BYLAWS
OF
CORRECTIONAL SYSTEMS, INC.
ARTICLE I
Applicability
Section 1. Applicability of Bylaws.
These Bylaws govern, except as otherwise provided by statute or its
Certificate of Incorporation, the management of the business and the conduct of
the affairs of the Corporation.
ARTICLE II
Offices
Section 1. Registered Office.
The address of the Corporation's registered office in the State of
Delaware is 1013 Centre Road, in the City of Wilmington, County of New Castle,
Delaware 19805. The name of the registered agent of the Corporation at such
address is The United States Corporation Company.
Section 2. Principal Executive Offices.
The location of the principal executive offices of the Corporation
is 6910A Miramar Road, Suite 200, San Diego, CA 92121.
Section 3. Other Offices, Changes in Offices.
The Board of Directors may establish other offices at any place or
places within or without the State of Delaware. Further, the Board of Directors
may change any office from one location to another or eliminate any office or
offices.
ARTICLE III
Meetings of Stockholders
Section 1. Place of Meetings.
Meetings of the stockholders shall be held at any place within or
without the State of Delaware designated by the Board of Directors, or, in the
absence of such designation, at the
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principal executive office of the Corporation.
Section 2. Annual Meetings.
An annual meeting of the stockholders shall be held within 180 days
following the end of the fiscal year of the Corporation at a date and time
designated by the Board of Directors. Directors shall be elected at each annual
meeting and any other proper business may be transacted thereat.
Section 3. Special Meetings.
Special meetings of the stockholders may be called for any purpose and
unless otherwise proscribed by law may be called by a majority of the Board of
Directors, the Chairman of the Board or the President. No business may be
transacted at a special meeting unless the general nature thereof was stated in
the notice of such meeting.
Section 4. Notice of Annual, Special or Adjourned Meetings.
(a) Except as provided in Sections 229 and 230 of the Delaware General
Corporation Law or as otherwise provided by applicable law, a written notice of
each meeting of stockholders shall be given in the manner described in
subdivision (c) of this section not less than 10 nor more than 60 days before
the date thereof to each stockholder entitled to vote thereat. The notice shall
state the place, date and hour of the meeting and (1) in the case of a special
meeting, the general nature of the business to be transacted or (2) in the case
of the annual meeting, those matters which the Board of Directors, at the time
of the giving of the notice, intend to present for action by the stockholders
including, whenever directors are to be elected at a meeting, the names of
nominees intended at the time of giving of the notice to be presented by the
Board for election.
(b) Notice need not be given of an adjourned meeting if the time and
place thereof are announced at the meeting at which the adjournment is taken,
except that if the adjournment is for more than 30 days or if after the
adjournment a new record date is established for the adjourned meeting, a notice
of the adjourned meeting shall be given to each stockholder of record entitled
to vote thereat.
(c) Notice of any meeting of the stockholders or any report shall be
given either personally or by depositing such notice in the United States Mail,
postage prepaid, addressed to the stockholder at his or her address appearing on
the books of the Corporation or given by him or her to the Corporation for the
purpose of notice or as otherwise known by the Secretary of the Corporation; or
by transmitting a notice thereof to such address by telegraph, cable or
certified delivery service (such as Federal Express, DHL, or the like). Except
as otherwise required by law, no publication of any meeting of stockholders
shall be required.
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An affidavit of mailing of any notice or report in accordance with the
provisions of these Bylaws or the Delaware General Corporation Law, executed
by the Secretary, Assistant Secretary or any transfer agent of the
Corporation, shall be prima facie evidence of the giving of the notice or
report.
Section 5. Record Date.
(a) The Board of Directors may fix a time in the future as a record
date for the determination of the stockholders (1) entitled to notice of any
meeting or to vote thereat, (2) entitled to receive payment of any dividend or
other distribution or allotment of any rights or (3) entitled to exercise any
rights in respect of any other lawful action. The record date so fixed shall be
not more than 60 nor less than 10 days prior to the date of any meeting of the
stockholders nor more than 60 days prior to any other action.
(b) In the event no record date is fixed:
(1) The record date for determining the stockholders entitled
to notice of or to vote at a meeting of stockholders shall be at the
close of business on the business day next preceding the day on which
notice is given or, if notice is waived, at the close of business on
the business day next preceding the day on which the meeting is held;
and
(2) The record date for determining stockholders entitled to
give consent to corporate action in writing without a meeting, when no
prior action by the Board of Directors has been taken, shall be the
date on which the first signed written consent setting forth the action
taken is delivered to the Corporation by delivery to (i) its registered
office in the state, (ii) its principal place of business, or (iii) the
officer or agent of the Corporation having custody of the book in which
the proceedings of meetings of stockholders are recorded; and
(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 to such other action, or
the 60th day prior the date of such other action, whichever is later.
(c) Only stockholders of record on the close of business on the record
date are entitled to notice and to vote or to receive a dividend, distribution
or allotment of rights or to exercise the rights, as the case may be,
notwithstanding any transfer or any shares on the books of the Corporation after
the record date.
(d) A determination of stockholders of record entitled to notice of and
to vote at a meeting of stockholders shall apply to any adjournment of the
meeting unless the Board of Directors fixes a new record date for the adjourned
meeting, but the Board shall fix a new record date if the meeting is adjourned
for more than 30 days from the date set for the original meeting.
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Section 6. Quorum.
(a) The holders of a majority of the shares entitled to vote at a
meeting of the stockholders, represented in person or by proxy, shall constitute
a quorum for the transaction of business thereat unless otherwise provided by
statute or the Certificate of Incorporation.
(b) Except as provided in Section 6(c), the affirmative vote of a
majority of the shares represented and voting at a duly held meeting at which a
quorum is present (which shares voting affirmatively also constitute at least a
majority of the required quorum), shall be the act of the stockholders, unless
the vote of a greater number is required by statute or the Certificate of
Incorporation.
(c) The stockholders present at a duly called or held meeting at which
a quorum is present may continue to transact business until adjournment not
withstanding the withdrawal of enough stockholders to leave less than a quorum,
if any action taken (other than adjournment) is approved by at least a majority
of the shares required to constitute a quorum. If a quorum is not present or
represented at any meeting of stockholders, a majority of the voting interests
present or represented shall have the power to adjourn such meeting from time to
time, without notice other than announcement of same at the meeting.
Section 7. Adjournment.
Any meeting of the stockholders may be adjourned from time to time,
whether or not a quorum is present, by the vote of a majority of the shares
represented thereat either in person or by proxy. At the adjourned meeting, the
Corporation may transact any business which might have been transacted at the
original meeting.
Section 8. Validation of Defectively Called, Noticed or Held Meetings.
(a) The transactions of any meeting of the stockholders, however called
and noticed, and whenever held, are as valid as though they had taken place at a
meeting duly held after regular call and notice, if a quorum is present either
in person or by proxy, and if, either before or after the meeting, each of the
persons entitled to vote thereat, not present in person or by proxy, signs a
written waiver of notice or a consent to the holding of the meeting or an
approval of the minutes thereof. All such waivers, consents and approvals shall
be filed with corporate records or made a part of the minutes of the meeting.
(b) Attendance of a person at a meeting shall constitute a waiver of
notice of such meeting, except (1) when the person objects, at the beginning of
the meeting, to the transaction of any business because the meeting is not
lawfully called or convened and (2) that attendance at a meeting is not a waiver
of any right to object to the consideration of any matter required by the
Delaware Corporation Law to be included in the notice but not so included, if
such
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objection is expressly made at the meeting.
(c) Any written waiver of notice shall comply with Section 229 of the
Delaware Corporations Law.
Section 9. Voting.
(a) Except as otherwise provided in the Certificate of Incorporation,
each stockholder shall be entitled to one vote in person or by proxy for each
share of capital stock having voting power held by such stockholder.
(b) Every person entitled to vote shares may authorize another person
or persons to act with respect to such shares by proxy as provided in Section
212 of the Delaware Corporations Law. A proxy shall be deemed validly granted if
signed stockholder or its authorized officer, director, employee or his or agent
or if the stockholder's signature is affixed thereto by any reasonable means,
including, but not limited to facsimile signature. Any duly executed proxy shall
continue in full force and effect until the expiration of the term specified
therein or upon its earlier revocation by the person executing it prior to the
vote pursuant thereto (1) by a writing delivered to the Corporation stating that
it is revoked, (2) by a subsequent proxy executed by the person executing the
prior proxy and presented to the meeting or (3) as to any meeting, by attendance
at the meeting and voting in person by the person executing the proxy. No proxy
shall be valid after the expiration of 3 years from the date thereof unless
otherwise provided in the proxy.
Section 10. List of Stockholders Entitled to Vote.
The officer who has charge of the stock ledger of a corporation shall
prepare and make, at least ten (10) days before every meeting of stockholders, a
complete list of the stockholders entitled to vote at the meeting, arranged in
alphabetical order, and showing the address of each stockholder and 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 ten (10) days prior to
the meeting, either at a place within the city where the meeting is to be held,
which place shall be specified in the notice of the meeting, or, if not so
specified, at the place where the meeting is to be held. The list shall also be
produced and kept at the time and place of the meeting during the whole time
thereof, and may be inspected by any stockholder who is present. Such list shall
presumptively determine the identity of the stockholders entitled to vote at the
meeting and the number of shares held by each of them.
Section 11. Inspectors of Election.
(a) In advance of any meeting of the stockholders, the Board of
Directors may appoint
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either one or more persons (other than nominees for the office of director)
as inspectors of election to act at such meeting or any adjournments thereof.
If inspectors of election are not so appointed, or if any person so appointed
fails to appear or refuses to act, the chairman of any such meeting may
appoint inspectors of elections (or persons to replace those who so fail or
refuse to act) at the meeting. Each inspector so appointed, before entering
upon the discharge of his or her duties, shall first take and sign an oath
faithfully to execute the duties of a inspector at with strict impartiality
and according to the best of such person's ability.
(b) The duties of inspectors of election and the manner of performance
thereof shall be as prescribed in Section 231 of the Delaware Corporation Law.
Section 12. Action by Written Consent
(a) Unless otherwise provided in the Certificate of Incorporation, any
action which may be taken at any annual or special meeting of the stockholders
may be taken without a meeting, without a vote and without prior notice, if a
consent in writing, setting forth the action so taken, is signed by the holders
of outstanding shares having not less than the minimum number of votes which
would be necessary to authorize or take such action at a meeting in which all
shares entitled to vote thereon were present and voted. All such consents shall
be filed with the Secretary of the Corporation and maintained with the corporate
records.
(b) Prompt notice of any stockholder approval without a meeting by less
than unanimous written consent shall be given to those stockholders who have not
consented in writing.
ARTICLE IV
Directors
Section 1. Powers.
Subject to the provisions of the Delaware General Corporation Law and
any limitations in the Certificate of Incorporation or these Bylaws relating to
action required to be approved by the stockholders or by the outstanding shares,
the business and affairs of the Corporation shall be managed and all corporate
powers shall be exercised by or under the direction of the Board of Directors.
Section 2. Number and Election of Directors.
(a) The authorized number of directors of the Corporation shall be not
less than three (3) nor more than seven (7). The exact number of directors shall
be fixed from time to time, within the limits of these Bylaws, by a Bylaw
amendment duly adopted by the shareholders or the Board of Directors. The exact
number of directors shall be five (5) until such an
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amendment has been effected.
(b) Except as provided in Subsection (c) below, Directors shall be
elected at each annual meeting of the stockholders. Each director, including a
director elected to fill a vacancy, shall hold office until the expiration of
the term for which he is elected and until a successor has been elected.
(c) Vacancies on the Board of Directors may be filled by a majority of
the directors then in office, whether or not less than a quorum, or by a sole
remaining director. A vacancy in the Board of Directors exists whenever any
authorized position of director is not then filled by a duly elected director,
whether caused by death, resignation, removal, change in the authorized number
of directors or otherwise.
(d) If, at the time of filing any vacancy or any newly created
directorship, the directors then in office constitute less than a majority of
the whole board (as constituted immediately prior to any such increase), then
the Delaware Court of Chancery may, upon application of any stockholder or
stockholders holing at least ten (10) percent of the total number of the shares
at the time outstanding having the right to vote for such directors, summarily
order an election to be held to fill any such vacancies or newly created
directorships or to replace the directors chosen by the directors then in office
as aforesaid, which election shall be governed by the provisions of Section 211
of the Delaware General Corporation Law as far as applicable.
Section 3. Resignation or Removal.
(a) Any director may resign effective upon giving written notice to the
Chairman of the Board, the President, the Secretary or the Board of Directors of
the Corporation, unless the notice specifies a later time for the effectiveness
of such resignation. If the resignation is effective at a future time, a
successor may be elected to take office when the resignation becomes effective.
(b) Any or all of the directors may be removed, with or without cause,
if such removal is approved by a majority of the outstanding shares entitled to
vote at an election of directors, except as follows:
(i) Unless the Certificate of Incorporation otherwise
provides, if the Corporation shall have a classified board,
stockholders may effect such removal only for cause; or
(ii) If the Corporation has cumulative voting, unless the
entire Board of Directors is removed, no director may be removed
without cause if the votes cast against removal would be sufficient to
elect such director, if then cumulatively voted, at an election of the
entire board, or, if there be classes of directors, at an election of
the class of directors of which such director is a part.
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Section 4. Fees and Compensation.
Directors may be reimbursed for their expenses, if any, for attendance
at each meeting of the Board of Directors and may be paid a fixed sum determined
by resolution of the Board for attendance at each such meeting. No such payments
shall preclude any director from serving the corporation in any other capacity
and receiving compensation in any manner therefor.
Section 5. Approval of Loans to Officers
The Corporation may lend money to, or guarantee any obligation of, or
otherwise assist any officer or other employee of the Corporation or of its
subsidiary, including any officer, or employee who is a director of the
Corporation or its subsidiary, whenever, in the judgment of the directors, such
loan, guaranty or assistance may reasonably be expected to benefit the
Corporation. The loan, guaranty or other assistance may be with or without
interest and may be unsecured or secured in such manner as the Board of
Directors shall approve, including, without limitation, a pledge of shares of
stock of the Corporation. Nothing in this section contained shall be deemed to
deny, limit or restrict the powers of guaranty or warranty of the Corporation at
common law or under statute.
ARTICLE V
Committees of the Board of Directors
Section 1. Designation of Committees.
The Board of Directors may, by resolution adopted by a majority of the
authorized number of directors, designate (1) one or more committees, each
consisting of two or more directors and (2) one or more directors as alternate
members of any committee, who may replace any absent members at any meeting of
the committee. The appointment of members or alternative members of a committee
requires the vote of a majority of the authorized number of directors. Any
member or alternate member of a committee shall serve at the discretion of the
Board.
Section 2. Powers of Committees.
Any committee, to the extent provided in the resolution of the Board of
Directors designating such committee or these Bylaws, shall have all the
authority of the Board, except with respect to:
(a) The approval of any action for which the Delaware General
Corporation Law also requires an action by the stockholders;
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(b) The amendment or appeal of the Certificate of Incorporation or
these Bylaws, the adoption of new bylaws, or the fixing of designations and the
preferences or rights of any stock of the Corporation;
(c) Adoption of any agreement of merger or consolidation under Sections
251 or 252 of the Delaware General Corporation Law.
(d) The recommendation to the stockholders of a sale, lease or exchange
of all or substantially all of the assets, property or voting stock of the
Corporation;
(e) A distribution to the stockholders of the Corporation, except at a
rate or in a periodic amount or within a price range determined by the Board of
Directors;
(f) The filling of vacancies on or fixing of compensation of directors
for serving on the Board or any committee thereof; or
(g) The amendment or repeal of any resolution of the Board which by its
express terms is not so amendable or repealable.
ARTICLE VI
Meetings of the Board of Directors
and Committees Thereof
Section 1. Place of Meetings.
Regular meetings of the Board of Directors shall be held at any place
within or without the State of Delaware which has been designated from time to
time by the Board or, in the absence of such designation, at the principal
executive office of the Corporation. Special meetings of the Board shall be held
either at any place within or without the State of Delaware which has been
designated in the notice of the meeting or, if not stated in the notice or there
is no notice, at the principal executive office of the Corporation.
Section 2. Organization Meeting.
Immediately following each annual meeting of the shareholders, the
Board of Directors shall hold a regular meeting for the purposes of organization
and the transaction of other business. Notice of any such meeting is not
required.
Section 3. Regular Meetings.
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Regular meetings of the Board of Directors shall be held without call
at such time as shall be designated from time to time by the Board. Notice of
any such meeting is not required.
Section 4. Special Meetings.
Special meetings of the Board of Directors may be called at any time
for any purpose or purposes by the Chairman of the Board, the President, any
vice president, the Secretary or any two directors (if there shall be three or
more directors) or any director (if there shall be less than three directors).
Notice shall be given of any special meeting of the Board of Directors.
Section 5. Notice of Special Meetings.
(a) Notice of the time and place of Special meetings of the Board of
Directors shall be delivered personally or by telephone to each director or sent
to each director by first-class mail or telegraph or confirmed facsimile
transmission, charges prepaid. Such notice shall be given four days prior to the
holding of the special meeting if sent by mail or 48 hours prior to the holding
thereof if delivered personally or given by telephone, telegraph or facsimile
transmission. The notice shall be deemed to have been given at the time when
delivered personally to the recipient director or a person at the office of such
recipient director who the person giving the notice reasonably believes will
promptly communicate it to the director; or deposited in the mail or sent by
other means of written communication.
(b) Notice of any special meeting of the Board of Directors need not
specify the purpose thereof and need not be given to any director (1) who signs
a waiver of notice or a consent to holding the meeting or an approval of the
minutes thereof, whether before or after the meeting, or (2) who attends the
meeting without protesting, prior thereto or at its commencement, the lack of
notice to him. All such waivers, consents and approvals shall be filed with the
corporate records or made a part of the minutes.
Section 6. Quorum; Telephone Meetings; Adjournment.
(a) A majority of the authorized number of directors shall constitute a
quorum for the transaction of business. Every act or decision done or made by a
majority of the directors present at a meeting duly held at which a quorum is
present is the act of the Board of Directors, unless action by a greater
proportion of the directors is required by law or by the Certificate of
Incorporation.
(b) A meeting at which a quorum is initially present may continue to
transact business notwithstanding the withdrawal of directors, if any action
taken is approved by at least a majority of the required quorum for such
meeting.
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(c) Members of the Board of Directors may participate in a meeting
through use of conference telephone or similar communications equipment, so long
as all members participating in such meeting can hear one another.
(d) A majority of the directors present, whether or not a quorum is
present, may adjourn any meeting to another time and place. If the meeting is
adjourned for more than 48 hours, notice of any adjournment to another time or
place shall be given, prior to the time of such adjourned meeting, to the
directors who were not present at the time of the adjournment.
Section 7. Action Without a Meeting.
Any action required or permitted to be taken by the Board of Directors
may be taken without a meeting, if all members of the Board, individually or
collectively, consent in writing to such action. Such written consent or
consents shall be filed with the minutes of the proceedings of the Board. Such
action by written consent shall have the same force and effect as a unanimous
vote of such directors.
Section 8. Meetings of and Action by Committees.
The provisions of this article apply mutatis mutandis to committees of
the Board of Directors and incorporators and actions by such committees and
incorporators.
ARTICLE VII
Officers
Section 1. Officers
The Corporation shall have as officers, a president, a secretary and a
chief financial officer. The chief financial officer shall be the treasurer of
the Corporation unless the Board of Directors has by resolution designated that
treasurer shall be a separate office. The Corporation may also have, at the
discretion of the Board, a Chairman of the Board, one or more vice presidents,
one or more assistant secretaries, one or more assistant treasurers and such
other officers as may be appointed in accordance with the provisions of Section
3 of this article. One person may hold more than one office.
Section 2. Election of Officer.
The officers of the Corporation, except such officers as may be
appointed in accordance with the provisions of Sections 3 or 5 of this article,
shall be chosen by the Board of Directors.
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Section 3. Subordinate Officers, Etc.
The Board of Directors may appoint by resolution, and may empower the
Chairman of the Board, if there be such an officer, or the President, to appoint
such other officers as the business of the Corporation may require, each of whom
shall hold office for such period, have such authority and perform such duties
as are determined from time to time by resolution of the Board or, in the
absence of any such determination, as are provided in these Bylaws. Any
appointment of an officer shall be evidenced by a written instrument filed with
the Secretary of the Corporation and maintained with the corporate records.
Section 4. Removal and Resignation.
(a) Any officer may be removed, either with or without cause, by the
Board of Directors or, except in case of any officer chosen by the Board, by any
officer upon whom such power of removal be conferred by resolution of the Board.
(b) Any officer may resign at any time effective upon giving written
notice to the Chairman of the Board, President, any vice president or Secretary
of the Corporation, unless the notice given pursuant hereto specifies a later
time for the effectiveness of such resignation.
Section 5. Vacancies.
A vacancy in any office because of death, resignation, removal,
disqualification or any other cause shall be filled in the manner prescribed in
these Bylaws for regular appointments to such office.
Section 6. Chairman of the Board.
If there is a Chairman of the Board, he shall, if present, preside at
all meetings of the Board of Directors, exercise and perform such other powers
and duties as may be from time to time assigned to him by resolution of the
Board, and if there is no president, the Chairman of the Board shall be the
chief executive officer of the Corporation and have the power and duties set
forth in Section 7 of this article.
Section 7. President
Subject to such supervisory powers, if any, as may be given by the
Board of Directors to the Chairman of the Board, if there be such an officer,
the President shall be the chief executive officer and general manager of the
Corporation and shall, subject to control of the Board, have general
supervision, direction and control of the business and affairs of the
Corporation. He shall preside at all meetings of the stockholders and, in the
absence of the
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Chairman of the Board, or if there be none, at all meetings of the Board. He
shall have the general powers and duties of management usually vested in the
office of president of a corporation, and shall have such other powers and
duties as may be prescribed from time to time by resolution of the Board.
Section 8. Vice President
In the absence or disability of the President, the vice presidents in
order of their rank as fixed by the Board of Directors or, if not ranked, the
Vice President designated by the Board, shall perform all the duties of the
President, and when so acting shall have all the powers of, and be subject to
all the restriction upon, the President. The vice presidents shall have such
other powers and perform such other duties as from time to time may be
prescribed for them respectively by the Board or as the President may from time
to time delegate.
Section 9. Secretary
(a) The Secretary shall keep or cause to be kept: (1) the minute book,
(2) the share register and (3) the seal, if any, of the Corporation.
(b) The Secretary shall give, or cause to be given, notice of all
meetings of the stockholders and of the Board of Directors required by these
Bylaws or by law to be given, and shall have such other powers and perform such
other duties as may be prescribed from time to time by the Board or as the
President may from time to time delegate.
Section 10. Chief Financial Officer
(a) The Chief Financial Officer, who shall also be designated as the
Treasurer, shall keep, or cause to be kept, the books and records of account of
the Corporation.
(b) The Chief Financial Officer shall deposit all monies and other
valuables in the name and to the credit of the Corporation with such
depositories as may be designated from time to time by resolution of the Board
of Directors. He shall disburse the funds of the Corporation as may be ordered
by the Board of Directors, shall render to the President and the Board, whenever
they request it, an account of all of his transactions as Chief Financial
Officer and of the financial condition of the Corporation, and shall have such
other powers and perform such other duties as may be prescribed from time to
time by the Board or as the President may from time to time delegate.
ARTICLE VIII
Record and Reports
Section l. Maintenance of Records.
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The Corporation shall keep or cause to be kept in written form at its
principal executive office or such other place as the Board of Directors may
order:
(a) a minute book which shall contain a record of all actions by its
stockholders, Board of Directors or committees of the Board; including (1) the
time, date and place of each meeting, (2) the manner of giving notice of each
meeting and copy thereof, (3) the names of those present at each meeting of the
Board or committees thereof, (4) the number of shares present or represented at
each meeting of the stockholders, (5) the proceedings of all meetings, (6) any
written waivers of notice, consents to the holding of a meeting or approvals of
the minutes thereof and (7) written consents for action without a meeting;
(b) a share register, or a duplicate share register, which shall
contain (1) the names of the stockholders and their addresses, (2) the number
and classes of shares held by each, (3) the number and date of certificates
issued for the same and (4) the number and date of cancellation of every
certificate surrendered for cancellation;
(c) the original or a copy of the Bylaws as amended to date; and
(d) adequate and correct books and records of account.
Section 2. Inspection of Records.
(a) Any stockholder or record, in person or by attorney or other agent,
shall, upon written demand under oath stating the purpose thereof, have the
right during the usual hours for business to inspect for any proper purpose the
Corporation's stock ledger, a list of its stockholders, and its other books and
records and to make copies or extracts therefrom. A proper purpose shall mean a
purpose reasonably related to such person's interest as a stockholder. In every
instance where an attorney or other agent is the person who seeks the right to
inspection, the demand under oath shall be accompanied by a power of attorney or
such other writing that authorized the attorney or other agent to so act on
behalf of the stockholder. The demand under oath shall be directed to the
Corporation at its registered office in Delaware or at its principal place of
business.
(b) Any director shall have the right to examine the Corporation's
stock ledger, a list of its stockholders, and its other books and records for a
purpose reasonably related to his position as a director. The Delaware Court of
Chancery is hereby vested with the exclusive jurisdiction to determine whether a
director is entitled to the inspection sought. The Court may summarily order the
Corporation to permit the director to inspect any and all books and records, the
stock ledger, and the stock list and to make copies or extracts therefrom. The
Court may, in its discretion, prescribe any limitations or conditions with
reference to the
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inspection, or award such other and further relief as the Court may deem just
and proper.
Section 3. Annual Statement to Stockholders.
The board of directors shall present at each annual meeting, and at any
special meeting of the stockholders when called for by vote of the stockholders,
a full and clear statement of the business and condition of the Corporation.
ARTICLE IX
General Matters
Section 1. Checks, Drafts, Etc.
All checks, drafts or other orders for payment of money, notes or other
evidences of indebtedness, and any assignment or endorsement thereof, issued in
the name of or payable to the Corporation, shall be signed or endorsed by such
person or persons and in such manner as, from time to time, shall be determined
by resolution of the Board of Directors.
Section 2. Contracts and other Corporate Instruments.
The Board of Directors, except as otherwise provided in these Bylaws,
may authorize any officer or officers, agents or agents, to enter into any
contract or execute any instrument in the name of and on behalf of the
Corporation, and such authority may be general or confined to specific
instances; and, unless so authorized or ratified by the Board, no officer,
employee or other agent shall have any power or authority to bind the
Corporation by any contract or engagement or to pledge its credit or to render
it liable for any purpose or to any amount.
Section 3. Certificates of Stock.
All certificates shall be signed in the name of the Corporation by the
Chairman of the Board or the President or a vice president and by the Secretary
or an assistant secretary or the treasurer or an assistant treasurer, certifying
the number of shares and the class or series thereof owned by stockholder. Any
or all of the signatures on a certificate may be by facsimile signature. In case
any officer, transfer agent who has signed or whose facsimile signature has been
placed upon certificate shall have ceased to be such officer, transfer agent or
registrar
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before such certificate is issued, it may be issued by the Corporation with
the same effect as if such person were an officer, transfer agent or
registrar as of the date of issue.
Section 4. Lost Certificates.
Except as provided in this section, no new certificate for shares shall
be issued at any time. The Board of Directors may in case any share certificate
or certificate for any other security is lost, stolen or destroyed, authorize
the issuance of a new certificate in lieu thereof, upon such terms and
conditions as the Board may require, including provision for indemnification of
the Corporation secured by a bond or other adequate security sufficient to
protect the Corporation against any claim that may be made against it, including
any expense or liability, on account of the alleged loss, theft or destruction
of such certificate or the issuance of such new certificate.
Section 5. Transfer of Stock.
(a) Upon surrender to the Corporation or the transfer agent of the
Corporation of a certificate for shares duly endorsed or accompanied by proper
evidence of succession, assignation or authority to transfer, it shall be the
duty of the Corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate, and record the transaction in its books.
(b) The Corporation shall have power to enter into and perform any
agreement with any number of stockholders of any one or more classes of stock of
the Corporation to restrict the transfer of shares of stock of the Corporation
of any one or more classes owned by such stockholder in any manner not
prohibited by the Delaware General Corporation Law.
Section 6. Registered Holders.
The Corporation shall be entitled to recognize the exclusive right of a
person registered on its books as the owner of shares (1) to receive dividends
and to vote as such owner and (2) to hold liable for calls and assessments the
person registered on its books as the owner of shares, and shall not be bound to
recognize any equitable or other claim to or interest in such shares on the part
of another person, whether or not it shall have express or other notice thereof,
except as otherwise provided by the laws of the State of Delaware.
Section 7. Dividends.
The directors of the Corporation, subject to any restrictions contained
in (i) the Delaware General Corporation Law or (ii) the Certificate of
Incorporation, may declare and pay dividends upon the shares of its capital
stock. Dividends may be paid in cash, in
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property, or in shares of the Corporation's capital stock. The directors of
the Corporation may set apart out of any of the funds of the Corporation
available for dividends a reserve or reserves for any proper purpose and may
abolish any such reserve. Such purposes shall include, but not be limited to,
equalizing dividends, repairing or maintaining any property or the
Corporation.
Section 8. Fiscal Year.
The fiscal year of the Corporation shall be fixed by resolution of the
Board of Directors and may be changed by the Board of Directors.
Section 9. Seal.
The corporation may adopt a corporate seal, which may be altered at the
discretion of the Board of Directors, and may use same by causing it or a
facsimile of it to be impressed or affixed or in any other manner reproduced.
Section 10. Representation of Shares of Other Corporations.
Any person designated by resolution of the Board of Directors or, in
the absence of such designation, the Chairman of the Board, the President or any
vice president or the Secretary, or any other person authorized by any of the
foregoing, is authorized to vote on behalf of the Corporation any and all shares
of any other corporation or corporations, foreign or domestic, owned by the
Corporation.
Section 11. Construction and Definitions.
Unless the context otherwise requires, the general provisions, rules of
construction and definitions contained in the Delaware General Corporation Law
shall govern the construction of these Bylaws.
Section 12. Amendments.
New Bylaws may be adopted or these Bylaws may be amended or repealed by
the affirmative vote of a majority of the outstanding shares entitled to vote.
Subject to the next preceding sentence, the Certificate of Incorporation may
also confer upon the Board of Directors the power to adopted, amended or
repealed bylaws.
ARTICLE X
Indemnification
(a) The Corporation shall indemnify any person who was or is a party or
is threatened
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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 that such
director or officer is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership,
joint venture trust or other enterprise (collectively "Representative"),
against expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement (if such settlement is approved in advance by an
independent board of Directors in the manner described in Section (d), which
approval shall not be unreasonably withheld) actually and reasonably incurred
in connection with such action, suit or proceeding if he or she acted in good
faith and in a manner 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 such 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 resumption that the person did not act in good faith and
in a manner which reasonably believed to be in or not opposed to the best
interest of the corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that such conduct was unlawful.
(b) 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 he or she is or was a Representative against expenses
(including attorneys' fees) actually and reasonably incurred in connection with
the defense or settlement of such action or suit if he or she acted in good
faith and in manner reasonably believed to be in or not opposed to the best
interests of the Corporation and 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
Delaware Court of Chancery or the court in which such action or suit was brought
shall determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the Delaware Court of
Chancery or such other court shall deem proper.
(c) To the extent that a Representative of the Corporation has been
successful on the merits or otherwise in defense of any action, suit or
proceeding referred to in Sections (a) and (b), or in defense of any claim,
issue or matter therein, he or she shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred in connection
therewith.
(d) Any indemnification under Sections (a) and (b) (unless ordered by a
court) shall be made by the Corporation only as authorized in the specific case
upon a determination that the indemnification of the Representative is proper in
the circumstances because he or she has met the applicable standard of conduct
set forth in Sections (a) and (b). Such determination shall be
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made (1) by the Board of Directors or the Executive Committee by a majority
vote of a quorum consisting of directors who were not parties to such action,
suit or proceeding or (2) or if such quorum is not obtainable or, even if
obtainable, a quorum of disinterested directors so directs, by independent
legal counsel in a written opinion, or (3) by the stockholders.
(e) Expenses incurred in defending a civil or criminal action, suit or
proceeding shall be paid by the Corporation in advance of the final disposition
of such action, suit or proceeding upon receipt of an undertaking by or on
behalf of the director, officer, employee or agent to repay such amount if it
shall ultimately be determined that he or she is not entitled to be indemnified
by the Corporation as authorized in this Article X. Such expenses (including
attorney's fees) incurred by other employees or agents may be paid upon such
terms and conditions, if any, as the Board of Directors deems appropriate;
provided, however, the Corporation shall indemnify any such party where required
to do so by law.
(f) The indemnification and advancement of expenses provided or granted
pursuant to the other subsections of this Article shall not be deemed exclusive
of any other rights to which those seeking indemnification or advancement of
expenses may be entitled under any Bylaw, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding such office.
(g) The Corporation shall have the power to purchase and maintain
insurance on behalf of any person who is or was a Representative of the
Corporation, or is or was serving at the request of the Corporation, as a
Representative against any liability asserted against and incurred by him or her
in any such capacity, or arising out of such status, whether or not the
Corporation would have the power to indemnify him or her against such liability
under the provisions of this Article X.
(h) For purposes of this Article X, 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 and officers, and
employees or agents, so that any person who is or was a Representative of such
constituent corporation, or is or was serving at the request of such constituent
corporation as a Representative, shall stand in the same position under and
subject to the provisions of this Article X (including, without limitation the
provisions of Section (d) with respect to the resulting or surviving corporation
as he or she would have with respect to such constituent corporation if its
separate existence had continued.
(i) For purposes of this Article X, references to "other enterprises"
shall include employee benefit plans; 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
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Corporation which imposes duties on, or involves services by, such director,
officer, employee, or agent with respect to an employee benefit plan, its
participants, or beneficiaries; and a person who acted in good faith and in a
manner he 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 X.
(j) The Corporation shall, if and to the extent the Board of Director
so determines by resolution, purchase and maintain insurance in any amount, or
establish a trust or other designated account, grant a security interest or use
other means, to ensure the payment of certain of its obligations arising under
this Article X and/or agreements which may be entered into between the
corporation and its officers and directors from time to time.
(k) Each director, officer and employee shall be a third party
beneficiary to the provisions of this Article X. If this Article or any portion
thereof shall be invalidated on any ground by any court of competent
jurisdiction, then the Corporation shall nevertheless indemnify each director,
officer, employee, agent or Representative of the Corporation against expenses
(including attorney's fees), judgments, fines and amounts paid in settlement
with respect to any action, suit , proceeding or investigation, whether civil,
criminal or administrative, and whether internal or external, including a grand
jury proceeding and an action or suit brought by or in the right of the
Corporation, to the full extent permitted by any applicable portion of this
Article that shall not have been invalidated, or by any other applicable law.
* * * * *
CERTIFICATE
This is to certify that the foregoing is a true and correct copy of the
Bylaws of Correctional Systems, Inc., and that such Bylaws were duly adopted by
the Board of Directors of said Corporation as of the date set forth below.
DATED:
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Gary D. Maynard, Secretary
