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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
AMENDMENT NO. 1
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 20, 1996
APACHE CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-4300 41-0747868
(State or other (Commission (I.R.S. Employer
jurisdiction File Number) Identification Number)
of incorporation)
2000 Post Oak Boulevard
Suite 100
Houston, Texas 77056-4400
(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (713) 296-6000
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Item 2. Acquisition or Disposition of Assets
In the first quarter of 1996, Apache Corporation ("Apache") entered into
the Agreement and Plan of Merger (the "Merger Agreement"), dated March
27, 1996, among Apache, YPY Acquisitions Inc. ("YPY"), and The Phoenix
Resource Companies, Inc. ("Phoenix"), providing for the merger of YPY with
Phoenix (the "Merger") in a transaction by which Phoenix would become a
wholly-owned subsidiary of Apache. Apache issued a press release, dated
March 28, 1996, which is listed under Item 7 as Exhibit 99.1 and
incorporated herein by reference. The Merger Agreement is listed under Item
7 as Exhibit 2.1 and incorporated herein by reference.
On May 20, 1996, the Merger was consummated shortly after the
transaction was approved by the Phoenix shareholders. Upon consummation of
the Merger and pursuant to the Merger Agreement, each share of Phoenix common
stock then outstanding was converted into the right to receive (a) .75 shares
of Apache common stock, with any fractional shares paid in cash, without
interest, and (b) $4.00 in cash. Apache issued a press release, dated May 20,
1996, which is listed under Item 7 as Exhibit 99.2 and incorporated herein
by reference.
Phoenix's principal assets are its interest in the Khalda and Qarun oil
and gas concessions in the Western Desert of Egypt, which in the aggregate
contain 18 oil fields and six gas fields. The sale of crude oil and
natural gas accounted for all of Phoenix's operating revenues during the
past three years. Phoenix's operations include exploring, developing and
operating crude oil and natural gas properties in Egypt. Phoenix's oil and gas
operations are currently conducted through Egyptian operating companies owned
jointly by the Egyptian General Petroleum Corporation, Phoenix and certain
other participants. Apache is one of the participants with Phoenix in the
Qarun concession.
In conjunction with the Merger, George D. Lawrence, Jr., former
president and chief executive officer of Phoenix, joined Apache's board of
directors. Other than the relationships mentioned above or provided for
or contemplated by the Merger Agreement, there were no other material
relationships between Phoenix and Apache or any of Apache's affiliates,
officers or directors, or any associate of any officer or director of Apache.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION
AND EXHIBITS
(a) FINANCIAL STATEMENTS
(i) The audited consolidated balance sheet of Phoenix and subsidiaries
as of December 31, 1995 and 1994, and the related consolidated
statements of income, stockholders' equity and cash flows for each
of the three years ended December 31, 1995, 1994 and 1993, together
with the related notes to consolidated financial statements and the
report of independent accountants, dated February 23, 1996,
previously filed with the Phoenix Annual Report on Form 10-K for the
fiscal year ended December 31, 1995, as amended, are listed below
as Exhibit 99.4 and are incorporated herein by reference.
(ii) The unaudited consolidated balance sheet of Phoenix and subsidiaries
as of March 31, 1996, and the related consolidated statements of
income and cash flows for the fiscal quarters ended March 31, 1996
and 1995, together with the related notes to consolidated financial
statements, previously filed with the Phoenix Quarterly Report on
Form 10-Q for the fiscal quarter ended March 31, 1996, are listed
below as Exhibit 99.5 and are incorporated herein by reference.
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(b) PRO FORMA FINANCIAL INFORMATION
APACHE CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
The following unaudited condensed financial statements and notes
thereto are presented to show the pro forma effects of the merger ("Merger") of
a wholly-owned subsidiary of Apache Corporation ("Apache") with The Phoenix
Resource Companies, Inc. ("Phoenix") on May 20, 1996, pursuant to which Phoenix
became a wholly-owned subsidiary of Apache. The Merger will be reported using
the purchase method of accounting.
The condensed pro forma statements of income are presented as if the
Merger occurred effective January 1 for each of the periods presented. The
condensed pro forma balance sheet assumes that the Merger occurred on March 31,
1996.
Pro forma data are based on assumptions and include adjustments as
explained in the notes to the unaudited pro forma consolidated condensed
financial statements. The pro forma data are not necessarily indicative of the
financial results that would have occurred had the transaction been effective
on and as of the dates referenced above, and should not be viewed as indicative
of operations in future periods. The unaudited pro forma consolidated
condensed financial statements should be read in conjunction with the notes
thereto, and Apache's and Phoenix's Annual Reports on Form 10-K for the fiscal
year ended December 31, 1995, and Apache's and Phoenix's Quarterly Reports on
Form 10-Q for the quarter ended March 31, 1996.
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APACHE CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONDENSED STATEMENT OF CONSOLIDATED INCOME
FOR THE YEAR ENDED DECEMBER 31, 1995
(IN THOUSANDS, EXCEPT PER COMMON SHARE DATA)
<TABLE>
<CAPTION>
APACHE PHOENIX PRO FORMA
HISTORICAL HISTORICAL ADJUSTMENTS PRO FORMA
---------- ---------- ----------- ----------
<S> <C> <C> <C> <C>
REVENUES:
Oil and gas production revenues................... $ 653,144 $ 33,255 $ (6,298)(f) $ 680,101
Gathering, processing and marketing revenues...... 97,207 0 97,207
Other revenues.................................... 351 1,781 (1,436)(d) 696
--------- --------- ---------- ---------
750,702 35,036 (7,734) 778,004
--------- --------- ---------- ---------
OPERATING EXPENSES:
Depreciation, depletion and amortization.......... 297,485 5,795 8,505 (a) 311,785
Operating costs................................... 211,742 6,421 218,163
Gathering, processing and marketing costs......... 91,243 - 91,243
Administrative, selling and other................. 36,552 2,194 38,746
Merger costs...................................... 9,977 - 9,977
Financing costs, net.............................. 70,560 - (11,708)(b) 61,837
4,421 (c)
(1,436)(d)
--------- --------- ---------- ---------
717,559 14,410 (218) 731,751
--------- --------- ---------- ---------
INCOME BEFORE INCOME TAXES......................... 33,143 20,626 (7,516) 46,253
Provision for income taxes....................... 12,936 10,015 (3,748)(f) 19,203
--------- --------- ---------- ---------
NET INCOME......................................... $ 20,207 $ 10,611 $ (3,768) $ 27,050
--------- --------- ---------- ---------
INCOME PER COMMON SHARE............................ $ 0.28 $ 0.65 $ 0.32
========= ========= =========
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING...................................... 71,792 12,190 (g) 83,982
========= ========== =========
</TABLE>
The accompanying notes to unaudited pro forma consolidated
condensed financial statements are an integral part of this statement.
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APACHE CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONDENSED STATEMENT OF CONSOLIDATED INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 1996
(IN THOUSANDS, EXCEPT PER COMMON SHARE DATA)
<TABLE>
<CAPTION>
APACHE PHOENIX PRO FORMA
HISTORICAL HISTORICAL ADJUSTMENTS PRO FORMA
----------- ---------- ----------- ---------
<S> <C> <C> <C> <C>
REVENUES:
Oil and gas production revenues.............. $ 171,921 $ 12,436 $ (1,957)(f) $ 182,400
Gathering, processing and marketing revenues. 33,949 0 33,949
Other revenues............................... 600 413 (366)(d) 647
----------- ---------- ---------- ---------
206,470 12,849 (2,323) 216,996
----------- ---------- ---------- ---------
OPERATING EXPENSES:
Depreciation, depletion and amortization..... 71,861 2,282 2,642 (a) 76,785
Operating costs.............................. 52,512 2,183 54,695
Gathering, processing and marketing costs.... 32,410 0 32,410
Administrative, selling and other............ 8,858 751 9,609
Merger costs................................. 0 334 (334)(e) 0
Financing costs, net......................... 15,423 209 (2,739)(b) 13,548
1,021 (c)
(366)(d)
----------- ---------- ---------- ---------
181,064 5,759 224 187,047
----------- ---------- ---------- ---------
INCOME BEFORE INCOME TAXES..................... 25,406 7,090 (2,547) 29,949
Provision for income taxes................... 9,751 3,395 (1,355)(f) 11,791
----------- ---------- ---------- ---------
NET INCOME..................................... $ 15,655 $ 3,695 $ (1,192) $ 18,158
=========== ========== ========== =========
INCOME PER COMMON SHARE........................ $ 0.20 $ 0.22 $ 0.20
=========== ========== ========== =========
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING.................................. $ 77,422 12,190 (g) $ 89,612
=========== ========== =========
</TABLE>
The accompanying notes to unaudited pro forma consolidated
condensed financial statements are an integral part of this statement.
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APACHE CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED CONDENSED BALANCE SHEETS
AS OF MARCH 31,1996
(IN THOUSANDS)
<TABLE>
<CAPTION>
APACHE PHOENIX PRO FORMA
HISTORICAL HISTORICAL ADJUSTMENTS PRO FORMA
---------- ---------- ----------- ----------
<S> <C> <C> <C> <C>
ASSETS:
Current assets...................... $ 221,877 $ 47,654 $ $ 269,531
Property and equipment, net......... 2,454,335 31,426 396,349 (h) 2,841,709
3,000 (i)
9,800 (j)
(53,201)(k)
Other assets........................ 69,795 7,283 77,078
---------- --------- ----------- ----------
$2,746,007 $ 86,363 $ 355,948 $3,188,318
========== ========= =========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Current liabilities................. $ 213,948 $ 13,163 $ 3,000 (i) $ 239,111
9,000 (l)
Long-term debt...................... 1,137,697 12,500 64,488 (h) 1,214,685
Other non-current liabilities....... 98,896 1,173 100,069
Deferred tax liabilities............ 190,349 6,326 9,800 (j) 206,475
Shareholders' equity................ 1,105,117 53,201 331,861 (h) 1,427,978
(53,201)(k)
(9,000)(l)
---------- --------- ----------- ----------
$2,746,007 $ 86,363 $ 355,948 $3,188,318
========== ========= =========== ==========
</TABLE>
The accompanying notes to unaudited pro forma consolidated condensed
financial statements are an integral part of this statement.
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APACHE CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
NOTE 1 -- BASIS OF PRESENTATION
The unaudited pro forma consolidated condensed financial statements
are based on the audited statements of Apache and Phoenix for the year ended
December 31, 1995, on unaudited statements for the quarter ended March 31,
1996, and on the adjustments and assumptions described below.
Pursuant to the terms of the Agreement and Plan of Merger, dated March
27, 1996, pro forma data reflect the issuance on May 20, 1996, of 12,121,150
shares of Apache Common Stock for 16,161,533 shares of Phoenix Common Stock
outstanding as of the Merger date and 68,768 Apache shares issued in connection
with Phoenix stock options exercised by Phoenix directors and employees
immediately after closing. Merger consideration consisted of .75 shares of
Apache common stock and $4.00 in cash for each share of Phoenix stock
outstanding and for each stock option exercised, net of option exercise
proceeds. A net value of approximately $14.9 million has been assigned to
approximately 1.1 million Phoenix stock options assumed by Apache and not
exercised immediately after closing that may be exercised in the future. The
value for the Apache shares issued and for the unexercised Phoenix stock
options equates to a total of approximately $331.9 million based on a price of
$26.00 per Apache common share. In addition, approximately $64.5 million in
net cash was paid to Phoenix stockholders and to directors and employees
exercising their stock options.
The purchase price, as described above, before consideration of
transaction costs and a deferred tax liability adjustment required by
accounting rules, totals approximately $396.3 million. Of this total,
approximately $54 million has been allocated to pipelines and facilities, $160
million to proved properties, $61 million to unproved properties, $99 million
to international concession rights, with the remaining value attributable to
working capital and miscellaneous assets. International concession rights
include the estimated value attributable to approximately
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APACHE CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED CONDENSED FINANCIAL
STATEMENTS
(CONTINUED)
50 drilling prospects identified to date on 4.3 million gross acres on the
Qarun and Khalda concessions in Egypt. Under features of the production sharing
contracts, costs incurred to explore and develop will be reimbursable through
increased future production sharing ratios.
NOTE 2 -- PRO FORMA ADJUSTMENTS
The unaudited pro forma condensed statements of consolidated income
reflect the following adjustments.
(a) Record incremental depreciation, depletion and amortization
expense based on the purchase price allocation, and using a
combined units-of-production rate for Egyptian properties and
a 20-year straight-line method for facilities and pipelines.
(b) Record capitalized interest relating to approximately $173
million of unevaluated properties, including international
concession rights, assuming interest rates of 6.87 percent and
6.33 percent for the year ended December 31, 1995 and for the
three months ended March 31, 1996, respectively.
(c) Record interest expense on debt incurred with respect to the
cash consideration paid to Phoenix stockholders, assuming
interest rates of 6.87 percent for the year ended December
31, 1995 and 6.33 percent for the three months ended March 31,
1996.
(d) Reclassification of Phoenix's interest income from revenues to
financing costs, net, to conform to Apache's presentation.
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APACHE CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED CONDENSED FINANCIAL
STATEMENTS
(CONTINUED)
(e) Eliminate non-recurring expenses recorded by Phoenix in the
first quarter of 1996 relating to the Merger.
(f) Adjust tax provision and the related Phoenix Egyptian tax
gross-up to reflect pro forma adjustments (a), (b), (c) and
(e).
(g) Increase Apache's weighted average shares outstanding by
approximately 12,190,000 shares to reflect Apache shares
issued at and immediately after closing. The effect of common
stock equivalents associated with unexercised Phoenix stock
options, along with all other Apache common stock equivalent
shares, were insignificant for the periods presented.
The unaudited consolidated condensed pro forma balance sheet reflects
the following adjustments:
(h) Record the consideration issued totaling $396.3 million,
consisting of approximately 12,190,000 shares of Apache Common
Stock valued at $26 per share, $14.9 million of net value
associated with unexercised Phoenix stock options, and $64.5
million cash, and the related debt incurred.
(i) Record estimated severance and other costs relating to the
merger.
(j) Record SFAS No. 109 deferred tax liability for the book basis
in excess of tax basis after adjustment for assumed
utilization of Phoenix net operating loss carryforwards and
foreign tax credits.
(k) Eliminate historical Phoenix stockholders' equity.
(l) Record Apache Common Stock issuance costs.
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(c) EXHIBITS
EXHIBIT NO. DESCRIPTION
- ----------- -----------
2.1 Agreement and Plan of Merger among Registrant, YPY and Phoenix
dated March 27, 1996 (incorporated by reference to Exhibit
99.1 to Registrant's Current Report on Form 8-K, dated March
27, 1996, SEC File No. 1-4300).
3.1* Bylaws of Registrant, As Amended July 11, 1996; Effective as
of May 2, 1996.
23.1* Consent of Arthur Andersen LLP
99.1 Press Release, dated March 28, 1996, "Apache and Phoenix to
Merge" (incorporated by reference to Exhibit 99.2 to
Registrant's Current Report on Form 8-K, dated March 27,
1996, SEC File No. 1-4300).
99.2 Press Release, dated May 20, 1996, "Apache and Phoenix
Complete Merger" (incorporated by reference to Exhibit 99.2
to Registrant's Current Report on Form 8-K, dated May 20,
1996, SEC File No. 1-4300).
99.3* Seventh Amendment to the Third Amended and Restated Credit
Agreement, dated as of May 8, 1996, among the Registrant, the
Lenders named therein, and The First National Bank of
Chicago, as Administrative Agent and Arranger, and Chemical
Bank, as Co-Agent and Arranger.
99.4 The audited consolidated balance sheet of Phoenix and
subsidiaries as of December 31, 1995 and 1994, and the related
consolidated statements of income, stockholders' equity and
cash flows for each of the three years ended December 31,
1995, 1994 and 1993, together with the related notes to
consolidated financial statements and the report of
independent accountants (incorporated by reference to the
Phoenix Annual Report on Form 10-K for the year ended
December 31, 1995, SEC File No. 1-547).
99.5 The unaudited consolidated balance sheet of Phoenix and
subsidiaries as of March 31, 1996, and the related
consolidated statements of income and cash flows for the
fiscal quarters ended March 31, 1996 and 1995, together with
the related notes to consolidated financial statements
(incorporated by reference to the Phoenix Quarterly Report
on Form 10-Q for the quarter ended March 31, 1996, SEC File
No. 1-547).
- -------------------
*filed herewith
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Amendment No. 1 on Form 8-K/A to be signed on
its behalf by the undersigned thereunto duly authorized.
APACHE CORPORATION
Date: July 18, 1996 /s/ Thomas L. Mitchell
-----------------------------------------
Thomas L. Mitchell
Controller and Chief Accounting Officer
/s/ Z. S. Kobiashvili
-----------------------------------------
Z. S. Kobiashvili
Vice President and General Counsel
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INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
- ----------- -----------
2.1 Agreement and Plan of Merger among Registrant, YPY and Phoenix
dated March 27, 1996 (incorporated by reference to Exhibit
99.1 to Registrant's Current Report on Form 8-K, dated March
27, 1996, SEC File No. 1-4300).
3.1* Bylaws of Registrant, As Amended July 11, 1996; Effective as
of May 2, 1996.
23.1* Consent of Arthur Andersen LLP
99.1 Press Release, dated March 28, 1996, "Apache and Phoenix to
Merge" (incorporated by reference to Exhibit 99.2 to
Registrant's Current Report on Form 8-K, dated March 27,
1996, SEC File No. 1-4300).
99.2 Press Release, dated May 20, 1996, "Apache and Phoenix
Complete Merger" (incorporated by reference to Exhibit 99.2
to Registrant's Current Report on Form 8-K, dated May 20,
1996, SEC File No. 1-4300).
99.3* Seventh Amendment to the Third Amended and Restated Credit
Agreement, dated as of May 8, 1996, among the Registrant, the
Lenders named therein, and The First National Bank of
Chicago, as Administrative Agent and Arranger, and Chemical
Bank, as Co-Agent and Arranger.
99.4 The audited consolidated balance sheet of Phoenix and
subsidiaries as of December 31, 1995 and 1994, and the related
consolidated statements of income, stockholders' equity and
cash flows for each of the three years ended December 31,
1995, 1994 and 1993, together with the related notes to
consolidated financial statements and the report of
independent accountants (incorporated by reference to the
Phoenix Annual Report on Form 10-K for the year ended
December 31, 1995, SEC File No. 1-547).
99.5 The unaudited consolidated balance sheet of Phoenix and
subsidiaries as of March 31, 1996, and the related
consolidated statements of income and cash flows for the
fiscal quarters ended March 31, 1996 and 1995, together with
the related notes to consolidated financial statements
(incorporated by reference to the Phoenix Quarterly Report
on Form 10-Q for the quarter ended March 31, 1996, SEC File
No. 1-547).
- -------------------
*filed herewith
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EXHIBIT 3.1
BYLAWS OF
APACHE CORPORATION
(AS AMENDED JULY 11, 1996; EFFECTIVE AS OF MAY 2, 1996)
ARTICLE I.
NAME OF CORPORATION
The name of the corporation is Apache Corporation.
ARTICLE II.
OFFICES
SECTION 1. The principal office of the corporation shall be in the
City of Wilmington, County of New Castle, State of Delaware, and the name of
its resident agent in charge thereof is The Corporation Trust Company.
SECTION 2. The corporation may have such other offices either within
or without the State of Delaware as the board of directors may designate or as
the business of the corporation may from time to time require.
ARTICLE III.
SEAL
The corporate seal shall have inscribed upon it the name of the
corporation and other designations as the board of directors from time to time
determine. There may be alternate seals of the corporation.
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ARTICLE IV.
MEETINGS OF STOCKHOLDERS
SECTION 1. PLACE OF MEETINGS. All meetings of the stockholders of
the corporation shall be held at the office of the corporation in the City of
Houston, Texas, or at any other place within or without the State of Delaware
that shall be stated in the notice of the meeting.
SECTION 2. ANNUAL MEETINGS. The annual meeting of stockholders of
the corporation shall be held at the place and time within or without the State
of Delaware that may be designated by the board of directors, on the first
Thursday in May in each year if not a legal holiday, and if a legal holiday,
then at the same time on the next succeeding business day for the purpose of
electing directors and for the transaction of any other business that may
properly come before the meeting.
SECTION 3. SPECIAL MEETINGS OF THE STOCKHOLDERS. Special meetings of
the stockholders of the corporation, for any purpose or purposes, unless
otherwise prescribed by statute, may be called by the chairman of the board and
shall be called by the chairman of the board or secretary at the request in
writing of a majority of the board of directors. The request shall state the
purpose or purposes of the proposed meeting.
SECTION 4. NOTICE OF MEETING. Written or printed notice stating the
place, day and hour of the meeting and in the case of special meeting, the
purpose or purposes for which the meeting is called, shall be delivered not
less than ten nor more than 50 days before the date of the meeting either
personally, by mail or other lawful means by or at the direction of the
chairman of the board or the secretary to each stockholder of record entitled
to vote at the meetings. If mailed, the notice shall be deemed to be delivered
when deposited in the United States Postal Service, addressed to the
stockholder at his address as it appears on the stock transfer books of the
corporation with postage thereon prepaid.
SECTION 5. CLOSING OF TRANSFER BOOKS FOR FIXING OF RECORD DATE. For
the purpose of determining stockholders entitled to notice of or to vote at any
meeting of stockholders or adjournment thereof, the board of directors may
close the stock transfer books of the corporation for a period not exceeding 50
days preceding the date of any meeting of stockholders. In lieu of closing the
stock transfer books, the board of directors may fix in advance a date, not
exceeding 50 days preceding the date of any meeting of stockholders, as a
record date for the determination of the stockholders entitled to notice of and
to vote at the meeting and any adjournment thereof, and only the stockholders
as shall be stockholders of record on the date so fixed shall be entitled to
the notice of and to vote at the meeting and any adjournment thereof.
SECTION 6. VOTING LISTS. The officer or agent having charge of the
stock transfer books for shares of the corporation shall prepare and make, at
least ten days before every meeting of the stockholders, a complete list of the
stockholders entitled to vote at the meeting, arranged in
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alphabetical order, and showing the address of each stockholder and the number
of shares registered in the name of each stockholder. The list shall be open
to the examination of any stockholder during ordinary business hours, for a
period of at least ten days prior to the meeting, either at a place within the
city where the election is to be held and which place shall be specified in the
notice of the meeting, or, if not so specified, at the place where the meeting
is to be held, and the list shall be produced and kept at the time and place of
the meeting during the whole time thereof, and subject to the inspection of any
stockholder who may be present. Upon the willful neglect or refusal of the
board of directors of the corporation to produce a list at any meeting of the
stockholders at which an election is to be held in accordance with this Section
6, they shall be ineligible to hold any office at such election.
SECTION 7. VOTING RIGHTS. At each meeting of the stockholders of the
corporation, every stockholder having the right to vote thereat shall be
entitled to vote in person or by proxy, but no proxy shall be voted after three
years from its date unless the proxy provides for a longer period. Except as
otherwise provided by law or the Certificate of Incorporation, each stockholder
shall have one vote for each share of stock having voting power registered in
his name. The vote at an election for directors, and upon the demand of any
stockholder, the vote upon any question before a meeting of the stockholders,
shall be by written ballot. All elections shall be had and all questions
decided by a plurality vote except where by statute, by provision in the
Certificate of Incorporation or these bylaws it is otherwise provided.
Prior to any meeting, but subsequent to the date fixed by the board of
directors pursuant to Section 5 of Article IV of these bylaws, any proxy may
submit his proxy to the secretary for examination. The certificate of the
secretary as to the regularity of the proxy and as to the number of shares held
by the persons who severally and respectively executed such proxies shall be
received as prima facie evidence of the number of shares represented by the
holder of the proxy for the purpose of establishing the presence of a quorum at
the meeting and of organizing the same.
SECTION 8. QUORUM. The holders of a majority of the stock issued and
outstanding and entitled to vote thereat, initially present in person or
represented by proxy, shall be requisite, and shall constitute a quorum of all
meetings of the stockholders for the transaction of business except as
otherwise provided by law, by the Certificate of Incorporation, or by these
bylaws. If, however, a majority shall not be present or represented at any
meeting of the stockholders, the stockholders entitled to vote thereat, present
in person or by proxy, shall have power to adjourn the meeting from time to
time, without notice, other than announcement at the meeting, until the
requisite amount of voting stock shall be present. At the adjourned meeting at
which the requisite amount of voting stock shall be represented, any business
may be transacted which might have been transacted at the meeting as originally
notified.
SECTION 9. INSPECTORS. At each meeting of the stockholders, the
polls shall be opened and closed. The proxies and the ballots shall be
received and taken in charge and all questions touching the qualifications of
voters and the validity of proxies and the acceptance or rejection of votes
shall be decided by three inspectors. The inspectors shall be appointed by the
board of directors before or at the meeting, or if no appointment shall have
been made, then by the
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presiding officer at the meeting. If, for any reason any of the inspectors
previously appointed shall fail to attend or refuse or be unable to serve,
inspectors in place of any so failing to attend or refusing or unable to serve
shall be appointed in like manner.
SECTION 10. WAIVER OF NOTICE. Whenever any notice whatever is
required to be given pursuant to the provisions of a statute, the Certificate
of Incorporation or these bylaws of the corporation, a waiver thereof in
writing signed by the person or persons entitled to the notice, whether before
or after the time stated therein, shall be deemed equivalent thereto.
SECTION 11. STOCKHOLDER ACTION. Any action required or permitted to
be taken by the stockholders must be effected at a duly called annual or
special meeting of stockholders and may not be effected by any consent in
writing by stockholders.
SECTION 12. NOTICE OF STOCKHOLDER BUSINESS. At an annual meeting of
the stockholders, only business shall be conducted that has been properly
brought before the meeting. To be properly brought before an annual meeting,
business must be (a) specified in the notice of meeting (or any supplement
thereto) given by or at the direction of the board of directors, (b) otherwise
properly brought before the meeting by or at the direction of the board of
directors, or (c) otherwise properly brought before the meeting by a
stockholder, which stockholder must have given timely notice thereof in writing
to the secretary of the corporation. To be timely, a stockholder's notice must
be delivered to or mailed and received at the principal executive offices of
the corporation, not less than 60 days nor more than 90 days prior to the
meeting; provided, however, that in the event that less than 70 days' notice or
prior public disclosure of the date of the meeting is given or made to
stockholders, notice by the stockholder to be timely, must be so received not
later than the close of business on the tenth day following the day on which
the notice of the date of the annual meeting was mailed or public disclosure
was made. A stockholder's notice to the secretary shall set forth as to each
matter the stockholder proposes to bring before the annual meeting (w) a brief
description of the business desired to be brought before the annual meeting,
(x) the name and address, as they appear on the corporation's books, of the
stockholder proposing the business, (y) the class and number of shares of the
corporation which are beneficially owned by the stockholder, and (z) any
material interest of the stockholder in the business. Notwithstanding anything
in these bylaws to the contrary, no business shall be conducted at an annual
meeting except in accordance with the procedures set forth in this Section 12.
The chairman of an annual meeting shall, if the facts warrant, determine and
declare to the meeting that business was not properly brought before the
meeting in accordance with the provisions of this Section 12, and if he should
so determine, he shall so declare to the meeting and any business not properly
brought before the meeting shall not be transacted. This section sets forth
only the procedure by which business may be properly brought before an annual
meeting of stockholders and does not in any way grant additional rights to
stockholders beyond those currently afforded them by law.
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SECTION 13. NOTICE OF STOCKHOLDER NOMINEES. Only persons who are
nominated in accordance with the procedures set forth in this Section 13 shall
be eligible for election as directors. Nominations of persons for election to
the board of directors of the corporation may be made at a meeting of
stockholders, by or at the direction of the board of directors or by any
stockholder of the corporation entitled to vote for the election of directors
at the meeting who complies with the notice procedures set forth in this
Section 13. Any nominations, other than those made by or at the direction of
the board of directors, shall be made pursuant to timely notice in writing to
the secretary of the corporation. To be timely, a stockholder's notice shall be
delivered to or mailed and received at the principal executive offices of the
corporation not less than 60 days nor more than 90 days prior to the meeting;
provided, however, that in the event that less than 70 days' notice or prior
public disclosure of the date of the meeting is given or made to stockholders,
notice by the stockholder to be timely must be so received not later than the
close of business on the tenth day following the day on which the notice of the
date of the meeting was mailed or public disclosure was made. The
stockholder's notice shall set forth (a) as to each person whom the stockholder
proposes to nominate for election or reelection as a director (i) the name,
age, business address and residence address of the person, (ii) the principal
occupation or employment of the person, (iii) the class and number of shares of
the corporation which are beneficially owned by the person, and (iv) any other
information relating to the person that is required to be disclosed in
solicitations of proxies for election of directors, or is otherwise required,
in each case pursuant to Regulation 14A under the Securities Exchange Act of
1934, as amended (including without limitation the person's written consent to
being named in the proxy statement as a nominee and to serving as a director if
elected); and (b) as to the stockholder giving the notice (i) the name and
address, as they appear on the corporation's books, of the stockholder and (ii)
the class and number of shares of the corporation which are beneficially owned
by the stockholder. At the request of the board of directors, any person
nominated by the board of directors for election as a director shall furnish to
the secretary of the corporation that information required to be set forth in a
stockholder's notice of nomination which pertains to the nominee. No person
shall be eligible for election as a director of the corporation unless
nominated in accordance with the procedures set forth in this Section 13. The
chairman of the meeting shall, if the facts warrant, determine and declare to
the meeting that a nomination was not made in accordance with the procedures
prescribed by these bylaws, and if he should so determine, he shall so declare
to the meeting and the defective nomination shall be disregarded. This section
sets forth only the procedure by which nominations for directors may be made
and does not in any way grant additional rights to stockholders beyond those
currently afforded them by law.
ARTICLE V.
DIRECTORS
SECTION 1. GENERAL POWERS. The property, business and affairs of the
corporation shall be managed by its board of directors which may exercise all
powers of the corporation and do all lawful acts and things as are not by
statute or by the Certificate of Incorporation or by these bylaws directed or
required to be exercised or done by the stockholders.
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SECTION 2. NUMBER, TENURE AND QUALIFICATIONS. The board of directors
shall consist of not less than seven nor more than 13 members. The directors
shall be elected in the manner set forth in Article Ninth of the Certificate of
Incorporation of the corporation. The term of office of directors shall be
three years except as provided in Article Ninth of the Certificate of
Incorporation of the corporation. Directors need not be stockholders or
residents of the State of Delaware.
SECTION 3. VACANCIES AND NEWLY CREATED DIRECTORSHIPS. Any vacancies
on the board of directors or any newly created directorships shall be filled by
the board of directors in the manner set forth in Article Ninth of the
Certificate of Incorporation of the corporation. If the directors then in
office shall constitute less than a majority of the whole board (as constituted
immediately prior to any increase therein), then upon application, any
stockholder or stockholders holding at least ten percent of the total number of
shares of the capital stock of the corporation at the time outstanding having
the right to vote for directors may require the board of directors to call a
special meeting of the stockholders for the purpose of electing directors to
fill the vacancy or vacancies or newly created directorships or to replace the
director or directors chosen by the directors then in office as aforesaid. The
person or persons elected at a special meeting of the stockholders shall serve
as director or as directors until the next annual meeting of stockholders and
until their successors are duly elected and qualified and shall displace any
person or persons who may theretofore have been appointed by the directors then
in office as aforesaid.
SECTION 4. CATASTROPHE. During any emergency period following a
national catastrophe due to enemy attack, or act of God, a majority of the
surviving members of the board who have not been rendered incapable of acting
due to physical or mental incapacity or due to the difficulty of transportation
to the place of the meeting shall constitute a quorum for the purpose of
filling vacancies on the board of directors and among the elected and appointed
officers of the corporation.
SECTION 5. PLACE OF MEETINGS. The directors of the corporation may
hold their meetings, both regular and special, at a place or places within or
without the State of Delaware that the board of directors may from time to time
determine.
SECTION 6. FIRST MEETING. The first meeting of the board of
directors following the annual meeting of stockholders shall be held at the
time and place that shall be fixed by the chairman of the board and shall be
called in the same manner as a special meeting.
SECTION 7. REGULAR MEETINGS. Regular meetings of the board of
directors may be held without notice at the time and place that shall from time
to time be determined by the board of directors.
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SECTION 8. SPECIAL MEETINGS. Special meetings of the board of
directors may be called by the chairman of the board on three days notice to
each director, either personally or by mail, by telegram, or by facsimile or
other lawful means; special meetings of the board of directors shall be called
by the chairman of the board or secretary in like manner and upon like notice
upon the written request of two directors.
SECTION 9. QUORUM. At all meetings of the board of directors, a
majority of the directors shall be necessary and sufficient to constitute a
quorum for the transaction of business, and the act of a majority of the
directors present at any meeting, at which there is a quorum present, shall be
the act of the board of directors, except as may be otherwise specifically
provided by statute, the Certificate of Incorporation or by these bylaws. If
at any meeting of the board of directors there shall be less than a quorum
present, a majority of those present may adjourn the meeting from time to time
without notice, other than by announcement at the meeting, until a sufficient
number of directors to constitute a quorum shall attend. At any adjourned
meeting at which a quorum shall be present, any business may be transacted
which might have been transacted at the original meeting as originally
notified.
SECTION 10. BUSINESS TO BE CONDUCTED. Unless otherwise indicated in
the notice, any and all business may be transacted at a regular or special
meeting of the board of directors. In the event a special meeting of the board
of directors is held without notice, any and all business may be transacted at
the meeting provided all directors are present.
SECTION 11. ORDER OF BUSINESS. At all meetings of the board of
directors, business shall be transacted in the order that from time to time the
board may determine by resolution. At all meetings of the board of directors
the chairman of the board or in his absence the vice chairman shall preside.
In the absence of the chairman and vice chairman of the board, the directors
present shall elect any director as chairman of the meeting.
SECTION 12. COMPENSATION OF DIRECTORS. Directors of the corporation
shall receive the compensation for their services that the board of directors
may from time to time determine and all directors shall be reimbursed for their
expenses of attendance at each regular or special meeting of the board or any
committee thereof.
SECTION 13. COMMITTEES. The board of directors may by resolution
passed by a majority of the board, in addition to the executive committee,
designate one or more committees. Each such committee shall consist of one or
more of the directors of the corporation, such number to be set by resolution
of the board of directors, or as otherwise provided in Section 14 below. Any
committee, to the extent provided in the resolution, shall have and may
exercise the powers of the board of directors in the management of the business
and affairs of the corporation, and may authorize the seal of the corporation
to be affixed to all papers which may require it. Any committee or committees
shall have the name or names that may be determined from time to time by
resolution adopted by the board of directors. Other than for a committee of
one director, the chairman of the board shall be an ex officio member of any
board committee except the audit
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committee, the management development and compensation committee, and the stock
option plan committee.
SECTION 14. EXECUTIVE COMMITTEE.
A. MEMBERS. The executive committee shall consist of such number of
directors as set by resolution of the board of directors, with a minimum of
four members, and shall include the chairman and vice chairman of the board as
ex officio members, together with the other members of the board of directors,
as may be the case, designated by the board of directors.
B. TERM OF OFFICE. Each of the elected members of the executive
committee shall be elected for a one year term and shall serve until his
successor shall have been duly elected and qualified.
C. ELECTION. The election of members of the executive committee shall
be held each year at the first meeting of the board of directors following the
annual meeting of stockholders. Should a member of the executive committee for
any reason be unable to serve for the term to which he was elected, the vacancy
shall be filled by the board of directors at its next meeting following the
occurrence of such vacancy.
D. COMPENSATION. Each member of the executive committee shall receive
the compensation that the board of directors shall from time to time determine
and shall be reimbursed for their expenses of attendance at regular or special
meetings.
E. CHAIRMAN AND SECRETARY OF THE EXECUTIVE COMMITTEE. The chairman
and secretary of the executive committee shall be elected by members of the
executive committee.
F. MEETINGS. Regular meetings of the executive committee may be held
without call or notice of the time and place that the executive committee
determines. Special meetings of the executive committee may be called by any
member, either personally or by mail, by telegram, by facsimile or other lawful
means forwarded not later than 48 hours prior to the date and time set forth
for the meeting. Upon request of any member, the secretary of the corporation
shall give the required notice calling the meeting.
G. QUORUM. At any meeting of the executive committee, a majority of
the committee members shall constitute a quorum. Any action of the executive
committee to be effective must be authorized by the affirmative votes of a
majority of committee members.
H. RULES. The executive committee shall fix its own rules of
procedure, provided the same do not contravene the provisions of the law, the
Certificate of Incorporation or these bylaws.
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I. AUTHORITY AND RESPONSIBILITY.
(a) The executive committee is vested with the authority to exercise
the full power of the board of directors, within the policies
established by the board of directors to govern the conduct of the
business of the corporation, in the intervals between meetings of the
board of directors.
(b) The executive committee, in addition to the general authority
vested in it, may be vested with other specific powers and authority
by resolution of the board of directors.
J. REPORTS. All action by the executive committee shall be reported
to the board of directors at its meeting next succeeding the action, and shall
be subject to revision or alteration by the board of directors; provided,
however, that no rights or acts of third parties shall be affected by any such
revision or alteration.
SECTION 15. AUDIT COMMITTEE.
A. MEMBERS. The audit committee shall include only outside directors
of the corporation.
B. TERM OF OFFICE. Each of the elected members of the audit
committee shall be elected for a one year term and shall serve until a
successor shall have been duly elected and qualified.
C. ELECTION. The election of members of the audit committee shall be
held each year at the first meeting of the board of directors following the
annual meeting of stockholders. Should a member of the audit committee for any
reason be unable to serve for the term to which he was elected, the vacancy
shall be filled by the board of directors at its next meeting.
D. COMPENSATION. Each member of the audit committee shall receive
the compensation the board of directors determines and shall be reimbursed for
their expenses for attendance at regular or special meetings.
E. CHAIRMAN AND SECRETARY OF THE AUDIT COMMITTEE. The chairman and
secretary of the audit committee shall be elected by the members of the audit
committee.
F. MEETINGS. Regular meetings of the audit committee may be held
without call or notice of the time and place that the audit committee
determines. Special meetings of the audit committee may be called by any
member, either personally or by mail, by telegram, by facsimile or other lawful
means forwarded not later than 48 hours prior to the date and time set forth
for the meeting. Upon request of any member, the secretary of the corporation
shall give the required notice calling the meeting.
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G. QUORUM. At any meeting of the audit committee, a majority of
committee members shall constitute a quorum. Any action of the audit committee
to be effective must be authorized by the affirmative votes of a majority of
committee members.
H. RULES. The audit committee shall determine its own rules of
procedure, provided the rules do not contravene the provisions of the law, the
Certificate of Incorporation or these bylaws.
I. AUTHORITY AND RESPONSIBILITY.
(a) The audit committee is vested with the authority to (i) review
with the independent and internal auditors of the corporation their
respective audit and review programs and procedures; (ii) review the
corporation's financial statements; (iii) review the adequacy of the
corporation's system of internal accounting controls and the scope and
results of internal audit engagements, special services provided by
them and related fees; and (iv) make recommendations to the board of
directors regarding the independence of the independent auditors and
their engagement or discharge.
(b) The audit committee, in addition to the authority vested in it
under subsection (a) above, may be vested with other specific powers
and authority by resolution of the board of directors.
J. REPORTS. All action by the audit committee shall be reported to
the board of directors at its next meeting, and shall be subject to revision or
alteration by the board of directors.
SECTION 16. MANAGEMENT DEVELOPMENT AND COMPENSATION COMMITTEE
A. MEMBERS. The management development and compensation
committee shall include only outside directors of the corporation.
B. TERM OF OFFICE. Each of the elected members of the management
development and compensation committee shall be elected for a one year term and
shall serve until a successor shall have been duly elected and qualified.
C. ELECTION. The election of members of the management
development and compensation committee shall be held each year at the first
meeting of the board of directors following the annual meeting of stockholders.
Should a member of the management development and compensation committee for
any reason be unable to serve for the term to which he was elected, the vacancy
shall be filled by the board of directors at its next meeting.
D. COMPENSATION. Each member of the management development and
compensation committee shall receive the compensation the board of directors
determines and shall be reimbursed for their expenses for attendance at regular
or special meetings.
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E. CHAIRMAN AND SECRETARY OF THE MANAGEMENT DEVELOPMENT AND
COMPENSATION COMMITTEE. The chairman and secretary of the management
development and compensation committee shall be elected by the members of the
management development and compensation committee.
F. MEETINGS. Regular meetings of the management development and
compensation committee may be held without call or notice of the time and place
that the management development and compensation committee determines. Special
meetings of the management development and compensation committee may be called
by any member, either personally or by mail, by telegram, by facsimile or other
lawful means forwarded not later than 48 hours prior to the date and time set
forth for the meeting. Upon request of any member, the secretary of the
corporation shall give the required notice calling the meeting.
G. QUORUM. At any meeting of the management development and
compensation committee, a majority of committee members shall constitute a
quorum. Any action of the management development and compensation committee to
be effective must be authorized by the affirmative votes of a majority of
committee members.
H. RULES. The management development and compensation committee
shall determine its own rules of procedure, provided the rules do not
contravene the provisions of the law, the Certificate of Incorporation or these
bylaws.
I. AUTHORITY AND RESPONSIBILITY. The management development and
compensation committee has two principal responsibilities:
(a) to monitor the corporation's management resources, structure,
succession planning, development, and selection process, and the
performance of key executives;
(b) to review and approve executive compensation and changes; and
(c) to make such reports on executive compensation as appropriate or
required.
The management development and compensation committee also serves as
the committee administering all incentive compensation plans other than the
corporation's stock option plans.
J. REPORTS. All action by the management development and
compensation committee shall be reported to the board of directors at its next
meeting, and shall be subject to revision or alteration by the board of
directors.
SECTION 17. STOCK OPTION PLAN COMMITTEE
A. MEMBERS. The stock option plan committee shall include only
directors of the corporation who qualify as "outside directors" pursuant to
Section 162(m) or any successor
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section(s) of the Internal Revenue Code of 1986, as amended, and the rules and
regulations promulgated thereunder.
B. TERM OF OFFICE. Each of the elected members of the stock
option plan committee shall be elected for a one year term and shall serve
until a successor shall have been duly elected and qualified.
C. ELECTION. The election of members of the stock option plan
committee shall be held each year at the first meeting of the board of
directors following the annual meeting of stockholders. Should a member of the
stock option plan committee for any reason be unable to serve for the term to
which he was elected, the vacancy shall be filled by the board of directors at
its next meeting.
D. COMPENSATION. Each member of the stock option plan committee
shall receive the compensation the board of directors determines and shall be
reimbursed for their expenses for attendance at regular or special meetings.
E. CHAIRMAN AND SECRETARY OF THE STOCK OPTION PLAN COMMITTEE.
The chairman and secretary of the stock option plan committee shall be elected
by the members of the stock option plan committee.
F. MEETINGS. Regular meetings of the stock option plan committee
may be held without call or notice of the time and place that the stock option
plan committee determines. Special meetings of the stock option plan committee
may be called by any member, either personally or by mail, by telegram, by
facsimile or other lawful means forwarded not later than 48 hours prior to the
date and time set forth for the meeting. Upon request of any member, the
secretary of the corporation shall give the required notice calling the
meeting.
G. QUORUM. At any meeting of the stock option plan committee, a
majority of committee members shall constitute a quorum, provided that such
quorum shall not be less than two members. Any action of the stock option plan
committee to be effective must be authorized by the affirmative votes of a
majority of committee members.
H. RULES. The stock option plan committee shall determine its
own rules of procedure, provided the rules do not contravene the provisions of
the law, the Certificate of Incorporation or these bylaws.
I. AUTHORITY AND RESPONSIBILITY. The stock option plan committee
has two principal responsibilities:
(a) to monitor and report on the corporation's stock option plans; and
(b) to establish any performance goals under which compensation in the
form of stock option grants is paid to employees of the corporation,
and to make such grants
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of stock options, in the discretion of the stock option plan
committee, on the terms and conditions set forth in the option plans
or otherwise established by the stock option plan committee.
J. REPORTS. All action by the stock option plan committee shall
be reported to the board of directors at its next meeting, and is subject to
ratification by the board of directors.
SECTION 18. NOMINATING COMMITTEE.
A. MEMBERS. The nominating committee may consist of any of the
members of the board of directors.
B. TERM OF OFFICE. Each of the elected members of the nominating
committee shall be elected for a one year term and shall serve until a
successor shall have been duly elected and qualified.
C. ELECTION. The election of members of the nominating committee
shall be held each year at the first meeting of the board of directors
following the annual meeting of stockholders. Should a member of the
nominating committee for any reason be unable to serve for the term to which he
was elected, the vacancy shall be filled by the board of directors at its next
meeting.
D. COMPENSATION. Each member of the nominating committee shall
receive the compensation the board of directors determines and shall be
reimbursed for their expenses for attendance at regular or special meetings.
E. CHAIRMAN AND SECRETARY OF THE NOMINATING COMMITTEE. The chairman
and secretary of the nominating committee shall be elected by the members of
the nominating committee.
F. MEETINGS. Regular meetings of the nominating committee may be
held without call or notice of the time and place that the nominating committee
determines. Special meetings of the nominating committee may be called by any
member, either personally or by mail, by telegram, by facsimile or other lawful
means forwarded not later than 48 hours prior to the date and time set forth
for the meeting. Upon request of any member, the secretary of the corporation
shall give the required notice calling the meeting.
G. QUORUM. At any meeting of the nominating committee, a majority of
committee members shall constitute a quorum. Any action of the nominating
committee to be effective must be authorized by the affirmative votes of a
majority of committee members.
H. RULES. The nominating committee shall determine its own rules of
procedure, provided the rules do not contravene the provisions of the law, the
Certificate of Incorporation or these bylaws.
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I. AUTHORITY AND RESPONSIBILITY.
(a) The nominating committee is vested with the authority and
responsibility to (i) recommend to the board of directors criteria for
selection of candidates to serve on the board of directors; (ii)
recommend to the board of directors qualified candidates to fill any
newly created directorships or vacancies on the board of directors
which occur between annual meetings of stockholders without regard to
race, sex, age, religion or physical disability; (iii) recommend
candidates for election to the committees of the board of directors;
(iv) periodically review, assess, and make recommendations to the
board of directors with regard to the size and composition of the
board of directors, and its evaluation of incumbent directors; (v)
cause the names of all director candidates that are approved by the
board of directors to be listed in the corporation's proxy materials
and support the election of all candidates so nominated by the board
of directors to the extent permitted by law; (vi) evaluate and
recommend to the board of directors potential candidates to serve in
the future on the board of directors to assure the continuity and
succession of the board of directors; and (vii) otherwise aid in
attracting qualified candidates to the board of directors.
(b) Only candidates recommended by the nominating committee shall be
eligible for nomination by the board of directors for election, or to
fill a vacancy or any newly created directorship, but if the board
does not approve one or more of the candidates recommended by the
nominating committee, the nominating committee shall submit a
recommendation of other candidates. If for any reason the nominating
committee shall fail to act or determines not to make a
recommendation, the board of directors shall fill any vacancy or newly
created directorship in the manner that it deems appropriate.
(c) The nominating committee, in addition to the authority vested in
it under subsections (a) and (b) above, shall have all additional
powers necessary to carry out its responsibilities, and may be vested
with other specific powers and authority by resolution of the board of
directors.
J. REPORTS. All action by the nominating committee shall be reported
to the board of directors at its next meeting, and shall be subject to revision
or alteration by the board of directors.
K. RIGHTS OF STOCKHOLDERS. Nothing in this Section 18 shall affect
or restrict the right of any stockholder to nominate any person for election as
a director where such nomination is otherwise authorized by law and made in
accordance with Section 13 of Article IV of these bylaws.
SECTION 19. ELECTION OF OFFICERS. At the first meeting of the board
of directors in each year, at which a quorum shall be present, following the
annual meeting of the stockholders of the corporation, the board of directors
shall proceed to the election of the officers of the corporation, except
regional officers who are subject to appointment in accordance with Section 19
of Article VI of these bylaws.
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SECTION 20. ACTION WITHOUT MEETING. Any action required or permitted
to be taken at any meeting of the board of directors or of any committee
thereof may be taken without a meeting, if prior to the action a written
consent thereto is signed by all members of the board of directors or of the
committee, as the case may be, and such written consent is filed with the
minutes of the proceedings of the board of directors or committee.
SECTION 21. WAIVER OF NOTICE. Whenever any notice whatever is
required to be given pursuant to the provisions of a statute, the Certificate
of Incorporation or these bylaws of the corporation, a waiver thereof in
writing signed by the person or persons entitled to the notice, whether before
or after the time stated therein, shall be deemed equivalent thereto.
ARTICLE VI.
OFFICERS
SECTION 1. OFFICERS. The officers of the corporation shall be a
chairman of the board, vice chairman of the board, president, one or more
executive vice presidents, one or more senior vice presidents, one or more vice
presidents, secretary, treasurer, controller and such assistant vice
presidents, assistant secretaries, assistant treasurers and assistant
controllers as the board of directors may provide for and elect. The chairman
of the board and the vice chairman of the board shall be members of the board
of directors. Any two or more offices may be held by the same person. The
board of directors may appoint such other officers as they shall deem
necessary, who shall have the authority and shall perform the duties that from
time to time may be prescribed by the board of directors. In its discretion,
the board of directors by a vote of a majority thereof may leave unfilled for
any period that it may fix by resolution any office except those of president,
treasurer and secretary.
SECTION 2. ELECTION. The board of directors at their first meeting
after each annual meeting of the stockholders or at any regular or special
meeting shall elect, as may be required, a chairman of the board, vice chairman
of the board, president, and one or more executive vice presidents, senior vice
presidents, vice presidents, a secretary, treasurer, controller, and assistant
vice presidents, assistant secretaries, assistant treasurers, and assistant
controllers.
SECTION 3. TENURE. The officers of the corporation elected by the
board of directors shall hold office for one year and until their successors
are chosen and qualify in their stead. Any officer elected or appointed by the
board of directors may be removed at any time by the affirmative vote of a
majority of the board of directors.
SECTION 4. SALARIES. The salaries of the officers of the corporation
shall be recommended by the management development and compensation committee
and approved by the board of directors.
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SECTION 5. VACANCIES. If the office of any officer of the
corporation becomes vacant by reason of death, resignation, disqualification or
otherwise, the directors by a majority vote, may choose his successor or
successors.
SECTION 6. RESIGNATION. Any officer may resign his office at any
time, such resignation to be made in writing and take effect at the time of
receipt by the corporation, unless some time be fixed in the resignation and
then from that time. The acceptance of a resignation shall not be required to
make it effective.
SECTION 7. DELEGATION OF DUTIES. Duties of officers may be delegated
in case of the absence of any officer of the corporation or for any reason that
the board of directors may deem sufficient. The board of directors may
delegate the powers or duties of the officer to any other officer or to any
director, except as otherwise provided by statute, for the time being, provided
a majority of the entire board of directors concurs therein.
SECTION 8. CHAIRMAN OF THE BOARD. The chairman of the board shall be
the chief executive officer and shall have, subject to the direction of the
board of directors, general control and management of the corporation's
business and affairs and shall see that all the policies and resolutions of the
board of directors are carried into effect, subject, however, to the right of
the board of directors to delegate any specific powers, except such as may be
by statute exclusively conferred on the president, to any other officer or
officers of the corporation. He shall preside at all meetings of stockholders
and the board of directors at which he may be present.
SECTION 9. VICE CHAIRMAN OF THE BOARD. The vice chairman shall
preside at all meetings of the board of directors and stockholders from which
the chairman of the board may be absent, and shall perform such other duties
that shall be specifically assigned to him from time to time by the board of
directors or the chairman of the board.
SECTION 10. PRESIDENT. The president shall be the chief operating
officer and shall perform those duties that shall be specifically assigned to
him from time to time by the board of directors. In the absence of the chief
executive officer or in the event of his death, inability or refusal to act,
the president shall perform the duties of the chief executive officer, and when
so acting shall have the powers of and be subject to all the restrictions upon
the chief executive officer.
SECTION 11. EXECUTIVE VICE PRESIDENTS, SENIOR VICE PRESIDENTS, AND
VICE PRESIDENTS. In the absence of the president or in the event of his death,
inability or refusal to act, the senior executive vice president present shall
perform the duties of the president, and when so acting, shall have all the
powers of and be subject to all the restrictions upon the president. In the
absence of the president and all executive or senior vice presidents, or in the
event of their deaths, inability or refusal to act, a vice president designated
by the board of directors, or in case the board of directors has failed to act,
designated by the chief executive officer, shall perform the duties of the
president and when so acting shall have all the powers of and be subject to all
the restrictions upon the president. The executive vice presidents, the senior
vice presidents, and all
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other vice presidents shall perform those duties consistent with these bylaws
and that may be specifically designated by the president or by the board of
directors.
SECTION 12. ASSISTANT VICE PRESIDENTS. The assistant vice presidents
shall perform those duties, not inconsistent with these bylaws, the Certificate
of Incorporation or statute, that may be specifically designated by the board
of directors or the president. In the absence of the executive vice
presidents, senior vice presidents, or vice presidents, an assistant vice
president (or in the event there be more than one assistant vice president, the
assistant vice presidents in the order designated at the time of their
election, or in the absence of any designation, then in the order of their
election) shall perform the duties of the executive vice presidents, senior
vice presidents or vice presidents, and when so acting, shall have all the
powers of and be subject to all restrictions upon the executive vice
presidents, the senior vice presidents, and vice presidents.
SECTION 13. SECRETARY. The secretary shall attend and keep all the
minutes of all meetings of the board of directors and all meetings of the
stockholders and, when requested by the board of directors, of any committees
of the board of directors. He shall give, or cause to be given, notice of all
meetings of the stockholders and board of directors and when so ordered by the
board of directors, shall affix the seal of the corporation thereto; he shall
have charge of all of those books and records that the board of directors may
direct, all of which shall, at all reasonable times, be open to the examination
of any director at the office of the corporation during business hours; he
shall, in general, perform all of the duties incident to the office of
secretary subject to the control of the board of directors or of the president,
under whose supervision he shall be, and shall do and perform any other duties
that may from time to time be assigned to him by the board of directors.
SECTION 14. ASSISTANT SECRETARIES. In the absence of the secretary
or in the event of his death, inability or refusal to act, the assistant
secretary (or in the event there be more than one assistant secretary, the
assistant secretaries in the order designated at the time of their election, or
in the absence of any designation, then in the order of their election) shall
perform the duties of the secretary, and when so acting shall have all the
powers of and be subject to all the restrictions upon the secretary and shall
perform any other duties that may from time to time be assigned to him by the
board of directors, the president or the secretary.
SECTION 15. TREASURER. The treasurer shall have custody of and be
responsible for all funds and securities of the corporation, receive and give
receipts for money due and payable to the corporation from any source
whatsoever, and deposit all such moneys in the name of the corporation in those
banks or depositories that shall be selected and designated by the board of
directors and shall in general perform all of the duties incident to the office
of treasurer and any other duties that may be assigned to him by the president
or by the board of directors. If required by the board of directors, the
treasurer shall give bond for the faithful discharge of his duties in the sum
and with the surety or sureties as the board of directors shall determine.
SECTION 16. ASSISTANT TREASURERS. In the absence of the treasurer or
in the event of his death, inability or refusal to act, the assistant treasurer
(or in the event there be more than one assistant treasurer, the assistant
treasurers in the order designated at the time of their
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election, or in the absence of any designation, then in the order of their
election) shall perform the duties of the treasurer and when so acting shall
have all the powers and be subject to all the restrictions upon the treasurer,
and shall perform any other duties that from time to time may be assigned to
him by the president, treasurer or the board of directors. The assistant
treasurers shall, if required by the board of directors, give bonds for the
faithful discharge of their duties in the sums and with the surety or sureties
that the board of directors shall determine.
SECTION 17. CONTROLLER. The controller shall maintain adequate
records of all assets, liabilities and transactions of the corporation; see
that adequate audits thereof are currently and regularly made; and, in
conjunction with other officers and department heads, initiate and enforce
measures and procedures whereby the business of the corporation shall be
conducted with the maximum safety, efficiency and economy. Except as otherwise
determined by the board of directors, or lacking a determination by the board
of directors, then by the president, his duties and powers shall extend to all
subsidiary corporations and, so far as may be practicable, to all affiliate
corporations. He shall have any other powers and perform other duties that may
be assigned to him by the president or by the board of directors. If required
by the board of directors, the controller shall give bond for the faithful
discharge of his duties in the sum and with the surety or sureties as the board
of directors shall determine.
SECTION 18. ASSISTANT CONTROLLERS. In the absence of the controller
or in the event of his death, inability or refusal to act, the assistant
controller (or in the event there be more than one assistant controller, the
assistant controllers, in the order designated at the time of their election,
or in the absence of any designation, then in the order of their election)
shall perform the duties of the controller and when so acting shall have all
the powers and be subject to all the restrictions upon the controller, and
shall perform any other duties that from time to time may be assigned to him by
the president, controller or the board of directors. The assistant controllers
shall, if required by the board of directors, give bonds for the faithful
discharge of their duties in the sums and with the surety or sureties that the
board of directors shall determine.
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SECTION 19. REGIONAL VICE PRESIDENTS.
A. ELECTION. One or more regional vice presidents may be
appointed by the chairman of the board, or the authority for such appointments
may be delegated by the chairman of the board to the president of the
corporation.
B. TENURE. The regional vice presidents appointed by the
chairman of the board or the president of the corporation shall hold office for
one year and until their successors are chosen and qualify in their stead. Any
regional vice president so appointed may be removed at any time by the chairman
of the board or the president of the corporation.
C. DUTIES. The regional vice presidents shall do and perform
those duties that shall from time to time be specifically designated or
assigned by the chairman of the board or the president of the corporation;
however, the regional vice presidents shall not perform "policy-making
functions" as defined pursuant to Section 16 or any successor section(s) of the
Securities Exchange Act of 1934, as amended, and shall be deemed not to be
subject to such Section 16 and the rules and regulations promulgated
thereunder.
ARTICLE VII.
INDEMNIFICATION OF OFFICERS, DIRECTORS,
EMPLOYEES AND AGENTS
SECTION 1. The board of directors shall indemnify any person (and
that person's heirs and personal representatives) who was or is a party or is
threatened or expected to be made a party to any threatened, pending or
completed action, suit, arbitration or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of the
corporation) by reason of the fact that he is or was a director, officer,
employee or agent of the corporation, or is or was serving at the request of
the corporation as a director, officer, employee, partner or agent of another
corporation, partnership (including a partnership in which the corporation is a
partner), joint venture, trust or other enterprise, against expenses
(including, but not limited to, attorneys' fees, expert fees, bonds,
prospective or retroactive insurance premiums or costs, litigation, appeal and
court costs and out-of-pocket expenses of such person during any investigation
hearing, arbitration, trial, or appeal of any such action, suit or proceeding,
including any interest payable thereon), judgments, damages, arbitration
awards, fines and amounts paid in settlement actually and reasonably incurred
by him in connection with such action, suit, arbitration or proceeding,
including any interest payable thereon, if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
the corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon
a plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed
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to the best interests of the corporation, and, with respect to any criminal
action or proceeding, had reasonable cause to believe that his conduct was
unlawful.
SECTION 2. The board of directors shall indemnify any person (and
that person's heirs and personal representatives) who was or is a party or is
threatened or expected 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 is or was a director,
officer, employee or agent of the corporation or is or was serving at the
request of the corporation as a director, officer, employee, partner or agent
of another corporation, partnership (including a partnership in which the
corporation is a partner), joint venture, trust or other enterprise against
expenses (including, but not limited to, attorneys' fees, expert fees, bonds,
prospective or retroactive insurance premiums or costs, litigation, appeal and
court costs, and out-of-pocket expenses of such person during any
investigation, hearing, trial or appeal of any such action or suit, including
any interest payable thereon), actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation and except that no indemnification shall
be made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable for negligence or misconduct in the performance
of his duty to the corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.
SECTION 3. To the extent that a present or past director, officer,
employee or agent of the corporation has been successful on the merits or
otherwise in defense of any action, suit, arbitration or proceeding referred to
in Sections 1 and 2, or in defense of claim, issue or matter therein, he shall
be indemnified against expenses (including, but not limited to, attorneys'
fees, expert fees, bonds, prospective or retroactive insurance premiums or
costs, litigation, appeal, and court costs, and out-of-pocket expenses of such
person during any investigation, hearing, arbitration, trial or appeal of any
such action, suit or proceeding) actually and reasonably incurred by him in
connection therewith, including any interest payable thereon.
SECTION 4. The board of directors shall cause the corporation to
advance to any person covered by Sections 1 or 2 the expenses (including, but
not limited to, attorneys' fees, expert fees, bonds, prospective or retroactive
insurance premiums or costs, litigation, appeal, and court costs and
out-of-pocket expenses, of such person during any investigation, hearing,
arbitration, trial or appeal of any such action, suit, arbitration or
proceeding) incurred by that person in defending a threatened, pending, or
completed civil, criminal, administrative, or investigative action suit,
arbitration, or proceeding, including any interest payable thereon, in advance
of the final disposition of such action, suit or proceeding.
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SECTION 5. Any advance by the board of directors under Section 4
above to any employee or agent who is not a present or past director or officer
of the corporation shall be conditional upon evidence of compliance with the
terms and conditions, if any, deemed appropriate and specified by the board of
directors for such advance if such employee or agent is determined ultimately
to be not legally entitled to indemnification from the corporation.
SECTION 6. Any advance authorized by the board of directors under
Section 4 above to a present or past officer or director shall be conditional
upon prior receipt by the corporation of a written undertaking from that
officer or director to repay such advance if he is determined ultimately to be
not legally entitled to indemnification from the corporation. Such undertaking
shall be in the form of a simple agreement by the officer or director to repay
advances made to him in the event that it is determined ultimately that he is
not legally entitled to indemnification by the corporation. Such undertaking
shall specifically state that no bond, collateral or other security shall be
required by the officer or director to insure its performance and that no
interest on any amount advanced shall be required to be paid to the corporation
if the officer or director is determined ultimately to be not legally entitled
to indemnification from the corporation.
SECTION 7. The board of directors, in its sole discretion, may
establish and may fund in advance and from time to time, in whole or in part, a
separate provision or provisions, which may be in the form of a trust fund,
periodic or advance retainers to counsel, or otherwise as the board of
directors may determine in each instance, to be used as payment and/or advances
of indemnification obligations under this Article VII to officers, directors,
employees and agents of the corporation; provided, however, that any amount
which is contributed to such fund shall not in any way be construed to be a
limitation on the amount of indemnification and/or advances of the corporation.
SECTION 8. The board of directors shall cause the corporation to pay
to any director, officer, employee or agent all expenses (including, but not
limited to, attorneys' fees, expert fees, bonds, prospective or retroactive
insurance premiums or costs, litigation, appeal, and court costs, and
out-of-pocket expenses of such person during any investigation, hearing,
arbitration, trial or appeal of any such action, suit, arbitration or
proceeding, including any interest payable thereon), which may be incurred by
such director, officer, employee or agent in enforcing his rights to
indemnification (as set forth herein in Sections 1, 2 and 3) and/or advances
(as set forth herein in Section 4) whether or not such director, officer,
employee or agent is successful in enforcing such rights and whether or not
suit or other proceedings are commenced.
SECTION 9. Any amendment to this Article VII shall only apply
prospectively and shall in no way affect the corporation's obligations to
indemnify and make advances to officers, directors, employees and agents as set
forth in this Article VII for actions or events which occurred before any such
amendment, and provided that any amendment to this Article VII shall require
affirmative vote of four-fifths of the entire board of directors.
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SECTION 10. Any indemnification granted under the provisions of
Sections 1, 2, 3 and 8 above shall be subject to the provisions of subsections
(d), (e), (f) and (g) of Section 145 of the General Corporation Law of the
State of Delaware.
ARTICLE VIII.
CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1. CONTRACTS. The board of directors may authorize any
officer or officers, agent or agents to enter into any contract or execute and
deliver any instrument in the name of and on behalf of the corporation. Such
authority may be general or confined to specific instances.
SECTION 2. LOANS. No loan shall be contracted on behalf of the
corporation and no evidences of indebtedness shall be issued in its name,
unless authorized by resolution of the board of directors. Such authority may
be general or confined to specific instances.
SECTION 3. CHECKS, DRAFTS, ETC. All checks, drafts or other order or
other orders for the payment of money, notes or other evidences of indebtedness
issued in the name of the corporation shall be signed by such officer or
officers, agent or agents and in such manner that shall from time to time be
determined by resolution of the board of directors.
SECTION 4. DEPOSITS. All funds of the corporation not otherwise
employed shall be deposited from time to time to the credit of the corporation
in the bank or banks or other depositories that the board of directors may
elect.
ARTICLE IX.
VOTING OF STOCK OF OTHER CORPORATIONS
Unless otherwise ordered by the board of directors, the chairman of
the board shall have full power and authority on behalf of the corporation to
act and vote at any meeting of stockholders of any corporation in which the
corporation may hold stock, and at any such meeting, shall possess, and may
exercise, any and all of the rights and powers incident to the ownership of the
stock, which, as the owner thereof, the corporation might have possessed and
exercised if present. The board of directors by resolution from time to time,
may confer like powers upon any other person or persons.
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ARTICLE X.
NOTICES
SECTION 1. FORM OF NOTICE. Whenever under the provisions of the
statutes, the Certificate of Incorporation, or these bylaws, notice is required
to be given to any director or stockholder, it shall not be construed to mean
personal notice, but the notice may be given in writing by mail, which shall
mean depositing same in a United States Postal Service post office or letter
box, in a postage paid, sealed envelope, addressed to the stockholder or
director at the address that appears on the books of the corporation or, in
default of other address, to such director or stockholder at the United States
Postal Service general post office in the City of Wilmington, Delaware, and the
notice shall be deemed to be given at the time when the same shall be thus
mailed or by any other means expressly provided for in these bylaws.
SECTION 2. WAIVER OF NOTICE. Whenever any notice is required to be
given under the provision of the statutes, the Certificate of Incorporation or
these bylaws, a waiver thereof in writing signed by the person or persons
entitled to the notice whether before or after the time stated therein shall be
deemed equivalent thereto.
ARTICLE XI.
STOCK CERTIFICATES
SECTION 1. CERTIFICATES FOR SHARES. The certificates for shares of
the capital stock of the corporation shall be in the form, not inconsistent
with the Certificate of Incorporation, that shall be approved by the board of
directors. The certificate shall be signed by the chairman of the board,
president or a vice president, and either the treasurer or an assistant
treasurer, or the secretary or an assistant secretary, but where the
certificate is signed by a transfer agent or an assistant transfer agent and a
registrar, the signatures of the chairman of the board, president, vice
president, treasurer, assistant treasurer, secretary or assistant secretary may
be facsimiles. All certificates shall be consecutively numbered, and the name
of the person owning the shares represented thereby, with the number of shares
and the date of issue shall be entered in the corporation's books. No
certificate shall be valid unless it is signed by the chairman of the board,
president, or a vice president, and either the treasurer or an assistant
treasurer, or the secretary or an assistant secretary, but where the
certificate is signed by a transfer agent or an assistant transfer agent and a
registrar, the signatures of the chairman of the board, president, vice
president, treasurer, assistant treasurer, secretary or assistant secretary may
be facsimiles. All certificates surrendered to the corporation shall be
canceled, and no new certificates shall be issued until the former certificate
for the same number of shares of the same class shall have been surrendered and
canceled.
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SECTION 2. TRANSFER OF SHARES. Shares of the capital stock of the
corporation shall be transferred only on the books of the corporation by the
holder thereof in person or by his attorney upon surrender and cancellation of
certificates for the same number of shares.
SECTION 3. REGULATIONS. The board of directors shall have authority
to make any rules and regulations that they may deem expedient concerning the
issue, transfer and registration of certificates for shares of the capital
stock of the corporation. The board of directors may appoint one or more
transfer agents or assistant transfer agents and one or more registrars of
transfers and may require all certificates to bear the signature of the
transfer agent or assistant transfer agent and a registrar of transfers. The
board of directors may at any time terminate the appointment of any transfer
agent or any assistant transfer agent or any registrar of transfers by the vote
of a majority of the board of directors.
SECTION 4. FIXING DATE FOR DETERMINATION OF STOCKHOLDERS' RIGHTS.
The board of directors may close the stock transfer books of the corporation
for a period not exceeding 50 days preceding the date of any meeting of
stockholders, or the date for payment of any dividend, or the date for the
allotment of rights, or the date when any change or conversion or exchange of
capital stock shall go into effect, or for a period not exceeding 50 days in
connection with obtaining the consent of stockholders for any purpose. In lieu
of closing the stock transfer books as aforesaid, the board of directors may
fix a date not exceeding 50 days preceding the date of any meeting of
stockholders, or the date for the payment of any dividend, or the date for the
allotment of rights, or the date when any change or conversion or exchange of
capital stock shall go into effect, or a date in connection with obtaining such
consent, as a record date for the determination of the stockholders entitled to
notice of, and to vote at, any meeting and any adjournment thereof, or entitled
to receive payment of any dividend, or to any allotment of rights, or to
exercise the rights in respect of any change, conversion or exchange of capital
stock, or to give such consent, and in such case the stockholders and only the
stockholders that shall be stockholders of record on the date so fixed shall be
entitled to the notice or to receive payment of the dividend, or to receive the
allotment of rights, or to exercise the rights or to give such consent, as the
case may be, notwithstanding any transfer of any stock on the books of the
corporation after any record date fixed as aforesaid.
SECTION 5. REGISTERED STOCKHOLDERS. The corporation shall be
entitled to treat the holder of record of any share or shares of stock as the
holder in fact thereof and accordingly shall not be bound to recognize any
equitable or other claim to or interest in the share or shares on the part of
any other person whether or not it shall have express or other notice thereof
except as otherwise provided by the laws of the State of Delaware.
SECTION 6. LOST CERTIFICATES. The board of directors may direct a
new certificate or certificates to be issued in place of any certificate or
certificates theretofore issued by the corporation alleged to have been lost or
destroyed, upon the making of an affidavit of that fact with the person
claiming the certificate of stock to be lost or destroyed. When authorizing
the issue of a new certificate or certificates, the board of directors may, in
its discretion and as a condition precedent to the issuance thereof, require
the owner of the lost or destroyed certificate or
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certificates, or his legal representative, to advertise the same in a manner
that it shall require for each share of stock having voting power registered in
his name and to give the corporation a bond in the sum that it may direct as
indemnity against any claim that may be made against the corporation with
respect to the certificate alleged to have been lost or destroyed.
SECTION 7. DIVIDENDS. The board of directors may from time to time
declare, and the corporation may pay, dividends on its outstanding shares in
the manner and upon the terms and conditions provided by law and the
Certificate of Incorporation.
SECTION 8. RESERVE FUNDS. Before payment of any dividend there may
be set aside out of any funds of the corporation available for dividends the
sum or sums that the board of directors may from time to time in their absolute
discretion think proper as a reserve fund to meet contingencies, or for
equalizing dividends, or for repairing or maintaining any property of the
corporation, or for any other purpose that the directors shall think conducive
to the interest of the corporation and the board of directors may modify or
abolish the reserve in the manner in which it was created.
ARTICLE XII.
GENERAL PROVISIONS
SECTION 1. FISCAL YEAR. The fiscal year of the corporation shall
begin on the first day of January in each year.
SECTION 2. INSPECTION OF BOOKS. The board of directors shall
determine from time to time whether, and if allowed, when and under what
conditions and regulations, the accounts and books of the corporation (except
as may be by statute specifically open to inspection) or any of them, shall be
open to the inspection of the stockholders, and a stockholder's rights in this
respect are, and shall be, restricted and limited accordingly.
SECTION 3. GENDER. The use of the masculine gender in these bylaws
shall be deemed to include the feminine gender.
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ARTICLE XIII.
AMENDMENTS TO AND SUSPENSION OF BYLAWS
SECTION 1. AMENDMENTS. Subject to the provisions of Section 12 of
Article IV, these bylaws may be altered or repealed at any regular meeting of
the stockholders or at any special meeting of the stockholders at which a
quorum is present or represented, provided notice of the proposed alteration or
repeal be contained in the notice of the special meeting, by the affirmative
vote of a majority of the stockholders entitled to vote at the meeting and
present or represented thereat, or by the affirmative vote of a majority of the
board of directors at any regular meeting of the board of directors or at any
special meeting of the board of directors, if notice of the proposed alteration
or repeal be contained in the notice of the special meeting.
SECTION 2. SUSPENSION. Any provision of these bylaws may be suspended
by vote of two-thirds of the votes cast upon the motion to suspend except that
the suspension of the bylaw provision might be in contravention of any
provision of any statute or of the Certificate of Incorporation.
* * *
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<PAGE> 1
Exhibit 23.1
CONSENT OF ARTHUR ANDERSEN LLP
As independent public accountants, we hereby consent to the incorporation by
reference in this Form 8-K/A Amendment No. 1 of our report dated February 23,
1996, included in The Phoenix Resource Companies, Inc.'s Form 10-K for the year
ended December 31, 1995. It should be noted that we have not audited any
financial statements of the company subsequent to December 31, 1995 or
performed any audit procedures subsequent to the date of our report.
ARTHUR ANDERSEN LLP
/s/ Arthur Andersen LLP
Oklahoma City, Oklahoma
July 17, 1996
<PAGE> 1
EXHIBIT 99.3
- --------------------------------------------------------------------------------
SEVENTH AMENDMENT TO THIRD AMENDED
AND RESTATED CREDIT AGREEMENT
dated as of May 8, 1996
among
APACHE CORPORATION
and
VARIOUS COMMERCIAL LENDING INSTITUTIONS,
and
THE FIRST NATIONAL BANK OF CHICAGO,
as Administrative Agent and Arranger
and
CHEMICAL BANK,
as Co-Agent and Arranger
- --------------------------------------------------------------------------------
<PAGE> 2
SEVENTH AMENDMENT TO THIRD AMENDED
AND RESTATED CREDIT AGREEMENT
THIS SEVENTH AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT,
dated as of May 8, 1996, (this "Seventh Amendment"), is among APACHE
CORPORATION, a Delaware corporation (the "Company"), the various commercial
lending institutions as are or may become parties hereto (the "Lenders"), THE
FIRST NATIONAL BANK OF CHICAGO, as Administrative Agent (in such capacity, the
"Administrative Agent") and Arranger (in such capacity, an "Arranger"), and
CHEMICAL BANK, as Co-Agent (in such capacity, the "Co-Agent") and Arranger (in
such capacity, an "Arranger").
W I T N E S S E T H:
1. The Company, the Lenders, the Arrangers, the Co-Agent and the
Administrative Agent have heretofore entered into that certain Third Amended
and Restated Credit Agreement, dated as of March 1, 1995, as previously amended
(the "Credit Agreement").
2. The Company, the Lenders, the Arrangers, the Co-Agent and the
Administrative Agent now intend to amend the Credit Agreement (i) to permit the
proposed merger of YPY Acquisitions, Inc., a Delaware corporation and a wholly-
owned Subsidiary of the Company ("YPY"), and The Phoenix Resource Companies,
Inc., a Delaware corporation ("Phoenix"), pursuant to that certain Agreement
and Plan of Merger, dated as of March 27, 1996, between the Company, YPY and
Phoenix (the "Phoenix Merger"), (ii) to permit the Company to replace Phoenix
as guarantor of the obligations of Phoenix Resources Company of Qarun, a
Delaware corporation and wholly-owned Subsidiary of Phoenix ("Phoenix Egypt"),
to the International Finance Corporation ("IFC") and certain participant banks
in connection with a project financing in the maximum aggregate amount of $50
million relating to the development of the Qarun oil and gas concession, (iii)
to permit the pledge of the stock of Phoenix Egypt by Phoenix Resources Company
International, a Delaware corporation ("Phoenix International"), to IFC and the
liens on substantially all of the property of Phoenix Egypt and (iv) to address
various other issues in connection therewith as follows:
I. AMENDMENTS TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT.
A. Section 1.1 of the Credit Agreement is hereby amended by
adding the following definitions of "Phoenix", "Phoenix Egypt", "Phoenix
International" and "Phoenix Merger" in appropriate alphabetical order:
"Phoenix" means The Phoenix Resource Companies, Inc., a
Delaware corporation, and following the effective date of the Phoenix
Merger, the successor company to the
<PAGE> 3
merger between Phoenix and YPY pursuant to the terms thereof.
"Phoenix Egypt" means Phoenix Resources Company of Qarun,
Inc., a Delaware corporation and a wholly-owned Subsidiary of Phoenix
International.
"Phoenix International" means Phoenix Resources Company
International, a Delaware corporation and a wholly-owned Subsidiary of
Phoenix.
"Phoenix Merger" means the acquisition transaction
contemplated by that certain Agreement and Plan of Merger, dated as of
March 27, 1996, between the Company, YPY Acquisitions, Inc., a
Delaware corporation ("YPY"), and Phoenix under the terms of which
Phoenix will become a Subsidiary of the Company.
B. Section 2.3(b) of the Credit Agreement is hereby amended in
its entirety to the following:
" (b) Determination of Borrowing Base at Request of
Company. The Company may request two Borrowing Base determinations
between any regularly scheduled semi-annual redeterminations of the
Borrowing Base by delivery to the Administrative Agent, the
Engineering Banks and the Lenders of a written request for such
determination; provided that a deemed request for a determination of
the Borrowing Base pursuant to Section 11.1(c), (d) or (e) shall not
preclude the Company's requesting a Borrowing Base determination to
which it is otherwise entitled pursuant to this clause (b). In
connection with any such determination the Company shall deliver to
the Administrative Agent, the Engineering Banks and the Lenders such
reports and information concerning the Properties (which may include
in the Engineering Banks' sole discretion an Approved Engineers'
Report or a Company's Engineers' Report as of such date) as the
Engineering Banks shall deem appropriate in its or their sole
discretion."
C. Section 11.1 of the Credit Agreement is hereby amended (a) by
deleting from subsection 11.1(j) the letter "(i)" from the second line thereof
and by replacing it with the letter "(j)"; (b) by relettering subsection
11.1(j) as subsection 11.1(k); and (c) by inserting the following after
subsection 11.1(i) thereof:
(j) Other Indebtedness of Phoenix Egypt to IFC in a
maximum aggregate principal amount of $50,000,000, together with
interest, fees and expenses related thereto; and
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<PAGE> 4
D. Section 11.2 of the Credit Agreement is hereby amended by
inserting the following proviso at the end of the first sentence thereof before
the period:
"provided, further, that the foregoing shall not prohibit the Phoenix
Merger".
E. Section 11.4 of the Credit Agreement is hereby amended by
amending subsection 11.4(d) of the Credit Agreement in its entirety to the
following:
"(d)(i) net Contingent Obligations of International, Apache Overseas,
Inc., Phoenix and any of their Subsidiaries consisting of foreign work
commitments or other similar obligations (but not including
obligations under authorizations for expenditures and other joint
operating arrangements) under exploration or production licenses or
agreements entered into by International, Apache Overseas, Inc.,
Phoenix or any of their Subsidiaries in the ordinary course of
business not to exceed $85,000,000 net at any one time outstanding for
all such Contingent Obligations and (ii) Contingent Obligations of
International, Apache Overseas, Inc., Phoenix and any of their
Subsidiaries consisting of obligations under authorizations for
expenditures and other joint operating arrangements entered into by
International, Apache Overseas, Inc., Phoenix or any of their
Subsidiaries in the ordinary course of business; provided that for
purposes of clause (d)(i), net Contingent Obligations shall be deemed
to be the difference between the aggregate for all such Contingent
Obligations in respect of foreign work commitments or other similar
obligations in which International, Apache Overseas, Inc., Phoenix or
any of their Subsidiaries is required to perform or pay a certain
amount (but not including obligations under authorizations for
expenditures and other joint operating arrangements) less the
aggregate of such Contingent Obligations in respect of which another
industry partner (which the Company reasonably believes is capable of
performing such commitments or obligations) has become obligated to
perform,"
; (ii) by deleting the word "and" at the end of subsections 11.4(j); and (iii)
by inserting the following after subsection 11.4(k) thereof before the period:
", and (l) Contingent Obligations of the Company and Phoenix to IFC
relating to Phoenix Egypt not exceeding $50,000,000 in the aggregate,
together with interest, fees and expenses related thereto".
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<PAGE> 5
F. Section 11.5 of the Credit Agreement is hereby amended by
inserting the following after subsection 11.5(j) thereof:
"(k) Liens securing the Indebtedness permitted in connection with
Section 11.1(j)."
G. Section 11.7 of the Credit Agreement is hereby amended by
inserting after the phrase "Apache Egypt" and before the semicolon preceding
the first proviso thereto the phrase "or Phoenix Egypt".
H. The proviso at the end of Section 11.10 of the Credit
Agreement is hereby amended in its entirety to the following:
"provided, however, that, notwithstanding the foregoing, this section
shall not apply to Apache Canada, Apache Egypt, Phoenix or any of
their Subsidiaries or to any restrictions on the creation, assumption
or perfection of any Lien on, or any transfer or sale of, any of their
respective securities."
I. Section 11.11 of the Credit Agreement is hereby amended by
inserting the following proviso before the period at the end of the first
sentence thereof:
"provided, further, that the foregoing shall not prohibit the Phoenix
Merger".
J. Section 11.12 of the Credit Agreement is hereby amended (i) by
amending subsection 11.12(e) in its entirety to the following:
" (e) in the ordinary course of business,
Investments in Subsidiaries, including, without limitation,
International, Apache Energy Limited, Apache Overseas, Inc.,
DEKALB, Phoenix or any of their Subsidiaries, for (i) the
acquisition, exploration, drilling or development of
Properties which are located outside the United States of
America and are not included in the Borrowing Base, or (ii)
costs incurred in connection with gathering, processing,
transporting and marketing production from such Properties;"
; (ii) by amending subsections 11.12(i), (j) and (k) in their entirety to the
following:
" (i) Investments in Phoenix and its Subsidiaries
in connection with the Phoenix Merger and other Investments in
Phoenix permitted under Section 11.12(e);
provided, however, that
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<PAGE> 6
(1) any Investment which when made complies with
the requirements of the definition of the term "Cash
Equivalent Investment" may continue to be held notwithstanding
that such Investment if made thereafter would not comply with
such requirements; and
(2) no Investment otherwise permitted by clause
(d), (e) (f) or (g) shall be permitted to be made if,
immediately before or after giving effect thereto, any Default
shall have occurred and be continuing."
II. LIMITED WAIVER OF SECTION 2.3(A). In connection with the
Approved Engineers Report, dated as of December 31, 1995, received by the
Engineering Banks pursuant to Section 9.1(d) of the Credit Agreement, each of
the Lenders consent and agree to the extension of the time for the Engineering
Banks to make their determination of the Borrowing Base pursuant to Section
2.3(a) of the Credit Agreement from 30 days after receipt by the Engineering
Banks of the Approved Engineers Report to 60 days after receipt by the
Engineering Banks of the Approved Engineers Report. Except as set forth in
this section, this consent and agreement shall not be deemed to be a waiver or
amendment of any other provision or requirement of the Credit Agreement or
Section 2.3(a) thereto, now or hereafter.
III. EFFECTIVENESS. This Seventh Amendment shall become effective
as of the date hereof when the Administrative Agent shall have received
counterparts hereof duly executed by the Company, the Required Lenders, the
Administrative Agent and the Co-Agent (or, in the case of any party as to which
an executed counterpart shall not have been received, telegraphic, telex, or
other written confirmation from such party of execution of a counterpart hereof
by such party).
IV. REAFFIRMATION OF REPRESENTATIONS AND WARRANTIES. To induce
the Lenders, the Administrative Agent, the Co-Agent and the Arrangers to enter
into this Seventh Amendment, the Company hereby reaffirms, as of the date
hereof, its representations and warranties in their entirety contained in
Article VIII of the Credit Agreement and in all other documents executed
pursuant thereto (except to the extent such representations and warranties
relate solely to an earlier date) and additionally represents and warrants as
follows:
(i) The Company is a corporation duly incorporated,
validly existing and in good standing under the laws of its
jurisdiction of incorporation and has all requisite authority, permits
and approvals, and is in good standing to conduct its business in each
jurisdiction in which its business is conducted.
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<PAGE> 7
(ii) The Company has the corporate power and authority and
legal right to execute and deliver this Seventh Amendment and to
perform its obligations hereunder. The execution and delivery by the
Company of this Seventh Amendment and the performance of its
obligations hereunder have been duly authorized by proper corporate
proceedings, and this Seventh Amendment and the Credit Agreement, as
amended hereby, constitute the legal, valid and binding obligations of
the Company, enforceable against the Company in accordance with their
terms, except as enforceability may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of creditors'
rights generally.
(iii) No Default or Unmatured Default has occurred and is
continuing as of the date hereof.
(iv) There has been no material adverse change (a) in the
businesses, assets, properties, operations, condition (financial or
otherwise) or results of operations or prospects of the Company and
its Subsidiaries from March 1, 1995, (b) affecting the rights and
remedies of the Lenders under and in connection with this Seventh
Amendment and the Credit Agreement, as amended by this Seventh
Amendment, or (c) in the ability of the Company to perform its
obligations under this Seventh Amendment or the Credit Agreement, as
amended by this Seventh Amendment.
(v) There is no litigation, arbitration, governmental
investigation, proceeding or inquiry pending or, to the knowledge of
any of their officers threatened against or affecting the Company or
its Subsidiaries which is or could have a Material Adverse Effect.
V. DEFINED TERMS. Except as amended hereby, terms used herein
when defined in the Credit Agreement shall have the same meanings herein unless
the context otherwise requires.
VI. REAFFIRMATION OF CREDIT AGREEMENT. This Seventh Amendment
shall be deemed to be an amendment to the Credit Agreement, and the Credit
Agreement, as amended hereby, is hereby ratified, approved and confirmed in
each and every respect. All references to the Credit Agreement herein and in
any other document, instrument, agreement or writing shall hereafter be deemed
to refer to the Credit Agreement as amended hereby.
VII. GOVERNING LAW. THIS SEVENTH AMENDMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE
OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
All obligations of the Company and rights of the Lenders, the Administrative
Agent, the Co-Agent and the Arrangers and any other holders of the Notes
expressed herein
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<PAGE> 8
shall be in addition to and not in limitation of those provided by applicable
law.
VIII. SEVERABILITY OF PROVISIONS. Any provision in this Seventh
Amendment that is held to be inoperative, unenforceable, or invalid in any
jurisdiction shall, as to that jurisdiction, be inoperative, unenforceable, or
invalid without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of this Seventh Amendment are
declared to be severable.
IX. COUNTERPARTS. This Seventh Amendment may be executed in any
number of counterparts, all of which taken together shall constitute one
agreement, and any of the parties hereto may execute this Seventh Amendment by
signing any such counterpart.
X. HEADINGS. Article and section headings in this Seventh
Amendment are for convenience of reference only, and shall not govern the
interpretation of any of the provisions of this Seventh Amendment.
XI. SUCCESSORS AND ASSIGNS. This Seventh Amendment shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.
XII. NOTICE. THIS WRITTEN SEVENTH AMENDMENT TOGETHER WITH THE
THIRD AMENDED AND RESTATED CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED
BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[SIGNATURES BEGIN ON FOLLOWING PAGE]
7
<PAGE> 9
IN WITNESS WHEREOF, the Company, the Lenders, the Administrative
Agent, the Co-Agent and the Arrangers have executed this Seventh Amendment as
of the date first above written.
APACHE CORPORATION
By:/s/ Matthew W. Dundrea
---------------------------------------------
Name: Matthew W. Dundrea
Title: Treasurer
THE FIRST NATIONAL BANK OF CHICAGO,
Individually, as Administrative Agent
and as Arranger
By:/s/ George R. Schanz
---------------------------------------------
Name: George R. Schanz
Title: Vice President
CHEMICAL BANK, Individually, as Co-Agent
and as Arranger
By:/s/ R. Potter
---------------------------------------------
Name: Ronald Potter
Title: Mananging Director
BANK OF MONTREAL, Individually and as
Lead Manager
By:/s/ Robert Roberts
---------------------------------------------
Name: Robert L. Roberts
Title: Director, U.S. Corporate Banking
S-1
<PAGE> 10
CIBC INC., Individually and as Lead
Manager
By:
---------------------------------------------
Name:
Title:
NATIONSBANK of Texas, N.A., Individually and as
Lead Manager
By:/s/ Kristin B. Palmer
---------------------------------------------
Name: Kristin B. Palmer
Title: Senior Vice President
BANK OF AMERICA NATIONAL TRUST & SAVINGS
ASSOCIATION
By:/s/ J. Stephen Mernick
---------------------------------------------
Name: J. Stephen Mernick
Title: Senior Vice President
BANQUE PARIBAS
By:
---------------------------------------------
Name:
Title:
By:
---------------------------------------------
Name:
Title:
SOCIETE GENERALE, SOUTHWEST AGENCY
By:/s/ R.A. Erbert
---------------------------------------------
Name: Richard A. Erbert
Title: Vice President
S-2
<PAGE> 11
MORGAN GUARANTY TRUST COMPANY OF
NEW YORK
By:
---------------------------------------------
Name:
Title:
ABN-AMRO BANK N.V. - HOUSTON AGENCY
By:
---------------------------------------------
Name:
Title:
By:
---------------------------------------------
Name:
Title:
THE FIRST NATIONAL BANK OF BOSTON
By:
---------------------------------------------
Name:
Title:
THE BANK OF NOVA SCOTIA, ATLANTA
AGENCY
By:/s/ A.S. Norsworthy
---------------------------------------------
Name: A.S. Norsworthy
Title: Assistant Agent
THE CHASE MANHATTAN BANK, N.A.
By:/s/ Bettylou J. Robert
---------------------------------------------
Name: Bettylou J. Robert
Title: Vice President
S-3
<PAGE> 12
CITIBANK, N.A.
By:/s/ Marjorie Futornick
---------------------------------------------
Name: Marjorie Futornick
Title: Vice President
THE FUJI BANK, LIMITED - HOUSTON AGENCY
By:/s/ Soichi Yoshida
---------------------------------------------
Name: Soichi Yoshida
Title: Vice President & Senior Manager
UNION BANK OF SWITZERLAND, HOUSTON AGENCY
By:/s/ J. George Kubove
---------------------------------------------
Name: J. George Kobove
Title: Assistant Vice President
By:/s/ Kelly Boots
---------------------------------------------
Name: Kelly Boots
Title: Assistant Treasurer
UNION BANK
By:/s/ Richard P. DeGrey
---------------------------------------------
Name: Richard P. DeGrey
Title: Vice President
By:
---------------------------------------------
Name:
Title:
<PAGE> 13
CHRISTIANIA BANK OG KREDITKASSE
By:/s/ Steve Phillips
---------------------------------------------
Name: Steve Phillips
Title: Vice President
By:/s/ Carl-Petter Svendsen
---------------------------------------------
Name: Carl-Petter Svendsen
Title: First Vice President
COLORADO NATIONAL BANK
By:/s/ Charles S. Searle
---------------------------------------------
Name: Charles S. Searle
Title: Senior Vice President
THE LONG-TERM CREDIT BANK OF JAPAN, LTD.
By:/s/ Satoru Otsubo
---------------------------------------------
Name: Satoru Otsubo
Title: Joint General Manager
ROYAL BANK OF CANADA, GRAND CAYMAN
(NORTH AMERICAN #1) BRANCH
By:/s/ Linda M. Stephens
---------------------------------------------
Name: Linda M. Stephens
Title: Manager
S-5
