BYLAWS
(as amended through May 17, 2000)
of
SOUTHWEST AIRLINES CO.
Dallas, Texas
SOUTHWEST AIRLINES CO.
BYLAWS
ARTICLE I
IDENTIFICATION AND OFFICES
Section 1. Name: The name of the corporation is
SOUTHWEST AIRLINES CO.
Section 2. Principal Business Office: The principal
business office of the corporation shall be in Dallas, Texas.
Section 3. Other Offices: The corporation may also have
offices at such other places within or without the State of
Texas as the Board of Directors may from time to time
determine or the business of the corporation may require.
ARTICLE II
THE SHAREHOLDERS
Section 1. Place of Meetings: All meetings of the
shareholders for the election of directors shall be held at
the principal executive offices of the corporation in Dallas,
Texas, or at such other place as may be designated by the
Board of Directors of the corporation. Meetings of the
shareholders for any other purpose may be held at such time
and place, within or without the State of Texas, as shall be
stated in the notice of the meeting or in a duly executed
waiver of notice thereof.
Section 2. Annual Meetings: Annual meetings of
shareholders shall be held on such date and at such time as
shall be designated from time to time by the Board of
Directors. At each annual meeting, the shareholders shall
elect a Board of Directors and transact such other business as
may be properly brought before the meeting.
Section 3. Special Meetings: Special meetings of the
shareholders may be called by the President and shall be
called by the Secretary upon written request, stating the
purpose or purposes therefor, by a majority of the whole Board
of Directors or by the holders of at least ten (10) percent
(or such greater percentage not exceeding a majority as may be
specified in the Articles of Incorporation) of all of the
shares entitled to vote at the meeting.
Section 4. Notice of Meetings: Written or printed
notice of all shareholders' meetings stating the place, day
and hour, and, in the case of a special meeting, the purpose
or purposes for which the meeting is called, shall be
delivered not less than ten (10) days nor more than sixty (60)
days before the date of the meeting, either personally or by
mail, by or at the direction of the officer or person calling
the meeting, to each shareholder of record entitled to vote at
such meeting. If mailed, such notice shall be deemed to be
delivered when deposited in the United States mail addressed
to the shareholder at his address as it appears on the stock
transfer books of the corporation, with postage thereon
prepaid.
Section 5. Purpose of Special Meetings: Business
transacted at all special meetings of shareholders shall be
confined to the purposes stated in the notice thereof.
Section 6. Fixing Record Date: For the purpose of
determining shareholders entitled to notice of or to vote at
any meeting of shareholders or any adjournment thereof, or
entitled to receive a distribution by the corporation (other
than a distribution involving a purchase or redemption by the
corporation of any of its own shares) or a share dividend or
in order to make a determination of shareholders for any other
purpose, the Board of Directors may fix in advance a date as
the record date for any such determination of shareholders,
such date in any case to be not more than sixty (60) days,
and, in the case of a meeting of shareholders, not less than
ten (10) days, prior to the date on which the particular
action requiring such determination of shareholders is to be
taken. If no record date is fixed for the determination of
shareholders entitled to notice of or vote at a meeting of
shareholders, or shareholders entitled to receive a
distribution by the corporation (other than a distribution
involving a purchase or redemption by the corporation of any
of its own shares) or a share dividend, the date on which
notice of the meeting is mailed or the date on which the
resolution of the Board of Directors declaring such
distribution or share dividend is adopted, as the case may be,
shall be the record date for such determination of
shareholders. When a determination of shareholders entitled
to vote at any meeting of shareholders has been made as
provided in this Section, such determination shall apply to
any adjournment thereof.
Section 7. Voting List: The officer or agent having
charge of the stock transfer books for the shares of the
corporation, shall make, at least ten (10) days before each
meeting of shareholders, a complete list of the shareholders
entitled to vote at such meeting or any adjournment thereof,
arranged in alphabetical order, with the address of and the
number of shares held by each, which list, for a period of ten
(10) days prior to such meeting, shall be kept on file at the
registered office of the corporation and shall be subject to
inspection by any shareholder at any time during usual
business hours; such list shall also be produced and be kept
open at the time and place of the meeting and shall be subject
to the inspection of any shareholder during the whole time of
the meeting. The original stock transfer books shall be prima
facie evidence as to who are the shareholders entitled to
examine such list or transfer books or to vote at any meeting
of shareholders.
Section 8. Quorum: The holders of a majority of the
shares entitled to vote (counting for such purposes all
abstentions and broker nonvotes), represented in person or by
proxy, shall constitute a quorum at meetings of the
shareholders, except as otherwise provided in the Articles of
Incorporation. If, however, such quorum shall be not present
or represented at a meeting of the shareholders, the holders
of a majority of the shares entitled to vote thereat, and
represented in person or by proxy, shall have power to recess
the meeting from time to time, without notice other than power
to recess the meeting from time to time, without notice other
than announcement at the meeting, until a quorum shall be
present or represented. At such recessed 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 convened had a quorum been present. Shareholders
present at a duly organized meeting with a quorum present may
continue to do business until adjournment, notwithstanding the
withdrawal of enough shareholders to leave less than a quorum.
Section 9. Voting at Meetings:
(a) With respect to any matter other than the
election of directors or a matter for which the
affirmative vote of the holders of a specified portion of
the shares entitled to vote is required by the Texas
Business Corporation Act, the act of the shareholders
shall be the affirmative vote of the holders of a
majority of the shares entitled to vote on, and voted for
or against, the matter at a meeting of shareholders at
which a quorum is present; provided that, for purposes of
this sentence, all abstentions and broker nonvotes shall
not be counted as voted either for or against such
matter. With respect to the election of directors,
directors shall be elected by a plurality of the votes
cast by the holders of shares entitled to vote in the
election of directors at a meeting of shareholders at
which a quorum is present; provided, that abstentions and
broker nonvotes shall not be counted as votes cast either
for or against any nominee for director.
(b) Each outstanding share, regardless of class,
shall be entitled to one vote on each matter submitted to
a vote at a meeting of shareholders, except to the extent
that the voting rights of shares of any class or series
are limited or denied by the Articles of Incorporation,
or as otherwise provide by law. No shareholder shall
have the right of cumulative voting.
(c) A shareholder may vote either in person or by
proxy executed in writing by the shareholder or by his
duly authorized attorney in fact. No proxy shall be
valid after eleven (11) months from the date of its
execution unless otherwise provided in the proxy. Each
proxy shall be revocable unless the proxy form
conspicuously states that the proxy is irrevocable and
the proxy is coupled with an interest.
Section 10. Actions by Shareholders Without a Meeting:
Any action required by law to be taken at a meeting of the
shareholders, or any action which may be taken at a meeting of
the shareholders, may be taken without a meeting if a consent
in writing, setting forth the action so taken, shall be signed
by all of the shareholders entitled to vote with respect to
the subject matter thereof.
Section 11. Inspectors of Election: The chairman of
each meeting of shareholders shall appoint one or more persons
to act as inspectors of election. The inspectors of election
shall report to the meeting the number of shares of each class
and series of stock, and of all classes, represented either in
person or by proxy. The inspectors of election shall oversee
the vote of the shareholders for the election of directors and
for any other matters that are put to a vote of shareholders
at the meeting; receive a ballot evidencing votes cast by the
proxy committee of the Board of Directors; judge the
qualifications of shareholders voting; collect, count, and
report the results of ballots cast by any shareholders voting
in person; and perform such other duties as may be required by
the chairman of the meeting or the shareholders.
Section 12. Notice of Shareholder Business: At an
annual meeting of shareholders, only such business shall be
conducted as shall have been brought before the meeting (i) by
or at the direction of the Board of Directors or (ii) by any
shareholder of the corporation who complies with the notice
procedures set forth in this Section 12. For business to be
properly brought before an annual meeting by a shareholder,
the shareholder must have given timely notice thereof in
writing to the Secretary of the corporation. To be timely, a
shareholder's notice must be delivered to or mailed and
received at the principal executive offices of the
corporation, not less than sixty (60) days nor more than
ninety (90) days prior to the meeting; provided, however, that
in the event that less than thirty (30) days' notice or prior
public disclosure of the date of the meeting is given or made
to the shareholders, notice by the shareholder to be timely
must be received not later than the close of business on the
tenth (10th) day following the day on which such notice of the
date of the annual meeting was mailed or such public
disclosure was made. A shareholder's notice to the Secretary
shall set forth as to each matter the shareholder proposes to
bring before the annual meeting the following information: (a)
a brief description of the business desired to be brought
before the annual meeting and the reasons for conducting such
business at the annual meeting; (b) the name and address, as
they appear on the corporation's books, of the shareholder
proposing such business; (c) the number of shares of the
corporation which are beneficially owned by the shareholder;
and (d) any material interest of the shareholder in such
business. Notwithstanding anything in these Bylaws to the
contrary, no business shall be conducted at an annual meeting
except in accordance with the procedures set forth in this
Section 12. The chairman of an annual meeting shall, if the
facts warrant, determine and declare to the meeting that
business was not properly brought before the meeting and in
accordance with the provisions of this Section 12, and if he
should so determine, he shall so declare to the meeting and
any such business not properly brought before the meeting
shall not be transacted. Notwithstanding the foregoing
provisions of this Section 12, a shareholder seeking to have a
proposal included in the corporation's proxy statement shall
comply with the requirements of Regulation 14A under the
Securities Exchange Act of 1934, as amended (including, but
not limited to, Rule 14a-8 or its successor provision).
Section 13. Notice of Shareholder Nominees: Nominations
of persons for election to the Board of Directors of the
corporation may be made at a meeting of shareholders (i) by or
at the direction of the Board of Directors or (ii) by any
shareholder of the corporation entitled to vote for the
election of directors at the meeting who complies with the
notice procedures set forth in this Section 13. Nominations
by shareholders shall be made pursuant to timely notice in
writing to the Secretary of the corporation. To be timely, a
shareholder's notice shall be delivered to or mailed and
received at the principal executive offices of the corporation
not less than sixty (60) days nor more than ninety (90) days
prior to the meeting; provided, however, that in the event
that less than thirty (30) days' notice or prior public
disclosure of the date of the meeting is given or made to
shareholders, notice by the shareholder to be timely must be
so received not later than the close of business on the tenth
(10th) day following the day on which such notice of the date
of the meeting was mailed or such public disclosure was made.
Such shareholder's notice shall set forth (a) as to each
person whom the shareholder proposes to nominate for election
or reelection as a director, all information relating to such
person that is required to be disclosed in solicitations of
proxies for election of directors, or is otherwise required,
in each case pursuant to Regulation 14A under the Securities
Exchange Act of 1934, as amended (including such person's
written consent to being named in the proxy statement as a
nominee and to serving as a director if elected); and (b) as
to the shareholder giving the notice (i) the name and address,
as they appear on the corporation's books, of such shareholder
and (ii) the number of shares of the corporation which are
beneficially owned by such shareholder. At the request of the
Board of Directors, any person nominated by the Board of
Directors for election as a director shall furnish to the
Secretary of the corporation that information required to be
set forth in a shareholder's notice of nomination which
pertains to the nominee. No person shall be eligible for
election as a director of the corporation unless nominated in
accordance with the procedures set forth in these Bylaws. The
chairman of the meeting shall, if the facts warrant, determine
and declare to the meeting that a nomination was not made in
accordance with the procedures prescribed by these Bylaws, and
if he should so determine, he shall so declare to the meeting
and the defective nomination shall be disregarded.
ARTICLE III
BOARD OF DIRECTORS
Section 1. Management: The business and affairs of the
corporation shall be managed by a Board of Directors.
Section 2. Number; Term of Office; Qualifications: The
number of directors of the corporation shall be determined
from time to time by resolution of the Board of Directors, but
no decrease in such number shall have the effect of shortening
the term of any incumbent director. At each annual meeting of
shareholders, the shareholders shall elect directors to hold
office until the next succeeding annual meeting, except in
case of the classification of directors as provided in these
Bylaws. Each director shall hold office for the term for
which he is elected and until his successor shall have been
elected and qualified or until his earlier death, retirement,
resignation, or removal for cause in accordance with the
provisions of these Bylaws. Directors need not be residents
of the State of Texas or shareholders of the corporation, but
they must have been nominated in accordance with the
procedures set forth in these Bylaws in order to be eligible
for election as directors. Each director must retire no later
than the first annual meeting of shareholders following his or
her 72nd birthday.
Section 3. Classification of Directors: Effective at
the time of the annual meeting of shareholders in 1990, in
lieu of electing the whole number of directors annually, the
directors shall be divided into three classes, Class I, Class
II and Class III, each class to be as nearly equal in number
as possible, and the remainder of this Section 3 shall be
effective. Each director shall serve for a term ending on the
date of the third annual meeting of shareholders following the
annual meeting at which such director was elected; provided,
however, that each initial director in Class I shall hold
office until the first annual meeting of shareholders after
his election; each initial director in Class II shall hold
office until the second annual meeting of shareholders after
his election; and each initial director in Class III shall
hold office until the third annual meeting of shareholders
after his election. In the event of any increase or decrease
in the authorized number of directors, (i) each director then
serving as such shall nevertheless continue as a director of
the class of which he is a member until the expiration of his
current term or until his prior death, retirement,
resignation, or removal for cause in accordance with the
provisions of these Bylaws, and (ii) the newly created or
eliminated directorships resulting from such increase or
decrease shall be apportioned by the Board of Directors among
the three classes of directors so as to maintain such classes
as nearly equal in number as possible.
Section 4. Vacancies; Increases in the Number of
Directors: Any vacancy occurring in the Board of Directors
may be filled in accordance with the following paragraph of
this Section 4 or may be filled by the affirmative vote of a
majority of the remaining directors though less than a quorum
of the Board of Directors. A director elected to fill a
vacancy shall be elected for the unexpired term of his
predecessor in office.
Any vacancy occurring in the Board of Directors or any
directorship to be filled by reason of an increase in the
number of directors (i) may be filled by election at an annual
or special meeting of shareholders called for that purpose or
(ii) may be filled by the Board of Directors; provided that,
with respect to any directorship to be filled by the Board of
Directors by reason of an increase in the number of directors
(a) such directorship shall be for a term of office continuing
only until the next election of one or more directors by
shareholders and (b) the Board of Directors may not fill more
than two such directorships during the period between any two
successive annual meetings of shareholders. If the Board of
Directors is classified, any director elected at an annual or
special meeting of shareholders to fill a directorship created
by reason of an increase in the number of directors shall be
elected for a term coterminous with the remaining term of the
other members of the class to which he has been designated in
accordance with the provisions of these Bylaws.
Section 5. Removal: At any meeting of shareholders
called expressly for that purpose, any director may be
removed, but only for cause, by vote of the holders of a
majority of the shares then entitled to vote for the election
of directors.
Section 6. Place of Meeting: Meetings of the Board of
Directors, regular or special, may be held either within or
without the State of Texas.
Section 7. First Meeting: The first meeting of each
newly elected Board shall be held immediately following the
shareholders' meeting at which the directors are elected and
at the place at which such annual meeting is held, or the
directors may meet at such time and place as shall be fixed by
the consent in writing of the directors. No notice of such
meeting shall be necessary to the newly elected directors in
order to legally constitute the meeting provided a quorum
shall be present.
Section 8. Regular Meetings: Regular meetings of the
Board of Directors may be held without notice at such time and
place as shall from time to time be determined by resolution
of the Board of Directors.
Section 9. Special Meetings: Special meetings of the
Board of Directors may be called by the President on two days'
notice to each director, either personally, by telephone, by
mail, or by telegram. Special meetings shall be called by the
President, or by the Secretary, in like manner and on like
notice on the written request of the majority of the whole
Board of Directors.
Section 10. Purpose of Meetings: Neither the purpose
of, nor the business to be transacted at, any regular or
special meeting of the Board of Directors need be specified in
the notice or waiver of notice of such meeting.
Section 11. Quorum: A majority of the number of
directors shall constitute a quorum for the transaction of
business at any meeting thereof. The act of the majority of
the directors present at a meeting at which a quorum is
present shall be the act of the Board of Directors, unless the
act of a greater number is required by law or the Articles of
Incorporation or these bylaws. If a quorum shall not be
present at any meeting of the Board of Directors, the
directors present thereat may adjourn the meeting from time to
time, without notice other than announcement at the meeting,
until a quorum shall be present.
Section 12. Committee of Directors: The Board of
Directors may, by resolution passed by a majority of the whole
Board, designate one or more committees, including an
"Executive Committee," each committee to consist of one or
more of the directors of the corporation, which, to the extent
provided in said resolution, shall have and may exercise all
of the authority of the Board of Directors in the business and
affairs of the corporation, except where action of the Board
is mandatorily required by law, 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. Such
committees shall keep regular minutes of their proceedings and
report the same to the Board when required.
Section 13. Action Without Meeting: Any action required
or permitted to be taken at a meeting of the Board of
Directors or any committee may be taken without a meeting if a
consent in writing, setting forth the action so taken, is
signed by all the members of the Board of Directors or
committee, as the case may be. Such consent shall have the
same force and effect as a unanimous vote at a meeting. The
signed consent, or a signed copy, shall be placed in the
minute book.
ARTICLE IV
OFFICERS
Section 1. Number and Designation: The officers of the
corporation shall consist of a President, a Vice President, a
Secretary, an Assistant Secretary, a Treasurer, an Assistant
Treasurer, and, if the Board of Directors so elects, a
Chairman of the Board. Any two or more offices may be held by
the same person, except that the President and Secretary shall
not be the same person.
Section 2. Election: The Board of Directors at its
first meeting after the annual meeting of the shareholders may
elect a Chairman of the Board from among its members and shall
elect a President, a Vice President, a Secretary, an Assistant
Secretary, a Treasurer, and an Assistant Treasurer, none of
whom need to be a member of the Board.
Section 3. Other Officers: The President may appoint
such other officers and agents as he may deem necessary for
the efficient and successful conduct of the business of the
corporation, but none of such other officers and agents shall
be given a contract of employment unless such is first
approved by the Board of Directors.
Section 4. Term of Office and Removal: The officers,
agents, or members of any committees of the corporation
elected or appointed by the Board of Directors shall hold
office until their successors are chosen and qualify in their
stead; provided, that any such officer, agent, or member of
such committees may be removed at any time by the majority
vote of the whole Board of Directors whenever in its sole
judgment the best interests of the corporation will be served
thereby, but such removal shall be without prejudice to the
contract rights, if any, of the person so removed. Any
officer or agent appointed by the President may be removed at
any time by majority vote of the whole Board of Directors or
by the President. Election or appointment of an officer or
agent shall not of itself create contract rights.
Section 5. Compensation: The salaries of all officers
of the corporation shall be fixed by, or at the direction of,
the Board of Directors or its Compensation Committee.
Section 6. The Chairman of the Board: If elected, the
Chairman of the Board shall preside at all meetings of the
shareholders and directors; and he shall have such other
powers and duties as the Board of Directors shall prescribe.
Section 7. The President: The President shall be the
chief executive officer of the corporation; in the absence of
the Chairman of the Board or if there be no Chairman of the
Board, he shall preside at all meetings of the shareholders
and directors; shall be ex officio a member of all standing
committees; and shall see that all orders and resolutions of
the Board of Directors are carried into effect. The President
may execute deeds, conveyances, notes, bonds, and other
contracts either or without the attestation of the Secretary
required thereon and either with or without the seal of the
corporation.
Section 8. Vice Presidents: The Vice Presidents, in the
order of their rank and seniority in office, in the absence or
disability of the President shall perform the duties and
exercise the powers of the President, and shall perform such
other duties as the Board of Directors shall prescribe.
Section 9. The Secretary: The Secretary shall attend
all meetings of the Board of Directors and all meetings of the
shareholders and record all votes and the minutes of all
proceedings in a book to be kept for that purpose and shall
perform like duties for the standing committees when required.
He shall give, or cause to be given, notice of all meetings of
the shareholders and special meetings of the Board of
Directors, and shall perform such other duties as may be
prescribed by the Board of Directors or President, under whose
supervision he shall be; he shall keep the seal the
corporation and, when authorized by the Board, affix the same
to any instrument requiring it and, when so affixed, it shall
be attested by his signature or by the signature of the
Treasurer or an Assistant Secretary or Assistant Treasurer.
Section 10. The Assistant Secretaries: The Assistant
Secretaries, in order of their seniority in office, 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 as the Board of Directors shall prescribe.
Section 11. The Treasurer: The Treasurer shall have
supervision over the corporate funds and securities and shall
keep or cause to be kept full and accurate accounts of
receipts and disbursements in books belonging to the
corporation and shall deposit or cause to be deposited all
moneys and other valuable effects in the name and to the
credit of the corporation in such depositories as may be
designated by the Board of Directors, 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 directors, at the regular meetings of the
Board, or whenever they may require it, an account of all the
transactions under his supervision as Treasurer and of the
financial condition of the corporation. If required by the
Board of Directors, the Treasurer and persons acting under
this supervision shall give the corporation a bond in such sum
and with such surety or sureties as shall be satisfactory to
the Board for the faithful performance of their duties and for
the restoration to the corporation, in case of their death,
resignation, retirement, or removal from office, of all books,
papers, vouchers, money, and other property of whatever kind
in their possession or under their control belonging to the
corporation.
Section 12. The Assistant Treasurers: The Assistant
Treasurers, in the order of their seniority in office, shall,
in the absence or disability of the Treasurer, perform the
duties and exercise the powers of the Treasurer and shall
perform such other duties as the Board of Directors shall
prescribe.
ARTICLE V
CERTIFICATES REPRESENTING SHARES
Section 1. Form and Issuance: The certificates
representing shares of the corporation of each class or series
shall be in such form as approved by resolution of the Boards
of Directors and as may be required by law and shall be
numbered and entered in the stock records of the corporation
as they are issued. They shall show the holder's name and
number of shares and shall be signed by the Chairman of the
Board, if any, or the President and the Secretary of the
corporation, and may be sealed with the seal of the
corporation or a facsimile thereof. The signatures of the
Chairman of the Board or President and of the Secretary upon a
certificate may be facsimiles. 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 at the date of
its issuance. No certificate shall be issued for any share
until the consideration therefor, fixed as provided by law,
has been fully paid.
Section 2. Fractional Shares: The corporation may, but
shall not be obligated to, issue a certificate for a
fractional share, and the Board of Directors may, in lieu
thereof, arrange for the disposition thereof by those entitled
thereto, pay the fair value in cash or issue scrip in
registered or bearer form which shall entitle the holder to
receive a certificate for a full share only upon the surrender
of such scrip aggregating a full share. A certificate for a
fractional share shall, but scrip shall not, unless otherwise
provided herein, entitle the holder to exercise voting rights,
to receive dividends, or to participate in any of the assets
of the corporation in the event of liquidation. Such scrip if
issued shall become void if not exchanged for certificates
representing full shares within one year after its issue, or
such scrip may be subject to the condition that the shares for
which it is exchangeable may be sold by the corporation and
the proceeds thereof distributed to the holders of such scrip,
and the same may be subject to any other conditions which the
Board of Directors may deem advisable.
Section 3. Lost, Stolen, or Destroyed Certificates. The
Board of Directors may direct a new certificate or
certificates to be issued in place of any certificate or
certificates theretofore issued by the corporation alleged to
have been lost, stolen, or destroyed, upon the making of an
affidavit of the fact by the person claiming the certificate
of stock to be lost, stolen, or destroyed, and by such other
persons as may have knowledge of the pertinent facts with
reference thereto. When authorizing such issue of a new
certificate or certificates, the Board of Directors may, in
its discretion, and as a condition precedent to the issuance
thereof, require the owner of such lost, stolen, or destroyed
certificate or certificates, or his legal representative, to
make proof of loss, theft, or destruction in such manner as it
shall require and/or give the corporation a bond in such sum
as it may direct as indemnity against any claim that may be
made against the corporation with respect to the certificate
alleged to have been lost, stolen or destroyed.
Section 4. Transfer of Shares: Upon surrender to the
corporation or the transfer agent of the corporation of a
certificate for shares duly endorsed or accompanied by proper
evidence of succession, assignment, or authority to transfer,
and upon payment of all taxes as may be imposed by law, it
shall be the duty of the corporation to issue a new
certificate to the person entitled thereto, cancel the old
certificate, and record the transaction upon its books.
Section 5. Registered Shareholders: The corporation
shall be entitled to treat the holder of record of any share
or shares of stock as the holder in fact thereof and,
accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such share or shares on the part
of any other person, whether or not it shall have express or
other notice thereof, except as otherwise provided by the laws
of Texas.
ARTICLE VI
NOTICES
Section 1. Waiver in Writing: Whenever any notice is
required to be given any shareholder or director under the
provisions of the law or the Articles of Incorporation or
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, shall be deemed equivalent to the
giving of such notice.
Section 2. Waiver by Attendance: Attendance of a
director or a shareholder, whether in person or by proxy, at
any meeting shall constitute a waiver of notice of such
meeting, except where such director or shareholder attends a
meeting for the express purpose of objecting to the
transaction of any business on the ground that the meeting is
not lawfully called or convened.
ARTICLE VII
GENERAL PROVISIONS
Section 1. Dividends and Reserves: Dividends upon the
shares of the corporation, subject to the provisions, if any,
of the Articles of Incorporation, may in the exercise of its
discretion be declared by the Board of Directors at any
regular or special meeting, to the extent permitted by law.
Dividends may be paid in cash, in property, or in shares of
the corporation. 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. Fiscal Year: The fiscal year of the
corporation shall be fixed by resolution of the Board of
Directors.
Section 3. Seal: The corporate seal shall have
inscribed therein the name of the corporation and shall be in
such form as may be approved by the Board of Directors. Said
seal may be used by causing it or a facsimile thereof to be
impressed or affixed or otherwise reproduced.
Section 4. Amendments to Bylaws: All of the powers of
this corporation, insofar as the same may be lawfully vested
by these Bylaws in the Board of Directors, are hereby
conferred upon the Board of Directors of this corporation. In
furtherance and not in limitation of that power, the Board of
Directors may amend or repeal these Bylaws, or adopt new
bylaws, unless (i) such power shall be reserved exclusively to
the shareholders in whole or part by the Articles of
Incorporation or the laws of Texas or (ii) the shareholders in
amending, repealing or adopting a particular bylaw shall have
expressly provided that the Board of Directors may not amend
or repeal that bylaw. Unless the Articles of Incorporation or
a bylaw adopted by the shareholders shall provide otherwise as
to all or some portion of the corporation's bylaws, the
shareholders may amend, repeal, or adopt (but only by the
affirmative vote of the holders of not less than eighty (80)
percent of the then outstanding shares of capital stock of the
corporation entitled to vote with respect thereto) the
corporation's bylaws even though the bylaws may also be
amended, repealed, or adopted by the Board of Directors.
Section 5. Preferred Shareholders: The provisions of
Sections 12 and 13 of Article II and of Sections 2, 3, 4 and 5
of Article III are subject to the rights of any holders of any
class or series of stock having a preference over the Common
Stock of the corporation as to dividends or upon liquidation
to elect directors under specified circumstances.
Section 6. Action With Respect to Securities of Other
Corporations: Unless otherwise directed by the Board of
Directors, the chief executive officer shall have power to
vote and otherwise act on behalf of the corporation, in person
or by proxy, at any meeting of shareholders of, or with
respect to any action of shareholders of, any other
corporation in which the corporation may hold securities and
otherwise to exercise any and all rights and powers which the
corporation may possess by reason of its ownership of
securities in such other corporation.
ARTICLE VIII
INDEMNIFICATION
Section 1. Right to Indemnification: Subject to the
limitations and conditions as provided in this Article VIII,
each person who was or is made a party to, or is threatened to
be made a party to, any threatened, pending or completed
action, suit or proceeding, whether civil, criminal,
administrative, arbitrative or investigative (hereinafter
called a "proceeding"), or any appeal in such a proceeding or
any inquiry or investigation that could lead to such 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 while a director or officer of
the corporation is or was serving at the request of the
corporation as a director, officer, partner, venturer,
proprietor, trustee, employee, agent, or similar functionary
of another foreign or domestic corporation, partnership, joint
venture, proprietorship, trust, employee benefit plan, or
other enterprise) shall be indemnified by the corporation to
the fullest extent permitted by the Texas Business Corporation
Act, as the same exists or may hereafter be amended (but, in
the case of any such amendment, only to the extent that such
amendment permits the corporation to provide broader
indemnification rights than said law permitted the corporation
to provide prior to such amendment) against judgments,
penalties (including excise and similar taxes and punitive
damages), fines, settlements and reasonable expenses
(including, without limitation, court costs and attorneys'
fees) actually incurred by such person in connection with such
proceeding, appeal, inquiry or investigation, and
indemnification under this Article VIII shall continue as to a
person who has ceased to serve in the capacity which initially
entitled such person to indemnity hereunder; provided,
however, that in no case shall the corporation indemnify any
such person (or the legal representative of any such person)
otherwise than for his reasonable expenses, in respect of any
proceeding (i) in which such person shall have been finally
adjudged by a court of competent jurisdiction (after
exhaustion of all appeals therefrom) to be liable on the basis
that personal benefit was improperly received by him, whether
or not the benefit resulted from an action taken in such
person's official capacity, or (ii) in which such person shall
have been found liable to the corporation; and provided,
further, that the corporation shall not indemnify any such
person for his reasonable expenses actually incurred in
connection with any proceeding in which he shall have been
found liable for willful or intentional misconduct in the
performance of his duty to the corporation. The rights
granted pursuant to this Article VIII shall be deemed contract
rights, and no amendment, modification or repeal of this
Article VIII shall have the effect of limiting or denying any
such rights with respect to actions taken or proceedings
arising prior to any such amendment, modification or repeal.
it is expressly acknowledged that the indemnification provided
in this Article VIII could involve indemnification for
negligence or under theories of strict liability.
Section 2. Advance Payment: The right to
indemnification conferred in this Article VIII shall include
the right to be paid or reimbursed by the corporation the
reasonable expenses incurred by a person of the type entitled
to be indemnified under Section 1 who was, or is threatened to
be made a named defendant or respondent in a proceeding, in
advance of the final disposition of the proceeding and without
any determination as to the person's ultimate entitlement to
indemnification; provided, however, that the payment of such
expenses incurred by any such person in advance of the final
disposition of a proceeding shall be made only upon delivery
to the corporation of a written affirmation by such person of
his good faith belief that he has met the standard of conduct
necessary for indemnification under this Article VIII and a
written undertaking, by or on behalf of such person, to repay
all amounts so advanced if it shall be ultimately determined
that such person is not entitled to be indemnified under this
Article VIII or otherwise.
Section 3. Indemnification of Employees and Agents: The
corporation, by adoption of a resolution of the Board of
Directors, may indemnify and advance expenses to an employee
or agent of the corporation to the same extent and subject to
the same conditions under which it may indemnify and advance
expenses to directors and officers under this Article VIII;
and the corporation may so indemnify and advance expenses to
persons who are not or were not directors, officers,
employees, or agents of the corporation but who are or were
serving at the request of the corporation as a director,
officer, partner, venturer, proprietor, trustee, employee,
agent, or similar functionary of another foreign or domestic
corporation, partnership, joint venture, proprietorship,
trust, employee benefit plan, or other enterprise against any
liability asserted against him and incurred by him in such a
capacity or arising out of his status as such a person to the
same extent that it may indemnify and advance expenses to
directors and officers under this Article VIII.
Section 4. Appearance as a Witness: Notwithstanding any
other provision of this Article VIII, the corporation may pay
or reimburse expenses incurred by a director or officer in
connection with his appearance as a witness or his other
participation in a proceeding at a time when he is not a named
defendant or respondent in the proceeding.
Section 5. Nonexclusivity of Rights: The right to
indemnification and the advancement and payment of expenses
conferred in this Article VIII shall not be exclusive of any
other right which a director or officer or other person
indemnified pursuant to Section 3 of this Article VIII may
have or hereafter acquire under any law (common or statutory),
provision of the Articles of Incorporation or these Bylaws,
agreement, vote of shareholders or disinterested directors or
otherwise.
Section 6. Insurance: The corporation may purchase and
maintain insurance, at its expense, to protect itself and any
person who is or was serving as a director, officer, employee,
or agent of the corporation or is or was serving at the
request of the corporation as a director, officer, partner,
venturer, proprietor, trustee, employee, agent, or similar
functionary of another foreign or domestic corporation,
partnership, joint venture, proprietorship, employee benefit
plan, 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 this Article VIII.
Section 7. Shareholder Notification: To the extent
required by law, any indemnification of or advance of expenses
to a director or officer in accordance with this Article VIII
shall be reported in writing to the shareholders with or
before the notice or waiver of notice of the next
shareholders' meeting or with or before the next submission to
shareholders of a consent to action without a meeting and, in
any case, within the 12-month period immediately following the
date of the indemnification or advance.
Section 8. Savings Clause: If this Article VIII or any
portion hereof shall be invalidated on any ground by any court
of competent jurisdiction, then the corporation shall
nevertheless indemnify and advance expenses to each director,
officer, and other person indemnified pursuant to this Article
VIII to the extent permitted by any applicable portion of this
Article VIII that shall not have been invalidated.
