As filed with the Securities and
Exchange Commission on October 28 , 1997 Registration No. 333-____
______________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
_______________________
ITT EDUCATIONAL SERVICES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 36-2061311
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
5975 CASTLE CREEK PARKWAY,
N. DRIVE, INDIANAPOLIS, INDIANA 46250-0466
(Address of Principal Executive Offices) (Zip Code)
1997 ITT EDUCATIONAL SERVICES, INC.
INCENTIVE STOCK PLAN
(Full title of the plan)
CLARK D. ELWOOD
5975 CASTLE CREEK PARKWAY, N. DRIVE, INDIANAPOLIS, INDIANA 46250-0466
(Name and address of agent for service)
(317) 594-9499
(Telephone number, including area code, of agent for service)
COPY TO:
JAMES A. ASCHLEMAN
BAKER & DANIELS
300 NORTH MERIDIAN STREET, SUITE 2700
INDIANAPOLIS, INDIANA 46204
(317) 237-0300
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
TITLE OF SECURITIES AMOUNT TO BE PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TO REGISTERED REGISTERED (1) OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION FEE
SHARE (2) PRICE (2)
<S> <C> <C> <C> <C>
Common Stock, 684,935 $23.8125 (3) $16,310,015 (3) $4,942.43 (3)
$0.01 par value
</TABLE>
(1) Pursuant to Rule 416 under the Securities Act of 1933 (the "Securities
Act"), this Registration Statement also registers such additional shares of
Common Stock as may be offered or issued to prevent dilution resulting from
stock splits, stock dividends and similar transactions.
(2) It is impracticable to state the maximum offering price. Shares offered
pursuant to stock options granted under the 1997 ITT Educational Services,
Inc. Incentive Stock Plan are to be offered at not less than the fair
market value of one share of Common Stock of ITT Educational Services, Inc.
on the date the option is granted.
(3) Estimated solely for purposes of calculating the registration fee and
computed in accordance with Rule 457(c) under the Securities Act using the
average of the high and low sale prices of the Common Stock as reported by
the NYSE on October 27, 1997, which was $23.8125 per share.
<PAGE>
PART I
INFORMATION REQUIRED IN SECTION 10(A) PROSPECTUS
The Section 10(a) prospectus for the 1997 ITT Educational Services,
Inc. Incentive Stock Plan is not required to be filed with the Securities
and Exchange Commission as part of this Registration Statement.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The Company's Annual Report on Form 10-K for the year ended December
31, 1996 and the description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A filed pursuant to the
Securities Exchange Act of 1934 (the "Exchange Act"), including any
amendments or reports filed for the purpose of updating such description,
are incorporated herein by reference. All other reports filed pursuant to
Section 13(a) or 15(d) of the Exchange Act since the end of the fiscal year
for which audited financial statements are contained in the annual report
described above are incorporated herein by reference. All documents filed
by the Company pursuant to Sections 13(a), 13(c), 14, or 15(d) of the
Exchange Act after the date hereof and prior to the termination of the
offering of the securities offered hereby shall be deemed to be
incorporated by reference herein and to be a part hereof from the date of
filing of such documents with the Commission. The Company will promptly
provide without charge to each person to whom a prospectus is delivered, a
copy of any or all information that has been incorporated herein by
reference (not including exhibits to the information that is incorporated
by reference unless such exhibits are specifically incorporated by
reference into such information), upon the written or oral request of such
person directed to the Secretary of the Company at its principal offices,
5975 Castle Creek Parkway, N. Drive, Indianapolis, Indiana 46250-0466,
(317) 594-9499.
ITEM 4. DESCRIPTION OF SECURITIES.
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not Applicable.
ITEM 6. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
Reference is made to Article VI of the Company's Restated Certificate
of Incorporation, filed as Exhibit 4.1 hereto, and Article VII of the
Company's By-Laws, filed as Exhibit 4.2 hereto, which provides that the
Company shall indemnify and advance expenses to its currently acting and
former directors and officers, and may indemnify and advance expenses to
its currently acting and former employees and agents, to the fullest extent
permitted by applicable law, including the Delaware General Corporation
Law, as amended from time to time (but, in the case of any such amendment,
only to the extent that such amendment permits the Company to provide
broader indemnification rights than said law permitted the Company to
provide prior to such amendment). The Company may also enter into one or
more agreements with any person which provide for indemnification greater
or different than that provided in Article VI of the Company's Restated
Certificate of Incorporation. In addition, insurance policies provide for
the indemnification of the Company's directors and officers, as well as for
reimbursement of the Company for amounts paid by the Company above certain
limits in indemnifying its directors and officers, for liabilities under
the Securities Act of 1933, subject to applicable retentions.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
The list of Exhibits is incorporated herein by reference to the Index
to Exhibits.
ITEM 9. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement;
(iii)To include any material information with respect to the plan
of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
Provided, however, that paragraphs (1)(i) and (1)(ii) do not
apply if the information required to be included in a post-
effective amendment by those paragraphs is contained in periodic
reports filed by the registrant pursuant to section 13 or section
15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at the time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the registrant's annual report pursuant to section 13(a) or section 15(d)
of the Securities Exchange Act of 1934 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by reference in
the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provisions,
or otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense
of any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, 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 the City of Indianapolis, State of Indiana,
on September 26, 1997.
ITT EDUCATIONAL SERVICES, INC.
By: /S/ RENE R. CHAMPAGNE
Rene R. Champagne
Chairman, President and
Chief Executive Officer
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in their respective
capacities and on the respective dates indicated opposite their names.
Each person whose signature appears below hereby authorizes each of Rene R.
Champagne, Gene A. Baugh and Clark D. Elwood, each with full power of
substitution, to execute in the name and on behalf of such person any post-
effective amendment to this Registration Statement and to file the same,
with exhibits thereto, and other documents in connection therewith, making
such changes in this Registration Statement as the registrant deems
appropriate, and appoints each of Rene R. Champagne, Gene A. Baugh and
Clark D. Elwood, each with full power of substitution, attorney-in-fact to
sign any amendment and any post-effective amendment to this Registration
Statement and to file the same, with exhibits thereto, and other
documents in connection therewith.
<TABLE>
<CAPTION>
SIGNATURES CAPACITY DATE
<S> <C> <C>
/S/ RENE R. CHAMPAGNE Chairman, President, Chief September 26, 1997
Rene R. Champagne Executive Officer and Director
(Principal Executive Officer)
/S/ GENE A. BAUGH Senior Vice President and Chief September 26, 1997
Gene A. Baugh Financial Officer (Principal
Financial Officer and Principal
Accounting Officer)
/S/ BETTE B. ANDERSON Director September 26, 1977
Bette B. Anderson
Director
Rand V. Araskog
/S/ ROBERT A. BOWMAN Director September 26, 1997
Robert A. Bowman
Director
John E. Dean
/S/ JAMES D. FOWLER, JR. Director September 26, 1997
James D. Fowler, Jr.
/S/ LESLIE LENKOWSKY Director September 26, 1997
Leslie Lenkowsky
/S/ RICHARD S. WARD Director September 26, 1997
Richard S. Ward
/S/ VIN WEBER Director September 26, 1997
Vin Weber
/S/ MARGITA E. WHITE Director September 26, 1997
Margita E. White
</TABLE>
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
DESCRIPTION OF EXHIBIT
Exhibit
NO.
<S> <C>
4.1 Restated Certificate of Incorporation of the Registrant, as amended
to date. (The copy of this Exhibit filed as Exhibit 3.1 to the
Company's report on Form 10-Q for the quarter ended June 30, 1996 is
incorporated by reference.)
4.2 By-Laws of the Registrant, as amended to date.
4.3 1997 ITT Educational Services, Inc. Incentive Stock Plan. (The copy
of this Exhibit filed as Exhibit 10.8 to the Company's report on
Form 10-Q for the quarter ended June 30, 1997, is incorporated by
reference.)
5 Opinion of Baker & Daniels regarding legality of the securities
being registered.
23.1 Consent of Price Waterhouse LLP.
23.2 Consent of Baker & Daniels (included in the Baker & Daniels Opinion
filed as Exhibit 5).
24 Powers of Attorney (included on the Signature Page of the
Registration Statement).
</TABLE>
<PAGE>
ITT EDUCATIONAL SERVICES, INC.
BY-LAWS
As Amended and Restated September 26, 1997
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I OFFICES 1
SECTION 1. REGISTERED OFFICE 1
SECTION 2. OTHER OFFICES 1
SECTION 3. CHANGE OF LOCATION 1
ARTICLE II MEETINGS OF STOCKHOLDERS 1
SECTION 1. PLACE OF MEETINGS 1
SECTION 2. ANNUAL MEETING 1
SECTION 3. SPECIAL MEETINGS 1
SECTION 4. NOTICE OF MEETINGS 1
SECTION 5. QUORUM 1
SECTION 6. VOTING OF STOCK 2
SECTION 7. LIST OF STOCKHOLDERS 2
SECTION 8. CONDUCT OF MEETING; BUSINESS 2
SECTION 9. PROXIES 3
SECTION 10. INSPECTORS 3
SECTION 11. NO WRITTEN CONSENT 3
ARTICLE III DIRECTORS 3
SECTION 1. NUMBER 3
SECTION 2. NOMINATIONS 3
SECTION 3. DUTIES AND POWERS 4
SECTION 4. PLACE OF MEETING 4
SECTION 5. ANNUAL MEETING 4
SECTION 6. REGULAR MEETINGS 4
SECTION 7. SPECIAL MEETINGS 4
SECTION 8. NOTICE OF MEETINGS 4
SECTION 9. QUORUM AND VOTING 5
SECTION 10. ACTION WITHOUT A MEETING 5
SECTION 11. TELEPHONIC PARTICIPATION 5
SECTION 12. BOOKS 5
SECTION 13. COMPENSATION 5
SECTION 14. VACANCIES 5
SECTION 15. REMOVAL 5
SECTION 16. ORGANIZATION 5
SECTION 17. STANDING COMMITTEES 5
SECTION 18. OTHER COMMITTEES 6
SECTION 19. RESIGNATION 6
ARTICLE IV OFFICERS 7
SECTION 1. GENERAL 7
SECTION 2. ELECTION 7
SECTION 3. OTHER OFFICERS 7
SECTION 4. CHAIRMAN OF THE BOARD 7
SECTION 5. PRESIDENT 7
SECTION 6. VICE PRESIDENT 7
SECTION 7. SECRETARY AND ASSISTANT SECRETARIES 7
SECTION 8. CHIEF FINANCIAL OFFICER AND ASSISTANT TREASURERS 7
ARTICLE V CAPITAL STOCK 8
SECTION 1. FORM AND SIGNATURE 8
SECTION 2. LOST, STOLEN OR DESTROYED CERTIFICATES 8
SECTION 3. TRANSFER OF SHARES 8
SECTION 4. REGISTERED STOCKHOLDERS 8
SECTION 5. REGULATIONS 8
SECTION 6. RECORD DATE 8
ARTICLE VI NOTICES 9
SECTION 1. NOTICES 9
SECTION 2. WAIVER OF NOTICE 9
ARTICLE VII INDEMNIFICATION 9
SECTION 1. NATURE OF INDEMNITY 9
SECTION 2. SUCCESSFUL DEFENSE 10
SECTION 3. DETERMINATION THAT INDEMNIFICATION IS PROPER 10
SECTION 4. ADVANCE PAYMENT OF EXPENSES 10
SECTION 5. PROCEDURE FOR INDEMNIFICATION OF DIRECTORS AND OFFICERS 10
SECTION 6. SURVIVAL; PRESERVATION OF OTHER RIGHTS 10
SECTION 7. INSURANCE 11
SECTION 8. SEVERABILITY 11
ARTICLE VIII GENERAL PROVISIONS; DIVIDENDS 11
SECTION 1. DIVIDENDS 11
SECTION 2. CHECKS 11
SECTION 3. FISCAL YEAR 11
SECTION 4. SEAL 11
SECTION 5. GENERAL AND SPECIAL BANK ACCOUNTS 12
SECTION 6. LOANS 12
SECTION 7. EXECUTION OF DOCUMENTS 12
ARTICLE IX AMENDMENTS OF BY-LAWS 12
ARTICLE X CONSTRUCTION 12
<PAGE>
ITT EDUCATIONAL SERVICES, INC.
(a Delaware Corporation)
BY-LAWS
ARTICLE I
OFFICES
SECTION 1. REGISTERED OFFICE. The registered office of ITT Educational
Services, Inc. (the "Corporation") in the State of Delaware and the name of the
registered agent at such address shall be as specified in the Corporation's
Amended and Restated Certificate of Incorporation, or as subsequently changed
as specified in the most recent certificate of change filed pursuant to law.
SECTION 2. OTHER OFFICES. The Corporation may also have offices at such
other places both within and without the State of Delaware as the Board of
Directors (the "Board") may from time to time determine or the business of the
Corporation may require.
SECTION 3. CHANGE OF LOCATION. In the manner permitted by law, the Board
or the Corporation's registered agent may change the address of the
Corporation's registered office in the State of Delaware and the Board may
make, revoke or change the designation of the registered agent.
ARTICLE II
MEETINGS OF STOCKHOLDERS
SECTION 1. PLACE OF MEETINGS. All meetings of stockholders for the
election of directors and for the transaction of such other business as may
properly come before the meeting shall be held at such place, either within or
without the State of Delaware, as may be fixed from time to time by the Board
and stated in the notice of the meeting or in a duly executed waiver of notice
thereof.
SECTION 2. ANNUAL MEETING. Annual meetings of stockholders, at which
they shall elect by a plurality vote a Board and transact such other business
as may properly be brought before the meeting, shall be held on such date and
at such time as shall be designated from time to time by the Board and stated
in the notice of meeting or in a duly executed waiver thereof.
SECTION 3. SPECIAL MEETINGS. Special meetings of the stockholders for
any purpose may be held at such time and place within or without the State of
Delaware as shall be stated in the notice of the meeting or in a duly executed
waiver of notice thereof. Special meetings of stockholders may be called at
any time, for any purpose or purposes, by the Chairman of the Board, the
President or a majority of the Board.
SECTION 4. NOTICE OF MEETINGS. Except as otherwise expressly required by
law, written or printed notice of each annual and special meeting of
stockholders stating the place, date and hour of the meeting, and, in the case
of a special meeting of the stockholders, the purpose or purposes thereof and
the person or persons by whom or at whose direction such meeting has been
called, shall be given not less than ten (10) nor more than sixty (60) days
before the date of the meeting, either personally or by mail, by or at the
direction of the President, or the Secretary, or the officer or persons calling
the meeting to each stockholder of record entitled to vote at such meeting. If
mailed, such notice shall be deemed to be given when deposited in the United
States mail, postage prepaid, directed to the stockholder at his address as it
appears on the stock transfer books of the Corporation, unless he shall file
with the Secretary of the Corporation a written request that notices to him be
mailed to some other address.
SECTION 5. QUORUM. The holders of a majority of the shares of stock
issued and outstanding and entitled to vote, represented in person or by proxy,
shall constitute a quorum at all meetings of the stockholders for the
transaction of business except as otherwise provided by statute or by the
Amended and Restated Certificate of Incorporation. If, however, such quorum
shall not be present or represented at any meeting of the stockholders, the
stockholders present in person or represented by proxy shall have the power to
adjourn the meeting from time to time, without notice other than announcement
at the meeting, until a quorum shall be present or represented by proxy. 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 6. VOTING OF STOCK. Except as is otherwise required by law, the
Amended and Restated Certificate of Incorporation or these By-laws, each holder
of record of shares of stock of the Corporation having voting powers shall be
entitled, at each meeting of the stockholders, to one vote for every share of
such stock standing in his or her name on the record of stockholders of the
Corporation and, if a quorum is present and unless otherwise required by the
Amended and Restated Certificate of Incorporation, the affirmative vote of a
majority of the shares of stock represented at the meeting shall be the act of
the stockholders.
SECTION 7. LIST OF STOCKHOLDERS. At least ten (10) days before each
meeting of stockholders, the Secretary or agent having charge of the stock
transfer book shall make a complete list of the stockholders entitled to vote
at such meeting, arranged in alphabetical order, with the address of each and
the number of shares held by each. Such list shall be kept on file at the
principal office of the Corporation and shall be subject to inspection by any
stockholder for a period of ten (10) days prior to such meeting, for any
purpose related to the meetings, at any time during usual business hours. Such
list shall be produced and kept open at the time and place of meeting and shall
be subject to the inspection of any stockholder during the whole time of the
meeting.
SECTION 8. CONDUCT OF MEETING; BUSINESS. The Chairman of the Board shall
preside at all meetings of the stockholders. If the Chairman has not been
elected or is not present, then the President shall preside. The Secretary of
the Corporation, or in his absence, an Assistant Secretary, if any, shall act
as Secretary of every meeting, but if neither the Secretary nor the Assistant
Secretary is present the Chairman or the President (as the case may be) shall
appoint a secretary of the meeting.
No business may be conducted at a meeting of the stockholders other
than business that is either (a) specified in the written notice of the meeting
(or any supplement thereto) given by or at the direction of the Board of
Directors or the President, (b) otherwise properly brought before the meeting
by or at the direction of the Board of Directors or the President, or (c)
otherwise properly brought before the meeting by or on behalf of a stockholder
of record of the Corporation (i) who shall have been a stockholder of record at
the time of giving of the notice provided for in this Section 8 and who shall
continue to be a stockholder of record on the record date for such meeting and
on the meeting date and who shall be entitled to vote thereat, and (ii) who
complies with the procedures set forth in this Section 8 with respect to any
business sought to be brought before such meeting by or on behalf of such
stockholder other than the election of directors and with the provisions set
forth in Section 2 of ARTICLE III of these By-laws with respect to the election
of directors. In addition to any other applicable requirements, for business
to be properly brought before a meeting by a stockholder, other than a
stockholder proposal included in the proxy statement pursuant to Rule 14a-8 of
the Securities Exchange Act of 1934, as amended, the stockholder must have
given timely notice thereof in proper written form to the Secretary of the
Corporation. To be timely, a stockholder's notice must be delivered to or
mailed and received at the principal executive offices of the Corporation (a)
no fewer than seventy (70) days nor more than ninety (90) days prior to the
anniversary date of the immediately preceding annual meeting of' the
stockholders of the Corporation, or (b) in the case of a special meeting or in
the event that the annual meeting is called for a date that is more than thirty
(30) days earlier or more than sixty (60) days later than such anniversary
date, notice by the stockholder to be timely given must be so received not
later than the close of business on the 10{th} day following the day on which
such notice of the date of the meeting was mailed or public disclosure of the
date of such meeting was made, whichever first occurs. To be in proper written
form, such stockholder's notice to the Secretary shall set forth as to each
matter the stockholder proposes to bring before the meeting (a) a brief
description of the business desired to be brought before the meeting and the
reasons for conducting such business at the meeting, (b) the name and record
address of the stockholder proposing such business, (c) the class and number of
shares of capital stock of the Corporation held of record, owned beneficially
or represented by proxy by such stockholder as of the record date for the
meeting (if such date shall then have been made publicly available) and as of
the date of such notice by the stockholder, (d) a representation that the
stockholder intends to appear in person or by proxy at the meeting to present
such stockholder's proposal, (e) all other information which would be required
to be included in a proxy statement filed with the Securities and Exchange
Commission if, with respect to any such item of business, such stockholder were
a participant in a solicitation subject to Regulation 14A under the Securities
Exchange Act of 1934, as amended (the "Proxy Rules") and (f) if the stockholder
intends to solicit proxies in support of such stockholder's proposal, a
representation to that effect. The foregoing notice requirements shall be
deemed satisfied by a stockholder if the stockholder has notified the
Corporation of his or her intention to present a proposal at an annual meeting
and such stockholder's proposal has been included in a proxy statement that has
been prepared by management of the Corporation to solicit proxies for such
annual meeting; provided, however, that if such stockholder does not appear or
send a qualified representative to present such proposal at such annual
meeting, the Corporation need not present such proposal for a vote at such
meeting, notwithstanding that proxies in respect of such vote may have been
received by the Corporation. No business shall be conducted at a meeting of
stockholders except in accordance with this Section 8, and the presiding
officer of any meeting of stockholders may refuse to permit any business to be
brought before a meeting without compliance with the foregoing procedures or if
the stockholder solicits proxies in support of such stockholder's proposal
without such stockholder having made the representation required by clause (f)
of the second preceding sentence.
SECTION 9. PROXIES. At all meetings of stockholders, a stockholder may
vote by proxy executed in writing by the stockholder or his duly authorized
attorney-in-fact.
SECTION 10. INSPECTORS. The Board may, in advance of any meeting of
stockholders, appoint one or more inspectors to act at such meeting or any
adjournment thereof. If an inspector or inspectors are not appointed, the
person presiding at the meeting may appoint one or more inspectors. Each
inspector, if any, before entering upon the discharge of his duties, shall take
and sign an oath faithfully to execute the duties of inspector at such meeting
with strict impartiality and according to the best of his ability. The
inspectors shall determine the number of shares of stock outstanding and the
voting power of each, the number of shares represented at the meeting, the
existence of a quorum, the validity and the fact of proxies, and shall receive
votes, ballots or consents herein, determine all challenges and questions
arising in connection with the right to vote, count and tabulate all votes,
ballots or consents, determine the result, and do such other acts as are proper
to conduct the election or vote with fairness to all stockholders. On request
of the person presiding at the meeting, the inspector or inspectors shall make
a report in writing of any challenge, request or matter determined by them and
shall execute a certificate of any fact found by them. No director or
candidate for the office of director shall act as an inspector on an election
of directors. Inspectors need not be stockholders.
SECTION 11. NO WRITTEN CONSENT. No action shall be taken by the
stockholders of the Corporation except at an annual or special meeting of
stockholders.
ARTICLE III
DIRECTORS
SECTION 1. NUMBER. The Board shall consist of at least three (3), but no
more than twenty (20) directors, as shall be fixed from time to time by the
affirmative vote of a majority of the entire Board of Directors; PROVIDED,
HOWEVER, that no decrease in the number comprising the entire Board made
pursuant to this Section 1 shall shorten the term of any incumbent director.
As provided by ARTICLE V of the Amended and Restated Certificate of
Incorporation, the directors shall be divided into three classes and the number
of directors in each such class shall be as set forth therein. Unless
otherwise provided by the Amended and Restated Certificate of Incorporation,
successors to each class of directors shall be elected for a three-year term at
the annual meeting for the year in which the term of such class of directors
expires and each such director elected shall hold office for a term continuing
until the annual meeting held in the third year following the year of his or
her election and until his or her successor is duly elected and qualified or
until his or her resignation, death or removal; provided, that in the event of
failure to hold such an annual meeting or to hold such election at such
meeting, the election of directors may be held at any special meeting of the
stockholders called for that purpose.
SECTION 2. NOMINATIONS. Nominations of persons for election as directors
may be made by the Board of Directors or a committee appointed by the Board of
Directors or by any stockholder of the Corporation who is a stockholder of
record at the time of the giving of the notice of nomination provided for in
this Section 2 who is entitled to vote for the election of directors. Any
stockholder of record entitled to vote for the election of directors at a
meeting may nominate a person or persons for election as directors only if
written notice of such stockholder's intent to make such nomination is given in
accordance with the procedures for bringing business before the meeting set
forth in ARTICLE II, Section 8 of these By-laws, either by personal delivery or
by United States mail, postage prepaid, to and received by the Secretary not
later than (i) with respect to an election to be held at an annual meeting of
stockholders, not less than seventy (70) nor more than ninety (90) days prior
to the anniversary date of the immediately preceding annual meeting; provided,
however, that in the event that the date of the annual meeting is more than
thirty (30) days earlier or more than sixty (60) days later than such
anniversary date, notice by the stockholder must be so delivered or received
not earlier than the 90{th} day prior to such annual meeting and not later than
the close of business on the later of the 70{th} day prior to such annual
meeting or the 10{th} day following the day on which public announcement of the
date of such meeting is first made and (ii) with respect to an election to be
held at a special meeting of stockholders for the election of directors, not
earlier than the 90{th} day prior to such special meeting and not later than
the close of business on the later of the 60{th} day prior to such special
meeting or the 10{th} day following the day on which public announcement of the
date of the special meeting is first made and of the nominees to be elected at
such meeting. Each such notice shall set forth: (a) the name and address of
the stockholder who intends to make the nomination and of the person or persons
to be nominated; (b) a representation that the stockholder is a holder of
record of stock of the Corporation entitled to vote at such meeting and intends
to appear in person or by proxy at the meeting to nominate the person or
persons specified in the notice; (c) a description of all arrangements or
understandings between the stockholder and each nominee and any other person or
persons (naming such person or persons) pursuant to which the nomination or
nominations are to be made by the stockholder; (d) such other information
regarding each nominee proposed by such stockholder as would have been
required to be included in a proxy statement filed pursuant to the Proxy Rules
of the Securities and Exchange Commission had each nominee been nominated, or
intended to be nominated, by the Board of Directors; (e) the consent of each
nominee to serve as a director if so elected; and (f) if the stockholder
intends to solicit proxies in support of such stockholder's nominee(s), a
representation to that effect. The presiding officer of any meeting of
stockholders to elect directors and the Board of Directors may refuse to
acknowledge the nomination of any person not made in compliance with the
foregoing procedure or if the stockholder solicits proxies in support of such
stockholder's nominee(s) without the stockholder having made the representation
required by clause (f) of the preceding sentence.
SECTION 3. DUTIES AND POWERS. The business affairs of the Corporation
shall be managed by its Board which may exercise all such powers of the
Corporation including all such lawful acts and things as are not by statute or
by the Amended and Restated Certificate of Incorporation or by these By-laws
directed or required to be exercised or done by the stockholders.
SECTION 4. PLACE OF MEETING. Meetings of the Board, regular or special,
may be held either within or without the State of Delaware.
SECTION 5. ANNUAL MEETING. The first meeting of each newly elected Board
shall be held immediately following the annual meeting of stockholders, and no
notice of such meeting to the newly elected directors shall be necessary in
order to legally constitute the meeting, provided a quorum shall be present, or
the newly elected directors may meet at such time and place as shall be fixed
by the consent in writing of all of the directors.
SECTION 6. REGULAR MEETINGS. Regular meetings of the Board may be held
upon such notice, or without notice, and at such time and at such place as
shall from time to time be determined by the Board.
SECTION 7. SPECIAL MEETINGS. Special meetings of the Board may be called
by the Chairman of the Board, if one shall have been elected, the President of
the Corporation or by a majority of the entire Board.
SECTION 8. NOTICE OF MEETINGS. Notice of each special meeting of the
Board (and of each regular meeting for which notice shall be required) shall be
given by the Secretary or an Assistant Secretary and shall state the place,
date and time of the meeting. Except as otherwise required by the By-laws,
neither the business to be transacted at, nor the business or the purpose of,
any regular or special meeting of the Board may be specified in the notice or
waiver of notice of such meeting. Notice of such meeting shall be mailed,
postage prepaid, to each director addressed to him or her at his or her address
or usual place of business by first class mail, at least two (2) days before
the day on which such meeting is to be held, or shall be sent addressed to him
or her at such place by facsimile, overnight courier, telex, or be delivered to
him or her personally or by telephone, at least twenty-four (24) hours before
the time at which such meeting is to be held.
SECTION 9. QUORUM AND VOTING. A majority of the directors then in office
shall constitute a quorum for the transaction of business unless a greater
number is required by law or by the Amended and Restated Certificate of
Incorporation. 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, unless the act of a
greater number is required by statute or by the Amended and Restated
Certificate of Incorporation. If a quorum shall not be present at any meeting
of the Board, the directors present thereat may adjourn the meeting to another
time and place. Notice of the time and place of any adjourned meeting shall be
given to all of the directors unless such time and place were announced at the
meeting at which the adjournment was taken, in which case such notice shall
only be given to the directors who were not present thereat. At such adjourned
meeting at which a quorum is present, any business may be transacted which
might have been transacted at the meeting as originally called. The directors
shall act only as a Board and an individual director shall have no authority to
act except through the Board.
SECTION 10. ACTION WITHOUT A MEETING. Any action required or permitted
to be taken by the Board, or by a committee of the Board, may be taken without
a meeting if all the members of the Board or committee, as the case may be,
consent in writing, and the writing or writings setting forth actions so taken
are filed with the minutes of the proceeding or committee, as the case may be.
SECTION 11. TELEPHONIC PARTICIPATION. One or more members of the Board,
or any committee designated by the Board, may participate in a meeting of such
Board, or committee of the Board, by means of conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and such participation in the meeting pursuant to
this Section shall constitute presence in person at the meeting.
SECTION 12. BOOKS. The directors may keep the books of the Corporation,
except as such are required by law to be kept within the state, outside of the
State of Delaware, at such place or places as they may from time to time
determine.
SECTION 13. COMPENSATION. The Board, by the affirmative vote of a
majority of the directors then in office, and irrespective of any personal
interest of any of its members, shall have authority to establish reasonable
compensation of all directors for services to the Corporation as directors,
officers or otherwise.
SECTION 14. VACANCIES. Newly created directorships resulting from any
increase in the authorized number of directors and any vacancies on the Board
resulting from death, resignation, disqualification, removal from office,
retirement or other cause shall be filled solely by the affirmative vote of the
remaining directors then in office, even though less than a quorum, or by the
sole remaining director, and each director so chosen shall hold office for a
term expiring at the annual meeting of stockholders at which the term of the
class to which he or she has been elected expires and until such director's
successor shall have been duly elected and qualified.
SECTION 15. REMOVAL. Any director may be removed from office with cause,
by an affirmative vote of the holders of a majority of the combined voting
power of the then outstanding shares of stock entitled to vote generally in the
election of directors, voting together as a single class. Any director may be
removed from office with cause by the affirmative vote of a majority of the
members of the Board, other than the director who is subject to a removal vote.
SECTION 16. ORGANIZATION. The Board may appoint one of its members as
Chairman of the Board. The Chairman of the Board (or if there be no Chairman
or in his or her absence, the President) shall preside over all meetings of the
Board and stockholders.
SECTION 17. STANDING COMMITTEES. By resolution adopted by a majority of
the entire Board, the Board shall elect, from among its members, individuals to
serve on the Standing Committees established hereunder. Each Standing
Committee shall be comprised of such number of Directors, not less than two, as
shall be elected to such Committee, provided that no officer or employee of the
Corporation shall be eligible to serve on the Audit and Corporate Governance,
Compensation or Nominating Committees. Each Committee shall keep a record of
all its proceedings and report the same to the Board. One-third of the members
of a Committee, but not less than two, shall constitute a quorum, and the act
of a majority of the members of a Committee present at any meeting at which a
quorum is present shall be the act of the Committee. Each Standing Committee
shall meet at the call of its chairperson or any two of its members. The
chairpersons of the various Committees shall preside, when present, at all
meetings of such Committees, and shall have such powers and perform such duties
as the Board may from time to time prescribe. The Standing Committees of the
Board, and functions of each, are as follows:
(a) AUDIT AND CORPORATE GOVERNANCE COMMITTEE. The Audit and
Corporate Governance Committee will support the independence of the Company's
external and internal auditors and the objectivity of the Company's financial
statements. The Audit and Corporate Governance Committee will (a) review the
Company's principal policies for accounting, internal control and financial
reporting, (b) recommend to the Company's Board of Directors the engagement or
discharge of the external auditors, (c) review with the external auditors the
plan, scope and timing of their audit, (d) review the auditors' fee and, after
completion of the audit, review with management the external auditors' report,
(e) review and consider major claims and litigation as well as legal,
regulatory and related governmental policy matters affecting the Company, (f)
review and approve management policies and programs relating to compliance with
legal and regulatory requirements, business ethics and environmental matters
and (g) review and define the Company's social responsibilities, including
issues of significance to the Company, its shareholders, employees and
customers. The Audit and Corporate Governance Committee will also review,
before publication, the annual financial statements of the Company, the
independence of the external auditors, the adequacy of the Company's internal
accounting control system, and the Company's policies on business integrity and
ethics and conflicts of interest. The Audit and Corporate Governance Committee
will also perform a number of other review functions related to auditing the
financial statements and internal controls.
(b) COMPENSATION COMMITTEE. The Compensation Committee will (a)
review and make recommendations to the Company's Board of Directors with
respect to the direct and indirect compensation and employee benefits of the
Chairman and other elected officers of the Company, (b) review, administer and
make recommendations to the Company's Board of Directors with respect to any
incentive plans and bonus plans that include elected officers and (c) review
the company's policies relating to the compensation of senior management and
other employees. In addition, the Committee will review management's long-
range planning for executive development and succession, establish and
periodically review policies on perquisites and perform certain other review
functions relating to management compensation and employee relations policies.
(c) NOMINATING COMMITTEE. The Nominating Committee will make
recommendations concerning the organization, size and composition of the Board
of Directors and its Committees, propose nominees for election to the Board and
its Committees and consider the qualifications, compensation and retirement of
directors.
SECTION 18. OTHER COMMITTEES. By resolution passed by a majority of the
entire Board, the Board may also appoint from among its members such other
Committees, Standing or otherwise, as it may from time to time deem desirable
and may delegate to such Committees such powers of the Board as it may consider
appropriate, consistent with the laws of Delaware, the Amended and Restated
Certificate of Incorporation and these By-laws.
SECTION 19. RESIGNATION. Any director may resign at any time by sending
a written notice of such resignation to the principal executive officer of the
Corporation addressed to the President, Secretary or the Chairman of the Board.
Unless otherwise specified therein such resignation shall take effect upon
receipt thereof by the Chairman of the Board, the President or the Secretary.
ARTICLE IV
OFFICERS
SECTION 1. GENERAL. The officers of the Corporation shall be chosen by
the Board and may be a Chairman of the Board, President, Vice President, a
Secretary and a Chief Financial Officer and as otherwise required by law. Any
two or more offices may be held by the same person.
SECTION 2. ELECTION. The Board at its first meeting after each annual
meeting and from time to time, as vacancies occur, shall elect officers, none
of whom need be a member of the Board, who shall exercise such powers and
perform such duties as shall be set forth in these By-laws and as determined
from time to time by the Board; and all officers of the Corporation shall hold
office until their successors are chosen and qualified, or until their earlier
resignation or removal. Any officer elected by the Board may be removed with
or without cause at any time by the Chairman, the President or a majority of
the Board. Any vacancy occurring in any office of the Corporation shall be
filled by the Board. The salaries of all officers of the Corporation shall be
fixed by the Board.
SECTION 3. OTHER OFFICERS. The Board may appoint such other officers and
agents as it shall deem necessary who shall hold their offices for such terms
and shall exercise such powers and perform such duties as shall be determined
from time to time by the Board.
SECTION 4. CHAIRMAN OF THE BOARD. The Chairman of the Board, if any,
shall preside at all meetings of the Board of Directors and of the stockholders
at which he or she shall be present and shall have and may exercise such powers
as may, from time to time, be assigned to him or her by the Board or as may be
provided by law.
SECTION 5. PRESIDENT. The President shall be the Chief Executive Officer
of the Corporation, shall have general direction of the business of the
Corporation, and shall authorize the other officers of the Corporation to
exercise such powers as he or she, in his or her discretion, may deem to be in
the best interest of the Corporation. He or she shall see that all orders and
resolutions of the Board are carried into effect and shall do and perform such
other duties as may from time to time be assigned to him or her by the Board.
If there be no Chairman of the Board or in his or her absence, the President
shall preside at all meetings of the Board of Directors and the stockholders.
SECTION 6. VICE PRESIDENT. The Vice President, or if there shall be more
than one, the Vice Presidents in the order determined by the Board, shall, in
the absence or disability of the President, perform the duties and have such
other powers as the Board may from time to time prescribe.
SECTION 7. SECRETARY AND ASSISTANT SECRETARIES. The Secretary shall
attend all meetings of the Board and all meetings of the stockholders and
record all the proceedings of the meetings of the Corporation and of the Board
in a book to be kept for that purpose and shall perform like duties for the
standing committees when required. He or she shall give, or cause to be given,
notice of all meetings of the stockholders and special meetings of the Board in
accordance with the By-laws and as required by law, and shall perform such
other duties as may be prescribed by the Board or President, under whose
supervision he or she shall be. He or she shall have custody of the records
and corporate seal of the Corporation and he or she, or an Assistant Secretary,
shall have authority to affix the same to any instrument requiring it and when
so affixed, it may be attested by his or her signature or by the signature of
such Assistant Secretary. The Board may give general authority to any other
officer to affix the seal of the Corporation and to attest the affixing by his
or her signature. The Assistant Secretary, or if there be more than one, the
Assistant Secretaries in the order determined by the Board, shall, in the
absence or disability of the Secretary, perform the duties and exercise the
powers of the Secretary and shall perform such other duties and have such other
powers as the Board may from time to time prescribe.
SECTION 8. CHIEF FINANCIAL OFFICER AND ASSISTANT TREASURERS. The Chief
Financial Officer shall be the Treasurer of the Corporation, shall have the
custody and charge of the Corporation's funds and securities, shall keep full
and accurate accounts of receipts and disbursements in books belonging to the
Corporation and shall deposit all moneys and other valuable effects in the name
and to the credit of the Corporation in such depositories as may be designated
from time to time by the Board. He or she shall disburse the funds of the
Corporation as may be ordered by the Board, taking proper vouchers for such
disbursements, and shall render to the President and the Board, at its regular
meetings, or when the Board so requires, an account of all his or her
transactions as Chief Financial Officer and of the financial condition of the
Corporation and shall perform such other duties as the Board may from time to
time prescribe. The Assistant Treasurer, or if there be more than one, the
Assistant Treasurers in the order determined by the Board, shall, in the
absence or disability of the Chief Financial Officer, perform the duties and
exercise the powers of the Chief Financial Officer and shall perform such
other duties and have such other powers as the Board may from time to time
prescribe.
ARTICLE V
CAPITAL STOCK
SECTION 1. FORM AND SIGNATURE. The shares of the Corporation shall be
represented by certificates signed by the President or a Vice President and the
Secretary or an Assistant Secretary or the Chief Financial Officer or an
Assistant Treasurer of the Corporation, and may be sealed with the seal of the
Corporation or a facsimile thereof. Each certificate representing shares shall
state upon its face (a) that the Corporation is formed under the laws of the
State of Delaware, (b) the name of the person(s) to whom it is issued, (c) the
number of shares which such certificate represents and (d) the par value, if
any, of each share represented by such certificate. The signatures of the
officers of the Corporation upon a certificate may be facsimiles if the
certificate is countersigned by a transfer agent, or registered by a registrar,
other than the Corporation itself or an employee of the Corporation. In case
any officer who has signed or whose facsimile signature has been placed upon
such certificate shall have ceased to be such officer before such certificate
is issued, it may be issued by the Corporation with the same effect as if he
were such officer on the date of its issue.
SECTION 2. LOST, STOLEN OR DESTROYED CERTIFICATES. The Corporation may
issue a new certificate for shares in place of any certificate theretofore
issued by it, alleged to have been lost, stolen or destroyed, and the
Corporation and/or the Board may require the owner of such lost, stolen or
destroyed certificate, or his or her legal representatives, to make an
affidavit of that fact and/or to give the Corporation a bond in such sum as it
may direct as indemnity against any claim that may be made against the
Corporation on account of the alleged loss, theft or destruction of any such
certificate or issuance of any such new certificate. Anything herein to the
contrary notwithstanding, the Board, in its absolute discretion, may refuse to
issue any such new certificate, except pursuant to legal proceedings under the
laws of the State of Delaware.
SECTION 3. TRANSFER OF SHARES. Upon surrender to the Corporation or the
transfer agent of the Corporation, if any, of a certificate representing shares
of stock duly endorsed or accompanied by proper evidence of succession,
assignment or authority to transfer, and, in the event that the certificate
refers to any agreement restricting transfer of the shares which it represents,
proper evidence of compliance with such agreement, a new certificate shall be
issued to the person entitled thereto, and the old certificate canceled and the
transaction recorded upon books of the Corporation.
SECTION 4. REGISTERED STOCKHOLDERS. The Corporation shall be entitled to
recognize the exclusive right of a person registered on its books as the owner
of shares to receive dividends, and to vote as such owner, and to hold liable
for calls and assessments a person registered on its books as the owners of
shares, and shall not be bound to recognize any equitable or legal claim or
claims to or interest in such shares on the part of any other person, whether
or not it shall have express or other notice thereof, except as otherwise
provided by the laws of the State of Delaware.
SECTION 5. REGULATIONS. Except as otherwise provided by law, the Board
may make such additional rules and regulations, not inconsistent with the By-
laws, as it may deem expedient concerning the issue, transfer and registration
of the certificates for the securities of the Corporation. The Board may
appoint, or authorize any officer or officers to appoint, one or more transfer
agents and one or more registrars and may require all certificates for shares
of capital stock to bear the signature or signatures of any of them.
SECTION 6. RECORD DATE. For the purpose of determining stockholders
entitled to notice of, or to vote at, any meeting of stockholders or any
adjournment thereof, or to express written consent to any corporate action
without a meeting, or for the purpose of determining stockholders entitled to
receive payment of any dividend or other distribution or allotment of any
rights, or entitlements to exercise any rights in respect of any change,
conversion or exchange of stock, or for the purpose of any other lawful action,
the Board may fix, in advance, a record date. Such date shall not be more than
sixty (60) nor less than ten (10) days before the date of any such meeting, nor
more than sixty (60) days prior to any other action.
ARTICLE VI
NOTICES
SECTION 1. NOTICES. Whenever, under the provisions of law or of the
Corporation's Amended and Restated Certificate of Incorporation or of these By-
laws, notice is required to be given to any director or stockholder, it shall
not be construed to mean personal notice, but such notice may be given in
writing, by mail, addressed to such director or stockholder, at his or her
address as it appears on the records of the corporation, with postage thereon
prepaid, or with an overnight express service, and such notice shall be deemed
to be given at the time when the same shall be deposited in the United States
mail. Notice to the directors shall also be deemed to have been duly given if
delivered by telegram, telecopier (transmission confirmed) or hand delivery.
SECTION 2. WAIVER OF NOTICE. Whenever a notice is required to be given
by any provision of law or under the provisions of the Amended and Restated
Certificate of Incorporation or these By-laws, a waiver thereof in writing
signed by the person or persons entitled to such notice, whether before or
after the time stated therein, shall be deemed equivalent to the giving of such
notice. In addition, any stockholder attending a meeting of stockholders in
person or by proxy without protesting prior to the conclusion of the meeting,
the lack of notice thereof to him or her, and any director attending a meeting
of the Board without protesting prior to the meeting or at its commencement
such lack of notice, shall be conclusively deemed to have waived notice of such
meeting.
ARTICLE VII
INDEMNIFICATION
SECTION 1. NATURE OF INDEMNITY. The Corporation shall indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that he or she
is or was or has agreed to become a director or officer of the Corporation, or
is or was serving or has agreed to serve at the request of the Corporation as a
director or officer of another corporation, partnership, joint venture, trust
or other enterprise, including an employee benefit plan, or by reason of any
action alleged to have been taken or omitted in such capacity, and may
indemnify any person who was or is a party or is threatened to be made a party
to such an action, suit or proceeding by reason of the fact that he or she is
or was or has agreed to become an employee or agent of the Corporation, or is
or was serving or has agreed to serve at the request of the Corporation as an
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, including an employee benefit plan, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him or her or on his or her behalf in
connection with such action, suit or proceeding and any appeal therefrom, if he
or she acted in good faith and in a manner he or she reasonably believed to be
in or not opposed to the best interests of the Corporation, and, with respect
to any criminal action or proceeding had no reasonable cause to believe his or
her conduct was unlawful; except that in the case of an action or suit by or in
the right of the Corporation to procure a judgment in its favor (a) such
indemnification shall be limited to expenses (including attorneys' fees)
actually and reasonably incurred by such person in the defense or settlement of
such action or suit, and (b) no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the Corporation unless and only to the extent that the Delaware Court
of Chancery or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which the Delaware Court of Chancery or
such other court shall deem proper.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of NOLO CONTENDERE or its equivalent,
shall not, of itself, create a presumption that the person did not act in good
faith and in a manner which he or she reasonably believed to be in or not
opposed to the best interests of the Corporation, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his or her
conduct was unlawful.
SECTION 2. SUCCESSFUL DEFENSE. To the extent that a director, officer,
employee or agent of the Corporation has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to in Section 1
of this ARTICLE VII or in defense of any claim, issue or matter therein, he or
she shall be indemnified against expenses (including attorneys' fees) actually
and reasonably incurred by him or her in connection therewith.
SECTION 3. DETERMINATION THAT INDEMNIFICATION IS PROPER. Any
indemnification of a director or officer of the Corporation under Section 1 of
this ARTICLE VII (unless ordered by a court) shall be made by the Corporation
unless a determination is made that indemnification of the director or officer
is not proper in the circumstances because he or she has not met the applicable
standard of conduct set forth in Section 1 of this ARTICLE VII. Any
indemnification of an employee or agent of the Corporation under Section I of
this ARTICLE VII (unless ordered by a court) may be made by the Corporation
upon a determination that indemnification of the employee or agent is proper in
the circumstances because he or she has met the applicable standard of conduct
set forth in Section 1 of this ARTICLE VII. Any such determination shall be
made (a) by the Board by a majority vote of a quorum consisting of directors
who were not parties to such action, suit or proceeding, or (b) if such a
quorum is not obtainable, or, even if obtainable a quorum of disinterested
directors so directs, by independent legal counsel in a written opinion, or (c)
by the stockholders.
SECTION 4. ADVANCE PAYMENT OF EXPENSES. Expenses (including attorneys'
fees) incurred by a director or officer in defending any civil, criminal,
administrative or investigative action, suit or proceeding shall be paid by the
Corporation in advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of the director or
officer to repay such amount if it shall ultimately be determined that he or
she is not entitled to be indemnified by the Corporation as authorized in this
ARTICLE VII. Such expenses (including attorneys' fees) incurred by other
employees and agents may be so paid upon such terms and conditions, if any, as
the Board deems appropriate. The Board may authorize the Corporation's counsel
to represent such director, officer, employee or agent in any action, suit or
proceeding, whether or not the Corporation is a party to such action, suit or
proceeding.
SECTION 5. PROCEDURE FOR INDEMNIFICATION OF DIRECTORS AND OFFICERS. Any
indemnification of a director or officer of the Corporation under Section 1 of
this ARTICLE VII, or advance of costs, charges and expenses to a director or
officer under Section 4 of this ARTICLE VII, shall be made promptly, and in any
event within thirty (30) days, upon the written request of the director or
officer. If a determination by the Corporation that the director or officer is
entitled to indemnification pursuant to this ARTICLE VII is required, and the
Corporation fails to respond within sixty (60) days to a written request for
indemnity, the Corporation shall be deemed to have approved such request. If
the Corporation denies a written request for indemnity or advancement of
expenses, in whole or in part, or if payment in full pursuant to such request
is not made within thirty (30) days, the right to indemnification or advances
as granted by this ARTICLE VII shall be enforceable by the director or officer
in any court of competent jurisdiction. Such person's costs and expenses
incurred in connection with successfully establishing his or her right to
indemnification, in whole or in part, in any such action shall also be
indemnified by the Corporation. It shall be a defense to any such action
(other than an action brought to enforce a claim for the advance of costs,
charges and expenses under Section 4 of this ARTICLE VII where the required
undertaking, if any, has been received by the Corporation) that the claimant
has not met the standard of conduct set forth in Section 1 of this ARTICLE VII,
but the burden of proving such defense shall be on the Corporation. Neither
the failure of the Corporation (including its Board, its independent legal
counsel, and its stockholders) to have made a determination prior to the
commencement of such action that indemnification of the claimant is proper in
the circumstances because he or she has met the applicable standard of conduct
set forth in Section 1 of this ARTICLE VII, nor the fact that there has been an
actual determination by the Corporation (including its Board, its independent
legal counsel, and its stockholders) that the claimant has not met such
applicable standard of conduct, shall be a defense to the action or create a
presumption that the claimant has not met the applicable standard of conduct.
SECTION 6. SURVIVAL; PRESERVATION OF OTHER RIGHTS. The foregoing
indemnification provisions shall be deemed to be a contract between the
Corporation and each director, officer, employee and agent who serves in any
such capacity at any time while these provisions as well as the relevant
provisions of the General Corporation Law of the State of Delaware are in
effect, and any repeal or modification thereof shall not affect any right or
obligation then existing with respect to any state of facts then or previously
existing or any action, suit or proceeding previously or thereafter brought or
threatened based in whole or in part upon any such state of facts. Such a
"contract right" may not be modified retroactively without the consent of such
director, officer, employee or agent.
The indemnification provided by this ARTICLE VII shall not be deemed
exclusive of any other rights to which those indemnified may be entitled under
any by-law, agreement, vote of stockholders or disinterested directors or
otherwise, both as to action in his or her official capacity and as to action
in another capacity while holding such office, and shall continue as to a
person who has ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of such a
person.
SECTION 7. INSURANCE. The Corporation shall purchase and maintain
insurance on behalf of any person who is or was or has agreed to become a
director or officer of the Corporation, or is or was serving at the request of
the Corporation as a director or officer of another corporation, partnership,
joint venture, trust or other enterprise, including an employee benefit plan,
against any liability asserted against him or her and incurred by him or her or
on his or her behalf in any such capacity, or arising out of his or her status
as such, whether or not the Corporation would have the power to indemnify him
or her against such liability under the provisions of this ARTICLE VII.
SECTION 8. SEVERABILITY. If this Article or any portion hereof shall be
invalidated on any ground by any court of competent jurisdiction, then the
Corporation shall nevertheless indemnify each director or officer and may
indemnify each employee or agent of the Corporation as to costs, charges and
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement with respect to any action, suit or proceeding, whether civil,
criminal, administrative or investigative, including an action by or in the
right of the Corporation, to the fullest extent permitted by any applicable
portion of this ARTICLE VII that shall not have been invalidated and to the
fullest extent permitted by applicable law.
ARTICLE VIII
GENERAL PROVISIONS; DIVIDENDS
SECTION 1. DIVIDENDS. Subject to the provisions of the Amended and
Restated Certificate of Incorporation relating thereto, if any, dividends may
be declared by the Board at any regular or special meeting, pursuant to law.
Dividends may be paid in cash, in property or in shares of the capital stock,
subject to any provisions of the Amended and Restated Certificate of
Incorporation. Before payment of any dividend, there may be set aside out of
any funds of the Corporation available for dividends such sum or sums as the
directors from time to time, in their absolute discretion, think proper as a
reserve fund to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the Corporation, or for such other
purpose as the directors shall think conducive to the interest of the
Corporation, and the directors may modify or abolish any such reserve in the
manner in which it was created.
SECTION 2. CHECKS. All checks, drafts, bills, demands for money and
notes of the Corporation or other orders or payment of money shall be signed by
such officer or officers or such other person or persons as the Board may from
time to time designate and, in the absence of such designation, such checks,
drafts, bills, demands for money and notes of the Corporation or other orders
or payment of money shall be signed by the President, Chief Financial Officer
or any Vice President of the Corporation.
SECTION 3. FISCAL YEAR. The fiscal year of the Corporation shall be
fixed by resolution of the Board.
SECTION 4. SEAL. The corporate seal shall have inscribed thereon the
name of the Corporation and the words "Corporate Seal, Delaware" and the date
of incorporation. The seal may be used by causing it or a facsimile thereof to
be impressed or affixed or in any manner reproduced.
SECTION 5. GENERAL AND SPECIAL BANK ACCOUNTS. The Board may authorize
from time to time the opening and keeping of general and special bank accounts
with such banks, trust companies or other depositories as the Board may
designate or as may be designated by any officer or officers of the Corporation
to whom such power of designation may be delegated by the Board from time to
time. The Board may make such special rules and regulations with respect to
such accounts, not inconsistent with the provisions of these By-laws, as it may
deem expedient.
SECTION 6. LOANS. Such of the officers of the Corporation as shall be
designated from time to time by any resolution adopted by the Board of
Directors and included in the minute book, and in the absence of any such
designation, the President, Chief Financial Officer or any Vice President 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.
SECTION 7. EXECUTION OF DOCUMENTS. The President or any Vice President
of the Corporation 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, otherwise
provided herein or in the Corporation's Amended and Restated Certificate of
Incorporation, or as otherwise required by law.
ARTICLE IX
AMENDMENTS OF BY-LAWS
The Board shall have the express power, without a vote of stockholders, to
adopt any By-law, and to amend, alter or repeal the By-laws of the Corporation,
except to the extent that the By-laws or the Amended and Restated Certificate
of Incorporation otherwise provide. The Board may exercise such power upon the
affirmative vote of a majority of the entire Board. Stockholders may adopt any
By-law, or amend, alter or repeal the By-laws of the Corporation, upon the
affirmative vote of the holders of at least a majority of the votes entitled to
be cast by the holders of all then outstanding voting shares of the
Corporation, voting together as a single class.
ARTICLE X
CONSTRUCTION
In the event of any conflict between the provisions of these By-laws as in
effect from time to time and the provisions of the Amended and Restated
Certificate of Incorporation of the Corporation as in effect from time to time,
the provisions of such Amended and Restated Certificate of Incorporation shall
be controlling.
<PAGE>
EXHIBIT 5
BAKER & DANIELS
300 NORTH MERIDIAN STREET
SUITE 2700
INDIANAPOLIS, INDIANA 46204
(317) 237-0300
October 28, 1997
ITT Educational Services, Inc.
5975 Castle Creek Parkway, N. Drive
Indianapolis, Indiana 46250-0466
Re: Registration Statement on Form S-8
Ladies and Gentlemen:
We have acted as counsel to ITT Educational Services, Inc., a Delaware
corporation (the "Company"), in connection with the preparation and filing
with the Securities and Exchange Commission (the "Commission") of the
Company's Registration Statement on Form S-8 (the "Registration Statement")
under the Securities Act of 1933 (the "Act"), registering the offer and
sale of up to 684,935 shares (the "Incentive Shares") of the Company's
common stock, $0.01 par value (the "Common Stock"), pursuant to the 1997
ITT Educational Services, Inc. Incentive Stock Plan (the "Incentive Plan").
In so acting, we have examined and relied upon the originals, or copies
certified or otherwise identified to our satisfaction, of such records,
documents and other instruments as in our judgment are necessary or
appropriate to enable us to render the opinion expressed below.
Based on the foregoing, we are of the opinion that the Incentive Shares
have been duly authorized and, when the Registration Statement shall have
become effective and the Incentive Shares have been issued in accordance
with the Incentive Plan, the Incentive Shares will be validly issued, fully
paid and non-assessable.
Our opinion expressed above is limited to the federal law of the United
States and the law of the State of Delaware.
<PAGE>
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving such consent, we do not thereby concede
that we are within the category of persons whose consent is required under
Section 7 of the Act or the Rules and Regulations of the Commission
thereunder.
Very truly yours,
/s/ BAKER & DANIELS
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated January 8, 1997, except as to
Note 10, which is as of February 12, 1997, which appears on page F-1 of ITT
Educational Services, Inc.'s Annual Report on Form 10-K for the year
ended December 31, 1996.
/S/ PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
Indianapolis, Indiana
October 28, 1997
<PAGE>
