BY-LAWS OF LITTON EMPLOYEES' RECREATION CLUB

ARTICLE I
IDENTIFICATION

Section 1. Name

The name of the Corporation shall be as stated in the Articles of Incorporation filed with the Secretary of the State of California as a nonprofit Corporation, and hereinafter shall be referred to as the Employees' Recreation Club, or abbreviated as ERC.

Section 2. Location

The principal location for transaction of the business of the Employees' Recreation Club is hereby fixed at 5500 Canoga Avenue, Woodland Hills, California 91367 6698.

ARTICLE II
PROCEDURE AND PURPOSE

Section 1. Procedure

The business of the Employees' Recreation Club shall be conducted, when applicable, in accordance with these By Laws. Where specific practices are not delineated herein, Roberts' Rules of Parliamentary Procedure shall be the acceptable guide.

Section 2. Purpose

The purpose of the ERC shall be as defined in the Articles of Incorporation. At no time shall the ERC or any of its approved clubs or activities endorse or participate in political, union, religious or other similar activities.

ARTICLE III
MEMBERSHIP

Section 1. Classes of Members

Members of the Employees Recreation Club shall be classified as Regular, Associate, or Affiliate in accordance with the following:

a. Regular Members. All full time employees of the Guidance and Control Systems, Litton Computer Services, Aero Products, Materiel Services Center, Divisions of Litton Systems, Inc. and Premier America Federal Credit Union, shall be Regular members of the ERC as a privilege of such employment. The ERC retains the right to assess a monetary fee from the Litton Division at which the regular member is employed. Regular members shall be entitled to vote and hold office in the ERC and/or any of its approved clubs or activities.

b. Associate Members. Full time employees of Litton Systems, Inc., who do not qualify as Regular members as defined in Section 1a above, and who seek and are granted membership in any recognized club or activity of the ERC shall be Associate Members. Associate members may hold office in any recognized club or activity of the ERC consistent with the By Laws of that club or activity, but may not be elected to the Recreation Club Council in accordance with Article IV. The ERC retains the right to assess a monetary fee from the Litton Division at which the associate member is employed. This assessment shall be commensurate with the subsidy paid by the ERC for a Regular member of the club or activity involved, and will be obtained by action of the Executive Board through the Treasurer. Guidance and Control Systems, Litton Computer Services, Aero Products Division, Materiel Services Center, Litton Divisions, Inc. and Premier Federal America Credit Union monies obtained by the ERC in support of its clubs and activities shall not be used directly to support associate members. Should another Litton Division not respond to the assessment, the Executive and Advisory Boards of the ERC will decide the issue and the subsequent status of the associate members.

c. Affiliate Members. Spouses and dependent children of Regular Members and Regular Members on retirement status who seek and are granted membership in a recognized club or activity of the ERC shall be considered Affiliate Members. Affiliate members may not be elected to the Recreation Club Council or hold office in any of the recognized clubs or activities of the ERC, but may enjoy voting rights within an individual club or activity in accordance with its unique By Laws. Affiliate members shall be subject to any specific organizational dues and/or assessments. Employees' Recreation club monies may be used in support of affiliate members.

Section 2. Duration of Membership

a. Regular and Associate Members. Regular and Associate membership status shall cease automatically upon termination of employment by Litton Systems, Inc. This shall not preclude the right of the terminated employee to participate as an affiliate member provided that he satisfies the requirements of affiliate membership. The individual recognized club or activity may, in consonance with its unique By Laws, permit the terminated employee to continue participation in club activities for a period no longer than the end of the current fiscal year. The ERC reserves the right to remove a regular or associate member for cause by majority vote of the Recreation Club Council.

b. Affiliate Members. Affiliate members will be terminated from membership in the ERC and any of its recognized clubs or activities under any of the following circumstances:

1. The individual is no longer recognized as an active member of the organization which sponsored his membership.

2. Removal for cause by majority vote of the organization which sponsored his membership.

3. Removal for cause by majority vote of the Recreation Club Council.

Section 3. Meetings

An annual meeting of the Employees' Recreation Club membership shall be convened on the 15th day of May of each year at the hour of 5:00 PM at the facilities of Litton Guidance and Control Systems, 5500 Canoga Avenue, Woodland Hills, California. In the event that the scheduled meeting day falls on a Saturday, Sunday, or legal holiday, the meeting shall be held at 5:00 PM on the next regular working day.

Section 3.1. Agenda

At the annual ERC membership meeting, the representatives of the Recreation Club Council shall be installed in accordance with Article IV. The ERC Treasurer shall present to the membership a summary of the financial transactions of the ERC during the past year and a financial projection for the coming year. Other business shall be transacted as required at the discretion of the President, the Executive and Advisory Boards, and the membership.

Section 3.2. Notice of Meeting

Announcement of the annual ERC membership meeting shall be disseminated by posting appropriate notices on bulletin boards within the facilities of the Litton Divisions participating in the ERC. Written notification shall also be distributed to the presiding officer of each of the ERC recognized clubs and activities. It shall be the responsibility of the unique club or activity to inform its membership of the time and place of the meeting. Such notices shall be posted no less than one week in advance of the scheduled membership meeting and mailed so that each presiding officer of individual clubs or activities receives his notification within the same time frame.

Section 3.3. Voting Rights

At meetings of the ERC membership, each member in good standing and in attendance shall be entitled to one vote, in accordance with the rules and regulations established by the Executive Board for the transaction of business.

Section 3.4. Compensation

No member of the ERC shall receive any compensation for his services per se. Members may be reimbursed for bona fide expenses incurred after prior approval by the Recreation Club Council, the Executive Board, or the individual club or activity, whichever is the applicable authority. Nothing in this Section shall preclude any member from receiving compensation for services performed in a consulting or other service capacity beyond the scope of his normal ERC activities, provided that such compensation is approved in advance by the Recreation Club Council or Executive Board, whichever is the applicable authority.

Section 4. Liabilities and Property Rights

No member of the Employees' Recreation Club shall be liable to creditors for any indebtedness or liability incurred on behalf of the ERC. Creditors shall heed only the assets of the unique club or activity involved in the contract arrangement and/or to the Employees' Recreation Club. No member may personally own or possess any property purchased with funds of, or in behalf of, the Employees' Recreation Club and/or any of its member clubs or activities.

ARTICLE IV
ORGANIZATION

Section 1. General Organization

The functional organization of the Employees' Recreation Club shall consist of the Recreation Club Council (RCC), the Executive Board, and the Advisory Board. Executive Board members shall also hold membership in the Recreation Club Council, but shall not serve as the representative of any individual club or activity. No club or activity shall have more than one representative to the RCC.

Section 2. Recreation Club Council

The Recreation Club Council shall be the principal legislative and policy making body of the Employees' Recreation Club. Membership in the RCC shall be limited to one representative from each recognized and operating club or activity within the ERC. Each recognized club or activity shall designate its RCC representative in accordance with its unique By Laws.

Section 2.1. Term of Office

Each designated member of the Recreation Club Council shall serve a full term of one year or as specified by the clubs by-laws, not to exceed six years, beginning on August 1, unless the office is vacated for one of the following reasons:

a. Termination of employment by Litton Systems, Inc.

b. Termination of membership, for any reason, in the club or activity being represented.

c. Failure to attend three meetings of the RCC for un-excused reasons, as adjudged by the RCC membership. Acceptable reasons for failure to attend RCC meetings shall include, but are not limited to:

1. Illness, Death (personal and/or immediate family)
2. Company assignment
3 . Scheduled vacation

d. Voluntary resignation from the RCC or from the club or activity being represented.

e. Recall in accordance with Section 5 of this Article.

Section 2.2. Voting Rights

Each member of the Recreation Club Council shall be entitled to one vote, and shall have the right to exercise that vote on any issue which requires a vote of the RCC. Each RCC member must be physically present at the session in order to exercise his franchise. Proxy voting shall not be permitted.

Section 2.3. Quorum Requirements

Quorum requirements for the Recreation Club council shall consist of 50 percent or more of the total RCC membership.

Section 2.4. Meetings

Regular meetings of the Recreation Club council shall be held during the months of February, May, August and November of each year. Special meetings of the RCC may be convened at any time at the discretion of the Executive or Advisory Boards. Notice of the time and location of the regularly scheduled quarterly meetings and any special meetings of the RCC shall be distributed to the RCC membership in a timely manner by the ERC Secretary.

Section 2.5. Vacancies

In the event of a vacancy occurring in the Recreation Club Council for any reason, the club or activity represented by the vacating member shall choose a successor in accordance with its unique By Laws to complete the term of office. This selection shall be made prior to the subsequent regularly scheduled meeting of the RCC.

Section 3. Executive Board

The Executive Board of the Employees' Recreation Club shall be the principal executive body and shall consist of the four elected ERC Officers: President, Vice President, Secretary, and Treasurer. The immediate past President will be a non elected member of the Executive Board.

Section 3.1. Term of Office

The Executive Board shall be elected at the regularly scheduled meeting of the Recreation Club Council held in April. The term of office of each Executive Board member shall be 2 years, or until that office has become vacated for one of the following reasons:

a. Termination of employment by Litton Systems, Inc.

b. Failure to attend three meetings of the executive Board for un-excused reasons, as adjudged by the members of the Executive Board. Acceptable reasons for failure to attend Executive Board meetings shall include, but are not limited to:

1. Illness, Death (personal and/or immediate family)
2. Company assignment
3. Scheduled vacation

c. Voluntary resignation from the elected office

d. Recall in accordance with Section 5 of this Article.

Section 3.2. Voting Rights

Each member of the Executive Board shall be entitled to one vote, and shall have the right to exercise that vote on any issue which requires a vote of the Executive Board. Executive Board members must be physically present in order to vote. Proxy votes shall not be permitted.

Section 3.3. Quorum Requirements

A quorum for the transaction of business at any meeting of the Executive Board shall consist of a majority of the total Executive Board membership.

Section 3.4. Meetings

The Executive Board shall hold a business meeting during the first week of each month of the calendar year. Other meetings may be scheduled, if needed, at the discretion of the ERC President.

Section 3.5. Special Duties

In addition to conducting the regular administration of the ERC, the Executive Board shall:

a. Schedule the quarterly and any special meetings of the Recreation Club Council.

b. At the regular Board meeting in January of each year, appoint a Nominating Committee of three members of the Recreation Club Council to function in accordance with Article V.

Section 3.6. Vacancies

In the event that the ERC President vacates that office for any reason, the Vice President shall assume the title, duties, and responsibilities of the President for the balance of the term of office. Vacancies in the offices of Vice President, Secretary, and/or Treasurer shall be filled by majority vote of the Recreation Club Council at the subsequent regularly scheduled meeting of the RCC. Officers so elected to fill vacancies shall serve for the remainder of the term of office of the vacating officer whom they replace.

Section 4. Advisory Board

The Advisory Board shall consist of eight permanent members assembled, as required, to provide assistance and guidance to the elected officers of the ERC and/or any of the ERC recognized clubs and activities. The Advisory Board shall be permanent and shall consist of the following individuals:

a. Director, Human Resources (or designee), Guidance and Control Systems Division, Woodland Hills, California.

b. One Staff member, Human Resources, Guidance and Control Systems Division, Woodland Hills or Northridge, California.

c. Director, Human Resources (or designee), Aero Products Division, Woodland Hills, California.

d. Director, Human Resources (or designee), Litton Computer Services, Woodland Hills, California.

e. Director, Human Resources (or designee), Materiel Services Center, Woodland Hills, California.

f. On Staff Member, Premier America Federal Credit Union, Woodland Hills, California.

g. Controller (or designee), Guidance and Control Systems Division, Woodland Hills, California.

h. Legal Council (or designee), Guidance and Control Systems Division, Woodland Hills, California.

Section 4.1. Control

The Advisory Board shall have ultimate control over the ERC Officers and Recreation Club Council in all matters which are in conflict with the best interests of the established Corporation, its Articles of incorporation, or the business interests of Litton Systems, Inc. The Advisory Board shall act as a Board of Arbitration in the resolution of any dispute which is not or cannot be resolved by the Executive Board and/or the Recreation Club Council. This shall include interpretation of the Articles of Incorporation and these By Laws.

Section 4.2. Rights and Restrictions

The rights of the Advisory Board shall be granted and restricted as follows:

a. Each Advisory Board member shall have the right, at his own discretion, to attend any and all meetings of the ERC Executive Board or Recreation Club Council.

b. The Advisory Board shall have the right to involve or engage other individuals as necessary to provide additional guidance and direction to the Employees' Recreation Club.

c. The Advisory Board may designate an advisor to be a member of the Executive Board.

d. Members of the Advisory Board or their designee, shall not have voting rights in either the Executive Board or the Recreation Club Council as a result of Advisory Board membership.

e. Advisory Board members are, by definition, also members of the ERC and may participate in any of the ERC recognized clubs and activities, but are not eligible for election to the Executive Board of Recreation Club Council while remaining members of the Advisory Board.

Section 5. Recall Procedures

Section 5.1. Recall of Officers

Elected or appointed officers within the Employee's Recreation Club may be recalled as follows:

a. Individual Clubs/Activities. The unique By Laws of each individual club or activity which is recognized by the ERC shall contain a method for recall of officers of that club or activity.

b. Recreation Club Council. Recall of representatives to the recreation Club Council may be effected by the club or activity represented as follows:

1. A petition signed by not less than one half of the membership of the club or activity requesting the recall shall be filed with the ERC President.

2. A secret ballot election shall then be held by that club or activity, under the direction of the ERC Executive Board, to decide whether or not the representative in question should continue in office.

3. If, in the election held in accordance with (2) above, a majority of the members of the concerned club vote in favor of recalling the representative, a new representative shall immediately be chosen in accordance with the unique By Laws of that club. The newly chosen representative shall serve only the unexpired portion of the term in question, but may be re elected to a subsequent term or terms if in accordance with the unique By Laws of the concerned club or activity.

Section 5.2. Appeal Procedures

Any regular member of the ERC who has been suspended, expelled, or otherwise disciplined by an individual club or activity shall have the right to appeal such action in writing to the Executive Board. The Executive Board shall present the appeal to the RCC at the next regularly scheduled or special meeting, where the appellant shall be permitted to state his position. A majority vote of the RCC shall be required to overturn the disciplinary action.

Section 6. Fiscal Year

The fiscal year of the Employees' Recreation Club shall extend from August l of any given calendar year to July 31 of the subsequent calendar year. Fiscal year vs. calendar year for taxes.

ARTICLE V
NOMINATIONS AND ELECTIONS

Section 1. Nominating Committee

The Nominating Committee appointed by the Executive Board in accordance with Article IV, Section 3.5b shall propose a slate of at least two candidates for each of the four offices comprising the Executive Board. Each candidate shall meet the following requirements:

a. Be classified as a Regular member of the Employees' Recreation Club.

b. Have more than one year tenure in the employ of Guidance and Control Systems, Litton Computer Systems, Aero Products and/or Data Systems Divisions of Litton Systems, Inc.

c. Be informed of and willing to accept the responsibilities of the office for which he is to be nominated.

No less than one month prior to the regularly scheduled meeting of the Recreation Club Council in April of each year, the Nominating Committee shall solicit nominations from the presiding officer of each of the ERC recognized clubs and activities. If sufficient nominations of qualified candidates are received, the Nominating Committee shall select the slate from this group. If additional nominations are needed to fill the minimum slate requirement of two candidates for each office, the Nominating Committee shall select the necessary nominees from among the members of the Recreation Club Council.

Section 2. Election Procedure

At the regularly scheduled meeting of the Recreation Club Council in April of each year, the slate of candidates certified by the Nominating Committee shall be presented to the Recreation Club Council. The ERC President shall open the meeting floor to any additional nominations. Nominations tendered from the floor which are qualified under Section 1 above shall be recorded by the ERC Secretary. Each tendered nomination shall be duly seconded. No more than two nominations for each office, in addition to those proposed by the Nominating Committee, shall be accepted.

The ERC Secretary shall display the names of all duly nominated candidates according to the office for which nominated and provide each Recreation Club Council member in attendance with a ballot indicating the four offices being chosen. Each RCC member shall write in his choice for each office from the displayed slate of candidates. All ballots shall be considered secret. Voting by proxy is not authorized and shall not be accepted. All ballots shall be collected by the ERC Secretary. Within one week following the April meeting of the RCC, the ballots shall be counted by the Secretary and the results certified by the entire Executive Board and announced. Each office shall be decided by the unique vote for that office.

ARTICLE VI
OFFICERS AND DUTIES

Section 1. Officers

The Employees' Recreation Club shall have four officers (President, Vice President, Secretary, and Treasurer), elected every two years by the Recreation Club Council in accordance with Article V. The four Officers shall comprise the Executive Board. The term of office shall be limited to six consecutive years for any of the four offices.

Section 2. Duties

Section 2.1. President

Subject to the control of the Advisory Board (Article IV, Section 4.1), the President shall exercise general supervision, direction, and control of the business and affairs of the Employees' Recreation Club. He shall preside at all meetings of the Executive Board, the Recreation Club Council, and the general membership. Other specific powers and duties include:

a. Signing all checks drawn for ERC expenditures jointly with the ERC Treasurer.

b. Appointment of committee members as required to carry out the purposes and activities of the ERC.

c. Such additional powers and/or duties as may be prescribed by the Executive Board or Advisory Board.

Section 2.2. Vice President

In the absence or disability of the President, the Vice President shall assume all of the powers and duties of the President. The Vice President shall exercise other powers and perform other duties as may be prescribed by the President, Executive Board, or Advisory Board.

Section 2.3. Secretary

The Secretary shall maintain a full and complete record of the proceedings at all meetings of the Executive Board, Recreation Club Council, and general membership. The secretary shall be responsible for notifying all eligible participants, including all members of the Advisory Board, of the time and place of each meeting. The secretary shall supervise the keeping of the books of the ERC and shall discharge such other duties as pertain to the office of Secretary or as prescribed by the President, Executive Board, or Advisory Board.

Section 2.4. Treasurer

The Treasurer shall receive and safely keep all funds of the Employees' Recreation Club and shall deposit such funds in the bank or banks designated by the Executive Board. Other specific duties of the Treasurer shall include:

a. The preparation and signing of all checks drawn for the disbursement of ERC funds and submittal of such checks for countersignature by the President, or, in his absence, the Vice President.

b. Post all deposits and withdrawals in appropriate ERC ledgers.

c. Prepare and submit to the President a quarterly statement of the financial status of the ERC. This statement shall be published and distributed to all members of the Executive and Advisory Boards and the Recreation Club Council.

d. Prepare an operating budget for the ERC, duly coordinated with the individual budgets of all ERC recognized clubs and activities, for presentation to the Recreation Club Council at the quarterly meeting in July of each year.

e. Be responsible for establishing and developing adequate and appropriate auditing, accounting, and banking procedures.

f. Develop guidelines for the ERC recognized clubs for budget formats, procedures for various expenditures, and instructions for property possession and/or disposal.

g. Maintain a petty cash fund in the amount specified by the Executive Board and disburse petty cash as authorized by the Executive Board.

h. Establish banking services and assure conformance to internal revenue requirements.

i. Such other duties and responsibilities as may be prescribed by the ERC President, the Executive Board, and/or the Advisory Board.

j. Prepare the annual budget for submittal to Division financial officers in accordance with Article X, Section 2.

ARTICLE VII
AMENDMENTS

These By Laws may be amended or repealed and new or different By Laws adopted by vote of a numerical majority of the total Recreation Club Council membership at any regularly scheduled or special meeting of that body. Proposed changes to the By Laws shall be presented to the Executive Board at least one week prior to any meeting requiring a vote on a proposed change. Upon receipt of a proposed change by the Executive Board, the Secretary shall distribute copies of the change to all members of the Recreation Club Council and Advisory Board. The Executive Board shall determine whether to convene a special meeting of the RCC to vote on the proposed change or to defer action until the subsequent regularly scheduled meeting.

ARTICLE VIII
CONTRACTS

All written agreements involving the Employees' Recreation Club, the Recreation Club Council, and/or any of the ERC recognized clubs or activities shall be subject to approval of the Executive Board and the Guidance and Control Systems Division Legal Counsel. All agreements thus approved shall be executed by the ERC President on behalf of the ERC and/or the originating club or activity.

ARTICLE IX
INDIVIDUAL CLUBS AND ACTIVITIES

Section 1. New Clubs and Activities

It shall be the policy of the Employees' Recreation Club to admit to membership such new clubs or activities as satisfy the general guidelines set forth in Section 1.1 below. Admission shall be granted formally by a vote of a numerical majority of the total Recreation Club Council membership, excluding any representative of the club or activity petitioning for membership in the ERC.

Section 1.1. General Guidelines for ERC Membership

In order to petition the ERC for membership, any newly organized club or activity shall satisfy certain basic general criteria. It is understood that situations may arise where not all of these criteria are applicable, or where the granting of exceptions might enhance the overall objectives of the ERC. Such judgments shall be made by the Executive Board and submitted to the Recreation Club Council as part of the membership petition. General guidelines for petitioning for ERC membership are as follows:

a. The club or activity shall demonstrate a roster of no less than ten regular members.

b. Membership shall be in accordance with Article III, Section 1 of these By Laws.

c. A Charter or By Laws for the petitioning club or activity shall be prepared and filed with the ERC concurrently with the petition for membership. The Charter or By Laws shall contain the following minimum information:

1. The purpose of the club or activity.

2. Membership conditions (dues, classes of members, etc.) which are not in conflict with the ERC By Laws.

3. Elective officers and their duties, term of office, method of election, etc.

4. Periodicity of meetings.

5. Operational procedures (quorum requirements, rules of order, disciplinary procedures, financial statements, purchase and disposition of property, abandonment, liability, etc.).

6. Financial Responsibilities (booking procedures, budgets, yearly audits, etc.).

7. Method of selection of the RCC representative.

Section 1.2. Membership Petitions

Petitions for membership in the Employees Recreation Club shall be submitted in writing to the ERC Secretary. The petition shall be presented by the Executive Board to the Recreation Club Council at the subsequent regularly scheduled or special meeting for review and action. Until a club or activity is formally recognized as a member of the ERC, no ERC funds shall be expended on its behalf.

Section 1.3. Suspension and Expulsion

Any club or activity may be suspended from ERC membership until the requirements of this Article are complied with by a majority vote of the Recreation Club Council at any regular of special meeting. Expulsion from ERC membership shall be by 2/3 majority of the RCC and shall be initiated only in case of gross violation of the ERC By Laws or the principles for which the ERC stands.

Section 2. Annual Filing

All clubs and activities within the ERC shall file the following data with the ERC Secretary prior to the indicated date each year:

a. List of officers: May 15

b. Membership roster (in alphabetical order with Litton Division indicated): May 15

c. Schedule of meetings and activities: May 15

d. Budget for following year: May 15

e. Updated By Laws, if applicable: May 15

Section 3. Budget Requests

ERC recognized clubs or activities seeking financial assistance from the Employees' Recreation Club shall submit such request to the ERC Treasurer no later than June 15 of any given year. The request shall encompass the entire subsequent fiscal year. All budget requests thus received shall be reviewed by the Executive Board and either returned to the originating club or activity for revision or compiled into the ERC Master Budget. Following approval of the Master Budget by Division Management, clubs and activities may arrange to make purchases or contract for services in accordance with the budgeted items and in compliance with Sections 4 and 5 of this Article.

Section 4. Authorized Expenditures

The following is a list of the type of expenditures normally authorized for individual clubs and activities by the ERC. It is recognized that situations may arise where financial support for types of expenditures which are not listed will be sought by individual clubs or activities. In such event, the organization seeking support shall petition the Executive Board for authorization prior to making any commitment.

a. Equipment, Purchased or Rented.

Special equipment may be rented for club sponsored events. Purchased equipment shall become the responsibility of the President of the individual club or activity. All purchases of capital items shall be approved by the Executive Board prior to purchase.

b. Trophies

Expenditures for trophies and prizes shall be limited to club sponsored events. It is suggested that such expenditures not exceed ten dollars ($10.00) per participating member per event.

c. Officiating

Reasonable fees for referees or umpires at athletic events (e.g., basketball, softball, etc.) may be authorized.

d. Stationery and Supplies

Necessary paper supplies and forms for the administration of the club or activity.

e. Trip Expenses

A club or activity may pay a portion of special trip expenses (e.g., Ski Club trip, charter boat for Fishing Club, competition meet for Gun Club, etc.). Normally expenditures for such items shall not exceed fifty dollars ($50.00) per participating member per event.

f. Special Equipment Rentals

Special equipment such as motion picture films and projectors, tapes, etc., may be rented.

g. Refreshments

These expenditures shall be limited to light refreshments for organizational and occasional business meetings.

h. Special Item Purchases

Such specialized items as magazine subscriptions, books, photographic film, cassette tapes, etc., may be authorized when pertinent as part of the activities of a particular organization.

Section 5. Expenditures Not Authorized

Generally, the Employees' Recreation Club shall not authorize expenditures for the items listed below. Where any doubt exists concerning the acceptability of an expenditure, the Executive Board shall be the final authority.

a. Fees or salaries paid to officers of members.

b. Purchases which are for personal use of officers or members.

c. Funding of award banquets, picnics, dinners or any major event providing full meals; breakfast, lunch or dinners.

Section 6. Fund Raising

To provide additional funds, ERC recognized clubs or activities may levy dues on their membership. Such levies shall be in accordance with the unique By Laws of the concerned organization. Other types of fund raising activities shall require the prior approval of the ERC Executive Board. All monies obtained through dues or other fund raising activities shall be retained by the individual club or activity in accordance with the accounting procedures established by the ERC Treasurer.

Section 7. Restrictions

Section 7.1. Corporate Names

Under no circumstances shall this Corporate name (Employees' Recreation Club), Litton Systems, Inc., Litton Industries, Inc., or the name of any Litton Division be used in connection with the account of an individual club or activity.

Section 7.2. Club Insignia

No individual club or activity shall utilize the Litton Logo, or Litton Corporate or Division name on any insignia for its members without prior approval of the ERC Executive and Advisory Boards.

Section 8. Reportable Capital assets

Each individual club or activity shall report any assets having value of one hundred dollars ($100.00) or more and a useful life expectancy of two years or more to the ERC Treasurer on June 15 of each year. Excluded from this requirement shall be assets acquired through purchase or donation wherein no ERC or other Company funding is in any way involved.

ARTICLE X
FINANCIAL PROCEDURES

Section 1. Corporation Funds

All funds belonging to the Employees' Recreation Club shall be placed in the custody of the Executive Board and, immediately upon receipt, deposited by the Treasurer in a depository designated by the Executive Board. Section 2. Requests for Division Funding

It is anticipated that a major portion of the funds required for the operation of the Employees' Recreation Club will be acquired as donations from the financial officers of the Guidance and Control Systems, Litton Computer Systems Aero Products and Data Systems Division of Litton Systems, Inc., in approximate proportion to the total number of persons employed by each Division. In pursuit thereof, the ERC Treasurer shall prepare annually a proposed budget of income and expenditures required to support the ERC. This proposed budget shall be reviewed and approved by the Executive Board and Advisory Board. Upon approval, the ERC President shall forward the budget, through G/CS Industrial Relations, to the Division financial officers.

Section 3. Investment of Surplus Funds

Surplus funds of the Employees' Recreation Club or any of its recognized clubs and activities shall be handled by one or more of the following techniques:

a. Placed in interest bearing account(s) in the depository or depositories designated by the Executive Board.

b. Invested in United States Savings Bonds.

c. Invested in such other securities as may be approved by the Executive Board.

The approval of the Executive Board shall be obtained whenever and as often as necessary to convert any investment or to liquidate such investment.

ARTICLE XI
CONDUCT OF BUSINESS

Section 1. Rules of Order

The rules presented in Roberts' Rules of Order shall govern all meetings of the ERC in all circumstances in which they apply, and to the extent that they are not inconsistent with the ERC By Laws.

Section 2. Agenda

The normal order of business to be observed in all meetings of the ERC is listed below. This agenda may be revised or modified, prior to any meeting, by the Executive Board as requirements dictate.

a. Reading of the minutes of the previous meeting

b. Treasurer's Report

c. Reports of Officers

d. Reports of Standing Committees

e. Reports of Special Committees

f. Communications

g. Unfinished business

h. New business

i. Miscellaneous business

j. Appointment of committees

ARTICLE XII
LIMITATIONS

Section 1. Labor Policy

The Employee's Recreation Club or any of its subsidiary clubs or activities shall not enter into or participate in any way in labor questions or labor matters with Litton Systems, Inc., Litton Industries, Inc., or any other group or individual.

Section 2. Division Social Functions

The Employees' Recreation Club shall not assume responsibility for or contribute support to social or other functions which fall outside the realm of its jurisdiction. Specifically included in this category are functions such as Division Holiday Dances, Company Picnics, trips to Disneyland, Las Vegas, Magic Mountain, Busch Gardens, etc.

Section 3. Accessibility of Records

The books and/or records of the Employees' Recreation Club and all of its recognized clubs and activities shall be open at all times to inspection by any member of the Recreation Club Council.

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