CODE OF REGULATIONS

                                    OF

                         OHIO CASUALTY CORPORATION

               (reflecting amendments through July 28, 2005)

 

                                 ARTICLE I

 

                         MEETINGS OF SHAREHOLDERS

 

        Section 1.   Annual Meetings.   The annual meeting of the

shareholders for the election of directors, for the consideration of reports

to be laid before such meeting and for the transaction of such other business

as may properly come before such meeting, shall be held on the third

Wednesday in April of each year, or on such other date as may from time to

time be designated by the Board of Directors.

 

        Section 2.   Calling of Meetings.   Meetings of the shareholders

may be called only by the Chairman of the Board, by the President, by the

Secretary, by the directors by action at a meeting, by a majority of the

directors acting without a meeting or by the holders of at least 50% of all

shares outstanding and entitled to vote thereat.

 

        Section 3.   Place of Meetings.   Meetings of shareholders may be

held at any place within or without the State of Ohio.  Meetings of

shareholders may be held in any manner or place, if any, determined by the

directors and permitted by Ohio law.

 

        Section 4.   Notice of Meetings.

 

        (A)     Written notice stating the time, place, if any, and purpose

or purposes of a meeting of the shareholders, and the means, if any, by which

shareholders can be present and vote at the meeting through the use of

communications equipment, and any other matters related to the conduct of the

meeting required by Ohio law to be specified in such notice shall be given by

or at the direction of the Chairman of the Board, the

President or the Secretary by personal delivery, by mail, by overnight

delivery service or, if authorized by the shareholder to whom notice is

given, any other means of communication.  Any such notice shall be given not

less than seven nor more than sixty days before the date of the meeting to

each shareholder of record entitled to notice of the meeting.  If mailed or

sent by an overnight delivery service, such notice shall be sent to the

shareholder at the shareholder's address as it appears on the records of the

corporation.  If sent by another means of communication authorized by the

shareholder, notice shall be sent to the address furnished by the shareholder

for such transmissions.

 

        (B)     Notice of adjournment of a meeting need not be given if the

time and place, if any, to which it is adjourned and the means, if any, by

which shareholders can be

 

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present and vote at the adjourned meeting through the use of communications

equipment are fixed and announced at the meeting.

 

        (C)     In the event of a transfer of shares after the record date

for determining the shareholders who are entitled to receive notice of a

meeting of shareholders, it shall not be necessary to give notice to the

transferee.  Nothing herein contained shall prevent the setting of a record

date in the manner provided by law, the Articles or these Regulations for the

determination of shareholders who are entitled to receive notice of or to

vote at any meeting of shareholders or for any purpose required or permitted

by law.

 

        (D)     Following the receipt by the President or the Secretary of a

request in writing, specifying the purpose or purposes for which the person

or persons properly making such request have called a meeting of the

shareholders, delivered either in person or by registered mail to such

officer by any person or persons entitled to call a meeting of shareholders,

such officer shall cause to be given to the shareholders entitled thereto

notice of a meeting to be held on a date not less than seven nor more than

105 days after the receipt of such request, as such officer may fix.  If such

notice is not given within 45 days after the receipt of such request by the

President or the Secretary, then, and only then, the persons properly calling

the meeting may fix the time of meeting and give notice thereof in accordance

with the provisions of these Regulations.

 

        Section 5.   Waiver of Notice.   Notice of the time, place, if

any, and purpose or purposes of any meeting of shareholders may be waived in

writing, either before or after the holding of such meeting, by any

shareholder, which writing shall be filed with or entered upon the records of

such meeting.  The attendance of any shareholder, in person, by proxy or by

the use of communications equipment, at any such meeting without protesting

the lack of proper notice, prior to or at the commencement of the meeting

shall be deemed to be a waiver by the shareholder of notice of such meeting.

A telegram, cablegram, electronic mail, or an electronic or other

transmission capable of authentication that appears to have been sent by a

person described in this Section and that contains a waiver by such person is

a writing for purposes of this Section 5.

 

        Section 6.   Quorum.   At any meeting of shareholders, the holders

of shares entitling them to exercise a majority of the voting power of the

corporation then outstanding and entitled to vote thereat, present in person,

by proxy, or by the use of communications equipment, shall constitute a

quorum for such meeting.  The holders of a majority of the voting power

represented at a meeting, whether or not a quorum is present, or the Chairman

of the Board, the President, the Secretary, or the officer of the corporation

acting as chairman of the meeting, may adjourn such meeting from time to

time, and at such adjourned meeting any business may be transacted as if the

meeting had been held as originally called.

 

        Section 7.   Votes Required.   At all elections of directors, the

candidates receiving the greatest number of votes shall be elected.  Any

other matter submitted to the shareholders for their vote shall be decided by

the vote of such proportion of the shares,

 

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or of any class of shares, or of each class, as is required by law, the

Articles or the Code of Regulations.

 

        Section 8.   Order of Business.   The order of business at any

meeting of the shareholders shall be determined by the officer of the

corporation acting as chairman of such meeting unless otherwise determined by

a vote of the holders of a majority of the voting shares of the corporation

then outstanding, present in person, by proxy or by the use of communications

equipment.

 

        Section 9.   Shareholders Entitled to Vote.   Each shareholder of

record on the books of the corporation on the record date for determining the

shareholders who are entitled to vote at a meeting of shareholders shall be

entitled at such meeting to one vote for each share of the corporation

standing in his name on the books of the corporation on such record date.

The directors may fix a record date for the determination of the shareholders

who are entitled to receive notice of or to vote at a meeting of

shareholders, which record date shall not be a date earlier than the date on

which the record date is fixed and which record date may be a maximum of 120

days preceding the date of the meeting of shareholders.

 

        Section 10.  Proxies.   At meetings of the shareholders, any

shareholder of record entitled to vote may be represented and may vote by

proxy or proxies appointed by an instrument in writing signed by such

shareholder or appointed in any manner permitted by Ohio law.  Any such

instrument in writing or record of any such appointment shall be filed with

or received by the secretary of the meeting before the person holding such

proxy shall be allowed to vote thereunder.  No appointment of a proxy is

valid after the expiration of eleven months after it is made unless the

writing or other communication which appoints such proxy specifies the date

on which it is to expire or the length of time it is to continue in force.

 

        Section 11.  Inspectors of Election.   In advance of any meeting

of shareholders, the directors may appoint inspectors of election to act at

such meeting or any adjournment thereof; if inspectors are not so appointed,

the officer of the corporation acting as chairman of any such meeting may

make such appointment.  In case any person appointed as inspector fails to

appear or act, the vacancy may be filled only by appointment made by the

directors in advance of such meeting or, if not so filled, at the meeting by

the officer of the corporation acting as chairman of such meeting.  No other

person or persons may appoint or require the appointment of inspectors of

election.

 

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                                ARTICLE II

 

                                DIRECTORS

 

        Section 1.   Authority.   Except where the law, the Articles or

these Regulations otherwise provide, all authority of the corporation shall

be vested in and exercised by its directors.  Directors need not be

shareholders of the corporation.

 

        Section 2.   Number of Directors and Terms of Office.

 

(A) Until changed in accordance with the provisions of the Code

of Regulations, the number of directors of the corporation shall be twelve

(12) [Number of directors of the corporation was reduced to eleven (11) by

unanimous action of the Board of Directors at the meeting of directors held

on February 18, 2004; Number of directors of the corporation was reduced to

ten by unanimous action of the Board of Directors at the meeting of directors

held on May 19, 2005].  The number of directors may be fixed or changed (i)

at a meeting of shareholders called for the purpose of electing directors at

which a quorum is present or (ii) by action of a majority of the whole

authorized number of directors, but no reduction in the number of directors

shall of itself have the effect of shortening the term of any incumbent

director.

 

        (B)     Until changed in accordance with law, the Board of Directors

shall be divided into three (3) classes consisting of four (4) directors each

(Class I, Class II and Class III).  [Authorized number of directors in Class

II changed to three (3) by unanimous action of the Board of Directors at the

meeting of directors held on February 18, 2004; Authorized number of

directors in Class I changed to three (3) by unanimous action of the Board of

Directors at the meeting of directors held on May 19, 2005].  If the

authorized number of directors is increased or decreased at any time, the

directors may, by a resolution adopted by a majority of the whole authorized

number of directors, determine the number of directors to be added or

subtracted, as the case may be, from any class or classes of directors, and

the effect of such increase or decrease need not be uniform; provided,

however, (a) that the authorized number of directors of any class shall not

exceed by more than four (4) the authorized number of directors of any other

class, and (b) no class shall consist of fewer than three (3) directors.  The

election of each class of directors shall be a separate election.  The term

of office of Class I shall expire at the annual meeting of shareholders for

1988; the term of office of Class II shall expire at the annual meeting of

shareholders for 1989; the term of office of Class III shall expire at the

annual meeting of shareholders for 1987; and at each annual meeting of

shareholders commencing with the year 1987, the successors to the directors

of the class whose term shall expire in that year shall be elected for a term

of three years, so that the term of office of one class of directors shall

expire in each year commencing with the year 1987; provided, however, that

each director elected at any time shall hold office until his successor is

duly elected and shall qualify, or until his earlier death, resignation or

removal.

 

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        Section 3.   Nomination and Election.

 

        (A)     Any nominee for election as a director of the corporation may

be proposed only by the Board of Directors or by any shareholder entitled to

vote for the election of directors.  No person, other than a nominee proposed

by the Board of Directors, may be nominated for election as a director of the

corporation unless such person shall have been proposed in a written notice,

delivered or mailed by first-class United States mail, postage prepaid, to

the Secretary of the corporation at its principal office.  In the case of a

nominee proposed for election as a director at an annual meeting of

shareholders, such written notice of a proposed nominee shall be received by

the Secretary of the corporation on or before the later of (i) February 1,

immediately preceding such annual meeting, or (ii) the sixtieth (60th) day

prior to the first anniversary of the most recent annual meeting of

shareholders of the corporation held for the election of directors; provided,

however, that if the annual meeting for the election of directors in any year

is not held on or before the thirty-first (31st) day next following such

anniversary, then the written notice required by this subparagraph (A) shall

be received by the Secretary within a reasonable time prior to the date of

such annual meeting.  In the case of a nominee proposed for election as a

director at a special meeting of shareholders at which directors are to be

elected, such written notice of a proposed nominee shall be received by the

Secretary of the corporation no later than the close of business of the

seventh day following the day on which notice of the special meeting was

mailed to shareholders.  Each such written notice of a proposed nominee shall

set forth (1) the name, age, business or residence address of each nominee

proposed in such notice, (2) the principal occupation or employment of each

such nominee, and (3) the number of common shares of the corporation owned

beneficially and/or of record by each such nominee and the length of time any

such shares have been so owned.

 

        (B)     If a shareholder shall attempt to nominate one or more

persons for election as a director at any meeting at which directors are to

be elected without having identified each such person in a written notice

given as contemplated by, and/or without having provided therein the

information specified in subparagraph  (A) of this Section, each such

attempted nomination shall be invalid and shall be disregarded unless the

person acting as chairman of the meeting determines that the facts warrant

the acceptance of such nomination.

 

        (C)     The election of directors shall be by ballot whenever

requested by the person acting as chairman of the meeting or by the holders

of a majority of the voting shares outstanding, entitled to vote at such

meeting and present in person or by proxy, but unless such request is made,

the election shall be by voice vote.

 

        Section 4.   Removal.  A director or directors may be removed from

office, with or without assigning any cause, by the vote of the holders of

shares entitling them to exercise not less than eighty percent (80%) of the

voting power of the corporation to elect directors in place of those to be

removed.  In case of any such removal, a new director may be elected at the

same meeting for the unexpired term of each director removed.

 

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Failure to elect a director to fill the unexpired term of any director

removed shall be deemed to create a vacancy in the Board.

 

        Section 5.   Vacancies.   Vacancies, and newly created

directorships resulting from any increase in the authorized number of

directors, may be filled by a majority of the directors then in office,

though less than a majority of the whole authorized number of directors, or

in any other manner provided by law, the Articles or the Code of Regulations.

 

        Section 6.   Meetings.   A meeting of the directors shall be held

immediately following the adjournment of each annual meeting of shareholders

at which directors are elected, and notice of such meeting need not be given.

The directors shall hold such other meetings as may from time to time be

called, and such other meetings of directors may be called only by the

Chairman of the Board, the President, the Secretary or any four directors.

Meetings of directors may be held in any manner or place, if any, permitted

by law.

 

        Section 7.   Notice of Meetings.   Notice of the place, if any,

and time of each meeting of directors for which the requirement of notice has

not been dispensed with by the Articles, these Regulations or the Bylaws (as

defined in Section 12) shall be given to each of the directors by at least

one of the following methods:

 

        (A)     By mail, telegram, cablegram, overnight delivery service, or

by any other means of communication authorized by the director, not later

than the day before the date on which such meeting is to be held; or

 

        (B)     Personally or by telephone not later than the day before the

date on which such meeting is to be held.

 

        Notice given to a director by any one of the methods specified in

these Regulations shall be sufficient, and the method of giving notice to all

directors need not be uniform.  Notice of any meeting of directors may be

given only by the Chairman of the Board, the President or the Secretary of

the corporation.  Unless otherwise required by law, any such notice need not

specify the purpose or purposes of the meeting.  Notice of adjournment of a

meeting of directors need not be given if the place, if any, and time to

which it is adjourned are fixed and announced at the meeting.

 

        Section 8.   Waiver of Notice.   Notice of any meeting of

directors may be waived in writing, either before or after the holding of

such meeting, by any director, which writing shall be filed with or entered

upon the records of the meeting.  The attendance of any director at any

meeting of directors without protesting, prior to or at the commencement of

the meeting, the lack of proper notice, shall be deemed to be a waiver by

such director of notice of such meeting.  A telegram, cablegram, electronic

mail, or an electronic or other transmission capable of authentication that

appears to have been sent

 

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by a person and that contains a waiver by that person is a writing for

purposes of this Section 8.

 

        Section 9.   Quorum.   A majority of the whole authorized number

of directors shall be necessary to constitute a quorum for a meeting of

directors, except that a majority of the directors in office shall constitute

a quorum for filling a vacancy in the Board.  The act of a majority of the

directors present at a meeting at which a quorum is present is the act of the

Board, except as otherwise provided by law, the Articles or the Code of

Regulations.

 

        Section 10.  Executive Committee.   The directors may create an

Executive Committee or any other committee of directors, to consist of not

less than three directors,  and may authorize the delegation to such

Executive Committee or other committees of any of the authority of the

directors, however conferred, other than that of filling vacancies among the

directors or in the Executive Committee or in any other committee of the

directors.

 

        Such Executive Committee or any other committee of directors shall

serve at the pleasure of the directors, shall act only in the intervals

between meetings of the directors, and shall be subject to the control and

direction of the directors.  Such Executive Committee or other committee of

directors may act by a majority of its members at a meeting or by a writing

or writings signed by all of its members.  A telegram, cablegram, electronic

mail, or an electronic or other transmission capable of authentication that

appears to have been sent by a director and that contains an affirmative vote

or approval of that director is a signed writing for the purposes of this

Section.  The date on which that telegram, cablegram, electronic mail, or

electronic or other transmission is sent is the date on which the writing is

signed.

 

        Any act or authorization of an act by the Executive Committee or any

other committee within the authority delegated to it shall be as effective

for all purposes as the act or authorization of the directors.  No notice of

a meeting of the Executive Committee or of any other committee of directors

shall be required.  A meeting of the Executive Committee or any other

committee of directors may be called by the Chairman of the Board, the

President or by a member of the Executive Committee or such other committee

of directors, as the case may be.

 

        Section 11.  Compensation.   Directors shall be entitled to

receive as compensation for services rendered and expenses incurred as

directors, such amounts as the directors may determine.

 

        Section 12.  Bylaws.   The directors may adopt, and amend from

time to time, Bylaws for their own government, which Bylaws shall not be

inconsistent with the law, the Articles or the Code of Regulations.

 

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                               ARTICLE III

 

                                 OFFICERS

 

        Section 1.   Officers, Term and Compensation.   The officers of

the corporation to be elected by the directors shall be a Chief Executive

Officer, a President (who may also be the Chief Executive Officer), a

Secretary and a Treasurer and, if desired, one or more Vice Presidents (which

may include one or more Executive Vice Presidents and/or Senior Vice

Presidents) as the directors may from time to time determine, one or more

Assistant Secretaries, one or more Assistant Treasurers and such other

officers as the directors may from time to time elect.  The officers of the

corporation may also include a Chairman of the Board, who shall be a

director.  Officers need not be shareholders of the corporation, and may be

paid such compensation as the directors may determine.  Any two or more

offices may be held by the same person, but no officer shall execute,

acknowledge or verify any instrument in more than one capacity if such

instrument is required by law, the Articles, these Regulations or the Bylaws

to be executed, acknowledged or verified by two or more officers.

 

        Section 2.   Tenure of Office.   The officers of the corporation

shall hold office at the pleasure of the directors.  Any officer of the

corporation may be removed, either with or without cause, at any time, by the

affirmative vote of a majority of all the directors then in office; such

removal, however, shall be without prejudice to the contract rights of the

persons so removed, if any.

 

        Section 3.   Duties of the Chairman of the Board.   The Chairman

of the Board, if any, shall preside at all meetings of the directors and at

all meetings of the shareholders, and shall have such other powers and duties

as the directors shall from time to time assign to the Chairman of the Board.

 

        Section 4.   Duties of the Chief Executive Officer.   The Chief

Executive Officer shall be the active executive officer of the corporation

and shall exercise supervision over the other officers, subject, however, to

the control of the directors.  The Chief Executive Officer shall have such

other powers and duties as the directors shall from time to time assign to

the Chief Executive Officer.  In the absence of the Chairman of the Board, or

if there be no Chairman of the Board, the Chief Executive Officer shall

preside at meetings of shareholders.

 

        Section 5.   Duties of the President.   The President shall,

subject to the control of the directors and, if there be one who is not also

the President, the Chief Executive Officer, exercise supervision over the

business of the corporation and shall have, among such additional powers and

duties as the directors or, if there be one who is not also the President,

the Chief Executive Officer may from time to time assign, including the power

and authority to sign all certificates evidencing shares of the corporation,

deeds, mortgages, bonds, contracts, notes and other instruments requiring the

signature of the President of the corporation.  In the absence of the

Chairman of the Board, if there be one, and the Chief Executive Officer if

there be

 

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one who is not also the President, it shall be the duty of the President to

preside at all meetings of shareholders.

 

        Section 6.   Duties of the Vice Presidents.   The Vice Presidents

(which may include one or more Executive Vice Presidents and/or Senior Vice

Presidents as determined by the directors) shall perform such duties as may

from time to time be assigned to them by the directors, the Chief Executive

Officer or the President.  At the request of the President, or in the

absence, death or disability of the President, the Vice President (or in the

event there be more than one Vice President, the Vice Presidents in the order

designated) authorized to exercise the authority of the President may perform

all the duties of the President, and when so acting, shall have all the

powers of the President.

 

        Section 7.   Duties of the Secretary.   It shall be the duty of

the Secretary, or of an Assistant Secretary, if any, in case of the absence

or inability to act of the Secretary, to keep minutes of all the proceedings

of the shareholders and the directors and to make a proper record of the

same, which shall be attested by the Secretary; to sign all certificates for

shares, and all deeds, mortgages, bonds, contracts, notes and other

instruments requiring the Secretary's signature on behalf of the corporation,

to perform such other duties as may be required by law, the Articles or these

Regulations; to keep such books as may be required by the directors; to

perform such other and further duties as may from time to time be assigned to

the Secretary by the directors, the Chief Executive Officer or the President;

and to deliver all books, paper and property of the corporation in the

possession of the Secretary to such person's successor, to the Chief

Executive Officer or to the President.

 

        Section 8.   Duties of the Treasurer.   The Treasurer or an

Assistant Treasurer, if any, in case of the absence or inability to act of

the Treasurer, shall receive and safely keep in charge all money, bills,

notes, choses in action, securities, deeds, leases, mortgages and similar

property belonging to the corporation, and shall do with or disburse the same

as directed by the Chief Executive Officer, the President or the directors;

shall keep an accurate account of the finances and business of the

corporation, and hold the same open for inspection and examination by the

directors; shall give bond in such sum with such security as the directors

may require for the faithful performance of the Treasurer's duties; shall,

upon the expiration of the Treasurer's term of office, deliver all money and

other property of the corporation in the Treasurer's possession or custody to

the Treasurer's successor, the Chief Executive Officer or the President; and

shall perform such other duties as from time to time may be assigned to the

Treasurer by the directors.

 

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                                 ARTICLE IV

 

                                   SHARES

 

        Section 1.   Certificates.   Certificates evidencing ownership of

shares of the corporation shall be issued to those entitled to them.  Each

certificate evidencing shares of the corporation shall bear a distinguishing

number, the signatures of the Chairman of the Board, the President, or a Vice

President, and of the Secretary or an Assistant Secretary (except that when

any such certificate is countersigned by an incorporated transfer agent or

registrar, such signatures may be facsimile, engraved, stamped or printed),

and such recitals as may be required or permitted by law.  Certificates

evidencing shares of the corporation shall be of such tenor and design as the

directors may from time to time adopt.

 

        Section 2.   Transfers.   Where a certificate evidencing a share

or shares of the corporation is presented to the corporation or its proper

agents with a request to register transfer, the transfer shall be registered

as requested if:

 

        1.   An appropriate person signs on each certificate so presented

or signs on a separate document an assignment or transfer of shares evidenced

by each such certificate, or signs a power to assign or transfer such shares,

or when the signature of an appropriate person is written without more on the

back of each such certificate; and

 

        2.   Reasonable assurance is given that the endorsement of each

appropriate person is genuine and effective; the corporation or its agents

may refuse to register a transfer of shares unless the signature of each

appropriate person is guaranteed by a commercial bank or trust company having

an office or a correspondent in the City of New York or by a firm having

membership in the New York Stock Exchange; and

 

        3.   All applicable laws relating to the collection of transfer or

other taxes have been complied with; and

 

        4.   The corporation or its agents are not otherwise required or

permitted to refuse to register such transfer.

 

        Section 3.   Transfer Agents and Registrars.   The directors may

appoint one or more agents to transfer or to register shares of the

corporation, or both.

 

        Section 4.   Lost, Wrongfully Taken or Destroyed Certificates.

Except as otherwise provided by law, where the owner of a certificate

evidencing shares of the corporation claims that such certificate has been

lost, destroyed or wrongfully taken, the directors must cause the corporation

to issue a new certificate in place of the original certificate if the owner:

 

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        1.   So requests before the corporation has notice that such

original certificate has been acquired by a bona fide purchaser; and

 

        2.   Files with the corporation any indemnity bond, with surety or

sureties satisfactory to the corporation, in such sum as the directors may,

in their discretion, deem reasonably sufficient as indemnity against any loss

or liability that the corporation may incur by reason of the issuance of each

such new certificate; and

 

        3.   Satisfies any other reasonable requirements which may be

imposed by the directors, in their discretion.

 

 

                                 ARTICLE V

 

                        INDEMNIFICATION AND INSURANCE

 

        Section 1.   Mandatory Indemnification.   The corporation shall

indemnify (A) any officer or director of the corporation and (B) any person

(including an officer or director of the corporation) who has served or is

serving at the request of the corporation as a director, trustee or officer

of another corporation (domestic or foreign, nonprofit or for profit),

partnership, joint venture, trust or other enterprise 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 (including, without limitation, any action threatened or

instituted by or in the right of the corporation) by reason of the fact that

he is or was a director, trustee, officer, employee or agent of the

corporation, or is or was serving at the request of the corporation as a

director, trustee, officer, employee or agent of another corporation

(domestic or foreign, nonprofit or for profit), partnership, joint venture,

trust, or other enterprise, against expenses (including, without limitation,

attorneys' fees, filing fees, court reporters' fees and transcript costs),

judgments, fines and amounts paid in settlement actually and reasonably

incurred by him in connection with such action, suit or proceeding if he

acted in good faith and in a manner he reasonably believed to be in or not

opposed to the best interests of the corporation, and with respect to any

criminal action or proceeding, he had no reasonable cause to believe his

conduct was unlawful.  A person claiming indemnification under this Section 1

shall be presumed in respect of any act or omission giving rise to such claim

for indemnification, to have acted in good faith and in a manner he

reasonably believed to be in or not opposed to the best interests of the

corporation, and with respect to any criminal matter, to have had no

reasonable cause to believe his conduct was unlawful, and the termination of

any action, suit or proceeding by judgment, order, settlement, or conviction,

or upon a plea of nolo contendere or its equivalent, shall not, of itself,

rebut such presumption.

 

        Section 2.   Court-Approved Indemnification.   Anything contained

in the Regulations or elsewhere to the contrary notwithstanding:

 

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        (A)     the corporation shall not indemnify (i) any officer or

director of the corporation, or (ii) any person (including an officer or

director of the corporation) who has served or is serving at the request of

the corporation as a director, trustee, or officer of another corporation

(domestic or foreign, nonprofit or for profit), partnership, joint venture,

trust or other enterprise who was a party to any completed action or suit

instituted by or in the right of the corporation to procure a judgment in its

favor by reason of the fact that he is or was a director, officer, employee

or agent of the corporation, or is or was serving at the request of the

corporation as a director, trustee, officer, employee or agent of another

corporation (domestic or foreign, nonprofit or for profit), partnership,

joint venture, trust or other enterprise, in respect of any claim, issue or

matter asserted in such action or suit as to which he shall have been

adjudged to be liable for gross negligence or misconduct (other than

negligence) in the performance of his duty to the corporation unless and only

to the extent that the Court of Common Pleas of Butler County, Ohio or the

court in which such action or suit was brought shall determine upon

application that despite such adjudication of liability, and in view of all

the circumstances of the case, he is fairly and reasonably entitled to such

indemnity as such Court of Common Pleas or such other court shall deem

proper; and

 

        (B)     the corporation shall promptly make any such unpaid

indemnification as is determined by a court to be proper as contemplated by

this Section 2.

 

        Section 3.   Indemnification for Expenses.   Anything contained in

the Regulations or elsewhere to the contrary notwithstanding, to the extent

that an officer or director of the corporation or any person (including an

officer or director of the corporation) who has served or is serving at the

request of the corporation as a director, trustee or officer of another

corporation (domestic or foreign, nonprofit or for profit), partnership,

joint venture, trust or other enterprise has been successful on the merits or

otherwise in defense of any action, suit or proceeding referred to in Section

1, or in defense of any claim, issue or matter therein, he shall be promptly

indemnified by the corporation against expenses (including, without

limitation, attorneys' fees, filing fees, court reporters' fees and

transcript costs) actually and reasonably incurred by him in connection

therewith.

 

        Section 4.   Determination Required.   Any indemnification

required under Section 1 and not precluded under Section 2 shall be made by

the corporation only upon a determination that such indemnification is proper

in the circumstances because the person has met the applicable standard of

conduct set forth in Section 1.  Such determination may be made only (A) by a

majority vote of a quorum consisting of directors of the corporation who were

not and are not parties to, or threatened with, any such action, suit or

proceeding or (B) if such a quorum is not obtainable or if a majority of a

quorum of disinterested directors so directs, in a written opinion by

independent legal counsel other than an attorney, or a firm having associated

with it an attorney, who has been retained by or who has performed services

for the corporation, or any person to be indemnified, within the past five

years or (C) by the shareholders or (D) by the Court of Common Pleas of

Butler County, Ohio or (if the corporation is a party thereto) the court in

which

 

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such action, suit or proceeding was brought, if any; any such determination

may be made by a court under subparagraph (D) of this Section at any time

(including, without limitation, any time before, during or after the time

when any such determination may be requested of, be under consideration by

or have been denied or disregarded by the disinterested directors under

subparagraph (A) or by independent legal counsel under subparagraph (B) or

by the shareholders under subparagraph (C) of this Section); and no failure

for any reason to make any such determination, and no decision for any reason

to deny any such determination, by the disinterested directors under

subparagraph (A) or by independent legal counsel under subparagraph (B) or

by shareholders under subparagraph (C) of this Section shall be evidence in

rebuttal of the presumption recited in Section 1.  Any determination made by

the disinterested directors under subparagraph (A) of this Section or by

independent legal counsel under subparagraph (B) of this Section to make

indemnification in respect of any claim, issue or matter asserted in an

action or suit threatened or brought by or in the right of the corporation

shall be promptly communicated to the person who threatened or brought such

action or suit, and within ten (10) days after receipt of such notification

such person shall have the right to petition the Court of Common Pleas of

Butler County, Ohio or the court in which such action or suit was brought,

if any, to review the reasonableness of such determination.

 

        Section 5.   Advances for Expenses.   Expenses (including, without

limitation, attorneys fees, filing fees, court reporters' fees and transcript

costs) incurred in defending any action, suit or proceeding referred to in

Section 1 shall be paid by the corporation in advance of the final

disposition of such action, suit or proceeding to or on behalf of the

officer, Director or other person entitled to indemnity under Section 1

promptly as such expenses are incurred by him, but only if such officer,

Director or other person shall first agree, in writing, to repay all amounts

so paid in respect of any claim, issue or other matter asserted in such

action, suit or proceeding in defense of which he shall not have been

successful on the merits or otherwise:

 

        (A)     unless it shall ultimately be determined as provided in

Section 4 that he is not entitled to be indemnified by the corporation as

provided under Section 1; or

 

        (B)     if, in respect of any claim, issue or other matter asserted

by or in the right of the corporation in such action or suit, he shall have

been adjudged to be liable for gross negligence or misconduct (other than

negligence) in the performance of his duty to the corporation, unless and

only to the extent that the Court of Common Pleas of Butler County, Ohio or

the court in which such action or suit was brought shall determine upon

application that, despite such adjudication of liability, and in view of all

the circumstances, he is fairly and reasonably entitled to all or part of

such indemnification.

 

        Section 6.   Article V Not Exclusive.   The indemnification

provided by this Article V shall not be deemed exclusive of any other rights

to which any person seeking indemnification may be entitled under the

Articles or the Regulations or any agreement, vote of shareholders of the

corporation or disinterested directors, or otherwise, both as to action in

his official capacity and as to action in another capacity while holding such

 

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<PAGE>

 

office, and shall continue as to a person who has ceased to be an officer or

director of the corporation and shall inure to the benefit of the heirs,

executors, and administrators of such a person.

 

        Section 7.   Insurance.   The corporation may purchase and

maintain insurance on behalf of any person who is or was a director, trustee,

officer, employee or agent of the corporation, or is or was serving at the

request of the corporation as a director, trustee, officer, employee, or

agent of another corporation (domestic or foreign, nonprofit or for profit),

partnership, joint venture, trust, or other enterprise, against any liability

asserted against him and incurred by him in any such capacity, or arising out

of his status as such, whether or not the corporation would have the

obligation or the power to indemnify him against such liability under the

provisions of this Article V.

 

        Section 8.   Certain Definitions.   For purposes of this Article

V, and as examples and not by way of limitation:

 

        (A)     A person claiming indemnification under this Article V shall

be deemed to have been successful on the merits or otherwise in defense of

any action, suit or proceeding referred to in Section 1, or in defense of any

claim, issue or other matter therein, if such action, suit or proceeding

shall be terminated as to such person, with or without prejudice, without the

entry of a judgment or order against him, without a conviction of him,

without the imposition of a fine upon him, and without his payment or

agreement to pay any amount in settlement thereof (whether or not any such

termination is based upon a judicial or other determination of lack of merit

of the claims made against him or otherwise results in a vindication of him);

and

 

        (B)     References to an "other enterprise" shall include employee

benefit plans; references to a "fine" 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, 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 best interests of the participants and beneficiaries of an employee

benefit plan shall be deemed to have acted in a manner "not opposed to the

best interest of the corporation" within the meaning of that term as used in

this Article V.

 

        Section 9.   Venue.   Any action, suit or proceeding to determine

a claim for indemnification under this Article V may be maintained by the

person claiming such indemnification, or by the corporation, in the Court of

Common Pleas of Butler County, Ohio.  The corporation and (by claiming such

indemnification) each such person consent to the exercise of jurisdiction

over its or his person by the Court of Common Pleas of Butler County, Ohio in

any such action, suit or proceeding.

 

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                                ARTICLE VI

 

                                   SEAL

 

        The seal of the corporation shall be circular, about two inches in

diameter, with the name of the corporation engraved around the margin and the

word "SEAL" engraved across the center.

 

 

                               ARTICLE VII

 

                               FISCAL YEAR

 

        The fiscal year shall begin on the first day of January and end on

the 31st day of December in each year, or on such other dates as may from time

to time be established by the directors.

 

 

                              ARTICLE VIII

 

                              MISCELLANEOUS

 

        Section 1.   Amendments.   These Regulations may be amended, or

new regulations may be adopted, at a meeting of shareholders held for such

purpose, or without a meeting by the written consent of the holders of shares

entitling them to exercise not less than all (100%) of the voting power of

the corporation on such proposal.

 

        Section 2.   Action by Shareholders or Directors Without a

Meeting.  Anything contained in these Regulations to the contrary

notwithstanding, except as provided in Section 1 of this Article VIII, any

action which may authorized or taken at a meeting of the shareholders or of

the directors or of a committee of the directors, as the case may be, may be

authorized or taken without a meeting with the affirmative vote or approval

of, and in writing or writings signed by, all the shareholders who would be

entitled to notice of a meeting of shareholders held for such purpose, or all

the directors, or all the members of such committee of directors,

respectively, which writings shall be filed with or entered upon the records

of the corporation.  A telegram, cablegram, electronic mail, or an electronic

or other transmission capable of authentication that appears to have been

sent by a person described in this Section and that contains an affirmative

vote or approval of that person is a signed writing for the purposes of this

Section.  The date on which that telegram, cablegram, electronic mail, or

electronic or other transmission is sent is the date on which the writing is

signed.