholders of the corporation.
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Section 4. Expenses incurred in defending a civil or criminal action, suit,
or proceeding may be paid by the corporation in advance of the final disposition
of such action, suit, or proceeding as authorized in the manner provided in
Section 3 of this Article upon receipt of an undertaking by or on behalf of the
director or officer to repay such amount unless it shall ultimately be
determined that he or she is entitled to be indemnified by the corporation at
authorized in this Article.
Section 5. Nothing contained in this Article shall limit the corporation's
ability to reimburse expenses incurred by a director or officer of the
corporation in connection with his or her appearance as a witness in a
proceeding at a time when he or she has not been made a named defendant or
respondent in the proceeding.
Section 6. Any indemnification of a director in accordance with this
Article, including any payment or reimbursement of expenses, shall be reported
in writing to the shareholders of the corporation with the notice of the next
shareholders' meeting or prior to such meeting.
Section 7. 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
serving at the request of the corporation as a director or officer of another
corporation, partnership, joint venture, trust, or other enterprise against any
liability asserted against him or her and incurred by him or her in any such
capacity or arising out of his or her status as such, whether or not the
corporation would have the power to indemnify him or her against such liability
under the provisions of this Article; provided, however, any such insurance
shall exclude coverage for a formal order assessing civil money penalties or
requiring affirmative action by such person in the form of payments to the
corporation.
Section 8. The indemnification provided by this Article VII (i) shall not be
deemed to be exclusive of but shall be in addition to any other rights to which
a person seeking indemnification hereunder may be entitled under any statute,
law or agreement, or under any By-Law or resolution adopted by the board of
directors or shareholders of the corporation, or otherwise, (ii) shall continue
as a person who has ceased to be such director or officer and (iii) shall inure
to the benefit of the heirs, legal representatives, and assigns of such person.
It is the intention of the corporation to indemnify every director and officer
of the corporation for liability to any person for any action taken or any
failure to take any action, as a director or officer to the fullest extent
permitted by law.
RESTATED to reflect amendments through [May 27, 1992] June 18, 1997.
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