SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1999
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 0-14060
INTRENET, INC.
(Exact name of registrant as specified in its charter)
Indiana 35-1597565
(State or other jurisdiction of (IRS Employer Identification No)
incorporation or organization)
400 TechneCenter Drive, Suite 200, Milford, Ohio 45150
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (513) 576-6666
Not Applicable
Former name, former address and former fiscal year,
if changed since last report
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.
Common Stock, without par value, 13,674,066 shares issued and
outstanding at May 1, 1999
INTRENET, INC.
FORM 10-Q
MARCH 31, 1999
INDEX
PAGE
Part I - Financial Information:
Item 1. Financial Statements:
Condensed Consolidated Balance Sheets
March 31, 1999 and December 31, 1998 .... 3
Condensed Consolidated Statements of Operations
Three Months Ended March 31, 1999 and 1998 .... 4
Condensed Consolidated Statement of Shareholders' Equity
Three Months Ended March 31, 1999 .... 5
Condensed Consolidated Statements of Cash Flows
Three Months Ended March 31, 1999 and 1998 .... 6
Notes to Condensed Consolidated Financial Statements .... 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations .... 9
Part II - Other Information:
Item 1. Legal Proceedings .... 13
Item 2. Changes in Securities .... 13
Item 3. Defaults Upon Senior Securities .... 13
Item 4. Submission of Matters to a Vote of Security Holders .... 13
Item 5. Other Information .... 14
Item 6. Exhibits and Reports on Form 8-K .... 14
<TABLE>
INTRENET, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
March 31, 1999 and December 31, 1998
(In Thousands of Dollars)
<CAPTION>
Assets 1999 1998
(Unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 485 $ 271
Receivables, principally freight revenue less
allowance for doubtful accounts of $1,402 in 1999
and $1,537 in 1998 36,369 33,233
Prepaid expenses and other 7,103 5,402
Total current assets 43,957 38,906
Property and equipment, at cost, less accumulated
depreciation 27,416 28,833
Reorganization value in excess of amounts allocated to
identifiable assets, net of accumulated amortize 4,800 4,967
Deferred income taxes, net 2,886 2,886
Other assets 2,496 2,208
Total assets $ 81,555 $ 77,800
Liabilities and Shareholders' Equity
Current liabilities:
Current debt and capital lease obligations $ 5,429 $ 5,789
Accounts payable and cash overdrafts 9,865 9,439
Current accrued claim liabilities 8,554 7,878
Other accrued expenses 6,443 7,418
Total current liabilities 30,291 30,524
Long-term debt and capital lease obligations 23,835 20,105
Long-term accrued claim liabilities 2,800 2,800
Total liabilities 56,926 53,429
Shareholders' equity:
Common stock, without par value; 20,000,000
shares authorized; 13,674,066 and 13,662,066 shares
issued and outstanding, respectively 16,881 16,856
Retained earnings since January 1, 1991 7,748 7,515
Total shareholders' equity 24,629 24,371
Total liabilities and shareholders' equity $ 81,555 $ 77,800
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
<TABLE>
INTRENET, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
Three Months Ended March 31, 1999 and 1998
(Unaudited)
(In Thousands of Dollars, Except Per Share Data)
<CAPTION>
1999 1998
<S> <C> <C>
Operating revenues $ 66,316 $ 60,676
Operating expenses:
Purchased transportation
and equipment rents 30,333 27,237
Salaries, wages, and benefits 16,890 14,464
Fuel and other operating expenses 11,730 11,199
Operating taxes and licenses 2,524 2,514
Insurance and claims 1,756 1,971
Depreciation 982 987
Other operating expenses 1,004 1,020
65,219 59,392
Operating income 1,097 1,284
Interest expense (619) (660)
Other expense, net (105) (105)
Earnings before income taxes 373 519
Provision for income taxes (140) (131)
Net earnings $ 233 $ 388
Earnings per common and common
equivalent share
Basic $ 0.02 $ 0.03
Diluted $ 0.02 $ 0.03
Weighted average shares outstanding during period 13,669,244 13,549,221
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
<TABLE>
INTRENET, INC. AND SUBSIDIARIES
Condensed Consolidated Statement of Shareholders' Equity
For the Three Months Ended March 31, 1999
(In Thousands of Dollars)
<CAPTION>
Retained Shareholders'
Common Stock Earnings Equity
Shares Dollars
<S> <C> <C> <C> <C>
Balance, December 31, 1998 13,662,066 $ 16,856 $ 7,515 $ 24,371
Exercise of stock options 12,000 25 - 25
Net earnings for 1999 - - 233 233
Balance, March 31, 1999 13,674,066 $ 16,881 $ 7,748 $ 24,629
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
<TABLE>
INTRENET, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
Three Months Ended March 31, 1999 and 1998
(Unaudited)
(In Thousands of Dollars)
<CAPTION>
1999 1998
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 233 $ 388
Adjustments to reconcile net earnings
to net cash provided by operating activities:
Deferred income taxes 61 131
Depreciation and amortization 1,094 1,107
Provision for doubtful accounts 106 59
Changes in assets and liabilities, net:
Receivables (3,242) (6)
Prepaid expenses (1,701) (2,140)
Accounts payable and accrued expenses (162) 1,035
Net cash provided by (used in)
operating activities (3,611) 574
Cash flows from financing activities:
Net borrowings (repayments) on line of
credit, net 4,251 619
Principal payments on long-term debt (879) (972)
Proceeds from exercise of stock options 25 5
Net cash provided by (used in)
financing activities 3,397 (348)
Cash flows from investing activities:
Additions to property and equipment (948) (89)
Disposals of property and equipment 1,376 78
Net cash (used in)
investing activities 428 (11)
Net increase in cash
and cash equivalents 214 215
Cash and cash equivalents:
Beginning of period 271 598
End of period $ 485 $ 813
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
INTRENET, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
March 31, 1999
(Unaudited)
(1) Unaudited Condensed Consolidated Financial Statements
The accompanying unaudited Condensed Consolidated Financial Statements
include the accounts of Intrenet, Inc. and all of its
subsidiaries (collectively, the "Company"). Truckload carrier
subsidiaries at March 31, 1999, were Roadrunner Trucking, Inc.
(RRT), Eck Miller Transportation Corporation (EMT), Advanced
Distribution System, Inc. (ADS), and Roadrunner Distribution
Services, Inc. (RDS). Also included is the Company's intermodal
broker and logistics manager, INET Logistics, Inc. (INL). All
significant intercompany transactions are eliminated in
consolidation. Through its subsidiaries, the Company provides
general and specialized regional truckload carrier, brokerage
and logistics management services throughout North America.
The condensed consolidated financial statements included herein have
been prepared pursuant to the rules and regulations of the Securities
and Exchange Commission (SEC). In management's opinion, these
financial statements include all adjustments (consisting only of
normal recurring adjustments) necessary for a fair presentation
of the results of operations for the interim periods presented.
Pursuant to SEC rules and regulations, certain information and
footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting
principles have been condensed or omitted from these statements
unless significant changes have taken place since the end of the
most recent fiscal year. For this reason, the accompanying
Consolidated Financial Statements and Notes thereto should be
read in conjunction with the financial statements and notes for
the year ended December 31, 1998, included in the Company's 1998
Annual Report on Form 10-K.
The results for the three month period ended March 31, 1999,
are not necessarily indicative of the results to be expected for
the entire year.
(2) Earnings Per Common and Common Equivalent Share
Earnings per common and common equivalent share have been
computed on the basis of the weighted average common shares
outstanding during the periods. The Company has adopted the
Financial Accounting Standard Board issue of SFAS No. 128,
"Earnings Per Share", and restated its computation of EPS for
all prior periods. The adoption of this new standard resulted
in an immaterial difference in its computation of basic and
diluted EPS.
(3) Income Taxes
Income taxes in interim periods are generally provided on the
basis of the estimated effective tax rate for the year.
(4) Contingent Liabilities
On June 13, 1997, the Company received notice from the Central
States Southeast and Southwest Areas Pension Fund (the "Fund")
of a claim pursuant to the Employee Retirement Income Security
Act of 1974, as amended by the Multi-employer Pension Plan
Amendments Act of 1980 ("MPPAA"). MPPAA provides that, if an
employer withdraws from participation in a multi-employer
pension plan, such as the Fund, the employer and members of the
employer's "controlled group" of businesses are jointly and
severally liable for a portion of the plan's underfunding. The
claim is based on the withdrawal of R-W Service System, Inc.
("RW") from the Fund in 1992. The Company's records indicate
that RW was an indirect subsidiary of the Company's predecessor,
Circle Express, Inc., from March 1985 through April 1988, when
it and certain other subsidiaries were sold. The Fund currently
claims that RW's withdrawal liability is approximately $3.7
million plus accrued interest in the amount of approximately
$1.7 million. Based on its investigation to date, and, after
consultation with counsel, management believes that the Company
is not liable to the Fund for any of RW's withdrawal liability.
The Company has filed a formal request for review of the claim
as provided by the MPPAA and the Fund rejected that request on
January 28, 1998. The Company is in the process of seeking
resolution of the claim in binding arbitration. The Company is
obligated to make interim payments to the Fund until the issue
of liability is resolved. The interim payment obligation is
currently approximately $88,500 per month. The Company has made
payments to the Fund that total approximately $1,855,000 as of
March 31, 1999, which are included in other assets on the
Company's balance sheet. There can be no assurance that either
the need to make interim payments to the Fund or the ultimate
resolution of this matter will not have a material adverse
effect on the Company's liquidity, results of operations or
financial condition.
The Company's subsidiary, RDS, is a defendant in an action
brought on March 20, 1997, in the 327th District Court, El Paso,
Texas, by a former employee. The plaintiff alleged that he was
injured as a result of the negligence and gross negligence of
RDS and received discriminatory treatment in violation of the
Texas Health and Safety Code. On March 13, 1998, a default
judgment was entered against RDS in the approximate amount of
$1.0 million, representing damages for medical expenses, loss of
wage earning capacity, physical pain and mental anguish,
physical impairment, disfigurement and punitive damages. RDS
has filed an appeal to the 8th Circuit Court of Appeals in El
Paso, Texas, which is currently pending. In its appeal, RDS
asserted it was never properly served in the action and that
there was insufficient basis to support an award of punitive
damages. RDS has notified its workers' compensation carrier of
the award. Management believes that RDS is likely to prevail on
its appeal and therefore, this action should not have a material
adverse effect on the Company's liquidity, results of operations
or financial condition.
There are no other material pending legal proceedings to which
the Company or any of its subsidiaries is a party or of which
any of their property is the subject, other than routine
litigation incidental to its business, primarily involving
claims for personal injury and property damage incurred in the
transportation of freight. The Company maintains insurance
which covers liability resulting from such transportation
related claims in amounts customary for the industry and which
management believes to be adequate.
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations
Results of Operations
Introduction
The following discussion should be read in conjunction with the
Condensed Consolidated Financial Statements and Notes thereto
appearing elsewhere in this report. Certain statements made in
this report relating to trends in the Company's business, as
well as other statements including words such as "believe",
"expect", "estimate", "anticipate" and similar expressions,
constitute forward looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. For a
description of risks and uncertainties relating to forward
looking statements, see the discussion in the Company's Annual
Report on Form 10-K for the year ended December 31, 1998.
The Company reported net earnings of $233,000 on revenues of
$66.3 million in the three month period ended March 31, 1999.
This compares with a net earnings of $388,000 on revenues of
$60.7 million in the comparable period of 1998. The Company's
revenue grew by 9.2 percent compared to the first quarter of
1998 and three of its four largest wholly owned subsidiaries,
EMT, RRT and RDS, reported revenue improvements. Average fuel
prices were lower during the first quarter of 1999 than the
first quarter of 1998, despite the rise in price during the
latter weeks of March, 1999. Despite the increase in revenues
and the benefit of lower fuel prices, the Company's operating
margin deteriorated as a result of higher driver wages, more
unmanned tractors and poorer tractor utilization. Barring any
unforeseen changes in the overall economy and despite the rise
in fuel prices, management expects the Company will benefit from
continuing cost reduction programs in the areas of safety, fuel
purchasing and insurance costs. In addition, management expects
that the Company will experience growth in revenue from better
equipment utilization and an expanded fleet. As a result,
management expects the Company will continue to operate
profitably in 1999.
The Company reported revenue miles for the first quarter of
1999, of 41.1 million miles, up 3.0% from the same quarter of
1998. Revenue per mile in the first quarter of 1999, improved
by 2.2 percent to $1.38 per mile, up from $1.35 compared to
first quarter 1998, results. The average length of haul for
company-owned tractors was 14% lower in 1999, which was
attributable to the inception of a regional haul operation at
RRT and container movements at EMT. The average length of haul
for the owner-operator fleet remained the same.
Intrenet's total operating fleet as of the end of the quarter,
including owner-operators, increased approximately 3.6 percent
during the first quarter of 1999, to 2,283 tractors from 2,203
tractors in 1998.
A discussion of the impact of the above and other factors on
the results of operations in the three months ended March 31,
1999, as compared to the comparable period of 1998 follows.
1999 Compared to 1998
Three Months Ended March 31,
Key Operating Statistics 1999 1998 %Change
Operating Revenues ($ millions) $ 66.3 $ 60.7 9.2%
Net Earnings ($ 000's) $ 233 $ 388 (40.0%)
Average Number of Tractors 2,308 2,198 5.0%
Total Loads (000's) 92.0 83.8 9.8%
Revenue Miles (millions) 41.1 40.0 3.0%
Average Revenue per Revenue Mile* $ 1.38 $ 1.35 2.2%
* Excluding brokerage revenue
Operating Revenues
Operating revenues for the three months ended March 31, 1999,
totaled $66.3 million as compared to $60.7 million for the same
period in 1998, reflecting better freight availability than the
prior year. Company owned tractor revenues increased 8.6%, or
$2.7 million, and the freight revenue brokered to others
increase by over 39.0%, or $2.7 million. Approximately $1.2
million of the growth in freight revenue brokered to others was
generated as a result of the June, 1998, acquisition of the
assets of Ram Trans, a Denver based flatbed and logistics
company. Revenues generated by owner operators increased over
$200,000, or 1.1% over the same period in 1998. The average
number of tractors increased by 5.0% in the first quarter 1999,
over 1998, as a result of 110 (2,308 versus 2,198), additional
operating tractors. The average Company operated fleet increased
by 164 tractors while the owner operator average fleet declined
by 54 tractors. Approximately 51% of the Company's revenue for
three months ending March 31, 1999, was generated from
company-owned equipment, while 35% was generated by
owner-operator equipment and 14% by freight revenue brokered to
others. In 1998, the company-owned equipment provided
approximately 51% of total revenue while the owner-operator
equipment registered 38% with the balance attributable to
freight revenue brokered to others.
The Company experienced a 2.2% improvement in the average
revenue per revenue mile in 1999 as compared to 1998.
Operating Expenses
The following table sets forth the percentage relationship of
operating expenses to operating revenues for the three months
ended March 31.
Three Months Ended March 31,
1999 1998
Operating revenues 100% 100%
Operating expenses:
Purchased transportation
and equipment rents 45.7 44.9
Salaries, wages and benefits 25.4 23.8
Fuel and other operating expenses 17.7 18.5
Operating taxes and licenses 3.8 4.1
Insurance and claims 2.7 3.3
Depreciation 1.5 1.6
Other operating expenses 1.5 1.7
Total operating expenses 98.3% 97.9%
Purchased transportation and equipment rents increased as a
percentage of revenue due to the Company's increase in brokerage
revenue activity and the use of operating leases for replacement
equipment as well as incremental Company equipment growth. The
Company uses operating leases almost exclusively as a means of
financing it's company fleet. If the same equipment were
purchased, the Company estimates that operating costs would be
lower by 1.4% of revenue and interest expense would increase by
a corresponding amount. Salaries, wages and benefits increased
as a percentage of revenue because of the proportional gain in
Company revenues and the carryover effect of driver wage
increases implemented in mid-1998. The percent of fuel and
operating expenses decreased slightly as a percent of revenue.
The average price per gallon of diesel fuel for the first
quarter of 1999, was approximately 13 cents lower than the same
period in 1998, but the Company used over 450,000 more gallons
in 1999 as a result of increased company-owned equipment
activity. Other operating supplies increased slightly due to
the increase in the number of company-owned units, over the 1998
level. Insurance and claims expense declined as a percent of
revenue in 1999, as a result of claim settlements offset
slightly by reserve provisions on two significant accidents.
Depreciation and other operating expenses decreased as a percent
of revenue in 1999, primarily due to the revenue growth in 1999.
The cost for these two items were relatively flat quarter over
quarter.
Interest Expense
Interest expense decreased in 1999, primarily as a result of
the approaching maturity of capital lease obligations and the
replacement equipment financed with operating leases. Interest
expense on bank borrowings were slightly higher in 1999 due to a
higher average borrowing base.
Provision for Income Taxes
The tax rate is lower than the expected statutory rate due to
the release of tax asset valuation reserves, offset by the
impact of state income taxes of $67,000.
Liquidity and Capital Resources
The Company generated $0.2 million in cash in the first three
months of 1999. As reflected in the accompanying Condensed
Consolidated Statement of Cash Flows, $3.6 million of cash was
used in operating activities as compared to $0.6 million
generated in the first quarter of 1998. Historically, the
Company's cash needs are greatest in the first quarter when the
plates and permits are purchased for the Company's fleet.
Borrowing under the Company's bank credit facility increased by
over $4.2 million primarily to fund principal payments on long
term debt, purchase plates and fund revenue growth.
The Company's day-to-day financing is provided by borrowings
under a bank credit facility. As of March 31, 1999, the credit
facility consists of a $5.0 million term loan, $1.3 million of
which is currently outstanding, with a final maturity of
December 31, 1999, and a $28.0 million revolving line of credit
which expires January 1, 2000. Quarterly principal payments of
$312,500 on the term loan are required. The line of credit
includes provisions for the issuance of stand-by letters of
credit which, as issued, reduce available borrowings under the
line of credit. Borrowings under the line of credit are limited
to amounts determined by a formula tied to the Company's
eligible accounts receivable and inventories, as defined in the
credit facility. Borrowings under the line of credit totaled
$13.9 million at March 31, 1999, and outstanding letters of
credit totaled $6.3 million at that date. The combination of
these two amounts totaled $20.2 million, leaving approximately
$5.6 million of borrowing capacity available at March 31, 1999.
On May 7, 1999, the Company's bank agreement was amended,
resulting in changes to maturity dates, term loan principal,
applicable interest rates and financial covenants. The maturity
of the revolving line of credit was extended to January 1, 2001.
The term loan changes resulted in a principal capacity
reduction from $5.0 million to $2.0 million and a maturity date
of December 31, 2000. The term loan principal capacity reduces
the entire credit facility to $35.0 million, from $38.0 million.
The new term loan agreement requires quarterly payments of
$100,000 starting July 1, 1999, with the final installment due
on December 31, 2000. The maturity date for the Capex Loan was
also extended to December 31, 2000. The interest rate margin on
all credit lines was reduced to 175 basis points over LIBOR,
from 250 basis points over LIBOR. The "Book Net Worth" covenant
for June 30, 1999, is amended to $23,500,000, plus cash proceeds
resulting from issuance of capital stock, then to $25,000,000,
plus cash proceeds resulting from issuance of capital stock at
December 31, 1999, and thereafter. The "Fixed Charge Coverage
Ratio" covenant is amended to 1.05 to 1.00 for periods beginning
January 1, 2000, and thereafter.
Management believes that cash generated from operations, and
cash available to the Company under the bank credit facility
will be sufficient to meet the Company's needs for the
foreseeable future.
Year 2000
The Company has assessed, and continues to assess, the
impact of the Year 2000 Issue on its reporting systems and
operations. The Year 2000 Issue exists because many computer
systems and applications currently use two-digit date fields to
designate a year. As the century date occurs, date sensitive
systems will recognize the year 2000 as 1900 or not at all.
This inability to recognize or properly treat the year 2000 may
cause our systems to process critical financial and operational
information incorrectly or may cause the system to discontinue
functioning altogether. One of the more significant Year 2000
issues faced by the Company is from its fully integrated
dispatch and equipment control systems, which are not Year 2000
compliant. As a result, the Company is updating and working
with the vendors of any products it is using to install new
models and/or modify all of its applications and computer
systems and, in particular, its dispatch and equipment control
system to insure that they will be Year 2000 compliant. All
programs are expected to be fully tested and problems resolved
by June 30, 1999. The Company does not expect the costs
associated with becoming Year 2000 compliant to be material.
The Company has incurred cost of approximately $40,000 to date,
and expects future costs to be less than $10,000 for a total
cost of $50,000. These costs are being charged to operations as
incurred. Management has not developed any contingency plan
regarding its dispatch and equipment control systems at this
time, but will develop one, if deemed necessary.
As part of the Company's comprehensive review, it is
continuing to verify the Year 2000 readiness of third parties
(vendors and customers) with whom the Company has material
relationships. At present, the Company is not able to determine
the effect on the Company's results of operations, liquidity,
and financial condition in the event the Company's material
vendors and customers are not Year 2000 compliant. The Company
will continue to monitor the progress of its material vendors
and customers and formulate a contingency plan when the Company
believes a material vendor or customer will not be compliant.
The estimated percentage of completion by June 30, 1999,
the date on which the Company believes it will complete its Year
2000 compliance efforts, and the expenses related to the
Company's Year 2000 compliance efforts are based on management's
best estimates, which are based on assumptions of future events,
including the availability of certain resources, third party
modification plans and other factors. There can be no
assurances that these results and estimates will be achieved,
and the actual results could materially differ from those
anticipated. Specific factors that might cause such material
differences include, but are not limited to, the availability of
personnel trained in this area and the ability to locate and
correct all relevant computer codes. In addition, there can be
no assurances that the systems or products of third parties on
which the Company relies will be timely converted or that a
failure by a third party, or a conversion that is incompatible
with the Company's systems, would not have a material adverse
effect on the Company.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
On June 13, 1997, the Company received notice from the Central
States Southeast and Southwest Areas Pension Fund (the "Fund")
of a claim pursuant to the Employee Retirement Income Security
Act of 1974, as amended by the Multi-employer Pension Plan
Amendments Act of 1980 ("MPPAA"). MPPAA provides that, if an
employer withdraws from participation in a multi-employer
pension plan, such as the Fund, the employer and members of the
employer's "controlled group" of businesses are jointly and
severally liable for a portion of the plan's underfunding. The
claim is based on the withdrawal of R-W Service System, Inc.
("RW") from the Fund in 1992. The Company's records indicate
that RW was an indirect subsidiary of the Company's predecessor,
Circle Express, Inc., from March 1985 through April 1988, when
it and certain other subsidiaries were sold. The Fund currently
claims that RW's withdrawal liability is approximately $3.7
million plus accrued interest in the amount of approximately
$1.7 million. Based on its investigation to date, and, after
consultation with counsel, management believes that the Company
is not liable to the Fund for any of RW's withdrawal liability.
The Company has filed a formal request for review of the claim
as provided by the MPPAA and the Fund rejected that request on
January 28, 1998. The Company is in the process of seeking
resolution of the claim in binding arbitration. The Company is
obligated to make interim payments to the Fund until the issue
of liability is resolved. The interim payment obligation is
currently approximately $88,500 per month. The Company has made
payments to the Fund that total approximately $1,855,000 as of
March 31, 1999, which are included in other assets on the
Company's balance sheet. There can be no assurance that either
the need to make interim payments to the Fund or the ultimate
resolution of this matter will not have a material adverse
effect on the Company's liquidity, results of operations or
financial condition.
The Company's subsidiary, RDS, is a defendant in an action
brought on March 20, 1997, in the 327th District Court, El Paso,
Texas, by a former employee. The plaintiff alleged that he was
injured as a result of the negligence and gross negligence of
RDS and received discriminatory treatment in violation of the
Texas Health and Safety Code. On March 13, 1998, a default
judgment was entered against RDS in the approximate amount of
$1.0 million, representing damages for medical expenses, loss of
wage earning capacity, physical pain and mental anguish,
physical impairment, disfigurement and punitive damages. RDS
has filed an appeal to the 8th Circuit Court of Appeals in El
Paso, Texas, which is currently pending. In its appeal, RDS
asserted it was never properly served in the action and that
there was insufficient basis to support an award of punitive
damages. RDS has notified its workers' compensation carrier of
the award. Management believes that RDS is likely to prevail on
its appeal and therefore, this action should not have a material
adverse effect on the Company's liquidity, results of operations
or financial condition.
There are no other material pending legal proceedings to which
the Company or any of its subsidiaries is a party or of which
any of their property is the subject, other than routine
litigation incidental to its business, primarily involving
claims for personal injury and property damage incurred in the
transporting of freight. The Company maintains insurance which
covers liability resulting from transportation related claims in
amounts management believes are prudent and consistent with
accepted industry practices, subject to deductibles for the
first $100,000 to $250,000 of exposure for each incident. The
Company is not aware of any claims or threatened claims that
might materially affect the Company's operating or financial
results.
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
Exhibit 3.2 - Amended By-laws of the Registrant
Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K
None
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
INTRENET, INC.
(Registrant)
May 14, 1999 /s/ John P. Delavan
John P. Delavan
President and Chief Executive Officer
/s/ Roger T. Burbage
Roger T. Burbage
Executive Vice-President and Chief Financial Officer
(Principal Financial and Accounting Officer)
BY-LAWS
OF
INTRENET, INC.
(As amended through March 8, 1998)
ARTICLE I
Meetings of Shareholders
Section1.1. Annual Meetings. Annual meetings of the
shareholders of the Corporation shall be held on the third
Wednesday of May of each year, at such hour and at such place
within or without the State of Indiana as shall be designated by
the Board of Directors. In the absence of designation, the
meeting shall be held at the principal office of the Corporation
at 11:00a.m. (local time). The Board of Directors may, by
resolution, change the date or time of such annual meeting. If
the day fixed for any annual meeting of shareholders shall fall
on a legal holiday, then such annual meeting shall be held on
the first following day that is not a legal holiday.
Section1.2. Special Meetings. Special meetings of the
shareholders of the Corporation may be called at any time by the
Board of Directors or the Chairman of the Board and shall be
called by the Board of Directors if the Secretary receives
written, dated and signed demands for a special meeting,
describing in reasonable detail the purpose or purposes for
which it is to be held, from the holders of shares representing
at least twenty-five percent (25%) of all votes entitled to be
cast on any issue proposed to be considered at the proposed
special meeting. If the Secretary receives one(1) or more
proper written demands for a special meeting of shareholders,
the Board of Directors may set a record date for determining
shareholders entitled to make such demand. The Board of
Directors or the Chairman of the Board, as the case may be,
calling a special meeting of shareholders shall set the date,
time and place of such meeting, which may be held within or
without the State of Indiana.
Section1.3. Notices. A written notice, stating the date,
time, and place of any meeting of the shareholders, and, in the
case of a special meeting, the purpose or purposes for which
such meeting is called, shall be delivered or mailed by the
Secretary of the Corporation, to each shareholder of record of
the Corporation entitled to notice of or to vote at such meeting
no fewer than ten(10) nor more than sixty(60) days before the
date of the meeting. In the event of a special meeting of
shareholders required to be called as the result of a demand
therefor made by shareholders, such notice shall be given no
later than the sixtieth (60th) day after the Corporation's
receipt of the demand requiring the meeting to be called.
Notice of shareholders' meetings, if mailed, shall be mailed,
postage prepaid, to each shareholder at his address shown in the
Corporation's current record of shareholders.
A shareholder or his proxy may at any time waive notice of a
meeting if the waiver is in writing and is delivered to the
Corporation for inclusion in the minutes or filing with the
Corporation's records. A shareholder's attendance at a meeting,
whether in person or by proxy, (a)waives objection to lack of
notice or defective notice of the meeting, unless the
shareholder or his proxy at the beginning of the meeting objects
to holding the meeting or transacting business at the meeting,
and (b)waives objection to consideration of a particular matter
at the meeting that is not within the purpose or purposes
described in the meeting notice, unless the shareholder or his
proxy objects to considering the matter when it is presented.
Each shareholder who has, in the manner above provided, waived
notice or objection to notice of a shareholders' meeting shall
be conclusively presumed to have been given due notice of such
meeting, including the purpose or purposes thereof.
If an annual or special shareholders' meeting is adjourned to
a different date, time, or place, notice need not be given of
the new date, time, or place if the new date, time, or place is
announced at the meeting before adjournment, unless a new record
date is or must be established for the adjourned meeting.
Section 1.4. Business of Shareholder Meetings. At an annual
meeting of the shareholders, only such business shall be
conducted as shall have 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 shareholder. For
business to be properly brought before an annual meeting by a
shareholder, the shareholder must have the legal right and
authority to make the proposal for consideration at the meeting
and the shareholder must have given timely notice thereof in
writing to the Secretary of the Corporation. To be timely, a
shareholder's notice must be delivered to or mailed and received
at the principal executive offices of the Corporation, not less
than sixty (60) days prior to the meeting; provided, however,
that in the event that less than seventy (70) days' notice or
prior public disclosure of the date of the meeting is given or
made to shareholders (which notice or public disclosure shall
include the date of the annual meeting specified in these
By-Laws, if such By-Laws have been filed with the Securities and
Exchange Commission and if the annual meeting is held on such
date), notice by the shareholder to be timely must be so
received not later than the close of business on the tenth
(10th) day of following the day on which such notice of the date
of the annual meeting was mailed or such public disclosure was
made. A shareholder's notice to the Secretary shall set forth
as to each matter the shareholder proposes to bring before the
annual meeting (a)a brief description of the business desired to
be brought before the annual meeting and the reasons for
conducting such business at the annual meeting, (b)the name and
record address of the shareholder proposing such business,
(c)the class and number of shares of the Corporation's capital
stock which are beneficially owned by the shareholder, and
(d)any material interest of the shareholder in such business.
Notwithstanding anything in these By-Laws to the contrary, no
business shall be conducted at an annual meeting except in
accordance with the procedures set forth in this Section1.4.
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 and in accordance with the
provisions of this Section1.4, and if he should so determine, he
shall so declare to the meeting and any such business not
properly brought before the meeting shall not be transacted. At
any special meeting of the shareholders, only such business
shall be conducted as shall have been specified in the notice of
meeting (or any supplement thereto) or otherwise properly
brought before the meeting by or at the direction of the Board
of Directors.
Section 1.5. Notice of Shareholder Nominees. Only persons
who are nominated in accordance with the procedures set forth in
this Section1.5 shall be eligible for election as Directors.
Nominations of persons for election to the Board of Directors
may be made at a meeting of shareholders by or at the direction
of the Board of Directors, by any nominating committee or
persons appointed by the Board of Directors or by any
shareholder of the Corporation entitled to vote for the election
of Directors at the meeting who complies with the notice
procedures set forth in this Section1.5. Such 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 shareholder's
notice shall be delivered to or mailed and received at the
principal executive offices of the Corporation not less than
sixty (60) days prior to the meeting; provided, however, that in
the event that less than seventy (70) days' notice or prior
public disclosure of the date of the meeting is given or made to
shareholders (which notice or public disclosure shall include
the date of the annual meeting specified in these By-Laws, if
such By-Laws have been filed with the Securities and Exchange
Commission and if the annual meeting is held on such date),
notice by the shareholders to be timely must be so received not
later than the close of business on the tenth (10th) day
following the day on which such notice of the date of the
meeting was mailed or such public disclosure was made. Such
shareholder's notice shall set forth (a)as to each person whom
the shareholder proposes to nominate for election or re-election
as a Director, (i)the name, age, business address and residence
address of such person, (ii)the principal occupation or
employment of such person, (iii)the class and number of shares
of the Corporation's capital stock which are beneficially owned
by such person and (iv)any other information relating to such
person that is required to be disclosed in solicitations of
proxies for election of Directors, or is otherwise required, in
each case pursuant to Regulation14A under the Securities
Exchange Act of 1934, as amended (including without limitation
such person's written consent to being named in the proxy
statement as a nominee and to servicing as a Director if
elected); and (b)as to the shareholder giving the notice (i)the
name and record address of such shareholder and (ii)the class
and number of shares of the Corporation's capital stock which
are beneficially owned by such shareholder. No person shall be
eligible for election as a Director of the Corporation unless
nominated in accordance with the procedures set forth in this
Section1.5. 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 By-Laws, and if he should so determine, he shall so
declare to the meeting and the defective nomination shall be
disregarded.
Section1.6. Voting. Except as otherwise provided by the
Indiana Business Corporation Law or the Corporation's Restated
Articles of Incorporation, each share of the capital stock of
any class of the Corporation that is outstanding at the record
date established for any annual or special meeting of
shareholders and is outstanding at the time of and represented
in person or by proxy at the annual or special meeting, shall
entitle the record holder thereof, or his proxy, to one(1) vote
on each matter voted on at the meeting.
Section1.7. Quorum. Unless the Corporation's Restated
Articles of Incorporation or the Indiana Business Corporation
Law provide otherwise, at all meetings of shareholders, a
majority of the votes entitled to be cast on a matter,
represented in person or by proxy, constitutes a quorum for
action on the matter. Action may be taken at a shareholders'
meeting only on matters with respect to which a quorum exists;
provided, however, that any meeting of shareholders, including
annual and special meetings and any adjournments thereof, may be
adjourned to a later date although less than a quorum is
present. Once a share is represented for any purpose at a
meeting, it is deemed present for quorum purposes for the
remainder of the meeting and for any adjournment of that meeting
unless a new record date is or must be set for that adjourned
meeting.
Section1.8. Vote Required To Take Action. If a quorum exists
as to a matter to be considered at a meeting of shareholders,
action on such matter (other than the election of Directors) is
approved if the votes properly cast favoring the action exceed
the votes properly cast opposing the action, except as the
Corporation's Restated Articles of Incorporation or the Indiana
Business Corporation Law require a greater number of affirmative
votes. Directors shall be elected by a plurality of the votes
properly cast.
Section1.9. Record Date. Only such persons shall be entitled
to notice of or to vote, in person or by proxy, at any
shareholders' meeting as shall appear as shareholders upon the
books of the Corporation as of such record date as the Board of
Directors shall determine, which date may not be earlier than
the date seventy(70) days immediately preceding the meeting. In
the absence of such determination, the record date shall be the
fiftieth (50th) day immediately preceding the date of such
meeting. Unless otherwise provided by the Board of Directors,
shareholders shall be determined as of the close of business on
the record date.
Section1.10. Proxies. A shareholder may vote his shares
either in person or by proxy. A shareholder may appoint a proxy
to vote or otherwise act for the shareholder (including
authorizing the proxy to receive, or to waive, notice of any
shareholders' meeting within the effective period of such proxy)
by signing an appointment form, either personally or by the
shareholders' attorney-in-fact. An appointment of a proxy is
effective when received by the Secretary or other officer or
agent authorized to tabulate votes and is effective for
eleven(11) months unless a longer period is expressly provided
in the appointment form. The proxy's authority may be limited
to a particular meeting or may be general and authorize the
proxy to represent the shareholder at any meeting of
shareholders held within the time provided in the appointment
form. Subject to the Indiana Business Corporation Law and to
any express limitation on the proxy's authority appearing on the
face of the appointment form, the Corporation is entitled to
accept the proxy's vote or other action as that of the
shareholder making the appointment.
Section1.11. Removal of Directors. Any or all of the members
of the Board of Directors may be removed, with or without cause,
only at a meeting of the shareholders called expressly for that
purpose, by a vote of the holders of shares representing a
majority of the votes then entitled to be cast at an election of
Directors.
ARTICLE II
Directors
Section2.1. Number and Terms. The business and affairs of
the Corporation shall be managed under the direction of a Board
of Directors consisting of up to nine (9) Directors. The exact
number of Directors may be determined from time to time by
resolution adopted by not less than a majority of the Directors
then in office. No reduction in the number of Directors shall
have the effect of shortening the term of office of any
incumbent Director. Each Director shall be elected for a term
of office to expire at the annual meeting of shareholders next
following his election.
Despite the expiration of a Director's term, the Director
shall continue to serve until his successor is elected and
qualified, or until the earlier of his death, resignation,
disqualification or removal, or until there is a decrease in the
number of Directors. Any vacancy occurring in the Board of
Directors, from whatever cause arising, shall be filled by
selection of a successor by a majority vote of the remaining
members of the Board of Directors (although less than a quorum);
provided, however, that if such vacancy or vacancies leave the
Board of Directors with no members or if the remaining members
of the Board are unable to agree upon a successor or determine
not to select a successor, such vacancy may be filled by a vote
of the shareholders at a special meeting called for that purpose
or at the next annual meeting of shareholders. The term of a
Director elected or selected to fill a vacancy shall expire at
the end of the term for which such Director's predecessor was
elected.
The Directors and each of them shall have no authority to bind
the Corporation except when acting as a Board.
Section2.2. Quorum and Vote Required To Take Action. A
majority of the whole Board of Directors shall be necessary to
constitute a quorum for the transaction of any business, except
the filling of vacancies. If a quorum is present when a vote is
taken, the affirmative vote of a majority of the Directors
present shall be the act of the Board of Directors, unless the
act of a greater number is required by the Indiana Business
Corporation Law, the Corporation's Restated Articles of
Incorporation or these By-Laws.
Section2.3. Annual and Regular Meetings. The Board of
Directors shall meet annually, without notice, immediately
following the annual meeting of the shareholders, for the
purpose of transacting such business as properly may come before
the meeting. Other regular meetings of the Board of Directors,
in addition to said annual meeting, shall be held on such dates,
at such times and at such places as shall be fixed by resolution
adopted by the Board of Directors and specified in a notice of
each such regular meeting, or otherwise communicated to the
Directors. The Board of Directors may at any time alter the
date for the next regular meeting of the Board of Directors.
Section2.4. Special Meetings. Special meetings of the Board
of Directors may be called by any member of the Board of
Directors upon not less than twenty-four (24) hours' notice
given to each Director of the date, time, and place of the
meeting, which notice need not specify the purpose or purposes
of the special meeting. Such notice may be communicated in
person (either in writing or orally), by telephone, telegraph,
teletype, or other form of wire or wireless communication, or by
mail, and shall be effective at the earlier of the time of its
receipt or, if mailed, five(5) days after its mailing. Notice
of any meeting of the Board may be waived in writing at any time
if the waiver is signed by the Director entitled to the notice
and is filed with the minutes or corporate records. A
Director's attendance at or participation in a meeting waives
any required notice to the Director of the meeting, unless the
Director at the beginning of the meeting (or promptly upon the
Director's arrival) objects to holding the meeting or
transacting business at the meeting and does not thereafter vote
for or assent to action taken at the meeting.
Section2.5. Written Consents. Any action required or
permitted to be taken at any meeting of the Board of Directors
may be taken without a meeting if the action is taken by all
members of the Board. The action must be evidenced by one(1) or
more written consents describing the action taken, signed by
each Director, and included in the minutes or filed with the
corporate records reflecting the action taken. Action taken
under this Section2.5 is effective when the last Director signs
the consent, unless the consent specifies a different prior or
subsequent effective date, in which cases the action is
effective on or as of the specified date. A consent signed
under this Section2.5 shall have the same effect as a unanimous
vote of all members of the Board and may be described as such in
any document.
Section2.6. Participation by Conference Telephone. The Board
of Directors may permit any or all Directors to participate in a
regular or special meeting by, or through the use of, any means
of communication, such as conference telephone, by which all
Directors participating may simultaneously hear each other
during the meeting. A Director participating in a meeting by
such means shall be deemed to be present in person at the
meeting.
Section2.7. Committees. (a)The Board of Directors may create
one(1) or more committees and appoint members of the Board of
Directors to serve on them, by resolution of the Board of
Directors adopted by a majority of all the Directors in office
when the resolution is adopted. Each committee may have one(1)
or more members, and all the members of a committee shall serve
at the pleasure of the Board of Directors.
(b) To the extent specified by the Board of Directors in the
resolution creating a committee, each committee may exercise all
of the authority of the Board of Directors; provided, however,
that a committee may not:
(1) Authorize dividends or other distributions, except a
committee may authorize or approve a reacquisition of shares if
done according to a formula or method prescribed by the Board of
Directors;
(2) Approve or propose to shareholders action that is required
to be approved by shareholders;
(3) Fill vacancies on the Board of Directors or on any of its
committees;
(4) Amend the Corporation's Restated Articles of Incorporation
under IC23-1-38-2;
(5) Adopt, amend, repeal, or waive provisions of these By-Laws;
or
(6) Approve a plan of merger not requiring shareholder approval.
(c) Except to the extent inconsistent with the resolutions
creating a committee, Sections2.1 through2.6 of these By-Laws,
which govern meetings, action without meetings, notice and
waiver of notice, quorum and voting requirements and telephone
participation in meetings of the Board of Directors, apply to
each committee and its members as well.
ARTICLE III
Officers
Section3.1. Designation, Selection and Terms. The officers
of the Corporation shall consist of the Chairman of the Board,
the President, the Vice President-Finance, the Treasurer, the
Secretary, and the Controller. The Board of Directors may also
elect other Vice Presidents, Assistant Secretaries, Assistant
Treasurers, Assistant Controllers, and such other officers or
assistant officers as it may from time to time determine by
resolution creating the office and defining the duties thereof.
In addition, the President may, by a certificate of appointment
creating the office and defining the duties thereof delivered to
the Secretary for inclusion with the corporate records, from
time to time create and appoint such assistant officers as they
deem desirable. The officers of the Corporation shall be
elected by the Board of Directors (or appointed by the President
as provided above) and need not be selected from among the
members of the Board of Directors, except for the Chairman of
the Board who shall be a member of the Board of Directors. Any
two(2) or more offices may be held by the same person. All
officers shall serve at the pleasure of the Board of Directors
and, with respect to officers appointed by the President, also
at the pleasure of such officer. The election or appointment of
an officer does not itself create contract rights.
Section3.2. Removal. The Board of Directors may remove any
officer at any time with or without cause. An officer appointed
by the President may also be removed at any time, with or
without cause, by such officer. Vacancies in such offices,
however occurring, may be filled by the Board of Directors at
any meeting of the Board of Directors (or by appointment by the
President, to the extent provided in Section3.1 of these
By-Laws).
Section3.3. Chairman of the Board. The Chairman of the Board
shall preside at all meetings of the shareholders and of the
Board of Directors if present and shall have such powers and
perform such duties as are assigned to him by the Board of
Directors.
Section3.4. President. The President shall be the chief
executive officer of the Corporation. Subject to the authority
of the Board of Directors, he shall formulate the major policies
to be pursued in the administration of the Corporation's
affairs. He shall study and make reports and recommendations to
the Board of Directors with respect to major problems and
activities of the Corporation and shall see that established
policies are carried out. The President shall, in the absence
or incapacity of the Chairman of the Board, perform all the
duties and functions and exercise the powers of the Chairman of
the Board.
Section 3.5. Executive Vice President. The Executive Vice
President shall have such powers and perform such duties as the
Board of Directors may, from time to time, prescribe and as the
President may, from time to time, delegate to him.
Section3.6. Vice President-Finance. The Vice
President-Finance shall be the chief financial officer of the
Corporation and shall perform all of the duties customary to
that office. He shall be responsible for all of the
Corporation's financial affairs, subject to the supervision and
direction of the President, and shall have and perform such
further powers and duties as the Board of Directors may, from
time to time, prescribe and as the President may, from time to
time, delegate to him.
Section3.7. Vice Presidents. Each Vice President shall have
such powers and perform such duties as the Board of Directors
may, from time to time, prescribe and as the President may, from
time to time, delegate to him.
Section3.8. Treasurer. The Treasurer shall perform all of
the duties customary to that office, including the duty of
supervising the keeping of the records of the receipts and
disbursements of the Corporation. He shall submit to the Board
of Directors at such times as the Board may require full
statements showing in detail the financial condition and affairs
of the Corporation. He shall also be responsible for causing
the Corporation to furnish financial statements to its
shareholders pursuant to IC23-1-53-1.
Section3.9. Assistant Treasurer. In the absence or inability
of the Treasurer, the Assistant Treasurer, if any, shall perform
only such duties as are specifically assigned to him, in
writing, by the Board of Directors, the President, the Vice
President-Finance, or the Treasurer.
Section3.10. Secretary. The Secretary shall be the custodian
of the books, papers, and records of the Corporation and of its
corporate seal, if any, and shall be responsible for seeing that
the Corporation maintains the records required by IC23-1-52-1
(other than accounting records) and that the Corporation files
with the Indiana Secretary of State the annual report required
by IC23-1-53-3. The Secretary shall be responsible for
preparing minutes of the meetings of the shareholders and of the
Board of Directors and for authenticating records of the
Corporation, and he shall perform all of the other duties usual
in the office of Secretary of a corporation.
Section3.11. Assistant Secretary. In the absence or
inability of the Secretary, the Assistant Secretary, if any,
shall perform only such duties as are provided herein or
specifically assigned to him, in writing, by the Board of
Directors, the President, or the Secretary.
Section3.12. Salary. The Board of Directors may, at its
discretion, from time to time, fix the salary of any officer by
resolution included in the minute book of the Corporation.
Section3.13. Vice Chairman of the Board. The Vice Chairman
of the Board shall preside at all meetings of the shareholders
and of the Board of Directors in the absence of the Chairman and
shall have such powers and perform such duties as are assigned
to him by the Board of Directors.
ARTICLE IV
Checks
All checks, drafts, or other orders for payment of money shall
be signed in the name of the Corporation by such officers or
persons as shall be designated from time to time by resolution
adopted by the Board of Directors and included in the minute
book of the Corporation; and in the absence of such designation,
such checks, drafts, or other orders for payment shall be signed
by the President, the Executive Vice President, the Vice
President-Finance, the Treasurer, or any of them.
ARTICLE V
Loans
Such of the officers of the Corporation as shall be designated
from time to time by resolution adopted by the Board of
Directors and included in the minute book of the Corporation
shall have the power, with such limitations thereon as may be
fixed by the Board of Directors, to borrow money in the
Corporation's behalf, to establish credit, to discount bills and
papers, to pledge collateral, and to execute such notes, bonds,
debentures, or other evidences of indebtedness, and such
mortgages, trust indentures, and other instruments in connection
therewith, as may be authorized from time to time by such Board
of Directors.
ARTICLE VI
Execution of Documents
The President or the Executive Vice President may, in the
Corporation's name, sign all deeds, leases, contracts, or
similar documents that may be authorized by the Board of
Directors unless otherwise directed by the Board of Directors or
otherwise provided herein or in the Corporation's Restated
Articles of Incorporation, or as otherwise required by law.
ARTICLE VII
Stock
Section7.1. Execution. Certificates for shares of the
capital stock of the Corporation shall be signed by the Chairman
of the Board or the President and by the Secretary and the seal
of the Corporation (or a facsimile thereof), if any, may be
thereto affixed. Where any such certificate is also signed by a
transfer agent or a registrar, or both, the signatures of the
officers of the Corporation may be facsimiles. The Corporation
may issue and deliver any such certificate notwithstanding that
any such officer who shall have signed, or whose facsimile
signature shall have been imprinted on, such certificate shall
have ceased to be such officer.
Section7.2. Contents. Each certificate issued after the
adoption of these By-Laws shall state on its face the name of
the Corporation and that it is organized under the laws of the
State of Indiana, the name of the person to whom it is issued,
and the number and class of shares and the designation of the
series, if any, the certificate represents, and shall state
conspicuously on its front or back that the Corporation will
furnish the shareholder, upon his written request and without
charge, a summary of the designations, relative rights,
preferences, and limitations applicable to each class and the
variations in rights, preferences, and limitations determined
for each series (and the authority of the Board of Directors to
determine variations for future series).
Section7.3. Transfers. Except as otherwise provided by law
or by resolution of the Board of Directors, transfers of shares
of the capital stock of the Corporation shall be made only on
the books of the Corporation by the holder thereof, in person or
by duly authorized attorney, on payment of all taxes thereon and
surrender for cancellation of the certificate or certificates
for such shares (except as hereinafter provided in the case of
loss, destruction, or mutilation of certificates) properly
endorsed by the holder thereof or accompanied by the proper
evidence of succession, assignment, or authority to transfer,
and delivered to the Secretary or an Assistant Secretary.
Section7.4. Stock Transfer Records. There shall be entered
upon the stock records of the Corporation the number of each
certificate issued, the name and address of the registered
holder of such certificate, the number, kind, and class of
shares represented by such certificate, the date of issue,
whether the shares are originally issued or transferred, the
registered holder from whom transferred, and such other
information as is commonly required to be shown by such records.
The stock records of the Corporation shall be kept at its
principal office, unless the Corporation appoints a transfer
agent or registrar, in which case the Corporation shall keep at
its principal office a complete and accurate shareholders' list
giving the names and addresses of all shareholders and the
number and class of shares held by each. If a transfer agent is
appointed by the Corporation, shareholders shall give written
notice of any changes in their addresses from time to time to
the transfer agent.
Section7.5. Transfer Agents and Registrars. The Board of
Directors may appoint one or more transfer agents and one or
more registrars and may require each stock certificate to bear
the signature of either or both.
Section7.6. Loss, Destruction, or Mutilation of Certificates.
The holder of any of the capital stock of the Corporation shall
immediately notify the Corporation of any loss, destruction, or
mutilation of the certificate therefor, and the Board of
Directors may, in its discretion, cause to be issued to him a
new certificate or certificates of stock, upon the surrender of
the mutilated certificate, or, in the case of loss or
destruction, upon satisfactory proof of such loss or
destruction. The Board of Directors may, in its discretion,
require the holder of the lost or destroyed certificate or his
legal representative to give the Corporation a bond in such sum
and in such form, and with such surety or sureties as it may
direct, to indemnify the Corporation, its transfer agents, and
registrars, if any, against any claim that may be made against
them or any of them with respect to the capital stock
represented by the certificate or certificates alleged to have
been lost or destroyed, but the Board of Directors may, in its
discretion, refuse to issue a new certificate or certificates,
save upon the order of a court having jurisdiction in such
matters.
Section7.7. Form of Certificates. The form of the
certificates for shares of the capital stock of the Corporation
shall conform to the requirements of Section7.2 of these By-Laws
and be in such printed form as shall from time to time be
approved by resolution of the Board of Directors.
ARTICLE VIII
Seal
The corporate seal of the Corporation shall, if the
Corporation elects to have one, be in the form of a disc, with
the name of the Corporation and "INDIANA" on the periphery
thereof and the word "SEAL" in the center.
ARTICLE IX
Miscellaneous
Section9.1. Indiana Business Corporation Law. The provisions
of the Indiana Business Corporation law, as amended, applicable
to all matters relevant to, but not specifically covered by,
these By-Laws are hereby, by reference, incorporated in and made
a part of these By-Laws.
Section9.2. Fiscal Year. The fiscal year of the Corporation
shall end of the 31st of December of each year.
Section9.3. Amendments. These By-Laws may be rescinded,
changed, or amended, and provisions hereof may be waived, at any
meeting of the Board of Directors by the affirmative vote of a
majority of the entire number of Directors at the time, except
as otherwise required by the Corporation's Restated Articles of
Incorporation or by the Indiana Business Corporation Law.
Section9.4. Control Share Acquisition Statute. The
provisions of IC23-1-42 shall not apply to any acquisition of
the power to direct the exercise of voting power of shares of
the common stock of the Corporation resulting from the
execution, operation or amendment of the proposed agreement to
be entered among the Corporation and certain shareholders of the
Corporation in the form reviewed by the Board of Directors on
March 8, 1999.
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