BY-LAWS
of
Freedom Holding Corp.
(As
Amended through February 4, 2019)
ARTICLE I
Offices
Section 1.
Registered Office. The registered agent of the Corporation
(the “Corporation”) in the State of
Nevada shall be determined by the board of directors of the
Corporation (the “Board of Directors”) and the
registered office of the Corporation shall be the street office of
that agent. The Board of Directors of the Corporation may at any
time change the Corporation's registered agent or office by making
the appropriate filing with the Nevada Secretary of
State.
Section 2. Principal and Other Offices. The Corporation
shall also have and maintain a principal place of business within
or without the State of Nevada and may also have offices at such
other places, both within and without the State of Nevada, as the
Board of Directors may from time to time determine or the business
of the Corporation may require.
Section 3. Books and Records. Any records maintained by the
Corporation in the regular course of its business, including its
stock ledger, books of account, and minute books, may be maintained
on any information storage device or method that can be converted
into clearly legible paper form within a reasonable time. The
Corporation shall convert any records so kept on the written
request of any person entitled to inspect such records pursuant to
applicable law.
ARTICLE II
Stockholders' Meetings
Section 1. Place of Meetings. Meetings of the stockholders
of the Corporation shall be held at such place, either within or
without the State of Nevada, as may be designated from time to time
by the Board of Directors, or, if not so designated, then at the
office of the Corporation required to be maintained pursuant to
Section 2 of ARTICLE I hereof. The Board of Directors may
determine, in its sole discretion, that any meeting of the
stockholders may be held solely by means of electronic
communication in accordance with Section 12 of ARTICLE II
hereof.
Section 2. Annual Meetings. The annual meetings of
stockholders of the Corporation for the purpose of election of
directors and for such other business as may lawfully come before
the meeting, shall be held on such date and at such time as may be
designated from time to time by the Board of Directors, or, if not
so designated, then at 10:00 a.m. on the third Wednesday in
September in each year if not a legal holiday, and, if a legal
holiday, at the same hour and place on the next succeeding day not
a holiday.
Failure to hold the annual meeting of stockholders at the
designated time shall not affect the validity of any action taken
by the Corporation.
Section 3. Special Meetings. Special meetings of the
stockholders of the Corporation may be called at any time and for
any purpose or purposes, by the entire Board of Directors, any two
Directors, or the President. The only business which may be
conducted at a special meeting of stockholders shall be the matter
or matters set forth in the notice of such meeting.
Section 4. Notice of Meetings.
(a)
Except as otherwise provided by law or the Restated Articles of
Incorporation, as amended from time-to-time, (the
“Restated Articles of
Incorporation”) written notice of each meeting of
stockholders, specifying the place, date and hour and, in the case
of special meetings, the purpose or purposes of the meeting, and
the means of electronic communication, if any, by which
stockholders and proxies shall be deemed to be present in person
and vote, shall be given not less than 10 nor more than 60 days
before the date of the meeting to each stockholder entitled to vote
thereat, directed to such stockholder by mail or by electronic
communication, if consented by such stockholder, to such physical
or electronic address as it appears upon the books of the
Corporation.
(b) If
at any meeting action is proposed to be taken which, if taken,
would entitle stockholders fulfilling the requirements of the
Nevada Revised Statutes to an appraisal of the fair value of their
shares, the notice of such meeting shall contain such statements of
that purpose and to that effect and shall be accompanied by a copy
of that statutory section as required by the Nevada Revised
Statutes.
(c)
When a meeting is adjourned to another date, time or place, notice
need not be given of the adjourned meeting if the date, time and
place thereof are announced at the meeting at which the adjournment
is taken unless the adjournment is for more than thirty days, or
unless after the adjournment a new record date is fixed for the
adjourned meeting, in which event a notice of the adjourned meeting
shall be given to each stockholder of record entitled to vote at
the meeting.
(d)
Notice of the date, time, place and purpose of any meeting of
stockholders may be waived in writing or by transmission of an
electronic record, by the person or persons entitled to notice,
either before or after the time stated therein, and to the extent
permitted by law, will be waived by any stockholder by his
attendance thereat, in person or by proxy. Any stockholder so
waiving notice of such meeting shall be bound by the proceedings of
any such meeting in all respects as if due notice thereof had been
given.
(e)
Unless and until voted, every proxy shall be revocable at the
pleasure of the person who executed it or of his legal
representatives or assigns, except in those cases where an
irrevocable proxy permitted by statute has been given.
Section 5. Quorum. At all meetings of stockholders, except
where otherwise provided by law, the Restated Articles of
Incorporation, or these By-Laws, the presence, in person or by
proxy duly authorized, of the holders of a majority of the
outstanding shares of stock entitled to vote shall constitute a
quorum for the transaction of business. Shares, the voting of which
at said meeting has been enjoined, or which for any reason cannot
be lawfully voted at such meeting, shall not be counted to
determine a quorum at said meeting. In the absence of a quorum any
meeting of stockholders may be adjourned, from time to time, by
vote of the holders of a majority of the shares represented
thereat, but no other business shall be transacted at such meeting.
At such adjourned meeting at which a quorum is present or
represented any business may be transacted which might have been
transacted at the original meeting. The stockholders present at a
duly called or convened meeting, at which a quorum is present, may
continue to transact business until adjournment, notwithstanding
the withdrawal of enough stockholders to leave less than a quorum.
Except as otherwise provided by law, the Restated Articles of
Incorporation or these By-Laws, all action taken by the holders of
a majority of the voting power represented at any meeting at which
a quorum is present shall be valid and binding upon the
Corporation. In the event that at any meeting at which the holders
of more than one class or series of the Corporation’s capital
stock are entitled to vote as a class, a quorum of any such class
or series is lacking, the holders of any class or series
represented by a quorum may proceed with the transaction of the
business to be transacted by that class or series, and if such
business is the election of directors, the director whose
successors shall not have been elected shall continue in office
until their successors shall have been duly elected and shall have
qualified.
Section 6. Organization.
The
Board of Directors may adopt by resolution such rules and
regulations for the conduct of the meeting of the stockholders as
it shall deem appropriate. At every meeting of the stockholders,
the Chair of the Board, or in his or her absence or inability to
act, the Chief Executive Officer, or, in his or her absence or
inability to act, the officer or director whom the Board of
Directors shall appoint, shall act as chair of, and preside at, the
meeting. The Secretary or, in his or her absence or inability to
act, the person whom the chair of the meeting shall appoint
secretary of the meeting, shall act as secretary of the meeting and
keep the minutes thereof. Except to the extent inconsistent with
these By-Laws or such rules and regulations as adopted by the Board
of Directors, the chair of any meeting of the stockholders shall
have the right and authority to prescribe such rules, regulations,
and procedures and to do all such acts as, in the judgment of such
chair, are appropriate for the proper conduct of the meeting. Such
rules, regulations, or procedures, whether adopted by the Board of
Directors or prescribed by the chair of the meeting, may include,
without limitation, the following:
(1) the
establishment of an agenda or order of business for the
meeting;
(2) the
determination of when the polls shall open and close for any given
matter to be voted on at the meeting;
(3)
rules and procedures for maintaining order at the meeting and the
safety of those present;
(4)
limitations on attendance at or participation in the meeting to
stockholders of record of the corporation, their duly authorized
and constituted proxies, or such other persons as the chair of the
meeting shall determine;
(5)
restrictions on entry to the meeting after the time fixed for the
commencement thereof; and
(6)
limitations on the time allotted to questions or comments by
participants.
Section 7. Voting Rights.
(a)
Except as otherwise provided by law, only persons in whose names
shares entitled to vote stand on the stock records of the
Corporation on the record date for determining the stockholders
entitled to vote at said meeting shall be entitled to vote at such
meeting. Shares standing in the names of two or more persons shall
be voted or represented in accordance with the determination of the
majority of such persons, or, if only one of such persons is
present in person or represented by proxy, such person shall have
the right to vote such shares and such shares shall be deemed to be
represented for the purpose of determining a quorum.
(b)
Every person entitled to vote or execute consents shall have the
right to do so either in person or by an agent or agents authorized
by a written proxy executed by such person or his duly authorized
agent, which proxy shall be filed with the Secretary of the
Corporation at or before the meeting at which it is to be used.
Said proxy so appointed need not be a stockholder. No proxy shall
be voted on after six months from its date unless the proxy
provides for a longer period, which may not exceed seven years from
the date of its creation.
(c)
Without limiting the manner in which a stockholder may authorize
another person or persons to act for him as proxy pursuant to
subsection (b) of this Section, the following shall constitute a
valid means by which a stockholder may grant such
authority:
(1) A
stockholder may execute a writing authorizing another person or
persons to act for him as proxy. Execution may be accomplished by
the stockholder or his authorized officer, director,
employee
or agent signing such writing or causing his or her signature to be
affixed to such writing by any reasonable means including, but not
limited to, by facsimile signature. The proxy may be limited to
action on designated matters.
(2) A
stockholder may authorize another person or persons to act for him
as proxy by transmitting or authorizing an electronic transmission
to the person who will be the holder of the proxy or to a proxy
solicitation firm, proxy support service organization or like agent
duly authorized by the person who will be the holder of the proxy
to receive such transmission, provided that any such electronic
transmission must either set forth or be submitted with information
from which it can be determined that the electronic transmission
was authorized by the stockholder. If it is determined that such
electronic transmissions are valid, the inspectors or, if there are
no inspectors, such other persons making that determination shall
specify the information upon which they relied.
(d)
Any copy, facsimile telecommunication, electronic transmission or
other reliable reproduction of the writing or transmission created
pursuant to subsection (c) of this Section may be substituted or
used in lieu of the original writing or transmission for any and
all purposes for which the original writing or transmission could
be used, provided that such copy, facsimile telecommunication,
electronic transmission or other reproduction shall be a complete
reproduction of the entire original writing or
transmission.
Section 8. Voting Procedures and Inspectors of
Elections.
(a) The
Corporation shall, in advance of any meeting of stockholders,
appoint one or more inspectors to act at the meeting and make a
written report thereof. The Corporation may designate one or more
persons as alternate inspectors to replace any inspector who fails
to act. If no inspector or alternate is able to act at a meeting of
stockholders, the person presiding at the meeting shall appoint one
or more inspectors to act at the meeting. Each inspector, before
entering upon the discharge of his duties, shall take and sign an
oath faithfully to execute the duties of inspector with strict
impartiality and according to the best of his ability.
(b) The
inspectors shall (i) ascertain the number of shares outstanding and
the voting power of each, (ii) determine the shares represented at
a meeting and the validity of proxies and ballots, (iii) count all
votes and ballots, (iv) determine and retain for a reasonable
period a record of the disposition of any challenges made to any
determination by the inspectors, and (v) certify their
determination of the number of shares represented at the meeting,
and their count of all votes and ballots. The inspectors may
appoint or retain other persons or entities to assist the
inspectors in the performance of the duties of the
inspectors.
(c) The
date and time of the opening and the closing of the polls for each
matter upon which the stockholders will vote at a meeting shall be
announced at the meeting. No ballot, proxies or votes, nor any
revocations thereof or changes thereto, shall be accepted by the
inspectors after the closing of the polls unless a court of
competent jurisdiction, upon application by a stockholder shall
determine otherwise.
(d) In
determining the validity and counting of proxies and ballots, the
inspectors shall be limited to an examination of the proxies, any
envelopes submitted with those proxies, any information provided in
accordance with Section 78.355(2) of the Nevada Revised Statutes,
ballots and the regular books and records of the Corporation,
except that the inspectors may consider other reliable information
for the limited purpose of reconciling proxies and ballots
submitted by or on behalf of banks, brokers, their nominees or
similar persons which represent more votes than the holder of a
proxy is authorized by the record owner to cast or more votes than
the stockholder holds of record. If the inspectors consider other
reliable information for the limited purpose permitted herein, the
inspectors at the time they make their certification pursuant to
subsection (b)(v) of this Section shall specify the precise
information considered by them including the person or persons from
whom they obtained the information, when the information was
obtained, the means by which the information was obtained and the
basis for the inspectors' belief that such information is accurate
and reliable.
Section 9. List of Stockholders. The officer who has charge
of the stock ledger of the Corporation shall prepare and make, at
least 10 days before every meeting of stockholders, a complete list
of the stockholders entitled to vote at said meeting, arranged in
alphabetical order and showing the number of shares registered in
the name of each stockholder. Such list shall be open to the
examination of any stockholder, for any purpose germane to the
meeting, during ordinary business hours, for a period of at least
10 days prior to the meeting, either at the principal office of the
Corporation, or a place within the city where the meeting is to be
held and which place shall be specified in the notice of the
meeting, or, if not specified, at the place where said meeting is
to be held, and the list shall be produced and kept at the time and
place of meeting during the whole time thereof, and may be
inspected by any stockholder who is present.
Section 10. Advance Notice of Stockholder Nominations and
Proposals.
(a) Annual Meetings. At a meeting of the stockholders, only such
nominations of persons for the election of directors and such other
business shall be conducted as shall have been properly brought
before the meeting. Except for nominations that are included in the
Corporation’s annual meeting proxy statement pursuant to
Section 11, to be properly brought before an annual meeting,
nominations or such other business must be:
(1)
specified in the notice of meeting (or any supplement thereto)
given by or at the direction of the Board of Directors or any
committee thereof;
(2)
otherwise properly brought before the meeting by or at the
direction of the Board of Directors or any committee thereof;
or
(3)
otherwise properly brought before an annual meeting by a
stockholder who is a stockholder of record of the Corporation at
the time such notice of meeting is delivered, who is entitled to
vote at the meeting, and who complies with the notice procedures
set forth in this Section 10.
In addition, any proposal of business (other than the nomination of
persons for election to the Board of Directors) must be a proper
matter for stockholder action. For business (including, but not
limited to, director nominations) to be properly brought before an
annual meeting by a stockholder pursuant to Section 10(a)(3), the
stockholder or stockholders of record intending to propose the
business (the “Proposing
Stockholder”) must have
given timely notice thereof pursuant to this Section10(a), in
writing to the Secretary even if such matter is already the subject
of any notice to the stockholders or Public Disclosure from the
Board of Directors. To be timely, a Proposing Stockholder’s
notice for an annual meeting must be delivered to or mailed and
received at the principal executive offices of the Corporation: (x)
not later than the close of business on the 90th day, nor earlier
than the close of business on the 120th day, in advance of the
anniversary of the previous year’s annual meeting if such
meeting is to be held on a day which is not more than 30 days in
advance of the anniversary of the previous year’s annual
meeting or not later than 60 days after the anniversary of the
previous year’s annual meeting; and (y) with respect to any
other annual meeting of stockholders, including in the event that
no annual meeting was held in the previous year, not earlier than
the close of business on the 120th day prior to the annual meeting
and not later than the close of business on the later of: (1) the
90th day prior to the annual meeting and (2) the close of business
on the tenth day following the first date of Public Disclosure of
the date of such meeting. In no event shall the Public Disclosure
of an adjournment or postponement of an annual meeting commence a
new notice time period (or extend any notice time period). For the
purposes of this Section 10 and Section 11,
“Public
Disclosure” shall mean a
disclosure made in a press release issued by the Corporation or in
a document filed by the Corporation with the Securities and
Exchange Commission (“SEC”) pursuant to Section 13, 14, or 15(d) of
the Exchange Act.
(b) Stockholder Nominations. For the nomination of any person
or persons for election to the Board of Directors pursuant to
Section 10(a)(3) or Section 10(d), a Proposing Stockholder’s
notice to the Secretary shall set forth or include:
(1)
the name, age, business address, and residence address of each
nominee proposed in such notice;
(2)
the principal occupation or employment of each such
nominee;
(3)
the class and number of shares of capital stock of the Corporation
which are owned of record and beneficially by each such nominee (if
any);
(4)
such other information concerning each such nominee as would be
required to be disclosed in a proxy statement soliciting proxies
for the election of such nominee as a director in an election
contest (even if an election contest is not involved) or that is
otherwise required to be disclosed, under Section 14(a) of the
Exchange Act;
(5) a written questionnaire with respect to the
background and qualification of such proposed nominee (which
questionnaire shall be provided by the Secretary
upon written request) and a written
statement and agreement executed by each such nominee acknowledging
that such person:
(A) consents
to being named in the Corporation’s proxy statement as a
nominee and to serving as a director if elected,
(B)
intends to serve as a director for the full term for which such
person is standing for election, and
(C) makes the following representations: (1) that
the director nominee has read and agrees to adhere to the
Corporation’s Code of Ethics and Business Conduct, Related
Party Transactions Policy, Corporate Governance Guidelines and any
other of the Corporation’s policies or guidelines applicable
to directors, including with regard to securities trading, (2) that
the director nominee is not and will not become a party to any
agreement, arrangement, or understanding with, and has not given
any commitment or assurance to, any person or entity as to how such
person, if elected as a director of the Corporation, will act or
vote on any issue or question (a “Voting
Commitment”), (3) that
the director nominee is not and will not become a party to any
agreement, arrangement, or understanding with any person or entity
other than the Corporation with respect to any direct or indirect
compensation, reimbursement, or indemnification
(“Compensation
Arrangement”) in
connection with such person’s nomination for director or
service as a director; and
(6)
as to the Proposing Stockholder:
(A)
the name and address of the Proposing Stockholder as they appear on
the Corporation’s books and of the beneficial owner, if any,
on whose behalf the nomination is being made,
(B) the class and number of shares of the
Corporation which are owned by the Proposing Stockholder
(beneficially and of record) and owned by the beneficial owner, if
any, on whose behalf the nomination is being made, as of the date
of the Proposing Stockholder’s notice, and a representation
that the Proposing Stockholder will notify the Corporation in
writing of the class and number of such shares owned of record and
beneficially as of the record date for the meeting within five
business days after the record date for such
meeting,
(C)
a description of any agreement, arrangement, or understanding with
respect to such nomination between or among the Proposing
Stockholder or the beneficial owner, if any, on whose behalf the
nomination is being made and any of their affiliates or associates,
and any others (including their names) acting in concert with any
of the foregoing, and a representation that the Proposing
Stockholder will notify the Corporation in writing of any such
agreement, arrangement, or understanding in effect as of the record
date for the meeting within five business days after the record
date for such meeting,
(D)
a description of any agreement, arrangement, or understanding
(including any derivative or short positions, profit interests,
options, hedging transactions, and borrowed or loaned shares) that
has been entered into as of the date of the Proposing
Stockholder’s notice by, or on behalf of, the Proposing
Stockholder or the beneficial owner, if any, on whose behalf the
nomination is being made and any of their affiliates or associates,
the effect or intent of which is to mitigate loss to, manage risk
or benefit of share price changes for, or increase or decrease the
voting power of such person or any of their affiliates or
associates with respect to shares of stock of the Corporation, and
a representation that the Proposing Stockholder will notify the
Corporation in writing of any such agreement, arrangement, or
understanding in effect as of the record date for the meeting
within five business days after the record date for such
meeting,
(E)
a representation that the Proposing Stockholder is a holder of
record of shares of the Corporation entitled to vote at the meeting
and intends to appear in person or by proxy at the meeting to
nominate the person or persons specified in the notice,
and
(F)
a representation whether the Proposing Stockholder intends to
deliver a proxy statement and/or form of proxy to holders of at
least the percentage of the Corporation’s outstanding capital
stock required to approve the nomination and/or otherwise to
solicit proxies from stockholders in support of the nomination. The
Corporation may require any proposed nominee to furnish such other
information as it may reasonably require to determine the
eligibility of such proposed nominee to serve as an independent
director of the Corporation or that could be material to a
reasonable stockholder’s understanding of the independence,
or lack thereof, of such nominee.
(c) Other Stockholder Proposals. For all business other than
director nominations, a Proposing Stockholder’s notice to the
Secretary shall set forth as to each matter the Proposing
Stockholder proposes to bring before the annual
meeting:
(1)
a brief description of the business desired to be brought before
the annual meeting;
(2)
the reasons for conducting such business at the annual
meeting;
(3)
the text of any proposal or business (including the text of any
resolutions proposed for consideration and in the event that such
business includes a proposal to amend these By-Laws, the language
of the proposed amendment);
(4)
any substantial interest (within the meaning of Item 5 of Schedule
14A under the Exchange Act) in such business of such stockholder
and the beneficial owner (within the meaning of Section 13(d) of
the Exchange Act), if any, on whose behalf the business is being
proposed;
(5)
any other information relating to such stockholder and beneficial
owner, if any, on whose behalf the proposal is being made, required
to be disclosed in a proxy statement or other filings required to
be made in connection with solicitations of proxies for the
proposal and pursuant to and in accordance with Section 14(a) of
the Exchange Act and the rules and regulations promulgated
thereunder;
(6)
a description of all agreements, arrangements, or understandings
between or among such stockholder, the beneficial owner, if any, on
whose behalf the proposal is being made, any of their affiliates or
associates, and any other person or persons (including their names)
in connection with the proposal of such business and any material
interest of such stockholder, beneficial owner, or any of their
affiliates or associates, in such business, including any
anticipated benefit therefrom to such stockholder, beneficial
owner, or their affiliates or associates; and
(7)
the information required by Section 10(b)(6) above.
(d) Special Meetings of
Stockholders. Only such business shall be conducted at a special
meeting of stockholders as shall have been brought before the
meeting pursuant to the Corporation’s notice of meeting.
Nominations of persons for election to the Board of Directors may
be made at a special meeting of stockholders called by the Board of
Directors at which directors are to be elected pursuant to the
Corporation’s notice of meeting:
(1)
by or at the direction of the Board of Directors or any committee
thereof; or
(2)
provided that the Board of Directors has determined that directors
shall be elected at such meeting, by any stockholder of the
Corporation who is a stockholder of record at the time the notice
provided for in this Section 10(d) is delivered to the Secretary,
who is entitled to vote at the meeting, and upon such election and
who complies with the notice procedures set forth in this Section
10.
In the event the Corporation calls a special meeting of
stockholders for the purpose of electing one or more directors to
the Board of Directors, any such stockholder entitled to vote in
such election of directors may nominate a person or persons (as the
case may be) for election to such position(s) as specified in the
Corporation’s notice of meeting, if such stockholder delivers
a stockholder’s notice that complies with the requirements of
Section 10(b) to the Secretary at its principal executive offices
not earlier than the close of business on the 120th day prior to
such special meeting and not later than the close of business on
the later of: (x) the 90th day prior to such special meeting; or
(y) the tenth day following the date of the first Public Disclosure
of the date of the special meeting and of the nominees proposed by
the Board of Directors to be elected at such meeting. In no event
shall the Public Disclosure of an adjournment or postponement of a
special meeting commence a new time period (or extend any notice
time period).
(e) Effect of Noncompliance. Only such persons who are nominated in
accordance with the procedures set forth in this Section 10 or
Section 11 shall be eligible to be elected at any meeting of
stockholders of the Corporation to serve as directors and only such
other business shall be conducted at a meeting as shall be brought
before the meeting in accordance with the procedures set forth in
this Section 10 or Section 11, as applicable. If any proposed
nomination was not made or proposed in compliance with this Section
10 or Section 11 as applicable, or other business was not made or
proposed in compliance with this Section 10, then except as
otherwise required by law, the chair of the meeting shall have the
power and duty to declare that such nomination shall be disregarded
or that such proposed other business shall not be transacted.
Notwithstanding anything in these By-Laws to the contrary, unless
otherwise required by law, if a Proposing Stockholder intending to
propose business or make nominations at an annual meeting or
propose a nomination at a special meeting pursuant to this Section
10 does not provide the information required under this Section 10
to the Corporation, including the updated information required by
Section 10(b)(6)(B), Section 10(b)(6)(C), and Section 10(b)(6)(D)
within five business days after the record date for such meeting or
the Proposing Stockholder (or a qualified representative of the
Proposing Stockholder) does not appear at the meeting to present
the proposed business or nominations, such business or nominations
shall not be considered, notwithstanding that proxies in respect of
such business or nominations may have been received by the
Corporation.
(f) Rule 14a-8. This Section 10 and Section 11 shall not apply to
a proposal proposed to be made by a stockholder if the stockholder
has notified the Corporation of the stockholder’s intention
to present the proposal at an annual or special meeting only
pursuant to and in compliance with Rule 14a-8 under the Exchange
Act and such proposal has been included in a proxy statement that
has been prepared by the Corporation to solicit proxies for such
meeting.
Section 11. Proxy Access.
(a) Inclusion of Proxy Access Stockholder Nominee in Proxy
Statement. Subject to the provisions of this Section 11, the
Corporation shall include in its proxy statement (including its
form of proxy and ballot) for an annual meeting of stockholders the
name of any stockholder nominee for election to the Board of
Directors submitted pursuant to this Section 11 (each a
“Proxy
Access Stockholder Nominee”) provided:
(1) timely written notice of such Proxy Access
Stockholder Nominee satisfying this Section 11
(“Proxy Access
Notice”) is delivered to
the Corporation by or on behalf of a stockholder or stockholders
that, at the time the Proxy Access Notice is delivered, satisfy the
ownership and other requirements of this Section 11 (such
stockholder or stockholders, and any person on whose behalf they
are acting, the “Eligible
Stockholder”);
(2)
the Eligible Stockholder expressly elects in writing at the time of
providing the Proxy Access Notice to have its Proxy Access
Stockholder Nominee included in the Corporation’s proxy
statement pursuant to this Section 11; and
(3)
the Eligible Stockholder and the Proxy Access Stockholder Nominee
otherwise satisfy the requirements of this Section 11.
(b) Timely Notice. To be timely, the Proxy Access Notice must be
delivered to the Secretary at the principal executive offices of
the Corporation, not later than 120 days nor more than 150 days
prior to the first anniversary of the date (as stated in the
Corporation's proxy materials) that the Corporation’s
definitive proxy statement was first sent to stockholders in
connection with the preceding year’s annual meeting of
stockholders; provided,
however, that in the event that
the date of the annual meeting is advanced by more than 30 days or
delayed by more than 60 days from the anniversary of the preceding
year’s annual meeting, or if no annual meeting was held in
the preceding year, the Proxy Access Notice must be so delivered
not earlier than the close of business on the 150th day prior to
such annual meeting and not later than the close of business on the
later of: (i) the 120th day prior to such annual meeting; or (ii)
the tenth day following the day on which Public Disclosure of the
date of such annual meeting is first made by the Corporation. In no
event shall the public announcement of an adjournment or
postponement of an annual meeting commence a new time period (or
extend any time period) for the giving of the Proxy Access
Notice.
(c) Information to be Included in Proxy Statement. In addition to
including the name of the Proxy Access Stockholder Nominee in the
Corporation’s proxy statement for the annual meeting, the
Corporation shall also include (collectively, the
“Required
Information”):
(1)
the information concerning the Proxy Access Stockholder Nominee and
the Eligible Stockholder that is required to be disclosed in the
Corporation’s proxy statement pursuant to the Exchange Act,
and the rules and regulations promulgated thereunder;
and
(2) if the Eligible Stockholder so elects, a
written statement of the Eligible Stockholder (or in the case of a
group, a written statement of the group), not to exceed 500 words,
in support of its Proxy Access Stockholder Nominee, which must be
provided at the same time as the Proxy Access Notice for inclusion
in the Corporation’s proxy statement for the annual meeting
(a “Statement”).
Notwithstanding anything to the contrary contained in this Section
11, the Corporation may omit from its proxy materials any
information or Statement that it, in good faith, believes is untrue
in any material respect (or omits a material fact necessary in
order to make the statements made, in light of the circumstances
under which they are made, not misleading) or would violate any
applicable law, rule, regulation, or listing standard.
Additionally, nothing in this Section 11 shall limit the
Corporation’s ability to solicit against and include in its
proxy statement its own statements relating to any Proxy Access
Stockholder Nominee.
(d) Proxy Access Stockholder Nominee Limits. The number of Proxy
Access Stockholder Nominees (including Proxy Access Stockholder
Nominees that were submitted by an Eligible Stockholder for
inclusion in the Corporation’s proxy statement pursuant to
this Section 11 but either are subsequently withdrawn or that the
Board of Directors decides to nominate (a
“Board
Nominee”)) appearing in
the Corporation’s proxy statement with respect to a meeting
of stockholders shall not exceed 20% of the number of directors in
office as of the last day on which notice of a nomination may be
delivered pursuant to this Section 11 (the
“Final
Proxy Access Nomination Date”) or, if such amount is not a whole number,
the closest whole number below 20% (the “Permitted
Number”);
provided,
however,
that:
(1)
in the event that one or more vacancies for any reason occurs on
the Board of Directors at any time after the Final Proxy Access
Nomination Date and before the date of the applicable annual
meeting of stockholders and the Board of Directors resolves to
reduce the size of the Board of Directors in connection therewith,
the Permitted Number shall be calculated based on the number of
directors in office as so reduced;
(2)
any Proxy Access Stockholder Nominee who is included in the
Corporation’s proxy statement for a particular meeting of
stockholders but either: (A) withdraws from or becomes ineligible
or unavailable for election at the meeting, or (B) does not receive
a number of votes cast in favor of his or her election at least
equal to 25% of the shares present in person or represented by
proxy at the annual meeting and entitled to vote on the Proxy
Access Stockholder Nominee’s election, shall be ineligible to
be included in the Corporation’s proxy statement as a Proxy
Access Stockholder Nominee pursuant to this Section 11 for the next
two annual meetings of stockholders following the meeting for which
the Proxy Access Stockholder Nominee has been nominated for
election; and
(3)
any director in office as of the nomination deadline who was
included in the Corporation’s proxy statement as a Proxy
Access Stockholder Nominee for any of the three preceding annual
meetings and whom the Board of Directors decides to nominate for
election to the Board of Directors also will be counted against the
Permitted Number.
In the event that the number of Proxy Access Stockholder Nominees
submitted by Eligible Stockholders pursuant to this Section 11
exceeds the Permitted Number, each Eligible Stockholder shall
select one Proxy Access Stockholder Nominee for inclusion in the
Corporation’s proxy statement until the Permitted Number is
reached, going in order of the amount (from greatest to least) of
voting power of the Corporation’s capital stock entitled to
vote on the election of directors as disclosed in the Proxy Access
Notice. If the Permitted Number is not reached after each Eligible
Stockholder has selected one Proxy Access Stockholder Nominee, this
selection process shall continue as many times as necessary,
following the same order each time, until the Permitted Number is
reached.
(e) Eligibility of Nominating Stockholder; Stockholder Groups. An
Eligible Stockholder must have owned (as defined below)
continuously for at least three years a number of shares that
represents 3% or more of the outstanding shares of the Corporation
entitled to vote in the election of directors (the
“Required
Shares”) as of both the
date the Proxy Access Notice is delivered to or received by the
Corporation in accordance with this Section 11 and the record date
for determining stockholders entitled to vote at the meeting and
must deliver a statement
that the Eligible Stockholder intends to continue to own the
Required Shares for at least one year following the date of the
annual meeting. For purposes of satisfying the ownership
requirement under this Section 11, the voting power represented by
the shares of the Corporation’s capital stock owned by one or
more stockholders, or by the person or persons who own shares of
the Corporation’s capital stock and on whose behalf any
stockholder is acting, may be aggregated, provided
that:
(1)
the number of stockholders and other persons whose ownership of
shares is aggregated for such purpose shall not exceed 20;
and
(2)
each stockholder or other person whose shares are aggregated shall
have held such shares continuously for at least three
years.
Whenever an Eligible Stockholder consists of a group of
stockholders, any and all requirements and obligations for an
Eligible Stockholder set forth in this Section 11 must be satisfied
by and as to each such stockholder or other person, except that
shares may be aggregated to meet the Required Shares as provided in
this Section11(e). With respect to any one particular annual
meeting, no stockholder or other person may be a member of more
than one group of persons constituting an Eligible Stockholder
under this Section 11.
(f) Funds. A group of two or more funds shall be treated as one
stockholder or person for this Section 11 provided that the other
terms and conditions in this Section 11 are met (including Section
11(h)(5)(A)) and the funds are:
(1)
under common management and investment control;
(2)
under common management and funded primarily by the same employer
(or by a group of related employers that are under common control);
or
(3)
a “group of investment companies,” as such term is
defined in Section 12(d)(1)(G)(ii) of the Investment Company Act of
1940, as amended.
(g) Ownership. For purposes of this Section 11, an Eligible
Stockholder shall be deemed to “own” only those outstanding shares of the
Corporation’s capital stock as to which the person possesses
both:
(1)
the
full voting and investment rights pertaining to the shares;
and
(2) the full
economic interest in (including the opportunity for profit and risk
of loss on) such shares; provided that the number of shares
calculated in accordance with clauses (1) and (2) shall not include
any shares:
(A)
sold by such person or any of its affiliates in any transaction
that has not been settled or closed,
(B)
borrowed by such person or any of its affiliates for any purposes
or purchased by such person or any of its affiliates pursuant to an
agreement to resell, or
(C)
subject to any option, warrant, forward contract, swap, contract of
sale, other derivative, or similar agreement entered into by such
person or any of its affiliates, whether any such instrument or
agreement is to be settled with shares or with cash based on the
notional amount or value of outstanding shares of the
Corporation’s capital stock, in any such case which
instrument or agreement has, or is intended to have, the purpose or
effect of: (1) reducing in any manner, to any extent or at any time
in the future, such person’s or affiliates’ full right
to vote or direct the voting of any such shares; and/or (2)
hedging, offsetting, or altering to any degree gain or loss arising
from the full economic ownership of such shares by such person or
affiliate.
An Eligible Stockholder “owns” shares held in the name of a nominee or
other intermediary so long as the Eligible Stockholder retains the
right to instruct how the shares are voted with respect to the
election of directors and possesses the full economic interest in
the shares. An Eligible Stockholder’s ownership of shares
shall be deemed to continue during any period in which the Eligible
Stockholder has delegated any voting power by means of a proxy,
power of attorney, or other instrument or arrangement that is
revocable at any time by the person. An Eligible
Stockholder’s ownership of shares shall be deemed to continue
during any period in which the Eligible Stockholder has loaned such
shares, provided that the Eligible Stockholder has the power to
recall such loaned shares on five business days' notice and recalls
such loaned shares not more than five business days after being
notified that any of its Proxy Access Stockholder Nominees will be
included in the Corporation's proxy statement. The terms
“owned,” “owning,” and other variations of the word
‘own” shall have correlative meanings. For
purposes of this Section 11, the term “affiliate” shall have the meaning ascribed thereto in
the regulations promulgated under the Exchange
Act.
(h) Nomination Notice and Other Eligible Stockholder Deliverables.
An Eligible Stockholder must provide with its Proxy Access Notice
the following information in writing to the Secretary:
(1)
one or more written statements from the record holder of the shares
(and from each intermediary through which the shares are or have
been held during the requisite three-year holding period) verifying
that, as of a date within seven calendar days prior to the date the
Proxy Access Notice is delivered to or received by the Corporation,
the Eligible Stockholder owns, and has owned continuously for the
preceding three years, the Required Shares, and the Eligible
Stockholder’s agreement to provide:
(A)
within five business days after the record date for the meeting,
written statements from the record holder and intermediaries
verifying the Eligible Stockholder’s continuous ownership of
the Required Shares through the record date, and
(B)
immediate notice if the Eligible Stockholder ceases to own any of
the Required Shares prior to the date of the applicable annual
meeting of stockholders;
(2)
the Eligible Stockholder’s representation and agreement that
the Eligible Stockholder (including each member of any group of
stockholders that together is an Eligible Stockholder under this
Section 11):
(A)
intends to continue to satisfy the eligibility requirements
described in this Section 11 through the date of the annual
meeting, including a statement that the Eligible Stockholder
intends to continue to own the Required Shares for at least one
year following the date of the annual meeting,
(B)
acquired the Required Shares in the ordinary course of business and
not with the intent to change or influence control of the
Corporation, and does not presently have such intent,
(C)
has not nominated and will not nominate for election to the Board
of Directors at the meeting any person other than the Proxy Access
Stockholder Nominee(s) being nominated pursuant to this Section
11,
(D)
has not engaged and will not engage in, and has not and will not
be, a “participant” in another person’s
“solicitation” within the meaning of Rule 14a-1(l)
under the Exchange Act in support of the election of any individual
as a director at the meeting other than its Proxy Access
Stockholder Nominee(s) or a Board Nominee,
(E)
will not distribute to any stockholder any form of proxy for the
meeting other than the form distributed by the
Corporation,
(F)
has provided and will provide facts, statements, and other
information in all communications with the Corporation and its
stockholders that are or will be true and correct in all material
respects and do not and will not omit to state a material fact
necessary in order to make the statements made, in light of the
circumstances under which they were made, not
misleading,
(G)
agrees to assume all liability stemming from any legal or
regulatory violation arising out of the Eligible
Stockholder’s communications with the Corporation’s
stockholders or out of the information that the Eligible
Stockholder provides to the Corporation,
(H)
agrees to indemnify and hold harmless the Corporation and each of
its directors, officers, and employees individually against any
liability, loss, or damages in connection with any threatened or
pending action, suit, or proceeding, whether legal, administrative,
or investigative, against the Corporation or any of its directors,
officers, or employees arising out of any nomination submitted by
the Eligible Stockholder pursuant to this Section 11,
(I)
will file with the SEC any solicitation or other communication with
the Corporation’s stockholders relating to the meeting at
which the Proxy Access Stockholder Nominee will be nominated,
regardless of whether any such filing is required under Section 14
of the Exchange Act and the rules and regulations promulgated
thereunder or whether any exemption from filing is available for
such solicitation or other communication under Section 14 of the
Exchange Act and the rules and regulations promulgated thereunder,
and
(J)
will comply with all other applicable laws, rules, regulations, and
listing standards with respect to any solicitation in connection
with the meeting;
(3) the
written consent of each Proxy Access Stockholder Nominee to be
named in the Corporation’s proxy statement, and form of proxy
and ballot and, as a nominee and, if elected, to serve as a
director;
(4)
a copy of the Schedule 14N (or any successor form) that has been
filed with the SEC as required by Rule 14a-18 under the Exchange
Act;
(5)
in the case of a nomination by a group of stockholders that
together is an Eligible Stockholder:
(A)
documentation satisfactory to the Corporation demonstrating that a
group of funds qualifies pursuant to the criteria set forth in
Section 11(f) to be treated as one stockholder or person for
purposes of this Section 11, and
(B)
the designation by all group members of one group member that is
authorized to act on behalf of all members of the nominating
stockholder group with respect to the nomination and matters
related thereto, including withdrawal of the nomination;
and
(6)
if desired, a Statement.
(i) Stockholder Nominee
Agreement. Each Proxy Access Stockholder Nominee
must:
(1)
provide within five business days of the Corporation’s
request an executed agreement, in a form deemed satisfactory to the
Corporation, providing the following representations:
(A)
the Proxy Access Stockholder Nominee has read and agrees to adhere
to the Corporation’s Code of Ethics and Business Conduct,
Related Party Transaction Policy, Corporate Governance Guidelines,
and any other of the Corporation’s policies or guidelines
applicable to directors, including with regard to securities
trading,
(B)
the Proxy Access Stockholder Nominee is not and will not become a
party to any Voting Commitment, and
(C)
the Proxy Access Stockholder Nominee is not and will not become a
party to any Compensation Arrangement in connection with such
person’s nomination for director or service as a
director;
(2) complete,
sign, and submit all questionnaires required of the
Corporation’s Board of Directors within five business days of
receipt of each such questionnaire from the Corporation;
and
provide within five business days of the Corporation’s
request such additional information as the Corporation determines
may be necessary to permit the Board of Directors to determine
whether such Proxy Access Stockholder Nominee meets the
requirements of this Section 11 or the Corporation’s
requirements with regard to director qualifications and policies
and guidelines applicable to directors, including
whether:
(A) such Proxy Access Stockholder Nominee is
independent under the independence requirements, including the
committee independence requirements, set forth in the listing
standards of the stock exchange on which shares of the
Corporation’s capital stock are listed, if any, any
applicable rules of the SEC, and any publicly disclosed standards
used by the Board of Directors in determining and disclosing the
independence of the directors (the “Independence
Standards”),
(B)
such Proxy Access Stockholder Nominee has any direct or indirect
relationship with the Corporation that has not been deemed
categorically immaterial pursuant to the Corporation’s
Corporate Governance Guidelines, and
(C) such Proxy Access Stockholder Nominee is not
and has not been subject to: (1) any event specified in Item 401(f)
of Regulation S-K under the Securities Act of 1933, as amended (the
“Securities
Act”), or (2) any order
of the type specified in Rule 506(d) of Regulation D under the
Securities Act.
(j) Eligible Stockholder/Proxy Access Stockholder Nominee
Undertaking. In the event that any information or communications
provided by the Eligible Stockholder or Proxy Access Stockholder
Nominee to the Corporation or its stockholders ceases to be true
and correct in any respect or omits a fact necessary to make the
statements made, in light of the circumstances under which they
were made, not misleading, each Eligible Stockholder or Proxy
Access Stockholder Nominee, as the case may be, shall promptly
notify the Secretary of any such inaccuracy or omission in such
previously provided information and of the information that is
required to make such information or communication true and
correct. Notwithstanding the foregoing, the provision of any such
notification pursuant to the preceding sentence shall not be deemed
to cure any defect or limit the Corporation’s right to omit a
Proxy Access Stockholder Nominee from its proxy materials as
provided in this Section 11.
(k) Exceptions Permitting Exclusion of Proxy Access Stockholder
Nominee. The Corporation shall not be required to include pursuant
to this Section 11 a Proxy Access Stockholder Nominee in its proxy
statement (or, if the proxy statement has already been filed, to
allow the nomination of a Proxy Access Stockholder Nominee,
notwithstanding that proxies in respect of such vote may have been
received by the Corporation):
(1)
if the Eligible Stockholder who has nominated such Proxy Access
Stockholder Nominee has nominated for election to the Board of
Directors at the meeting any person other than pursuant to this
Section 11, or has or is engaged in, or has been or is a
“participant” in another person’s,
“solicitation” within the meaning of Rule 14a-1(l)
under the Exchange Act in support of the election of any individual
as a director at the meeting other than its Proxy Access
Stockholder Nominee(s) or a Board Nominee;
(2) if the
Corporation has received a notice (whether or not subsequently
withdrawn) that a stockholder intends to nominate any candidate for
election to the Board of Directors pursuant to the advance notice
requirements in Section 10 of these By-Laws;
(3) who is not
independent under the Independence Standards;
(4)
whose election as a member of the Board of Directors would violate
or cause the Corporation to be in violation of these By-Laws, the
Corporation’s Restated Articles of Incorporation, Code of
Ethics and Business Conduct, Corporate Governance Guidelines, or
other document setting forth qualifications for directors, the
listing standards of the stock exchange on which shares of the
Corporation’s capital stock is listed, if any, or any
applicable state or federal law, rule, or regulation;
(5)
if the Proxy Access Stockholder Nominee is or becomes a party to
any Voting Commitment;
(6)
if the Proxy Access Stockholder Nominee is or becomes a party to
any Compensation Arrangement;
(7)
who is or has been, within the past three years, an officer or
director of a competitor, as defined in Section 8 of the Clayton
Antitrust Act of 1914;
(8)
who is a named subject of a pending criminal proceeding (excluding
traffic violations and other minor offenses) or has been convicted
in such a criminal proceeding within the past ten
years;
(9)
who is subject to any order of the type specified in Rule 506(d) of
Regulation D under the Securities Act; or
(10)
if such Proxy Access Stockholder Nominee or the applicable Eligible
Stockholder shall have provided information to the Corporation in
respect of such nomination that was untrue in any material respect
or omitted to state a material fact necessary in order to make the
statement made, in light of the circumstances under which they were
made, not misleading or shall have breached its or their
agreements, representations, undertakings, or obligations pursuant
to this Section 11.
(l) Invalidity. Notwithstanding anything to the contrary set forth
herein, the Board of Directors or the person presiding at the
meeting shall be entitled to declare a nomination by an Eligible
Stockholder to be invalid, and such nomination shall be disregarded
notwithstanding that proxies in respect of such vote may have been
received by the Corporation; and the Corporation shall not be
required to include in its proxy statement any successor or
replacement nominee proposed by the applicable Eligible Stockholder
or any other Eligible Stockholder if:
(1)
the Proxy Access Stockholder Nominee and/or the applicable Eligible
Stockholder shall have breached its or their agreements,
representations, undertakings, or obligations pursuant to this
Section 11, as determined by the Board of Directors or the person
presiding at the meeting; or
(2)
the Eligible Stockholder (or a qualified representative thereof)
does not appear at the meeting to present any nomination pursuant
to this Section 11 .
(m) Interpretation. The Board of Directors (and any other person or
body authorized by the Board of Directors) shall have the power and
authority to interpret this Section 11 and to make any and all
determinations necessary or advisable to apply this Section 11 to
any persons, facts, or circumstances, including the power to
determine whether:
(1)
a
person or group of persons qualifies as an Eligible
Stockholder;
(2)
outstanding shares of the Corporation’s capital stock are
“owned” for purposes of meeting the ownership
requirements of this Section 11;
(3)
a notice complies with the requirements of this Section
11;
(4)
a person satisfies the qualifications and requirements to be a
Proxy Access Stockholder Nominee;
(5)
inclusion of the Required Information in the Corporation’s
proxy statement is consistent with all applicable laws, rules,
regulations, and listing standards; and
(6)
any and all requirements of this Section 11 have been
satisfied.
Any such interpretation or determination adopted in good faith by
the Board of Directors (or any other person or body authorized by
the Board of Directors) shall be conclusive and binding on all
persons, including the Corporation and all record or beneficial
owners of stock of the Corporation.
Section 12. Participation by Electronic Communication. The
Board of Directors may, but is not required to allow stockholders
not physically present at a meeting of the stockholders to
participate in the meeting by electronic communication,
videoconference, teleconference, or other available technology if
the Corporation implements reasonable measures to:
(a)
Verify the identity of each stockholder participating by electronic
communication; and
(b)
Provide the stockholders a reasonable opportunity to participate
and vote, including an opportunity to communicate and read or hear
the proceedings in a substantially concurrent manner with the
proceedings.
Stockholders
participating by electronic communication shall be considered
present in person at the meeting.
ARTICLE III
Directors
Section 1. General Powers. The property, affairs and
business of the Corporation shall be managed under the direction of
its Board of Directors, which may exercise all of the powers of the
Corporation, except such as are by law or by the Restated Articles
of Incorporation or by these By-Laws expressly conferred upon or
reserved to the stockholders.
Section 2. Number and Term of Office; Removal. The Board of
Directors shall consist of not less than three (3) directors and
not more than seven (7) directors as fixed from time to time by
resolution of a majority of the total number of directors then
serving. The directors shall be divided into three classes. Each
such class shall consist, as nearly as may be possible, of
one-third of the total number of directors, and any remaining
directors shall be included within such group or groups as the
Board of Directors shall designate. At the annual meeting of
stockholders in 2018, a class of directors was elected for a
one-year term, a class of directors for a two-year term and a class
of directors for a three-year term. At each succeeding annual
meeting of stockholders, beginning in 2019, successors to the class
of directors whose term expires at that annual meeting shall be
elected for a three-year term. If the number of directors is
changed, any increase or decrease shall be apportioned among the
classes so as to maintain the number of directors in each class as
nearly equal as possible, but in no case shall a decrease in the
number of directors shorten the term of any incumbent director. A
director may be removed from office for cause only and, subject to
such removal, death, resignation, retirement or disqualification,
shall hold office until the annual meeting for the year in which
his term expires and until his successor shall be elected and
qualify. No alteration, amendment or repeal of these By-Laws shall
be effective to shorten the term of any director holding office at
the time of such alteration, amendment or repeal, to permit any
such director to be removed without cause, or to increase the
number of directors in any class or in the aggregate from that
existing at the time of such alteration, amendment or repeal until
the expiration of the terms of office of all directors then holding
office, unless such alteration, amendment or repeal has been
approved by either the holders of all shares of stock entitled to
vote thereon or by a vote of a majority of the entire Board of
Directors. The provisions of this Section 2 shall not apply to
directors governed by Section 15 of this ARTICLE III.
Section 3. Election of Directors. At each meeting of the
stockholders for the election of directors, the directors to be
elected at such meeting shall be elected by a plurality of votes
given at such election.
Section 4. Vacancies. Any vacancy occurring in the Board of
Directors for any cause other than by reason of an increase in the
number of directors may be filled by a majority of the remaining
members of the Board of Directors, although such majority is less
than a quorum, or by the stockholders. Any vacancy occurring by
reason of an increase in the number of directors may be filled by
action of a majority of the entire Board of Directors or by the
stockholders. A director elected by the Board of Directors to fill
a vacancy shall be elected to hold office until the expiration of
the term for which he was elected and until his successor shall
have been elected and shall have been qualified. A director elected
by the stockholders to fill a vacancy shall be elected to hold
office until the expiration of the term for which he was elected
and until his successor shall have been elected and shall have
qualified. The provisions of this Section 4 shall not apply to
directors governed by Section 15 of this ARTICLE III.
Section 5. Resignations. A director may resign at any time
by notice given in writing or by electronic transmission to the
Board of Directors or to the Secretary. Such resignation shall take
effect at the date of receipt of such notice by the Corporation or
at such later effective date or upon the happening of an event or
events as specified therein. Unless otherwise specified in such
notice, the acceptance of such resignation shall not be necessary
to make it effective.
Section 6. Annual Meetings. The Board of Directors, as
constituted following the vote of stockholders at any meeting of
the stockholders for the election of directors, may hold its first
meeting for the purpose of organization and the transaction of
business, if a quorum be present, immediately after such meeting
and at the same place, and notice of such meeting need not be
given. Such first meeting may be held at any other time and place
specified in a notice given as hereinafter provided for special
meetings of the Board of Directors or in a consent and waiver of
notice thereof signed by all the directors.
Section 7. Regular Meetings. Regular meetings of the Board
of Directors may be held without notice at such places and times as
may be fixed from time to time by resolution of the
Board.
Section 8. Special Meetings; Notice. Special meetings of the
Board of Directors may be called at any time by the entire Board of
Directors, any two directors or the President and shall be called
by the Secretary upon the written request of the person or persons
calling the meeting and each special meeting shall be held at such
date, place and time as shall be specified in the notice thereof.
At least 24 hours’ notice of each such special meeting shall
be given to each director personally or sent to him addressed to
his residence or usual place of business, by telephone, overnight
courier (including, without limitation, FedEx or UPS), facsimile
transmission directed to the facsimile transmission number which
the director has provided or consented to receive notice),
electronic mail (directed to the electronic mail address which the
director has provided or consented to receive notice) or such other
electronic means which the director has provided or consented to
for delivery of notice, or at least 120 hours’ notice of each
such special meeting shall be given to each director by letter sent
by mail to him addressed as aforesaid or on such shorter notice and
by such means as the person or persons calling such meeting may
deem reasonably necessary or appropriate in light of the
circumstances. Any notice by letter shall be deemed to be given
when deposited in the United States mail so addressed. Such notice
need not state the business to be transacted at or the purpose or
purposes of such special meeting. No notice of any such special
meeting of the Board of Directors need be given to any director who
attends in person or who, in writing executed and filed with the
records of the meeting, either before or after the holding thereof,
waives such notice. No notice need be given of an adjourned meeting
of the Board of Directors.
Section 9. Quorum and Manner of Acting. A majority of the
total number of directors then in office, but in no event less than
two directors, shall constitute a quorum for the transaction of
business at any annual, regular or special meeting of the Board of
Directors. Except as otherwise provided by law, by the Restated
Articles of Incorporation or by these By-Laws, the act of a
majority of the directors present at any meeting, at which a quorum
is present, shall be the act of the Board of Directors. In the
absence of a quorum, a majority of the directors present may
adjourn the meeting from time to time until a quorum be
had.
Section 10. Consent in Writing. Any action required or
permitted to be taken at any meeting of the Board of Directors or
any committee thereof may be taken without a meeting, if a written
consent to such action is signed by all members of the Board or of
such committee, as the case may be, except as otherwise provided by
the Nevada Revised Statutes, before or after taking such action and
such written consent is filed with the minutes of proceedings of
the Board or such committee.
Section 11. Committees.
(a)
Executive Committee. The Board of Directors may, by resolution
passed by a majority of a quorum of the Board, appoint an Executive
Committee of not less than three members, each of whom shall be a
director. The Executive Committee, to the extent permitted by law,
shall have and may exercise when the Board of Directors is not in
session all powers of the Board in the management of the business
and affairs of the Corporation, including, without limitation, the
power and authority to declare a dividend or to authorize the
issuance of stock, except such Committee shall not have the power
or authority (i) to approve, adopt, or recommend to stockholders
any action or matter required by the Nevada Revised Statutes to be
submitted for stockholder approval; or (ii) to adopt, amend, or
repeal any By-Law of the Corporation.
(b)
Other Committees. The Board of Directors may, by resolution passed
by a majority of a quorum of the Board, from time to time appoint
such other committees as may be permitted by law. Such other
committees appointed by the Board of Directors shall have such
powers and perform such duties as may be prescribed by the
resolution or resolutions creating such committee, but in no event
shall any such committee have the powers denied to the Executive
Committee in these By-Laws.
(c)
Term. The members of all committees of the Board of Directors shall
serve a term set by the Board of Directors. The Board, subject to
the provisions of subsections (a) or (b) of this Section 11, may at
any time increase or decrease the number of members of a committee
or terminate the existence of a committee; provided, that no
committee shall consist of less than one member. The membership of
a committee member shall terminate on the date of his death or
voluntary resignation, but the Board may at any time for any reason
remove any individual committee member and the Board may fill any
committee vacancy created by death, resignation, removal or
increase in the number of members of the committee. The Board of
Directors may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member
at any meeting of the committee, and, in addition, in the absence
or disqualification of any member of a committee, the member or
members thereof present at any meeting and not disqualified from
voting, whether or not he or they constitute a quorum, may
unanimously appoint another member of the Board of Directors to act
at the meeting in the place of any such absent or disqualified
member.
(d)
Meetings. Unless the Board of Directors shall otherwise provide,
regular meetings of the Executive Committee or any other committee
appointed pursuant to this Section 11 shall be held at such dates,
times and places as are determined by the Board of Directors, or by
any such committee, and when notice thereof has been given to each
member of such committee, no further notice of such regular
meetings need be given thereafter; special meetings of any such
committee may be held at the principal office of the Corporation
required to be maintained pursuant to Section 2 of ARTICLE I
hereof; or at any place which has been designated from time to time
by resolution of such committee or by written consent of all
members thereof, and may be called by any director who is a member
of such committee, upon written notice to the members of such
committee of the date, time and place of such special meeting given
in the manner provided for the giving of written notice to members
of the Board of Directors of the date, time and place of special
meetings of the Board of Directors. Notice of any special meeting
of any committee may be waived in writing at any time after the
meeting and will be waived by any director by attendance thereat. A
majority of the authorized number of members of any such committee
shall constitute a quorum for the transaction of business, and the
act of a majority of those present at any meeting at which a quorum
is present shall be the act of such committee.
Section 12. Participation through Electronic Communication.
The Board of Directors or any committee thereof may participate in
a meeting of the board or committee through electronic
communications, videoconferencing, teleconferencing, or other
available technology if the Corporation implements reasonable
measures to: (a) verify the identity of each director or committee
member participating by electronic communication, and (b) provide
the directors or committee members a reasonable opportunity to
participate and vote, including the opportunity to communicate and
read or hear the proceedings in a substantially concurrent manner
with such proceedings. Participation in a meeting by these means
shall constitute presence in person at the meeting.
Section 13. Compensation. The directors may be paid their
expenses, if any, of attendance at each meeting of the Board of
Directors and may be paid a fixed sum for attendance at each
meeting of the Board of Directors and/or a stated salary as
director. No such payment shall preclude any director from serving
the Corporation in any other capacity and receiving compensation
therefor. Members of special or standing committees may be allowed
like compensation for serving on committees and/or attending
committee meetings as determined by then Board of
Directors.
Section 14. Interested Directors. No contract or transaction
between the Corporation and one or more of its directors or
officers, or between the Corporation and any other corporation,
firm, or association in which one or more of its directors or
officers are directors or officers, or have a financial interest,
shall be void or voidable solely for this reason, or solely because
the director or officer is present at or participates in the
meeting of the Board of Directors or committee thereof which
authorizes the contract or transaction, or solely because his or
their votes are counted for such purpose if (i) the material facts
as to his or their relationship or interest and as to the contract
or transaction are disclosed or are known to the Board of Directors
or committee, and the Board of Directors or committee in good faith
authorizes the contract or transaction by the affirmative votes of
a majority of the disinterested directors, even though the
disinterested directors be less than a quorum; or (ii) the material
facts as to his or their relationship or interest and as to the
contract or transaction are disclosed or are known to the
stockholders entitled to vote thereon, and the contract or
transaction is specifically approved in good faith by vote of the
stockholders approved in good faith by vote of the stockholders;
(iii) the fact of the common directorship, office or financial
interest is not known to the director or officer at the time the
contract or transaction is brought before the Board of Directors or
shareholders of the Corporation for action or (iv) the contract or
transaction is fair as to the Corporation as of the time it is
authorized, approved or ratified, by the Board of Directors, a
committee thereof or the stockholders. Common or interested
directors may be counted in determining the presence of a quorum at
a meeting of the Board of Directors or of a committee which
authorizes, approves or ratifies the contract or transaction. This
paragraph shall not be construed to invalidate any such contract or
transaction which would otherwise be valid under common and
statutory law applicable thereto.
Section 15. Directors Elected by Special Class or Series. To
the extent that any holders of any class or series of stock other
than Common Stock issued by the Corporation shall have the separate
right, voting as a class or series, to elect directors, the
directors elected by such class or series shall be deemed to
constitute an additional class of directors and shall have a term
of office for one year or such other period as may be designated by
the provisions of such class or series providing such separate
voting right to the holders of such class or series of stock, and
any such class of directors shall be in addition to the classes
referred to in Section 2 of this ARTICLE III. Any directors so
elected shall be subject to removal in such manner as may be
provided by law or by the Restated Articles of Incorporation of
this Corporation. The provisions of Sections 2 and 4 of this
ARTICLE III do not apply to directors governed by this Section
15.
ARTICLE IV
Officers
Section 1. Designation of Officers. The officers of the
Corporation, who shall be elected by the Board of Directors shall
be a Chair of the Board, a Chief Executive Officer, a President,
one or more Vice Presidents, a Treasurer, a Secretary and a Chief
Financial Officer. The Board of Directors from time to time may
choose such other officers as it shall deem appropriate. Any one
person may hold any number of offices of the Corporation at any one
time unless specifically prohibited therefrom by law. The Chair of
the Board shall be chosen from among the directors; the other
officers need not be directors.
Section 2. Term of Office; Resignation; Removal. Each
officer shall hold office until such officer’s successor is
elected and qualified, or until such officer’s death,
resignation, disqualification or removal. Any officer may resign at
any time by giving written notice to the Board of Directors or to
the Secretary. Such resignation shall take effect at the time
specified therein and, unless otherwise specified therein, the
acceptance of such resignation shall not be necessary to make it
effective. Any officer may be removed at any time either with or
without cause by the Board of Directors.
Section 3. Vacancies. A vacancy in any office because of
death, resignation, removal, disqualification or any other cause,
may be filled for the unexpired portion of the term by the Board of
Directors.
Section 4. Authority of Officers. Subject to the power of
the Board of Directors in its discretion to change and redefine the
duties of the officers of the Corporation by resolution in such
manner as it may from time to time determine, the duties of the
officers of the Corporation shall be as follows:
(a)
Chair of the Board. The Chair of the Board shall preside at
meetings of the stockholders and the Board of Directors. Subject to
the direction of the Board of Directors, he shall generally manage
the affairs of the Board and perform such other duties as are
assigned by the Board.
(b)
Chief Executive Officer. Chief Executive Officer of the Corporation
shall execute all the powers and perform all the duties usual to
such office. Subject to the discretion of the Board of Directors,
he shall have the responsibility for the strategic management of
the affairs of the Corporation. The Chief Executive Officer shall
perform such other duties as may be prescribed by or assigned to
him from time to time by the Board of Directors. He shall preside
at all meetings of the shareholders and, in case of absence of the
Chair of the Board, at meetings of the Board of Directors. He may
appoint officers, agents or employees other than those appointed by
the Board of Directors.
(c)
President. The President shall execute all the powers and perform
all the duties usual to such office. Subject to the direction of
the Chief Executive Officer, he shall have responsibility for the
general management of the affairs of the Corporation. The President
shall perform such other duties as may be prescribed by or assigned
to him from time to time by the Board of Directors. In the absence
or disability of the Chief Executive Officer, the President
designated by the board or the Chief Executive Officer shall
perform the duties and exercise the powers of the Chief Executive
Officer. The President may sign and execute contracts and other
obligations pertaining to the regular course of his
duties.
(d)
Vice Presidents. The Corporation shall have such Vice Presidents as
the Board of Directors and the Chief Executive Officer determine.
Each Vice President shall perform the duties and exercise the
powers of the President in the absence or disability of the
President, and shall perform all other duties as the Board of
Directors, Chief Executive Officer or President shall
assign.
(e)
Secretary. The Secretary shall attend all meetings of the Board of
Directors and stockholders, shall record all votes and the minutes
of all proceedings, and shall perform like duties for the standing
committees when required. The Secretary shall give or cause to be
given notice of all meetings of the Board of Directors and
stockholders and shall perform all other duties as the Board of
Directors or Chief Executive Officer shall assign. The Secretary
shall be the custodian of the records of the
Corporation.
In the
absence of the Secretary, the minutes of all meetings of the Board
of Directors and stockholders shall be recorded by the person
designated by the Chief Executive Officer or Board of
Directors.
(f)
Chief Financial Officer. The Chief Financial Officer shall be the
principal financial officer of the Corporation and shall have such
powers and performs such duties as may be assigned by the Board of
Directors, the Chair of the Board, or the Chief Executive
Officer.
(g)
Treasurer. The Treasurer shall be the principal financial officer
of the Corporation, shall have the custody of the corporate funds
and securities and shall keep full and accurate accounts of
receipts and disbursements of the Corporation, shall deposit all
moneys and other valuable effects in the name and to the credit of
the Corporation in the depositories designated by the Board of
Directors, and in general shall perform all the duties incident to
the office of Treasurer and such other duties as the Board of
Directors or Chief Executive Officer shall assign.
The
Treasurer shall disburse the funds of the Corporation as may be
ordered by the Board of Directors, taking proper vouchers for the
disbursements. The Treasurer shall keep and maintain the
Corporation's books of account and shall render to the Chief
Executive Officer and Board of Directors an account of all
transactions as Treasurer and of the financial condition of the
Corporation and exhibit the books, records, and accounts to the
Chief Executive Officer or Board of Directors at any
time.
(h)
Other Officers. The other officers of the Corporation shall have
such powers and shall perform such duties as generally pertain to
their respective offices, as well as such powers and duties as the
Board of Directors, the Executive Committee, the Chief Executive
Officer or the President may prescribe.
Section 5. Authority to Execute Agreements. All agreements
of the Corporation shall be executed on behalf of the Corporation
by: (a) the Chief Executive Officer, President, Chief Financial
Officer or Secretary of the Corporation; (b) such other officer or
employee of the Corporation authorized in writing by the Chief
Executive Officer, President or Chief Financial Officer, with such
limitations or restrictions on such authority as he or she deems
appropriate; or (c) such other person as the may be authorized by
the Board of Directors, and if required, the seal of the
Corporation shall be thereto affixed and attested by the Secretary
or assistant secretary of the Corporation.
Section 6. Divisional Titles. Any one of the Chief Executive
Officer, President, or Vice President of Human Resources and
Administration (each one an "Appointing Person"), may from time to
time confer upon any employee of a division of the Corporation the
title of President, Vice President, Treasurer or Secretary of such
division or any other divisional title or titles deemed
appropriate. Any such titles so conferred may be discontinued and
withdrawn at any time by any one Appointing Person. Any employee of
a division designated by such a divisional title shall have the
powers and duties with respect to such division as shall be
prescribed by the Appointing Person. The conferring, withdrawal or
discontinuance of divisional titles shall be in writing and shall
be filed with the Secretary of the Corporation.
Section 7. Salaries. The salaries and other compensation of
the principal officers of the Corporation shall be fixed from time
to time by the Board of Directors.
ARTICLE V
Execution of Corporate Instruments and Voting of Securities Owned
by the Corporation
Section 1. Execution of Instruments. The Board of Directors
may in its discretion determine the method and designate the
signatory officer or officers or other person or persons, to
execute any corporate instrument or document, or to sign the
corporate name without limitation, except where otherwise provided
by law, and such execution or signature shall be binding upon the
Corporation. All checks, notes, drafts or other orders for payment
of money drawn on banks or other depositories on funds to the
credit of the Corporation or in special accounts of the
Corporation, shall be signed by such person or persons as the
Treasurer or such other person designated by the Board of Directors
for that purpose shall authorize so to do.
Section 2. Voting of Securities Owned by the Corporation.
All stock and other securities of other corporations and business
entities owned or held by the Corporation for itself, or for other
parties in any capacity, shall be voted, and all proxies with
respect thereto shall be executed, by the person authorized to do
so by resolution of the Board of Directors.
ARTICLE VI
Shares of Stock and Other Securities
Section 1. Form and Execution of Certificates. Shares of
stock of the Corporation shall be represented by certificates, or
shall be uncertificated shares that may be evidenced by a
book-entry system maintained by the registrar of such stock, or a
combination of both, and such forms as is consistent with the
Restated Articles of Incorporation and applicable law. To the
extent that shares are represented by certificates, such
certificates shall be in a form approved by the board of directors.
Every certificate shall be signed by, or in the name of the
Corporation by, the Chair of the Board (if there be such an officer
appointed), or by the Chief Executive Officer, President or any
Vice President and by the Treasurer or Assistant Treasurer or the
Secretary or Assistant Secretary, certifying the number of shares
owned by him in the Corporation. Any or all of the signatures on
the certificate may be a facsimile. In case any officer, transfer
agent, or registrar who has signed or whose facsimile signature has
been placed upon a certificate shall have ceased to be such
officer, transfer agent, or registrar before such certificate is
issued, it may be issued with the same effect as if he were such
officer, transfer agent, or registrar at the date of issue. If the
Corporation shall be authorized to issue more than one class of
stock or more than one series of any class, the powers,
designations, preferences and relative, participating, optional or
other special rights of each class of stock or series thereof and
the qualifications, limitations or restrictions of such preferences
and/or rights shall be set forth in full or summarized on the face
or back of the certificate which the Corporation shall issue to
represent such class or series of stock, provided that, except as
otherwise provided in Section 78.242 of the Nevada Revised
Statutes, in lieu of the foregoing requirements, there may be set
forth on the face or back of the certificate which the Corporation
shall issue to represent such class or series of stock, a statement
that the Corporation will furnish without charge to each
stockholder who so requests the powers, designations, preferences
and relative, participating, optional or other special rights of
each class of stock or series thereof and the qualifications,
limitations or restrictions of such preferences and/or
rights.
Section 2. 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 that fact by the
person claiming the certificate of stock to be lost or destroyed.
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 indemnify the Corporation in such manner as it
shall require and/or to give the Corporation a surety bond or other
security in such form and amount 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 3. Transfers. Certificated shares of the Corporation
will only be transferred on its books upon the surrender to the
Corporation of the share certificates duly endorsed or accompanied
by proper evidence of succession, assignment or authority to
transfer. The surrendered certificates shall be canceled, new
certificates issued to the person entitled to them and the
transaction recorded on the books of the Corporation.
Uncertificated shares will only be transferred on the books of the
Corporation upon the written instruction from the registered owner
of such uncertificated shares, or from a duly authorized attorney
or from an individual presenting proper evidence of succession,
assignment or authority to transfer the stock.
Section 4. Fixing Record Dates. In order that the
Corporation may determine the stockholders entitled to notice of or
to vote at any meeting of stockholders or any adjournment thereof,
or to express consent to corporate action in writing without a
meeting, or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled 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 of
Directors may fix, in advance, a record date, which shall not be
more than 60 nor less than 10 days before the date of such meeting,
nor more than 60 days prior to any other action. If no record date
is fixed: (1) the record date for determining stockholders entitled
to notice of or to vote at a meeting of stockholders shall be at
the close of business on the day before the day on which the first
notice is given, or, if notice is waived, at the close of business
on the day before the day on which the meeting is held; (2) the
record date for determining stockholders entitled to express
consent to corporate action in writing without a meeting, when no
prior action by the Board of Directors is necessary, shall be the
day on which the first written consent is expressed; (3) the record
date for determining stockholders for any other purpose shall be at
the close of business on the day on which the Board of Directors
adopts the resolution relating thereto. A determination of
stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the Board of Directors must fix a
new record date for any meeting adjourned or postponed to a date
more than 60 days later than the meeting date set for the original
meeting.
Section 5. 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 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
Nevada.
Section 6. Regulations. The Board of Directors may make such
rules and regulations as it may deem expedient concerning the
issue, transfer and registration of certificates for shares of the
stock and other securities of the Corporation, and may appoint
transfer agents and registrars of any class of stock or other
securities of the Corporation.
Section 7. Other Securities of the Corporation. All bonds,
debentures and other corporate securities of the Corporation, other
than stock certificates, may be signed by the Chair of the Board
(if there be such an officer appointed), or the Chief Executive
Officer, President or any Vice President or such other person as
may be authorized by the Board of Directors and the corporate seal
impressed thereon or a facsimile of such seal imprinted thereon and
attested by the signature of the Secretary or an Assistant
Secretary, or the Treasurer or an Assistant Treasurer; provided,
however, that where any such bond, debenture or other corporate
security shall be authenticated by the manual signature of a
trustee under an indenture pursuant to which such bond, debenture
or other corporate security shall be issued, the signature of the
persons signing and attesting the corporate seal on such bond,
debenture or other corporate security may be the imprinted
facsimile of the signatures of such persons. Interest coupons
appertaining to any such bond, debenture or other corporate
security, authenticated by a trustee as aforesaid, shall be signed
by the Treasurer or an Assistant Treasurer of the Corporation, or
such other person as may be authorized by the Board of Directors,
or bear imprinted thereon the facsimile signature of such person.
In case any officer who shall have signed or attested any bond,
debenture or other corporate security or whose facsimile signature
shall appear thereon shall have ceased to be such officer before
the bond, debenture or other corporate security so signed or
attested shall have been delivered, such bond, debenture or other
corporate security nevertheless may be adopted by the Corporation
and issued and delivered as though the person who signed the same
or whose facsimile signature shall have been used thereon had not
ceased to be such officer of the Corporation.
Section 8. Transfer Agents and Registrars. The Board of
Directors may appoint, or authorize any officer of officers to
appoint, one or more transfer agents and one or more
registrars.
ARTICLE VII
Corporate Seal
The
Corporation shall not be required to have a corporate seal. However
nothing in these By-Laws shall prevent the Board of Directors from
using a corporate seal as they may deem necessary. In the event the
Corporation has a seal, said seal may be used by causing it or a
facsimile thereof to be impressed or affixed or reproduced or
otherwise.
ARTICLE VIII
Indemnification of Officers, Directors, Employees and
Agents
Section 1. Power to Indemnify in Actions, Suits or Proceedings
Other Than Those by or in the Right of the Corporation.
Subject to Section 3 of this ARTICLE VIII, 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 (other than an action by or in the right of the
Corporation) by reason of the fact that he is or was a director or
officer of the Corporation, or is or was a director or officer of
the Corporation serving at the request of the Corporation as a
director or officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by such person
in connection with such action, suit or proceeding if the person
(a) did not breach, through intentional misconduct, fraud or a
knowing violation of the law, the person’s fiduciary duty as
a director or officer to act in good faith and in the interests of
the Corporation, or (b) acted in good faith and in a manner the
person 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 the
conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a
plea of nolo contendere or its equivalent, shall not, of itself,
create a presumption that the person breached his or her fiduciary
duties, as discussed above, or did not act in good faith and in a
manner which that person reasonably believed to be in or not
opposed to the best interests of the Corporation, or that, with
respect to any criminal action or proceeding, such person had
reasonable cause to believe that the conduct was unlawful. The
right to indemnification conferred in this ARTICLE VIII shall be a
contract right.
Section 2. Power to Indemnify in Actions, Suits or Proceedings by
or in the Right of the Corporation. Subject to Section 3 of
this ARTICLE VIII, 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 or suit by or in the right
of the Corporation to procure a judgment in its favor by reason of
the fact that the person is or was a director or officer of the
Corporation, or is or was a director or officer of the Corporation
serving at the request of the Corporation as a director, officer,
employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses (including
attorneys' fees) actually and reasonably incurred by the person in
connection with the defense or settlement of such action or suit if
the person (a) did not breach, through intentional misconduct,
fraud or a knowing violation of the law, the person’s
fiduciary duty as a director or officer to act in good faith and in
the interests of the Corporation, or (b) acted in good faith and in
a manner the person reasonably believed to be in or not opposed to
the best interests of the Corporation; except that no
indemnification shall be made in respect of any claim, issue or
matter as to which such person shall have been adjudged to be
liable to the Corporation unless and only to the extent that the
court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view
of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the court
shall deem proper.
Section 3. Authorization of Indemnification. Any
indemnification under this ARTICLE VIII (unless ordered by a court)
shall be made by the Corporation only as authorized in the specific
case upon a determination that indemnification of the director or
officer is proper in the circumstances because such person has met
the applicable standard of conduct set forth in Section 1 or
Section 2 of this ARTICLE VIII, as the case may be. Such
determination shall be made (i) by the Board of Directors by a
majority vote of a quorum consisting of directors who were not
parties to such action, suit or proceeding, or (ii) 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 (iii) by the stockholders. To the extent,
however, that a director or officer of the Corporation has been
successful on the merits or otherwise in defense of any action,
suit or proceeding described above, or in defense of any claim,
issue or matter therein, he shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by him
in connection therewith, without the necessity of authorization in
the specific case.
Section 4. Good Faith Defined. For purposes of any
determination under Section 3 of this ARTICLE VIII, a person shall
be deemed to have acted in good faith and in a manner the person
reasonably believed to be in or not opposed to the best interests
of the Corporation, or, with respect to any criminal action or
proceeding, to have had no reasonable cause to believe the conduct
was unlawful, if the person’s action is based on the records
or books of account of the Corporation or another enterprise, or on
information supplied to the person by the officers of the
Corporation or another enterprise in the course of their duties, or
on the advice of legal counsel for the Corporation or another
enterprise or on information or records given or reports made to
the Corporation or another enterprise by an independent certified
public accountant or by an appraiser or other expert selected with
reasonable care by the Corporation or another enterprise. The term
"another enterprise" as used in this Section 4 shall mean any other
corporation or any partnership, joint venture, trust or other
enterprise of which such person is or was serving at the request of
the Corporation as a director, officer, employee or agent. The
provisions of this Section 4 shall not be deemed to be exclusive or
to limit in any way the circumstances in which a person may be
deemed to have met the applicable standard of conduct set forth in
Sections 1 or 2 of this ARTICLE VIII, as the case may
be.
Section 5. Indemnification by a Court. Notwithstanding any
contrary determination in the specific case under Section 3 of this
ARTICLE VIII, and notwithstanding the absence of any determination
thereunder, any director or officer may apply to any court of
competent jurisdiction in the State of Nevada for indemnification
to the extent otherwise permissible under Sections 1 and 2 of this
ARTICLE VIII. The basis of such indemnification by a court shall be
a determination by such court that indemnification of the director
or officer is proper in the circumstances because such person has
met the applicable standards of conduct set forth in Sections 1 or
2 of this ARTICLE VIII, as the case may be. Neither a contrary
determination in the specific case under Section 3 of this ARTICLE
VIII nor the absence of any determination thereunder shall be a
defense to such application or create a presumption that the
director or officer seeking indemnification has not met any
applicable standard of conduct. Notice of any application for
indemnification pursuant to this Section 5 shall be given to the
Corporation promptly upon the filing of such application. If
successful, in whole or in part, the director or officer seeking
indemnification shall also be entitled to be paid the expense of
prosecuting such application.
Section 6. Expenses Payable in Advance. Expenses incurred by
a director or officer in defending or investigating a threatened or
pending action, suit or proceeding shall be paid by the Corporation
as they are incurred and in advance of the final disposition of
such action, suit or proceeding upon receipt of an undertaking by
or on behalf of such director or officer to repay such amount if it
shall ultimately be determined that the person is not entitled to
be indemnified by the Corporation as authorized in this ARTICLE
VIII.
Section 7. Nonexclusivity of Indemnification and Advancement of
Expenses. The indemnification and advancement of expenses
provided by or granted pursuant to this ARTICLE VIII shall not be
deemed exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under
the Restated Articles of Incorporation, any By-Law, agreement,
contract, vote of stockholders or disinterested directors or
pursuant to the direction (howsoever embodied) of any court of
competent jurisdiction or otherwise, both as to action in the
person’s official capacity and as to action in another
capacity while holding such office, it being the policy of the
Corporation that indemnification of the persons specified in
Sections 1 and 2 of this ARTICLE VIII shall be made to the fullest
extent permitted by law. The provisions of this ARTICLE VIII shall
not be deemed to preclude the indemnification of any person who is
not specified in Sections 1 or 2 of this ARTICLE VIII but whom the
Corporation has the power or obligation to indemnify under the
provisions of the Nevada Revised Statutes, or
otherwise.
Section 8. Insurance. The Corporation may purchase and
maintain insurance or make other financial arrangements on behalf
of any person who is or was a director or officer of the
Corporation, or is or was a director or officer of the Corporation
serving at the request of the Corporation as a director, officer,
employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against any liability asserted
against the person and incurred by the person in any such capacity,
or arising out of the person’s status as such, whether or not
the Corporation would have the power or the obligation to indemnify
the person against such liability under the provisions of this
ARTICLE VIII.
Section 9. Certain Definitions. For purposes of this ARTICLE
VIII, references to “the Corporation” shall include, in
addition to the resulting corporation, any constituent corporation
(including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had
continued, would have had power and authority to indemnify its
directors or officers, so that any person who is or was a director
or officer of such constituent corporation, or is or was a director
or officer of such constituent corporation serving at the request
of such constituent corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or
other enterprise, shall stand in the same position under the
provisions of this ARTICLE VIII with respect to the resulting or
surviving corporation as the person would have with respect to such
constituent corporation if its separate existence had continued.
For purposes of this ARTICLE VIII, references to "fines" shall
include any excise taxes assessed on a person with respect to an
employee benefit plan; and references to “serving at the
request of the Corporation” shall include any service as a
director, officer, employee or agent of the Corporation which
imposes duties on, or involves services by, such director or
officer with respect to an employee benefit plan, its participants
or beneficiaries; and a person who acted in good faith and in a
manner the person reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan shall be
deemed to have acted in a manner “not opposed to the best
interests of the Corporation” as referred to in this ARTICLE
VIII.
Section 10. Survival of Indemnification and Advancement of
Expenses. The indemnification and advancement of expenses
provided by, or granted pursuant to, this ARTICLE VIII shall,
unless otherwise provided when authorized or ratified, continue as
to a person who has ceased to be a director or officer and shall
inure to the benefit of the heirs, executors and administrators of
such a person.
Section 11. Limitation on Indemnification. Notwithstanding
anything contained in this ARTICLE VIII to the contrary, except for
proceedings to enforce rights to indemnification (which shall be
governed by Section 5 hereof), the Corporation shall not be
obligated to indemnify any director or officer in connection with a
proceeding (or part thereof) initiated by such person unless such
proceeding (or part thereof) was authorized or consented to by the
Board of Directors of the Corporation.
Section 12. Indemnification of Employees and Agents. The
Corporation may, to the extent authorized from time to time by the
Board of Directors, provide rights to indemnification and to the
advancement of expenses to employees and agents of the Corporation
similar to those conferred in this ARTICLE VIII to directors and
officers of the Corporation.
Section 13. Effect of Amendment. Any amendment, repeal or
modification of this ARTICLE VIII shall not (a) adversely affect
any right or protection of any director or officer existing at the
time of such amendment, repeal or modification, or (b) apply to the
indemnification of any such person for liability, expense, or loss
stemming from actions or omissions occurring prior to such
amendment, repeal, or modification.
Section 14. Authority to Enter into Indemnification
Agreements. The Corporation may enter into indemnification
agreements with the directors and officers of the Corporation,
including, without limitation, any indemnification agreement in
substantially the form set forth in Exhibit 1 attached to these
By-Laws.
ARTICLE IX
Notices
Whenever,
under any provisions of these By-Laws, notice is required to be
given to any stockholder, the same shall be given in writing,
timely and duly deposited in the United States Mail, postage
prepaid, and addressed to his last known post office address or by
electronic transmission, if consented to by such stockholder, to
such physical or electronic address as shown by the stock record of
the Corporation or its transfer agent. Any notice sent by means of
electronic transmission must contain or be accompanied by
information from which the recipient can determine the date of
transmission. Any notice required to be given to any director may
be given by any of the methods stated in Section 8 of ARTICLE III
hereof. If no address of a stockholder or director be known, such
notice may be sent to the office of the Corporation required to be
maintained pursuant to Section 2 of ARTICLE I hereof. An affidavit
of mailing, executed by a duly authorized and competent employee of
the Corporation or its transfer agent appointed with respect to the
class of stock affected, specifying the name and address or the
names and addresses of the stockholder or stockholders, director or
directors, to whom any such notice or notices was or were given,
and the time and method of giving the same, shall be conclusive
evidence of the statements therein contained. All notices given by
mail, as above provided, shall be deemed to have been given as at
the time of mailing and all notices given by means of electronic
transmission shall be deemed to have been given at the time such
notice enters an information processing system that the recipient
has designated or use for the purpose of receiving electronic
transmissions of information of the type sent, in a form ordinarily
capable of being processed by that system. It shall not be
necessary that the same method of giving be employed in respect of
all directors, but one permissible method may be employed in
respect of any one or more, and any other permissible method or
methods may be employed in respect of any other or others. The
period or limitation of time within which any stockholder may
exercise any option or right, or enjoy any privilege or benefit, or
be required to act, or within which any director may exercise any
power or right, or enjoy any privilege, pursuant to any notice sent
him in the manner above provided, shall not be affected or extended
in any manner by the failure of such a stockholder or such director
to receive such notice. Whenever any notice is required to be given
under the provisions of Nevada corporate law or of the Restated
Articles of Incorporation, or of these By-Laws, 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 thereto. Whenever notice is required to be given, under
any provision of law or of the Restated Articles of Incorporation
or By-Laws of the Corporation, to any person with whom
communication is unlawful, the giving of such notice to such person
shall not be required and there shall be no duty to apply to any
governmental authority or agency for a license or permit to give
such notice to such person. Any action or meeting which shall be
taken or held without notice to any such person with whom
communication is unlawful shall have the same force and effect as
if such notice had been duly given. In the event that the action
taken by the Corporation is such as to require the filing of a
certificate under any provision of the Nevada Revised Statutes, the
certificate shall state, if such is the fact and if notice is
required, that notice was given to all persons entitled to receive
notice except such persons with whom communication is
unlawful.
ARTICLE X
Amendments
The
Board of Directors is expressly authorized to adopt, alter and
repeal the By-Laws of the Corporation in whole or in part at any
regular or special meeting of the Board of Directors, by vote of a
majority of the entire Board of Directors. The By-Laws may also be
adopted, altered or repealed in whole or in part at any annual or
special meeting of the stockholders by the affirmative vote of
three-fourths of the shares of the Corporation outstanding and
entitled to vote thereon.
ARTICLE XI
Fiscal Year
The
fiscal year of the Corporation shall be determined by the Board of
Directors.
[Left
Blank Intentionally]
CERTIFICATE OF SECRETARY
The
undersigned, Chief Executive Officer and Secretary of Freedom
Holding Corp., a Nevada corporation, hereby certifies that the
foregoing is a full, true and correct copy of the By-Laws of said
Corporation, with all amendments to date of this
Certificate.
WITNESS
the signature of the undersigned and the seal of the Corporation
this 6th
day of February, 2019.
/s/ Timur Turlov
Timur
Turlov, Chief Executive Officer
/s/ Adam R. Cook
Adam R.
Cook, Secretary
Exhibit 1
INDEMNIFICATION AGREEMENT
AGREEMENT,
effective as of __________________between Freedom Holding Corp., a
Nevada corporation (the “Company”), and
_____________________ (the “Indemnitee”).
WHEREAS, it is
essential to the Company to retain and attract as directors and
officers the most capable persons available.
WHEREAS, Indemnitee
is a director/officer of the Company.
WHEREAS, both the
Company and Indemnitee recognize the increased risk of
litigation
and other claims being asserted against directors of public
companies in today’s environment;
WHEREAS, the
Restated Articles of Incorporation and the By-laws of the Company
require the Company to indemnify and advance expenses to its
directors to the fullest extent permitted by law and the Indemnitee
has been serving and continues to serve as a director or officer of
the Company in part in reliance on such Restated Articles of
Incorporation and By-laws;
WHEREAS, in
recognition of Indemnitee's need for substantial protection against
personal liability in order to enhance Indemnitee's continued
service to the Company in an effective manner and Indemnitee's
reliance on the aforesaid Restated Articles of Incorporation and
By-laws, and in part to provide Indemnitee with specific
contractual assurance that the protection promised by such Restated
Articles of Incorporation and By-laws will be available to
Indemnitee (regardless of, among other things, any amendment to or
revocation of such Restated Articles of Incorporation and By-laws
or any change in the composition of the Company's Board of
Directors or acquisition transaction relating to the Company), and
in order to induce Indemnitee to continue to provide services to
the Company as a director or officer thereof, the Company wishes to
provide in this Agreement for the indemnification of and the
advancing of expenses to Indemnitee to the fullest extent (whether
partial or complete) permitted by law and as set forth in this
Agreement, and, to the extent insurance is maintained, for the
continued coverage of Indemnitee under the Company's directors' and
officers' liability insurance policies.
NOW,
THEREFORE, in consideration of the premises and of Indemnitee
continuing to serve the Company directly or, at its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1.
Certain Definitions.
(a)
Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than a trustee
or other fiduciary holding securities under an employee benefit
plan of the Company or a corporation owned directly or indirectly
by the stockholders of the Company in substantially the same
proportions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly, of securities of the Company
representing 20% or more of the total voting power represented by
the Company's then outstanding Voting Securities, or (ii) during
any period of two consecutive years, individuals who at the
beginning of such period constitute the Board of Directors of the
Company and any new director whose election by the Board of
Directors or nomination for election by the Company's stockholders
was approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors at the
beginning of the period or whose election or nomination for
election was previously so approved, cease for any reason to
constitute a majority thereof, or (iii) the stockholders of the
Company approve a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would
result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entity) at least 80% of the total voting power
represented by the Voting Securities of the Company or such
surviving entity outstanding immediately after such merger or
consolidation, or the stockholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale or
disposition by the Company (in one transaction or a series of
transactions) of all or substantially all of the Company's
assets.
(b)
Expense: include attorneys' fees and all other costs, expenses and
obligations paid or incurred in connection with investigating,
defending, being a witness in or participating in (including on
appeal), or preparing to defend, be a witness in or participate in
any Proceeding relating to any Indemnifiable Event.
(c)
Indemnifiable Event: any event or occurrence that takes place
either prior to or after the execution of this Agreement, related
to the fact that Indemnitee is or was a director or an officer of
the Company, or while a director or officer is or was serving at
the request of the Company as a director, officer, employee,
trustee, agent or fiduciary of another corporation, partnership,
joint venture, trust or other enterprise, or by reason of anything
done or not done by Indemnitee in any such capacity.
(d)
Potential Change in Control: shall be deemed to have occurred if
(i) the Company enters into an agreement or arrangement, the
consummation of which would result in the occurrence of Change in
Control; (ii) any person (including the Company) publicly announces
an intention to take or to consider taking actions which if
consummated would constitute Change in Control; (iii) any person,
other than a trustee or other fiduciary holding securities under an
employee benefit plan of the Company acting in such capacity or a
corporation owned, directly or indirectly, by the stockholders of
the Company in substantially the same proportions as their
ownership of stock of the Company, who is or becomes the beneficial
owner, directly or indirectly, of securities of the Company
representing 10% or more of the combined voting power of the
Company's then outstanding Voting Securities, increases his
beneficial ownership of such securities by 5% or more over the
percentage so owned by such person on the date hereof; or (iv) the
Board adopts a resolution to the effect that, for purposes of this
Agreement, a Potential Change in Control has occurred.
(e)
Proceeding: any threatened, pending or completed action, suit or
proceeding, or any inquiry, hearing or investigation, whether
conducted by the Company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such
action, suit or proceeding, whether civil, criminal,
administrative, investigative or other.
(f)
Reviewing Party: any appropriate person or body consisting of a
member or members of the Company's Board of Directors or any other
person or body appointed by the Board (including the special,
independent counsel referred to in Section 3) who is not a party to
the particular Proceeding with respect to which Indemnitee is
seeking indemnification.
(g)
Voting Securities: any securities of the Company which vote
generally in the election of directors.
2.
Agreement to Indemnify.
(a) In
the event Indemnitee was, is or becomes a party to or witness or
other participant in, or is threatened to be made a party to or
witness or other participant in, a Proceeding by reason of (or
arising in part out of) an Indemnifiable Event, the Company shall
indemnify Indemnitee to the fullest extent permitted by law, as
soon as practicable but in any event no later than thirty days
after written demand is presented to the Company, against any and
all Expenses, judgments, fines, penalties and amounts paid in
settlement (including all interest, assessments and other charges
paid or payable in connection with or in respect of such Expenses,
judgments, fines, penalties or amounts paid in settlement) of such
Proceeding and any federal, state, local or foreign taxes imposed
on the Indemnitee as a result of the actual or deemed receipt of
any payments under this Agreement (including the creation of the
Trust). Notwithstanding anything in this Agreement to the contrary
and except as provided in Section 5, prior to a Change in Control
Indemnitee shall not be entitled to indemnification pursuant to
this Agreement in connection with any Proceeding initiated by
Indemnitee against the Company or any director or officer of the
Company unless the Company has joined in or consented to the
initiation of such Proceeding. If so requested by Indemnitee, the
Company shall advance (within ten business days of such request)
any and all Expenses to Indemnitee (an "Expense
Advance").
(b)
Notwithstanding the foregoing, (i) the obligations of the Company
under Section 2(a) shall be subject to the condition that the
Reviewing Party shall not have determined (in a written opinion, in
any case in which the special, independent counsel referred to in
Section 3 hereof is involved) that Indemnitee would not be
permitted to be indemnified under applicable law, and (ii) the
obligation of the Company to make an Expense Advance pursuant to
Section 2(a) shall be subject to the condition that, if, when and
to the extent that the Reviewing Party determines that Indemnitee
would not be permitted to be so indemnified under applicable law,
the Company shall be entitled to be reimbursed by Indemnitee (who
hereby agrees to reimburse the Company) for all such amounts
theretofore paid; provided, however, that if Indemnitee has
commenced legal proceedings in a court of competent jurisdiction to
secure a determination that Indemnitee should be indemnified under
applicable law, any determination made by the Reviewing Party that
Indemnitee would not be permitted to be indemnified under
applicable law shall not be binding and Indemnitee shall not be
required to reimburse the Company for any Expense Advance until a
final judicial determination is made with respect thereto (as to
which all rights of appeal therefrom have been exhausted or
lapsed). Indemnitee's obligation to reimburse the Company for
Expense Advances shall be unsecured and no interest shall be
charged thereon. If there has not been a Change in Control the
Reviewing Party shall be selected by the Board of Directors, and if
there has been such a Change in Control (other than a Change in
Control which has been approved by a majority of the Company's
Board of Directors who were directors immediately prior to such
Change in Control), the Reviewing Party shall be the special,
independent counsel referred to in Section 3 hereof. If there has
been no determination by the Reviewing Party or if the Reviewing
Party determines that Indemnitee substantively would not be
permitted to be indemnified in whole or in part under applicable
law, Indemnitee shall have the right to commence litigation in any
court in the State of Nevada having subject matter jurisdiction
thereof and in which venue is proper seeking an initial
determination by the court or challenging any such determination by
the Reviewing Party or any aspect thereof, and the Company hereby
consents to service of process and to appear in any such
proceeding. Any determination by the Reviewing Party otherwise
shall be conclusive and binding on the Company and
Indemnitee.
3.
Change in Control. The Company agrees that if there is a Change in
Control of the Company (other than a Change in Control which has
been approved by a majority of the Company's Board of Directors who
were directors immediately prior to such Change in Control) then
with respect to all matters thereafter arising concerning the
rights of Indemnitee to indemnity payments and Expense Advances
under this Agreement or any other agreement or under applicable law
or the Company's Restated Articles of Incorporation or By-Laws now
or hereafter in effect relating to indemnification for
Indemnifiable Events, the Company shall seek legal advice only from
special independent counsel selected by Indemnitee and approved by
the Company (which approval shall not be unreasonably withheld),
and who has not otherwise performed services for the Company or the
Indemnitee (other than in connection with such matters) within the
last five years. Such independent counsel shall not include any
person who, under the applicable standards of professional conduct
then prevailing, would have a conflict of interest in representing
either the Company or Indemnitee in an action to determine
Indemnitee's rights under this Agreement. Such counsel, among other
things, shall render its written opinion to the Company and
Indemnitee as to whether and to what extent the Indemnitee would be
permitted to be indemnified under applicable law. The Company
agrees to pay the reasonable fees of the special, independent
counsel referred to above and to indemnify fully such counsel
against any and all expenses (including attorneys' fees), claims,
liabilities and damages arising out of or relating to this
Agreement or the engagement of special, independent counsel
pursuant hereto.
4.
Establishment of Trust. In the event of a Potential Change in
Control, the Company shall, upon written request by Indemnitee,
create a Trust for the benefit of the Indemnitee and from time to
time upon written request of Indemnitee shall fund such Trust in an
amount sufficient to satisfy any and all Expenses reasonably
anticipated at the time of each such request to be incurred in
connection with investigating, preparing for and defending any
Proceeding relating to an Indemnifiable event, and any and all
judgments, fines, penalties and settlement amounts of any and all
Proceedings relating to an Indemnifiable Event from time to time
actually paid or claimed, reasonably anticipated or proposed to be
paid. The amount or amounts to be deposited in the Trust pursuant
to the foregoing funding obligation shall be determined by the
Reviewing Party, in any case in which the special, independent
counsel referred to above is involved. The terms of the Trust shall
provide that upon a Change in Control (i) the Trust shall not be
revoked or the principal thereof invaded, without the written
consent of the Indemnitee, (ii) the Trustee shall advance, within
ten business days of a request by the Indemnitee, any and all
Expenses to the Indemnitee (and the Indemnitee hereby agrees to
reimburse the Trust under the circumstances under which the
Indemnitee would be required to reimburse the Company under Section
2(b) of this Agreement), (iii) the Trust shall continue to be
funded by the Company in accordance with the funding obligation set
forth above, (iv) the Trustee shall promptly pay to the Indemnitee
all amounts for which the Indemnitee shall be entitled to
indemnification pursuant to this Agreement or otherwise, and (v)
all unexpended funds in such Trust shall revert to the Company upon
a final determination by the Reviewing Party or a court of
competent jurisdiction, as the case may be, that the Indemnitee has
been fully indemnified under the terms of this Agreement. The
Trustee shall be chosen by the Indemnitee. Nothing in this Section
4 shall relieve the Company of any of its obligations under this
Agreement. All income earned on the assets held in the Trust shall
be reported as income by the Company for federal, state, local and
foreign tax purposes.
5.
Indemnification for Expenses Incurred in Enforcing this Agreement.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees), and, if requested by Indemnitee, shall
(within ten business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with any
claim asserted against or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or under applicable law or
the Company's Restated Articles of Incorporation or By-laws now or
hereafter in effect relating to indemnification for Indemnifiable
Events and/or (ii) recovery under any directors' and officers'
liability insurance policies maintained by the Company, regardless
of whether Indemnitee ultimately is determined to be entitled to
such indemnification, advance expense payment or insurance
recovery, as the case may be.
6.
Partial Indemnity. If Indemnitee is entitled under any provision of
this Agreement to indemnification by the Company for some or a
portion of the Expenses, judgments, fines, penalties and amounts
paid in settlement of a Proceeding but not, however, for all of the
total amount thereof, the Company shall nevertheless indemnify
Indemnitee for the portion thereof to which Indemnitee is entitled.
Moreover, notwithstanding any other provision of this Agreement, to
the extent that Indemnitee has been successful on the merits or
otherwise in defense of any or all Proceedings relating in whole or
in part to an Indemnifiable Event or in defense of any issue or
matter therein, including dismissal without prejudice, Indemnitee
shall be indemnified against all Expenses incurred in connection
therewith.
7.
Defense to Indemnification, Burden of Proof and Presumptions. It
shall be a defense to any action brought by the Indemnitee against
the Company to enforce this Agreement (other than an action brought
to enforce a claim for expenses incurred in defending a Proceeding
in advance of its final disposition where the required undertaking
has been tendered to the Company) that the Indemnitee has not met
the standards of conduct that make it permissible under Nevada
corporate law for the Company to indemnify the Indemnitee for the
amount claimed. In connection with any determination by the
Reviewing Party or otherwise as to whether the Indemnitee is
entitled to be indemnified hereunder, the burden of proving such a
defense shall be on the Company. Neither the failure of the Company
(including its Board of Directors, independent legal counsel, or
its stockholders) to have made a determination prior to the
commencement of such action by the Indemnitee that indemnification
of the claimant is proper under the circumstances because he or she
has met the applicable standard of conduct set forth in Nevada
corporate law, nor an actual determination by the Company
(including its Board of Directors, independent legal counsel, or
its stockholders) that the Indemnitee had not met such applicable
standard of conduct, shall be a defense to the action or create a
presumption that the Indemnitee has not met the applicable standard
of conduct. For purposes of this Agreement, the termination of any
claim, action, suit or proceeding, by judgment, order, settlement
(whether with or without court approval) or conviction, or upon a
plea of nolo contendere, or its equivalent, shall not create a
presumption that Indemnitee did not meet any particular standard of
conduct or have any particular belief or that a court has
determined that indemnification is not permitted by applicable
law.
8.
Non-exclusivity. The rights of the Indemnitee hereunder shall be in
addition to any other rights Indemnitee may have under the
Company's Restated Articles of Incorporation or By-laws or the
Nevada corporate law or otherwise. To the extent that a change in
Nevada corporate law (whether by statute or judicial decision)
permits greater indemnification by agreement than would be afforded
currently under the Company's Restated Articles of Incorporation
and By-laws and this Agreement, it is the intent of the parties
hereto that Indemnitee shall enjoy by this Agreement the greater
benefits so afforded by such change.
9.
Liability Insurance. To the extent the Company maintains an
insurance policy or policies providing directors' and officers'
liability insurance, Indemnitee shall be covered by such policy or
policies, in accordance with its or their terms, to the maximum
extent of the coverage available for any Company director or
officer.
10.
Period of Limitations. No legal action shall be brought and no
cause of action shall be asserted by or on behalf of the Company or
any affiliate of the Company against Indemnitee, Indemnitee's
spouse, heirs, executors or personal or legal representatives after
the expiration of two years from the date of accrual of such cause
of action, or such longer period as may be required by state law
under the circumstances, and any claim or cause of action of the
Company or its affiliate shall be extinguished and deemed released
unless asserted by the timely filing of a legal action within such
period; provided, however, that if any shorter period of
limitations is otherwise applicable to any such cause of action
such shorter period shall govern.
11.
Amendment of this Agreement. No supplement, modification or
amendment of this Agreement shall be binding unless executed in
writing by both of the parties hereto. No waiver of any of the
provisions of this Agreement shall be deemed or shall constitute a
waiver of any other provisions hereof (whether or not similar) nor
shall such waiver constitute a continuing waiver.
12.
Subrogation. In the event of payment under this Agreement, the
Company shall be subrogated to the extent of such payment to all of
the rights of recovery of Indemnitee, who shall execute all papers
required and shall do everything that may be necessary to secure
such rights, including the execution of such documents necessary to
enable the Company effectively to bring suit to enforce such
rights.
13. No
Duplication of Payments. The Company shall not be liable under this
Agreement to make any payment in connection with any claim made
against Indemnitee to the extent Indemnitee has otherwise actually
received payment (under any insurance policy, By-law or otherwise)
of the amounts otherwise indemnifiable hereunder.
14.
Settlement of Claims. The Company shall not be liable to indemnify
Indemnitee under this Agreement for any amounts paid in settlement
of any action or claim effected without the Company's written
consent. The Company shall not settle any action or claim in any
manner which would impose any penalty or limitation on Indemnitee
without Indemnitee's written consent. Neither the Company nor the
Indemnitee will unreasonably withhold their consent to any proposed
settlement. The Company shall not be liable to indemnify the
Indemnitee under this Agreement with regard to any judicial award
if the Company was not given a reasonable and timely opportunity,
at its expense, to participate in the defense of such
action.
15.
Binding Effect. This Agreement shall be binding upon and inure to
the benefit of and be enforceable by the parties hereto and their
respective successors, assigns, including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company,
spouses, heirs, and personal and legal representatives. The Company
shall require and cause any successor (whether direct or indirect
by purchase, merger, consolidation or otherwise) to all,
substantially all, or a substantial part, of the business and/or
assets of the Company, by written agreement in form and substance
satisfactory to the Indemnitee, expressly to assume and agree to
perform this Agreement in the same manner and to the same extent
that the Company would be required to perform if no such succession
had taken place. This Agreement shall continue in effect regardless
of whether Indemnitee continues to serve as a director or officer
of the Company or of any other enterprise at the Company's
request.
16.
Severability. The provisions of this Agreement shall be severable
in the event that any of the provisions hereof (including any
provision within a single section, paragraph or sentence) is held
by a court of competent jurisdiction to be invalid, void or
otherwise unenforceable, and the remaining provisions shall remain
enforceable to the fullest extent permitted by law. Furthermore, to
the fullest extent possible, the provisions of this Agreement
(including, without limitation, each portion of this Agreement
containing any provision held to be invalid, void or otherwise
unenforceable, that is not itself invalid, void or unenforceable)
shall be construed so as to give effect to the intent manifested by
the provision held invalid, illegal or unenforceable.
17.
Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Nevada
applicable to contracts made and to be performed in such State
without giving effect to the principles of conflicts of
laws.
IN
WITNESS WHEREOF, the parties hereto have duly executed and
delivered
this
Agreement as of the _______________ day of _______________,
20___.
FREEDOM
HOLDING CORP.
By:
____________________________________
Name:
Title:
“INDEMNITEE”
______________________________________