As filed with the Securities and Exchange Commission on December 10, 1996.
Registration No. 33-________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
WATSON WYATT & COMPANY
(Exact name of registrant as specified in its charter)
Delaware 53-018291
(State or other Jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6707 Democracy Boulevard, Suite 800
Bethesda, Maryland 20817-1129
(Address of principal executive office, including zip code)
The Wyatt Stock Purchase Plan
(Full title of the plan)
Walter W. Bardenwerper
Vice President, General Counsel and Secretary
Watson Wyatt & Company
601 13th Street, N.W., Suite 900
Washington, D.C. 20005
(202) 624-0600
(Name, address, and telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
Title of Amount Proposed Maximum Proposed Amount
Securitie to be Price Maximum of
to be Registered Registered Offering Aggregate Registration
Per Share Offering Fee
Price
Common Stock 3,700,000 1 $4.94 $18,278,000 $6,302.76
Pursuant to Rule 429 under the Securities Act of 1933, this Registration
Statement also relates to the registrant's Form S-8 Registration Statement (No.
33-300110) filed on January 5, 1996.
1 Registration fee is being paid for 3,700,000 shares currently being
registered hereunder. A registration fee has previously been paid as to
2,200,000 shares, 641,486 shares of which this registration statement relates to
pursuant to Rule 429 under the Securities Act of 1933. The amount of the filing
fee previously paid associated with the securities being carried forward was
$997.62.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Registrant's prior registration statement on Form S-8 (File No. 33-300110),
filed on January 5, 1996, is hereby incorporated herein by this reference.
Item 5. Interests of Named Experts and Counsel
The shares of Common Stock that may be held under the Plan will be original
issuance shares. The legality of the shares of Common Stock of the Company will
be passed upon for the Company by Walter W. Bardenwerper, Esq., General Counsel
of the Company. Mr. Bardenwerper owns 91,936 shares of Common Stock and is
eligible to purchase shares of Common Stock offered hereby.
Item 8. Exhibits.
Exhibit No.
4 Restated Bylaws of the Company
5 Opinion of Walter W. Bardenwerper, Esq.
23(a) Consent of Price Waterhouse LLP
23(b) Consent of Walter W. Bardenwerper (included in Exhibit No. 5)
24 Powers of Attorney (see signature page)
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Bethesda, Maryland, on this 5th day of December, 1996.
WATSON WYATT & COMPANY
By: /s/ A.W. Smith, Jr.
Name: A. W. Smith, Jr.
Title: President & Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each officer and director of Watson
Wyatt & Company whose signature follows constitutes and appoints Walter W.
Bardenwerper as such person's true and lawful attorney-in-fact and agent, with
full power of substitution and restitution, for such person and in such person's
name, place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) of and supplements to this Registration
Statement on Form S-8, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto such attorney-in-fact and agent full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in and about the premises to all intents and purposes and as fully as
such person might or could do in person, hereby ratifying and confirming all
that such attorney-in-fact and agent, or a substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below on December 5, 1996 by the following persons
in the capacities indicated.
Signature Title
/s/ A. W. Smith, Jr.
A. W. Smith, Jr. Director; President & Chief Executive Officer
/s/ Paul R. Daoust
Paul R. Daoust Director; Executive Vice
President & Chief Operating Officer
/s/ Barbara L. Landes
Barbara L. Landes Vice President, Finance, Chief Financial
Officer and Principal Accounting Officer
/s/ Walter W. Bardenwerper
Walter W. Bardenwerper Director
/s/ Charles A. Clemens
Charles A. Clemens Director
/s/ John J. Gabarro
John J. Gabarro Director
/s/ John J. Haley
John J. Haley Director
/s/ Gary T. Hallenbeck
Gary T. Hallenbeck Director
<PAGE>
/s/ Daniel B. Holmes
Daniel B. Holmes Director
/s/ Ira T. Kay
Ira T. Kay Director
/s/ Brian E. Kennedy
Brian E. Kennedy Director
/s/ Robert D. Masding
Robert D. Masding Director
R. Michael McCullough Director
/s/ John A. Steinbrunner
John A. Steinbrunner Director
/s/ A. Grahame Stott
A. Grahame Stott Director
/s/ Angela H. Watson
Angela H. Watson Director
<PAGE>
EXHIBIT INDEX
Exhibit No. Page No.
4 Restated Bylaws of the Company
5 Opinion of Walter W. Bardenwerper, Esq.
23(a) Consent of Price Waterhouse LLP
23(b) Consent of Walter W. Bardenwerper (included in Exhibit No. 5) -
24 Powers of Attorney (see signature page) -
EXHIBIT 4
Restated Bylaws of the Company
<PAGE>
Bylaws
`[GRAPHIC OMITTED]
RESTATED BYLAWS
(Includes Changes Approved through November 22, 1996)
* * * * * *
OFFICES
Section 1.1 Resident Agent. The President or Secretary of the Corporation may,
from time to time, select a resident agent for the Corporation in the State of
Delaware.
Section 1.2 Offices. The Corporation may have offices in such locations as the
Board of Directors may from time to time determine or the business of the
Corporation may require.
SHAREHOLDERS' MEETINGS
Section 2.1 Place of Meetings. All meetings of the shareholders other than the
annual meeting may be held at such place and time as shall be stated in the
notice of the meeting, or in a duly executed waiver of notice thereof.
Section 2.2 Annual Meetings. An annual meeting of shareholders shall be held in
each year on a business day in November to be determined by the Board of
Directors and set forth in the Notice of such meeting, in the place designated
in the notice of such meeting at such time of day as will be set forth in such
notice. At such annual meeting, the shareholders shall elect a Board of
Directors and transact such other business as may properly be brought before the
meeting.
Section 2.3 Shareholders' List. At least ten days before every election of
directors, a complete list of the shareholders entitled to vote at said election
arranged in alphabetical order, with the residence of each and the number of
voting shares held by each, shall be prepared by the Secretary. Such list shall
be open for said ten days to the examination of any shareholder during normal
business hours at the place where the election is to be held or at such other
place in the city where the election is to be held as is designated by the
Secretary and is specified in the notice for such meeting, and shall be produced
and kept at the time and place of election during the whole time thereof, and
subject to the inspection of any shareholder who may be present.
Section 2.4 Special Meetings. Special meetings of the shareholders, for any
purpose or purposes, unless otherwise prescribed by statute or by the Restated
Certificate of Incorporation, shall be called by the President or Secretary at
the request in writing of a majority of the Board of Directors, or at the
request in writing of shareholders owning ten percent (10%) of the entire
capital stock of the Corporation issued and outstanding and entitled to vote.
Such request shall state the purpose or purposes of the proposed meeting.
Section 2.5 Notice of Meetings. Written notice of a meeting of the shareholders,
stating the time and place and object thereof, shall be served upon or mailed to
each shareholder entitled to vote thereat at such address as appears on the
books of the Corporation at least 10 but not more than 60 days before the
meeting.
<PAGE>
Section 2.6 Quorum. The holders of a majority of the stock issued and
outstanding and entitled to vote thereat, present in person or represented by
proxy, shall be requisite and shall constitute a quorum at all meetings of the
shareholders for the transaction of business except as otherwise provided by
statute, by the Restated Certificate of Incorporation or by these Bylaws. In the
event that a separate vote by class of stock may be required at such meeting,
holders of the majority of each such class of stock issued and outstanding
entitled to vote thereat, present in person or represented by proxy, shall be
requisite and shall constitute a quorum. If, however, such quorum shall not be
present or represented at any meeting of the shareholders, the shareholders
entitled to vote thereat, present in person or represented by proxy, shall have
power to adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present or represented. Any
such adjourned meeting as to which there may be a new record date, or which has
been adjourned for more than 30 days, shall be subject to the notice
requirements as set forth in section 2.5 hereof. At such adjourned meeting at
which a quorum shall be present or represented any business may be transacted
which might have been transacted at the meeting as originally notified.
Section 2.7 Voting. When a quorum is present at any meeting, the vote of the
holders of stock representing a majority of the voting power present in person
or represented by proxy shall decide any question brought before such meeting,
unless the question is one upon which by express provision of the statutes or of
the Restated Certificate of Incorporation or of these Bylaws, a different vote
is required in which case such express provision shall govern and control the
decision of such question. Each shareholder shall have the number of votes for
each share of stock having voting power, registered in his name on the books of
the Corporation, as is provided for in the Restated Certificate of
Incorporation. Except where the transfer books of the Corporation shall have
been closed or a date shall have been fixed as a record date for the
determination of its shareholders entitled to vote, no share of stock shall be
voted on at any election of directors which shall have been transferred on the
books of the Corporation twenty days next preceding such election of directors.
Section 2.8 Proxies. At any meeting of the shareholders every shareholder having
the right to vote shall be entitled to vote in person, or by proxy appointed by
an instrument in writing subscribed by such shareholder and bearing a date not
more than three years prior to said meeting, unless said instrument provides for
a longer period.
Section 2.9. Majority Consent. Whenever the vote of shareholders at a meeting
thereof is required or permitted to be taken in connection with any corporate
action by any provisions of the statutes or of the Restated Certificate of
Incorporation or these Bylaws, the meeting and vote of shareholders may be
dispensed with, if the holders of the outstanding stock having not less than the
minimum number that would be necessary to authorize or take such action at a
meeting if such meeting were held, shall consent in writing to such corporate
action being taken.
DIRECTORS
Section 3.1 Number of Directors. The number of directors which shall constitute
the whole Board shall not be less than 7 nor more than 25, as determined by the
Board of Directors. The directors shall be elected at the Annual Meeting of
Shareholders, except as provided in Section 3.3, and each director elected shall
hold office until his successor is elected and qualified. Directors need not be
shareholders.
Section 3.2 Place of Meeting. Meetings of the Board of Directors shall be held
at such place either within or without the State of Delaware or by telephone
conference call as shall be specified in the respective notices or waivers of
notice of such meetings.
Section 3.3 Vacancies. If the office of any director or directors becomes vacant
by reason of death, resignation, retirement, disqualification, removal from
office, or otherwise, or a new directorship is created, a majority of the
remaining directors, though less than a quorum, may choose a successor or
successors, or a director to fill the newly created directorship, who shall hold
office for the unexpired term or until the next election of directors.
<PAGE>
Section 3.4 General Powers. The property and business of the Corporation shall
be managed by its Board of Directors which may exercise all such powers of the
Corporation and do all such lawful acts and things as are not by statute or by
the Restated Certificate of Incorporation or by these Bylaws directed or
required to be exercised or done by the shareholders. The Board of Directors may
exercise the hereinbefore described powers, and any duly constituted and
authorized committee of the Board of Directors may exercise such powers as have
been delegated to it by the Board of Directors, without a meeting by the
unanimous execution of an instrument in writing.
Section 3.5 Committees of Directors. The Board of Directors may, by resolution
or resolutions passed by a majority of the Board, designate one or more
committees, each committee to consist of two or more of the directors of the
Corporation which, only to the extent provided in said resolution or
resolutions, 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 have power
to authorize the seal of the Corporation to be affixed to all papers which may
require it. Such committee or committees shall have such name or names as may be
determined from time to time by resolution adopted by the Board of Directors.
Whenever a committee is authorized by the Board of Directors to exercise any
power of the Board of Directors, two-thirds of the members of such committee
shall constitute a quorum and the act of the total number of directors who shall
constitute a quorum shall be the act of the committee. Such Committees, when
required by the Board, shall keep regular minutes of their proceedings and
report the same to the Board.
Section 3.6 Compensation of Directors. Directors who are employees shall not
receive any stated salary for their services as directors, but, pursuant to
normal corporate expense reimbursement policies, shall receive reimbursement for
expenses of attendance at such meetings; provided that nothing herein contained
may be construed to preclude any Director from serving the Corporation in any
other capacity and receiving compensation therefore.
Section 3.7 Annual Meeting. The annual meeting of the Board of Directors shall
be held immediately following and at the same place as the annual meeting of the
shareholders, or at such time and place as may be specified or fixed by the
Board of Directors, the Chairman of the Board, the President or the Secretary in
the notice of such meeting or waiver thereof.
Section 3.8 Notices of Board of Directors Meetings; Special Meetings. Special
meetings of the Board of Directors may be held at any time on the call of the
Chairman of the Board or the President or at the request in writing of any six
(6) directors. Notice of any regular or special meeting, unless waived, shall be
given by mail or facsimile, telex, or courier to each director at his address as
the same appears on the records of the Corporation not less than one (1) day
prior to the day on which such meeting is to be held if such notice is by
facsimile, telex, or courier, and not less than five (5) business days prior to
the day on which the meeting is to be held if such notice is by mail. If the
Secretary shall fail or refuse to give such notice, then the notice may be given
by the officer or any one of the directors making the call. Any such meeting may
be held at such place as the Board may fix from time to time or as may be
specified or fixed in such notice or waiver thereof. Notice may be waived in
writing by any director, either before or after the meeting. Any meeting of the
Board of Directors shall be a legal meeting without any notice thereof having
been given, if all the directors shall be present thereat, and no notice of a
meeting shall be required to be given to any director who shall attend such
meeting.
Section 3.9 Quorum and Manner of Acting. Except as otherwise provided in these
Bylaws, a majority of the total number of directors shall constitute a quorum at
any regular or special meeting of the Board of Directors. Except as otherwise
provided by law or by the Restated Certificate of Incorporation as amended, or
by these Bylaws, the act of a majority of the directors present at any meeting
at which a quorum is present shall be the act of the Board of Directors. In the
absence of a quorum, a majority of the directors present may adjourn the meeting
from time to time until a quorum be had. Notice of any adjourned meeting need
not be given.
Section 3.10 Notices. Whenever under the provisions of the statutes or of the
Restated Certificate of Incorporation or of these Bylaws, notice is required to
be given to any director or shareholder, it shall not be construed to mean
personal notice, but such notice may be given in writing, by mail, by depositing
the same in a post office or letter box, in a post-paid sealed wrapper, or by
facsimile, telex or courier, addressed to such director or shareholder at such
address as appears on the books of the Corporation, or in default of other
address, to such director or shareholder at the General Post Office in the City
of Wilmington, Delaware, and such notice shall be deemed to be given at the time
when the same shall be thus mailed or sent by facsimile, telex or courier.
Section 3.11 Waivers of Notice. Whenever any notice is required to be given
under the provisions of the statutes or of the Restated Certificate of
Incorporation, or of these Bylaws, a waiver thereof in writing signed by the
person or persons entitled to said notice, whether before or after the time
stated therein, or such person's or persons' attendance at such meeting, unless
such attendance is for the express purpose of objecting, at the beginning of the
meeting, to the transaction of any business because the meeting is not lawfully
called or convened, shall be deemed equivalent thereto.
OFFICERS
Section 4.1 Executive Officers. The executive officers of the Corporation may
include a Chairman of the Board, and shall include a President, an Executive
Vice President, such Vice Presidents as the Board of Directors may designate to
be executive officers, a Vice President and Chief Financial Officer, a
Secretary, and a General Counsel. One person may hold any two of said offices
except the offices of President and Secretary or Chairman of the Board and
Secretary.
Section 4.2 Election, Term of Office and Eligibility. The executive officers of
the Corporation shall be elected annually by the Board of Directors at its
annual meeting or at a special meeting held in lieu thereof. Each officer,
except such officers as may be appointed in accordance with the provisions of
Section 4.3 shall hold office until his successor shall have been duly chosen
and qualified or until his death, resignation, retirement or removal. The
Chairman of the Board, the President, and the Executive Vice President shall be
and remain members of the Board of Directors. None of the other officers need be
members of the Board.
Section 4.3 Subordinate Officers, etc. The Board of Directors, or the President
of the Corporation if he is so empowered by resolution adopted by the Board of
Directors, may appoint such Assistant Vice Presidents, Assistant Secretaries,
Assistant Treasurers, and other Officers, such committees and such agents as the
Board, or the President may determine, to hold office for such period, and with
such authority and to perform such duties as the Board, or President may from
time to time determine. Unless otherwise specifically directed by the Board of
Directors, or the President, any committee appointed pursuant to this Section
4.3 may conduct its proceedings in such manner as its members shall determine,
including the taking of actions without a meeting by majority vote of its
members.
Section 4.4 Removal. Any Executive Officer may be removed at any time, either
with or without cause, but only by the affirmative vote of the majority of the
total number of directors serving at that time. Any subordinate officer
appointed pursuant to Section 4.3 may be removed at any time, either with or
without cause, by a majority vote of the directors present at any meeting of the
Board, or by the President if empowered so to do by resolution of the Board.
Section 4.5 Resignations. Any officer may resign at any time by giving written
notice to the Board of Directors or to the President or the Secretary of the
Corporation. Any such resignation shall take effect at the time specified
therein; and, unless otherwise specified therein, the acceptance of such
resignation shall not be necessary to make it effective.
Section 4.6 Vacancies. A vacancy in the office of President or Secretary for any
reason must be filled. A vacancy in any other office may be filled. Any vacancy
which is filled shall be filled for the unexpired portion of the term in the
same manner in which an officer to fill said office may be chosen pursuant to
Section 4.2 and/or Section 4.3.
Section 4.7 The Chairman of the Board. If a Chairman of the Board has been
elected, The Chairman of the Board shall preside at all meetings of the Board of
Directors and of the shareholders; he may sign with the Secretary or any other
proper officer of the Corporation thereunto authorized by the Board of
Directors, certificates for shares of the Corporation, any deeds, mortgages,
bonds, contracts, or other instruments which the Board of Directors has
authorized to be executed, except in cases where the signing and execution
thereof shall be expressly delegated by the Board of Directors or by these
Bylaws to some other officer or agent of the Corporation, or shall be required
by law to be otherwise signed or executed; and in general shall perform all
duties incident to the office of Chairman of the Board and such other duties as
from time to time may be assigned to him by the Board of Directors.
<PAGE>
Section 4.8 Office of the President.
(a)
The President. The President shall be the principal executive officer of the
Corporation and shall carry out the duties of the Chairman of the Board when no
incumbent holds such office or the Chairman of the Board is absent or when
otherwise requested by the Chairman of the Board to be responsible for any
duties of the Chairman of the Board; he shall have executive authority to see
that all orders, resolutions or other duly authorized decisions of the Board of
Directors or any duly authorized committee are carried into effect and, subject
to the control vested in the Board of Directors by statute, by the Restated
Certificate of Incorporation, as amended, or by these Bylaws, shall administer
and be responsible for the management of business and affairs of the
Corporation; he may sign with the Secretary or any other proper officer of the
Corporation thereunto authorized by the Board of Directors, certificates for
shares of the Corporation, any deeds, mortgages, bonds, contracts or other
instruments which the Board of Directors has authorized to be executed, except
in cases where signing and execution thereof shall be expressly delegated by the
Board of Directors or by these Bylaws to some other officer or agent of the
Corporation, or shall be required by law to be otherwise signed or executed; and
in general shall perform all duties incident to the office of President and such
other duties as from time to time may be assigned to him by the Board of
Directors or such duties as shall be in the normal and ordinary course of
business.
(b)
The Executive Vice President. In the event of the absence or disability
of the President, the Executive Vice President shall perform the duties
of the President. The Executive Vice President shall have principal
responsibility for the Corporation's consulting offices and practices
and shall also perform such other duties as from time to time may be
assigned to him by the Board of Directors or the President.
(c) The Chairman of the Board, if any, the President and the Executive Vice
President shall together constitute the Office of the President.
Section 4.9 The Vice Presidents. In the event of the absence or disability of
the President and the Executive Vice President, the Vice President who is also a
member of the Board of Directors and who has the longest continuous tenure on
the Board of Directors, or, if two or more such Vice Presidents and Directors
have equal tenure, such Vice President and Director who has the longest service
with the Corporation shall perform the duties of the President. The Vice
Presidents shall also perform such other duties as from time to time may be
assigned to them by the Board of Directors or the President.
Section 4.10 The Secretary. The Secretary shall:
(a) Keep the minutes of the meetings of the shareholders and of the
Board of Directors in books provided for that purpose;
(b) See that all notices are duly given in accordance with the
provisions of these Bylaws or as required by law;
(c) Be custodian of the records and of the seal of the Corporation and see
that the seal or a facsimile or equivalent thereof is affixed to or
impressed or reproduced on all stock certificates prior to their issue,
and on all documents the execution of which on behalf of the
Corporation under its seal is duly authorized;
(d) Have charge of the stock record books of the Corporation and keep or
cause to be kept the stock record and transfer books in such manner as
to show at any time the number of shares of each class of the capital
stock of the Corporation issued and outstanding, the names and
addresses of the holders of record thereof, and the number of shares
held by each; and exhibit or cause to be exhibited at all reasonable
times to any officer or director, upon application, the original or
duplicate stock ledger;
(e) See that the books, reports, statements, certificates, and all
other documents and records, required by law, are properly made, kept
and filed;
(f) In general, perform all duties incident to the office of Secretary, and
such other duties as are provided by these Bylaws and as from time to
time are assigned to him by the Board of Directors or by the Chairman
of the Board or by the President.
Section 4.11 The Treasurer. The Treasurer shall perform all the duties incident
to the office of Treasurer, and such other duties as from time to time may be
assigned to him by the Board of Directors, or by the Chairman of the Board, the
President or the Vice President and Chief Financial Officer.
Section 4.12 The Vice President and Chief Financial Officer. The Vice President
and Chief Financial Officer shall, under the direction of the Board of
Directors, the Chairman of the Board, the President, or the Executive Vice
President, be responsible for the management, coordination and administration of
the financial and accounting affairs of the Corporation and its subsidiaries
including providing advice to the Board of Directors, the President and the
executive officers of the Corporation on all financial matters. The Vice
President and Chief Financial Officer shall:
(a) Render to the Board of Directors at any meeting thereof, or from time
to time whenever the Board of Directors or the Chairman of the Board or
the President may require, an account of the financial condition of the
Corporation, and render or cause to be rendered a full financial report
at the annual meeting of the shareholders, if called upon so to do;
(b) have charge and custody of all funds and securities of the Corpora-
tion, except petty cash accounts;
(c) receive and give receipts for monies due and payable to the Corporation
from any source and deposit all the Corporation's monies in the name of
the Corporation in the institutions that are selected in accordance
with the provisions of these Bylaws; and
(d) in general, perform all of the duties as may be assigned to him
by the Board of Directors, the Chairman of the Board, the President
or the Executive Vice President.
Section 4.13 The Controller. The Controller shall maintain the fiscal records of
the Corporation. He shall advise the President, the Executive Vice President,
Treasurer, Vice President and Chief Financial Officer, the Board of Directors
and any audit committee thereof with respect to what, in his opinion, are proper
accounting procedures for the Corporation in light of its operating methods. He
shall be responsible for the maintenance of all financial records in accord with
the accounting procedures approved by the Board of Directors. The Controller
shall also serve as the principal assistant to the Vice President and Chief
Financial Officer in carrying out the latter's duties.
Section 4.14 The General Counsel. The General Counsel shall be the chief legal
officer of the Corporation and shall, under the direction of the Board of
Directors, the Chairman of the Board, or the President, be responsible for the
management, coordination and administration of the legal affairs of the
Corporation and its subsidiaries, including the prosecution and defense of legal
actions by and against the Corporation, shall provide advice to the Board of
Directors, the President, and the executive officers of the Corporation in all
legal matters and, in general, shall perform such duties as may be assigned to
him by the Board of Directors, the Chairman of the Board or the President.
Section 4.15 The Tax Director. The Tax Director shall report to the Vice
President and Chief Financial Officer or the Controller and shall be responsible
for the compliance with all tax laws by the Company and its affiliates, the
filing of tax returns, the management of tax audits and disputes and the
coordination of tax planning and compliance with the management of the Company
and its affiliates.
Section 4.16 Salaries. The salaries of the officers shall be fixed from time to
time by the Board of Directors, or by such officer or officers as are designated
to do so by the Board of Directors or, in the absence of any such designation,
by the President. No officer shall be prevented from receiving such salary by
reason of the fact that he is also a director of the Corporation.
Section 4.17 Bonds. If the Board of Directors shall so require, the Treasurer,
the Vice President and Chief Financial Officer, and any Assistant Treasurer
and/or any other officer or agent of the Corporation shall give bond to the
Corporation in such amount and with such surety as the Board of Directors may
deem sufficient, conditioned upon the faithful performance of their respective
duties and offices.
Section 4.18 Delegation of Duties. In case of the absence of any officer of the
Corporation or for any other reason which may seem sufficient to the Board, the
Board of Directors may, for the time being, delegate his powers and duties, or
any of them, to any other officer or to any director, provided that such
delegation shall be by a majority vote of the total number of directors.
SHARES OF STOCK
Section 5.1 Regulations. Subject to the terms of any contract of the Corporation
and Delaware Law, the Board of Directors may make such rules and regulations as
it may deem expedient concerning the issue, transfer, and registration of
certificates and uncertificated shares evidencing the ownership of shares of the
stock of the Corporation, including the issue of new certificates or the
registration on the Corporation's books of uncertificated shares, for lost or
destroyed certificates, and including the appointment of transfer agents and
registrars.
Section 5.2 Stock Certificates. Certificates for shares of stock of the
Corporation, if any, shall be respectively numbered serially for each class of
shares, or series thereof, as they are issued, shall be impressed with the
corporate seal or a facsimile thereof, and shall be signed by two officers of
the Corporation, one of whom shall be the Chairman of the Board, the President
or a Vice President, and the other of whom shall be the Secretary or Treasurer,
or an Assistant Secretary or an Assistant Treasurer, provided that such
signatures may be facsimiles. Each certificate shall exhibit the name of the
Corporation, the class (or series of any class) and the number of shares
represented thereby, the name of the holder, the par value of the shares
represented thereby or that such shares are without par value. Each certificate
shall be otherwise in such form as may be prescribed by the Board of Directors.
Subject to the requirements of Delaware law, the Corporation may (i) cancel
surrendered stock certificates as the respective shares are sold; and (ii) issue
uncertificated shares to evidence shares purchased.
Section 5.3 Transfer of Shares. The Corporation may from time to time enter into
an agreement or agreements with one or more of its shareholders restricting the
transferability of its stock in accord with the general corporate purpose to
have its stock owned by persons actively engaged in the corporate business.
Subject to the terms of any such agreement, shares of the capital stock of the
Corporation shall be transferable on the books of the Corporation by the holder
thereof in person or by his duly authorized attorney, upon (i) the surrender and
cancellation of a certificate or certificates for a like number of shares;
and/or (ii) upon registration on the books of the Corporation of the transfer of
the respective uncertificated shares and the transmittal to the new registered
owner, any former registered owner, and any applicable pledgee of a written
statement advising of such transfer (as required pursuant to Delaware law). As
against the Corporation a transfer of shares can be made only on the books of
the Corporation and in the manner hereinabove provided, and the Corporation
shall be entitled to treat the registered holder of any share as the owner
thereof and shall not be bound to recognize any equitable or other claim to or
interest in such share on the part of any other person, whether or not it shall
have express or other notice thereof, save as expressly provided by the statutes
of the State of Delaware. In the event shares of the Corporation are held by an
Employee Trust under Section 9.3, no transfer on the books of the Corporation
shall be made if said transfer would cause a violation of any provision of Title
I of the Employee Retirement Income Security Act of 1974 or the prohibited
transaction rules of Section 4975 of the Internal Revenue Code of 1986, as
amended.
Section 5.4 Date for Determination of Shareholders of Record. The Board of
Directors of the Corporation shall have the power to fix in advance a date as a
record date for the determination of shareholders entitled to notice of, and to
vote at, any meeting of shareholders of the Corporation, and any adjournment
thereof; or entitled to receive the payment of any dividend; or the date for the
allotment of rights, or the date when any rights in respect of any change or
conversion or exchange of capital stock of the Corporation shall go into effect
or in connection with obtaining the consent of shareholders for any purpose.
Notwithstanding the transfer of any stock on the books of the Corporation after
any such record date fixed as aforesaid, only such shareholders as shall be
shareholders as of such record date shall be entitled notice of, and to vote at,
such meeting and any adjournment thereof, to receive payment of such dividend,
or to receive such allotment of rights, or to exercise such rights, or to give
such consent, as the case may be. If the Board of Directors shall fail to
determine the record date for determining shareholders entitled to notice of,
and to vote at, any meeting of shareholders of the Corporation, such date shall
be established as provided by law.
Section 5.5 Lost Certificate. Any shareholder claiming that a certificate
representing shares of stock has been lost or destroyed may make an affidavit or
affirmation of that fact and if the Board of Directors so requires, advertise
the same in a manner designated by the Board, and give the Corporation a bond of
indemnity in form and with security for an amount satisfactory to the Board, but
not exceeding double the value of the shares represented by said certificate;
whereupon a new certificate may be issued of the same tenor (or a registration
may be made on the books of the Corporation evidencing the ownership of
uncertificated shares) representing the same number, class and/or series of
shares as were represented by the certificate alleged to have been lost or
destroyed.
BOOKS AND RECORDS
Section 6.1 Location. The books, accounts and records of the Corporation may be
kept at such place or places within or without the State of Delaware as the
Board of Directors may from time to time determine.
Section 6.2 Inspection. The books, accounts and records of the Corporation shall
be open to inspection by any member of the Board of Directors at all times; and
shall be open to inspection by the shareholders at such times, for proper
purposes, subject to regulations as the Board of Directors may prescribe, except
as otherwise provided by statute.
Section 6.3 Corporate Seal. The corporate seal shall contain two concentric
circles between which shall be the name of the Corporation and the word
"Delaware" and in the center shall be inscribed the words "Corporate Seal" and
the year in which the original Certificate of Incorporation was issued.
DIVIDENDS AND RESERVES
Section 7.1 Dividends. Subject to the provisions of the Restated Certificate of
Incorporation, as amended, and other lawful commitments of the Corporation,
dividends upon the shares of any class of stock, or series thereof, of the
Corporation may be declared by the Board of Directors out of the net assets of
the Corporation in excess of its capital or out of its net profits at any
regular or special meeting of the Board of Directors.
Section 7.2 Reserves. Before declaring any dividend or making any distribution
of net assets in excess of capital or any distribution of net profits, the Board
of Directors, from time to time in their absolute discretion, may set apart, out
of any funds of the Corporation available for dividends, a reserve or reserves
for working capital, or to meet contingencies, or for repairs or maintenance, or
for any other lawful purpose, and also, from time to time, may abolish or
decrease any such reserve or reserves.
MISCELLANEOUS PROVISION
Section 8.1 Fiscal Year. The fiscal year of the Corporation shall end on June
30th of each year.
<PAGE>
Section 8.2 Depositories. The Board of Directors, the Chairman of the Board, the
President, the Treasurer, the Vice President and Chief Financial Officer and the
Controller, and each of them, may designate the banks, trust companies, or other
depositories in which shall be deposited from time to time, the money or
securities of the Corporation. In the case of a designation by the
aforementioned officers, any such designation shall require the approval of two
of such officers, one of whom shall be the Treasurer or the Vice President and
Chief Financial Officer.
Section 8.3 Checks, Drafts, Notes, etc. All checks, drafts or other orders for
the payment of money and all notes or other evidences of indebtedness issued in
the name of the Corporation shall be signed by such officer or officers or agent
or agents as shall from time to time be designated by the Board of Directors or
as shall be designated by any two of the Chairman of the Board, the President,
the Treasurer or the Vice President and Chief Financial Officer in writing.
Section 8.4 Contracts, etc., How Executed. Except as in the Bylaws otherwise
provide, the Board of Directors may authorize any officer, agent or agents, to
enter into any contract or execute and deliver any instrument in the name and on
behalf of the Corporation, and such authority may be general or confined to
specific instances.
Section 8.5 Stock in Other Corporations. Any shares of stock in any other
corporation which may from time to time be held by the Corporation may be
represented and voted at any meeting of shareholders of such other corporation
by the President, the Treasurer or the Secretary of the Corporation or by any
other person or persons thereunto authorized by Board of Directors or designated
by the President, or by any proxy designated by written instrument of
appointment executed in the name of this Corporation by its President or by such
officers as may be designated by him and attested by the Secretary or Assistant
Secretary. Shares of stock held by the Corporation for investment purposes only
may be voted by the Vice President and Chief Financial Officer or by any proxy
designated by written instrument of appointment executed in the name of the
Corporation by the Vice President and Chief Financial Officer and attested by
the Secretary or an Assistant Secretary. Shares of stock belonging to the
Corporation need not stand in the name of the Corporation, but may be held for
the benefit of the Corporation in the individual name of the Treasurer or of any
other nominee designated for the purpose by the Board of Directors. Certificates
for shares so held for the benefit of the Corporation shall be endorsed in blank
or have proper stock powers attached so that said certificates are at all times
in due form for transfer, and shall be held for safekeeping in such manner as
shall be determined from time to time by the Board of Directors.
Section 8.6 Indemnification.
(a)
Each person who was or is a party or is threatened to be made a party to or is
involved in any action, suit or proceeding, whether civil, criminal,
administrative or investigative (hereinafter a "proceeding"), by reason of the
fact that he, or a person of whom he is the legal representative, is or was a
director or officer of the Corporation or is or was a director or officer
serving at the request of the Corporation as a director, officer, employee or
agent of another Corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to employee benefit plans, shall be
indemnified and held harmless by the Corporation to the fullest extent
authorized by the laws of Delaware as the same now or may hereafter exist (but,
in the case of any change, only to the extent that such change authorizes the
Corporation to provide broader indemnification rights than said law permitted
the Corporation to provide prior to such change) against all costs, charges,
expenses, liabilities and losses (including attorneys' fees, judgments, fines,
ERISA excise taxes or penalties and amounts paid or to be paid in settlement)
reasonably incurred or suffered by such person in connection therewith and such
indemnification shall continue as to a person who has ceased to be a director or
officer and shall inure to the benefit of his heirs, executors and
administrators. The right to indemnification conferred in this Section shall be
a contract right and shall include the right to be paid by the Corporation the
expenses incurred in defending any such proceeding in advance of its final
disposition upon receipt by the Corporation of an undertaking, by or on behalf
of such director or officer, to repay all amounts so advanced if it shall
ultimately be determined that the director or officer is not entitled to be
indemnified under this Section or otherwise. The Corporation may, by action of
its Board of Directors, provide indemnification to employees and agents of the
Corporation with the same scope and effect as the foregoing indemnification of
directors and officers.
<PAGE>
(b)
If a claim under subsection (a) of this Section is not paid in full by the
Corporation within thirty days after a written claim has been received by the
Corporation the claimant may at any time thereafter bring suit against the
Corporation to recover the unpaid amount of the claim and, if successful in
whole or in part, the claimant shall also be entitled to be paid the expense of
prosecuting such claim. It shall be a defense to any action (other than an
action brought to enforce a claim for expenses incurred in defending any
proceeding in advance of its final disposition where the required undertaking
has been tendered to the Corporation) that the claimant has failed to meet a
standard of conduct which makes it permissible to indemnify the claimant for the
amount claimed, but the burden of proving such defense shall be on the
Corporation. Neither the failure of the Corporation (including its Board of
Directors, independent legal counsel, or its shareholders) to have made a
determination prior to the commencement of such action that indemnification of
the claimant is permissible in the circumstances because he has met such
standard of conduct, nor an actual determination by the Corporation (including
its Board of Directors, independent legal counsel, or its shareholders) that the
claimant has not met such standard of conduct, nor the termination of any
proceeding by judgment, order, settlement, conviction or upon a plea of nolo
contendere or its equivalent, shall be a defense to the action or create a
presumption that the claimant has failed to meet the required standard of
conduct.
(c) The right to indemnification and the payment of expenses incurred in
defending a proceeding in advance of its final disposition conferred in
this Section shall not be exclusive of any other right which any person
may have or hereafter acquire under any statute, provision of the
Restated Certificate of Incorporation, Bylaw, agreement, vote of
shareholders or disinterested directors or otherwise.
(d) The Corporation may maintain insurance, at its expense, to protect
itself and any director, officer, employee or agent of the Corporation
or another corporation, partnership, joint venture, trust or other
enterprise against any expense, liability or loss, whether or not the
Corporation would have the power to indemnify such person against such
expense, liability or loss under Delaware law.
(e) To the extent that any director, officer, employee or agent of the
Corporation is by reason of such position, or a position with another
entity at the request of the Corporation, a witness in any proceeding,
he shall be indemnified against all costs and expenses actually and
reasonably incurred by him or on his behalf in connection therewith.
(f) Notwithstanding any amendment of this section which may have been
approved by the shareholders, this section may be added to, altered,
amended or repealed pursuant to Section 8.7 of these Bylaws.
(g) Any amendment, repeal or modification of any provision of this Section
by the shareholders or the directors of the Corporation shall not
adversely affect any right or protection of a director or officer of
the Corporation existing at the time of such amendment, repeal or
modification.
Section 8.7 Amendment of Bylaws. Except for Section 9 of these Bylaws, (which by
its terms may be altered, amended or repealed only upon the affirmative vote of
holders of stock possessing at least 80% of the outstanding voting rights), in
accordance with authority expressly contained in the Restated Certificate of
Incorporation, these Bylaws may be added to, altered, amended, or repealed, and
new or other Bylaws may be made and adopted by vote of a majority of the Board
of Directors at any regular or special meeting of the Board, and without prior
notice of intent so to do.
Section 8.8 Notices. All Notices and communications given hereunder shall be
given (a) to the Corporation at: 601 13th Street, Suite 900, Washington, D.C.
20005; Attn: Secretary, or such other address as may be provided to each
shareholder in writing by the Secretary and (b) to shareholders at their
respective addresses appearing on the stock records of the Corporation.
<PAGE>
RESTRICTION ON TRANSFERS OF STOCK
Section 9.1 Restriction on Stock. Except for (i) transfers to the Corporation or
to trusts, personal holding companies or other entities satisfying the terms and
conditions of Section 9.2 or 9.3 below, (ii) reversions from trusts described in
Section 9.2 to the grantors thereof or their estates, or (iii) transfers from
personal holding companies or similar entities described in Section 9.2 to the
sole shareholders there of, no present or future shareholder shall transfer,
whether by way of sale, gift, hypothecation, trust distribution, will, intestacy
or any other disposition, any shares of any class of capital stock ("Stock") in
the Corporation now owned or hereafter acquired by such shareholder (including,
without limitation, shares of Stock acquired upon conversion or exchange of
other shares of Stock), without first giving the Corporation prior written
notice of his intention to so dispose of such Stock. Said notice to the
Corporation ("Disposition Notice") shall state the terms and conditions of the
proposed disposition, including the names of the transferees, the purchase price
and payment terms, if any, the type of disposition, and the number of shares to
be transferred ("Offered Shares"). A shareholder giving a Disposition Notice is
herein sometimes called an "Offering Stockholder".
(a)
The Corporation shall have the option for a period of thirty days following the
receipt of a Disposition Notice from an Offering Stockholder to buy on such
Closing Date, as is determined by the President or Secretary, part or all of the
Offered Shares at the price per share determined in accordance with Section 9.5
of this Section 9, provided that the Corporation may buy less than all of the
Offered Shares if the balance of the Offered Shares is contemporaneously
purchased by Eligible Purchasers (or otherwise disposed of in accordance with
these Bylaws) or if the Offering Stockholder elects to accept offers by the
Corporation and/or Eligible Purchasers to purchase less than all of the Offered
Shares and to retain the balance of the Offered Shares. If the Corporation does
not elect to purchase all Offered Shares, within thirty days after receipt of
the Offering Stockholder's Disposition Notice, it shall forward to the Offering
Stockholder a list of the names and addresses of all Eligible Purchasers
together with a description of their respective rights to purchase Offered
Shares not initially purchased by the Corporation.
The Offering Stockholder shall within fifteen days after receipt of such list of
Eligible Purchasers offer to sell the balance of the Offered Shares to such
Eligible Purchasers in accordance with their respective rights to purchase set
forth in such list.
(b) Elections by Eligible Purchasers to purchase Offered Shares under
subsection (a) hereof shall be by written notice delivered both to the
Corporation and to the Offering Stockholder within thirty days
following the receipt of the offer to sell from the Offering
Stockholder as provided in Section 9.1(a) hereof.
(c) The Corporation shall have the further option to buy or furnish
Eligible Purchasers for any Offered Shares not initially to be
purchased by the Corporation or by Eligible Purchasers under
subsections (a) or (b) hereof within 120 days following receipt by the
Corporation of the Disposition Notice.
(d)
The Offered Shares, if any, not purchased under subsections (a), (b), or (c) of
this Section 9.1 may be disposed of within 150 days after receipt by the
Corporation of the Disposition Notice, but only to persons and only on the terms
and conditions set forth in the Disposition Notice. Any Offered Shares not so
transferred within such 150-day period may not thereafter be transferred, except
upon compliance with the terms of this Section 9 of the Bylaws and as if they
had not been previously offered hereunder. Any attempt to transfer any Stock of
the Corporation in contravention of the provisions of this Section 9 shall be
null and void and without legal effect, except that such attempted transfer
shall constitute a continuing offer to sell all such Stock under Section 9.1(a)
hereof. The price at which such Stock may be purchased by the Corporation or
Eligible Purchasers shall be determined pursuant to Section 9.5 of this Section
9; such Stock will be deemed to have been offered at the date of the attempted
transfer; and, for purposes hereof, such attempted transfer shall be deemed to
constitute the giving of a Disposition Notice under Section 9.1, but there shall
be no limitations on the time periods within which the Corporation and/or
Eligible Purchasers shall be required to exercise their rights hereunder.
Section 9.2 Revocable Trusts; Personal Holding Corporations.
(a) Anything in this Section 9 to the contrary notwithstanding, any
shareholder may, with the approval of the Board of Directors or such
officer(s) as may be designated by the Board of Directors for such
purpose, transfer any or all Stock of the Corporation now owned or
hereafter acquired by him to a revocable trust for the sole benefit of
himself during his lifetime, provided that:
(i) the trust instrument acknowledges that the Stock is held
subject to the terms and conditions of these Bylaws;
(ii) the trust, by its terms, provides that on the first to occur of:
(A) the termination of the trust,
(B) the ceasing of the shareholder to act as sole
trustee of the trust, or
(C) any event described in Section 9.4 with
respect to the settlor, all stock of the Corporation
then held by the trust will either revert to the
shareholder or be offered for sale by the same
procedure as set forth in Section 9.1 hereof.
(iii) the shareholder is the sole trustee of said trust and
the trust grants to the shareholder and to no other person,
corporation or other entity full powers as trustee with
respect to all Stock of the Corporation at any time held by
the Trust, including powers to attend all meetings of
shareholders, vote such shares and give proxies with respect
thereto, make all decisions with respect to the trust's sale
or purchase thereof, including the power to direct the sale of
some or all of the Stock of the Corporation at any time for
any reason deemed valid by said shareholder;
(iv) a copy of the trust, as from time to time amended,
is at all times kept on file by the Trustee thereof with the
Secretary of the Corporation; and
(v) the trust, by its terms, provides that any amendment that
in any way affects the Stock of the Corporation held by the
trust or any of the provisions relating to such Stock set
forth in subparagraphs [(a)](i) through [d](iv) above, must be
approved in advance by the President, Treasurer or Secretary
of the Corporation or shall be null and void and of no effect
with respect to such Stock.
(b)
Personal Holding Corporations. Anything in this Section 9 to the contrary
notwithstanding, any non-U.S. resident shareholder of the Corporation's stock
(for purposes of this paragraph, the "Shareholder") may, with the approval of
the Board of Directors or such officer(s) as may be designated by the Board of
Directors for such purpose, transfer any or all Stock of the Corporation now
issued or hereafter acquired by him (or direct the Corporation to issue stock
allocated by the Corporation to him) to a personal holding corporation
incorporated under the laws of a jurisdiction outside of the United States which
corporation is wholly-owned by such Shareholder (or such similar entity under
the laws of the jurisdiction in which such Shareholder is domiciled which is
wholly-owned by such Shareholder and which is approved by the General Counsel of
the Corporation in his discretion), provided that:
(i) One hundred percent (100%) of the stock of such personal
holding corporation is owned solely by the Shareholder (or the
ownership of such other similar approved entity is one hundred
percent (100%) vested in the Shareholder) and no person,
corporation or other entity other than the Shareholder shall
have any rights or powers with respect to the ownership,
control or direction of any stock of such personal holding
corporation or other similar approved entity or any stock of
the Corporation at any time held by such personal holding
corporation or other similar approved entity, including,
without limitation, any right to attend meetings of
shareholders, vote such shares or give proxies with respect
thereto;
<PAGE>
(ii) the Articles of Incorporation, Bylaws and any other
charter or governing documents of such personal holding
corporation or other similar approved entity contain
restrictions on the transfer of its stock which have
substantially the same effect as the stock transfer
restrictions contained in these Bylaws, and are approved in
writing by the General Counsel of the Corporation, are not
amended without such approval, and certified or notarized
copies thereof are at all times kept on file with the
Secretary of the Corporation;
(iii) all stock certificates of the personal holding
corporation (or similar documents evidencing ownership of such
other similar approved entity) contain a legend identifying
the existence of such transfer restrictions;
(iv) such personal holding corporation or similar approved
entity shall agree in writing with the Corporation not to
issue or allot any additional stock of any class to anyone
other than the Shareholder;
(v) the Shareholder and the personal holding corporation or
other similar approved entity agree with the Corporation in
writing, in a form approved by the General Counsel of the
Corporation, that they will abide by all of the terms
restricting the transfer of the Corporation's stock as set
forth in these Bylaws (as they may be amended from time to
time) and that they will take or cause to be taken all steps
which may be required in order to assure compliance with the
stock transfer restrictions contained in these Bylaws,
including an agreement not to transfer the stock of the
personal holding corporation (or other evidence of ownership
of a similar approved entity); and
(vi) the personal holding corporation (or similar approved
entity) and the Shareholder shall agree in writing with each
other and the Corporation that, upon the first to occur of:
(A) any event described in Section 9.4
with respect to the Shareholder;
(B) the bankruptcy, insolvency, dissolution
(either voluntary or involuntary), sale or merger of
the personal holding corporation or other similar
approved entity, or the sale or attempted sale of any
of its stock, other than in accordance with these
Bylaws, or its assets, or the imposition of any lien
upon the stock of the Corporation or other assets
owned by the personal holding corporation or other
similar approved entity; or
(C) the amendment of the Articles of
Incorporation, Bylaws, or other charter or governing
documents of such personal holding corporation or
other similar approved entity, which amendment is not
approved in writing by the General Counsel of the
Corporation, or any breach of any of the provisions
of subparagraphs (i) through (v) of this subsection;
all stock of the Corporation then owned by the
personal holding corporation or other similar approved entity
will be deemed to be offered for sale by the same procedures
as set forth in Section 9.1 hereof.
Section 9.3 Employee Trusts. Anything in this Section 9 to the contrary
notwithstanding, Stock of the Corporation may be owned by one or more trusts
maintained exclusively for the benefit of employees of the Corporation and/or
any of its present or future subsidiaries and either qualified under Section
401(a) or 501(a) of the Internal Revenue Code of 1986 (or any successor
statute), or approved by the Board of Directors of the Corporation, provided
that:
(a) upon the occurrence of any event specified in Section 9.4 with respect
to any employee who is then a beneficiary of such trust, the trust
shall offer for sale in accordance with the terms and provisions of
Section 9.4 hereof:
(i) all Stock of the Corporation, if any, allocated
to the separate account of such employee under the trust's
terms; and
<PAGE>
(ii) a pro rata portion of all Stock of the Corporation held
by such trust and not allocated to the separate accounts of
beneficiaries, such pro rata portion to be based upon such
actuarial and other considerations as the trustees of the
trust and the Board of Directors of the Corporation shall, in
their absolute discretion, deem appropriate.
Section 9.4 Death, Termination of Employment, Bankruptcy, Liens. On the death of
a shareholder, or upon the termination of a shareholder's employment with the
Corporation or any subsidiary of the Corporation, whether said termination be by
retirement, voluntary or involuntary termination, or for any other reason, or
upon the Corporation receiving actual knowledge that a shareholder or any
personal holding corporation or similar approved entity as described in Section
9.2 has become bankrupt or suffered or permitted the imposition of any lien or
attachment on any Stock of the Corporation owned by such shareholder or any
trust, personal holding company or other similar approved entity holding Stock
for his benefit, whichever first occurs ("Determination Date"), all Stock of the
Corporation then owned by such shareholder or his representative or held for his
benefit in any trust, personal holding company or other entity permitted
hereunder shall be deemed offered for sale and to constitute Offered Shares
subject to purchase by the same procedure as set forth in Section 9.1 of this
Section 9, excepting that, purchase of such shares shall occur on such Closing
Date (not more than 245 days after the Determination Date), as the President or
Secretary shall determine with payment to be made in accordance with Section 9.6
hereof. Any of such shares of Stock not elected to be purchased by the
Corporation or by Eligible Purchasers within 245 days after the Determination
Date shall be purchased by the Corporation unless and to the extent that the
Corporation is prohibited from doing so by the Delaware General Corporation Law.
For purposes of this Section 9.4, notwithstanding any other provision of this
Bylaw, a shareholder shall be deemed to own all Stock transferred by him to a
trust satisfying the terms and conditions of Section 9.2 hereof and such trust
shall have the same obligations with respect to the sale of such Stock hereunder
as the shareholder would have had if the Stock had not been transferred to said
trust.
Section 9.5 Purchase Price.
(a) The Purchase Price for any Stock of the Corporation shall be determined
in accordance with this Section 9.5, excepting that if a Disposition
Notice given under Section 9.1 indicates an intention to make a bona
fide sale of Stock for value, then the Purchase Price for any Stock
which is the subject of such notice (including Stock which is being
offered pursuant to the terms of Section 9.2 or 9.3) shall equal the
price set forth in such notice, if such price is lower than the
Purchase Price determined hereunder.
(b) Except as provided in subparagraph (a) hereof and subject to
subparagraph (e) hereof, the Purchase Price for any Stock purchased by
an Eligible Purchaser on or after July 1, 1996 shall be the Formula
Book Value of such Stock as of the last day of the Corporation's fiscal
year coincident with or next preceding the Closing Date with respect to
such purchase.
(c) Except as provided in subparagraph (a) hereof, the Purchase Price for
any Stock purchased by the Corporation hereunder shall be determined as
follows (subject to appropriate adjustment to reflect stock splits,
stock dividends, combinations of shares and similar recapitalizations):
The Purchase Price (P) per share for purchases by the
Corporation with a date of Disposition Notice or a
Determination Date on or after July 1, 1990 shall be
determined by the following formula:
P = [B x (1 + (r x n/12))] + (d x n/12)
B = Formula Book Value of such Stock as of the last
day of the Corporation's fiscal year coincident with or next
preceding the date of Disposition Notice under Section 9.1 or
a Determination Date under Section 9.4, whichever is
applicable;
r = the actual percentage increase, if any, in the
Formula Book Value of such Stock as of the last day of the
Corporation's fiscal year during which such Disposition Notice
or Determination Date occurs over the Formula Book Value as of
the last day of the Corporation's prior fiscal year;
n = the number of completed months between (1) the
last day of the Corporation's fiscal year coincident with or
next preceding such Disposition Notice or Determination Date,
and (2) the date of such Disposition Notice or such
Determination Date, whichever is applicable; and
d = The dividend, if any, per share declared for such
Stock for the fiscal year during which such Disposition Notice
or Determination Date occurs (unless the shareholder actually
receives the dividend for such year, in which case d = 0).
(d) If, and only if, the Closing Date for the purchase by the Corporation
or an Eligible Purchaser of any Stock under Section 9.4 hereof is more
than thirty (30) days after the Determination Date, the Corporation
will pay the selling shareholder interest on the amount of the Net Book
Value denoted as "B" in the formula set forth in subparagraph (c)
hereof at the Loan Rate (as described in Section 9.6(b)(iii) hereof)
from the Determination Date to the Closing Date.
(e) Except as provided in subparagraph (a) hereof, with respect to any
purchases of Stock by an Eligible Purchaser from a shareholder other
than the Corporation, the Corporation will pay the selling shareholder
an amount which is equal to "P" minus "B" in the formula set forth in
subparagraph (c) hereof.
Section 9.6 Payment.
(a) The Purchase Price for Stock of the Corporation purchased hereunder by
an Eligible Purchaser shall be paid in cash on the Closing Date,
subject to Section 9.5(e) hereof, except as the purchaser and seller
may otherwise agree.
(b.i) Payments by the Corporation of the portion of the Purchase Price
representing the pro rata increase, if any, in the Net Book Value of
the Stock and the pro rata dividend may be made in multiple
installments as may be determined by the President or Secretary from
time-to-time, but no such installment shall be made later than eighteen
(18) months after the Closing Date except as provided in subparagraph
(b)(ii) hereof.
(b.ii)
Notwithstanding the provisions of subparagraph (b)(i) hereof, the Purchase Price
for Stock of the Corporation purchased hereunder by the Corporation may be paid,
at the option of the Corporation, (i) all in cash, or (ii) twenty-five percent
(25%) in cash and the balance in a non-negotiable promissory note of the
Corporation payable over a period of not more than three (3) years following the
Closing Date, no part of such note to be paid in the same calendar year in which
the stock is purchased unless such note is paid in full within such calendar
year, such note to bear interest on the unpaid balance thereof at the Loan Rate
(as hereinafter defined), or (iii) on such other terms as seller and the
Corporation may agree in writing.
(b.iii) "Loan Rate" shall mean the interest rate for Wyatt shareholder loans in
effect at such bank or banks as the Board of Directors, the President
or the President's designee shall have approved for such loans on the
date of issue of a note pursuant to subparagraph (b)(ii) hereof, or the
Determination Date pursuant to Section 9.5(d) hereof, or 10% per annum,
whichever is lower.
Section 9.7 Endorsement on Stock Certificates. All certificates representing
Stock of the Corporation shall be conspicuously endorsed with a legend
substantially as follows:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933. THE SHARES REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED,
HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT UNDER THE CIRCUMSTANCES
SPECIFIED IN SECTION 9. OF THE BYLAWS OF THE COMPANY, A COPY OF WHICH
MAY BE OBTAINED FROM THE SECRETARY OF THE WYATT COMPANY WHO WILL MAIL A
COPY THEREOF WITHOUT CHARGE TO THE HOLDER HEREOF WITHIN 5 DAYS OF A
WRITTEN REQUEST THEREFOR."
Section 9.8 [Reserved]
<PAGE>
Section 9.9 Definitions.
(a) The term "Eligible Purchasers", as used herein, shall mean any of the
following persons or entities:
(i) full-time employees or regular part-time
employees of the Corporation or its subsidiaries who
satisfy criteria approved from time-to-time by the Board
of Directors;
(ii) a partner engaged full-time in a partnership
practice of any affiliate or subsidiary, if applicable,
of the Corporation;
(iii) a director of the Corporation or any subsidiary
of the Corporation;
(iv) a corporation, partnership, association, or other entity
with which the Corporation has an affiliated business
relationship, as designated from time to time by the Board of
Directors; or
(v) full-time employees or regular part-time employees of any
corporation, partnership, association, or other entity with
which the Corporation has an affiliated business relationship
as designated from time to time by the Board of Directors and
who satisfy criteria approved from time to time by the Board
of Directors.
The Board of Directors shall designate which persons in the categories
of persons set forth above shall be deemed to be Eligible Purchasers
with respect to any particular transaction. Designation as an Eligible
Purchaser in connection with any offer and sale shall not create or
imply any right to be so designated in connection with any other offer
or sale or, if so designated, to be designated on the same terms and
conditions.
(b)
Net Book Value of Common Stock as used herein shall mean the consolidated net
book value of the Common Stock of the Corporation determined, on an accrual
basis, by generally accepted accounting principles except that in computing such
Net Book Value as of June 30, 1984, or any subsequent fiscal year end,
consolidated assets of the Corporation consisting of subscriber lists, computer
software and data banks used principally in compensation survey or related
businesses carried on by the Corporation or any subsidiary shall be valued at
50% of the Consolidated income received by the Corporation in respect of such
business during the fiscal year then ended. Formula Book Value as used herein
shall mean the Net Book Value of the Company's Common Stock as of June 30, 1996,
increased or decreased by net income or losses, and all other GAAP basis
increases or decreases to Net Book Value occurring after June 30, 1996, adjusted
to (i) spread the economic impact of certain real estate sublease losses over
the remaining life of the sublease; and (ii) eliminate annual changes in the
Currency Translation Adjustment ("CTA") occurring after June 30, 1996. Formula
Book Value shall be determined by the independent certified public accountants
of the Corporation from the Company's consolidated financial statement prepared
on an accrual basis in accordance with generally accepted accounting principles
as certified by such accountants, except as described above. Such determinations
shall be conclusive and binding upon the Corporation and all holders of stock.
(c) The term "Closing Date" hereunder shall mean the time established by
the President or Secretary pursuant to Section 9.1, 9.4 or 9.5 hereof.
(d) The term "Corporation" as used herein in Section 9 shall mean the
Corporation, a Subsidiary, or an Affiliate as defined in ARTICLE
FOURTEENTH of the Restated Certificate of Incorporation.
Section 9.10 Benefit. The rights and restrictions contained herein shall be
binding upon and inure to the benefit of all present and future shareholders of
the Corporation, their heirs, executors, administrators, successors and assigns.
Section 9.11 Amendment. Except as provided below, this Section 9 of the Bylaws
of the Corporation may be altered, amended or repealed only upon the affirmative
vote of the holders of Stock possessing at least 80% of the outstanding voting
rights of the capital stock of the Corporation, voting as one aggregate class.
If any such alteration, amendment or repeal affects any class or classes
adversely, then, in addition to the affirmative vote required above, the
affirmative vote of holders of at least a majority of the outstanding shares of
each class so affected, voting separately as a class, shall be required, unless
the effect of such alteration, amendment or repeal is adverse to all classes on
a substantially equivalent basis. Notwithstanding the foregoing, any amendment
to this Section 9 of the Bylaws of the Corporation describing the Purchase Price
of any class of Stock hereafter authorized shall require only such affirmative
vote of shareholders as Section 242 of the Delaware General Corporation Law, as
then in effect, requires to amend the Company's Restated Certificate of
Incorporation to authorize the issuance of such class
g:\CORP: BYL11_96.doc
Revised: November 22, 1996
EXHIBIT 5
Opinion of Walter W. Bardenwerper, Esq.
<PAGE>
December 10, 1996
Board of Directors
Watson Wyatt & Company
6707 Democracy Boulevard
Suite 800
Bethesda, Maryland 20817-1129
Board of Directors:
As General Counsel of Watson Wyatt & Company, a Delaware corporation ("Watson
Wyatt"), I am familiar with the Form S-8 Registration Statement to be filed (the
"Registration Statement") by Watson Wyatt with the Securities and Exchange
Commission in connection with the offering to Watson Wyatt employees of up to
3,700,000 shares of Watson Wyatt common stock (the "Shares") pursuant to Watson
Wyatt's Stock Purchase Plan.
As General Counsel of Watson Wyatt, I am also familiar with Watson Wyatt's
Restated Certificate of Incorporation and Bylaws. I have examined the
Registration Statement and have examined or caused to be examined such other
documents, board resolutions, corporate records and certificates of corporate
officers and public officials as I have deemed relevant or necessary to give the
opinion set forth below.
Based on the foregoing, I am of the opinion that the issuance of the Shares has
been approved by all necessary corporate action and that when the shares are
sold and paid for they will be legally issued, fully paid and non-assessable.
I hereby consent to the filing of this opinion as an Exhibit to the Registration
Statement, as well as the reference to me and my opinion appearing in Item 5 of
the Registration Statement.
Very truly yours,
/s/ Walter W. Bardenwerper
Walter W. Bardenwerper
Vice President, General Counsel and Secretary
EXHIBIT 23(a)
Consent of Price Waterhouse LLP
<PAGE>
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 of Watson Wyatt & Company of our report dated July 25,
1996 appearing on page F-1 of the Watson Wyatt & Company Annual Report on Form
10-K. We also consent to the incorporation by reference of our report on the
Financial Statement Schedule, which appears on page F-25 of such Annual
Report on Form 10-K.
/s/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
Washington, D.C.
December 10, 1996
